In the first quarter of 2012, PwC interviewed 41 Canadian-based industrial manufacturing executives about their current business performance, the state of the economy, and their expectations for business growth over the next 12 months.
Overall, three-fourths of Canadian-based industrial manufacturing executives are optimistic about the prospects for the Canadian economy over the next 12 months. Over two-thirds believe that the Canadian economy grew in first-quarter, 2012. The expanded Canadian sample of companies interviewed forecast single-digit revenue growth for their own companies over the next 12 months, 4.2 per cent, somewhat below the calendar year 2011 pace of 4.9 per cent (reported by the original sample last quarter).
Optimism about prospects for the world economy among those selling abroad remained at a low 25 per cent level in view of majority uncertainty. Little positive change was reported in international sales in first-quarter, 2012. The contribution of international to total revenues among the expanded sample is expected to be 66 percent—45 per cent from the US and 21 per cent from other international markets.
Chief barriers to growth over the next 12 months remain high oil/energy costs, concern about low demand and monetary exchange rates. A moderately-high number (42 per cent) are planning major new investments of capital over the next 12 months, and 59 per cent are planning increased operational spending, focused on information technology, research & development and new products or service introductions. One-third are planning new hiring. Finally, gross margins remained somewhat positive in the first-quarter 2012, with moderate increases in both costs and prices.
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