Finance chiefs’ confidence plummets on EU decision

CONFIDENCE among the finance bosses of the largest companies in the UK since the vote to leave the European Union has plummeted to the lowest level ever recorded.

A survey of chief financial officers (CFO) by consultancy giant Deloitte has found that 73 per cent are less optimistic about the financial prospects for their company, up from 32 per cent in Q1.

This marks the highest level registered since Deloitte’s survey began in 2007, higher even than during the fallout from the Lehman Brothers collapse in 2008.

Deloitte chief executive David Sproul said: “The outcome of the EU referendum has triggered a sharp, negative response from the corporate sector.”

When asked about the level of uncertainty facing their business, 95 per cent of CFOs said it was above normal, high or very high, up from 83 per cent in Q1.

Finance bosses demanded the government provide details about the aims of its negotiations with the EU. Maintaining the solvency and liquidity of the banking system was also cited as essential.

The highest ever recorded level of CFOs, almost two-thirds, said they expected revenues at their firms to decrease in the next year. Conversely, almost a quarter (23 per cent) predicted an increase in revenues, but 70 per cent expect operating margins to decrease.

Overall, 68 per cent of CFOs believe that leaving the EU will lead to a deterioration in the UK business environment in the long term.

“Businesses recognise their important role in forming a positive future for the UK outside of the EU,” added Mr Sproul. “They must play their part in the coming years, being proactive in finding ways to boost productivity and drive growth, manage the risks Brexit poses, take advantage of the opportunities it creates and make their voices clearly heard in the debates around the UK’s relationship with Europe.”