SMALL FIRMS STILL COMING UNDER PRESSURE - The Small Firms Association, in its summer business sentiment survey, says that small business continues to come under severe pressure, but the speed of the deterioration is slowing. It says half of small firms will restructure, get smaller or close within the next three months.
Patricia Callan, the SFA's director, says that while 1% of companies plan to close down due to the economic downturn, most firms now realise that they can not stay the same. Firms know that they either have to scale back - which means cutting back staff numbers - or diversify or expand. Ms Callan says that people are looking at all their options because it is very clear that to be in business is much more difficult than it once was.
The SFA director says that medical device companies and electronic manufacturing firms are more optimistic, but in general sectoral trends, distribution companies are being hardest hit, followed by services and manufacturing. Ms Callan says in terms of all indicators - turnover, profitability or price of goods - and after a 'devastating' three months, the pace of deterioration is sliding. She says that while almost half of companies are expecting their key business activity indicators to go down in the coming months, that is still better than three months ago.
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MORNING BRIEFS - In a new survey released today, Ernst and Young says almost 80% of Irish companies underestimated the how bad the downturn here was going to be.
*** Barclays Wealth says that since the start of the recession Irish investors are concentrating more on wealth protection than wealth creation. Its research also finds that Irish investors have become among the world's most conservative; and emotional considerations are becoming stronger than financial ones when it comes to investing. Barclays says 88% of investors think there are good investment opportunities now. But most of these - 68% - are not yet buying, as they think the risk of prices falling further is too high.
***Goldcore, which used to be Gold Investments, says people who invested in gold in August 2007 would be a lot better off than if they had invested in the ISEQ. It says that gold has increased in value by over 40% in the period, while the ISEQ is down by 66%.
*** It has been reported that Endemol, the TV company behind Big Brother, is considering taking a share in sports broadcaster Setanta. But earlier plans by Endemol to be an equal partner in Setanta with Access Industries have been scaled down. Access is the investment vehicle of Russian-born US billionaire Len Blavatnik. It says it had offered Setanta £20m sterling for a 51% stake. The reports say Endemol wants to be an equal partner.
*** Bottle making group Ardagh Glass, which numbers Heineken and Diageo among its clients, says this week it will ask investors to buy £300m sterling in new bonds to help it refinance its bank debt.
*** On the currency markets, the euro is trading at $1.3921 cents and 85.1 pence sterling.
