The Deloitte/SEB CFO Survey | Spring 2016
Opposing outlook: Domestic strength versus international uncertainty
We are excited to present the spring 2016 results of the Deloitte/SEB CFO Survey and hope that you find our accompanying analysis both stimulating and valuable.
The spring 2016 CFO Survey reveals that large Swedish companies remain in good shape. However the Swedish CFO index fell for the first time in 1½ years, albeit rather marginal to 55.3 from 55.9 in the 2015 fall survey. All four sub-indices − business climate, financial position, lending willingness and counterparty default risk − came in lower. It is evident that the increased CFO worries identified in previous surveys are starting to materialise, since there are signs that global macroeconomic concerns are gradually imposing real effects on some of these companies’ performance. In the current survey, CFOs still note growth expectations but on a more moderate level and order bookings (“intake”) are a major concern. We also see a greater divergence between sectors; more domestic-oriented sectors such as consumer business and transport as well as real estate generally have a more positive outlook, especially compared to manufacturing companies with a global presence and financial services with their heavy regulatory agenda and a digitisation trend that is putting pressure on business models and pricing power.
Among corporate priorities, it is clear that more than previously, CFOs prefer to “wait and see” and not to engage in change activities until the situation becomes clearer. Notably, there is still more to do within “reducing costs” and then specifically within “process efficiency improvements” – likely areas that are perceived as owned by the company and thus easier to control than other areas.
Compared to the fall 2015 survey, the M&A outlook is less aggressive, lending willingness has fallen and excess cash will be used to pay down debt to a larger extent – despite strong balance sheets and record-low interest rates.
To sum up, it is evident that Swedish CFOs are increasingly worried about the future, but in comparison with their peers elsewhere in Europe, external financial and economic uncertainty is still perceived as much lower.
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Research & Strategy, SEB
Hot Topics (Selection)
|More expensive funding 7%|
|Lack of attractive target companies22%|
|Increasing target company valuations 37%|
|Geopolitical uncertainty 13%|
|Weaker economy 22%|
Business conditions and outlook
|Fall 2015||Spring 2016|
|Increasing cash flow as a corporate priority for the coming year||52||37|
|Unchanged number of employees||58||57|
|Fall 2015||Spring 2016|
|Probability of counterparties default||80||78|
|Investments in Sweden||34||28|
Download the report
We are proud to present our CFO Survey website in Sweden, an initiative of the Deloitte CFO Program. This website provides a snapshot of the key findings from the Survey. We hope that it will provide insights into changes over time in CFOs' attitudes to risk, financing and M&A, and reports trends and turning points for you and your business. Download the pfd to read the full survey.
About the Survey
The CFOs who responded represent a selection of the 200 largest companies in Sweden across industries. The survey was carried out as a web-based questionnaire in March 2016. Given the broad range of industries and organisations that responded, the trends observed and conclusions made are considered representative of the wider Swedish CFO community.