MBC survey shows optimistic revenue forecasts

MANILA, Philippines - Most businesses see higher revenues and income this year as the country is expected to continue to post strong economic growth, according to a survey conducted by the Makati Business Club (MBC).

The MBC’s Executive Outlook Survey for the first semester 2013 released yesterday, which covers 64 business executives from the period Feb. 5 to March 6, showed that majority expect higher gross revenues and income this year compared to 2012.

“In terms of expectations on corporate performance for 2013, almost 86 percent of respondents project their company’s gross revenues to rise above 2012 levels by an average of 13 percent,” the survey read.

“In terms of net income, three-quarters of respondents anticipate an average 13- percent rise in net income,” it added.

As businesses expect higher revenues and income this year, over 59 percent of respondents said they plan to make additional investments, with the average amount of investments to reach P807 million.

Half of the respondents are planning to expand their labor force by close to 10 percent.

Firms have a positive outlook on earnings this year as the Philippine economy is expected to continue to grow.

The survey showed that almost 66 percent of senior business executives polled expect the Philippine economy to beat last year’s 6.6-percent gross domestic product (GDP) expansion.

With regard to the outlook on consumer prices, 47 percent said they expect headline inflation this year to mirror last year’s average rate of 3.2 percent.

In terms of interest rates, over 56 percent see the 91-day Treasury bill rate to remain at the same level as last year’s weighted average of 1.583 percent.

As for the peso-dollar exchange rate, more than 62 percent see a further appreciation of the local currency against the greenback by an average of 4.3 percent from the P41.05 to the dollar rate in end-2012.

Most businesses also have a positive outlook on investment pledges to the country, with almost 83 percent saying approved investments this year would surpass the previous year’s.

Majority or almost 69 percent of businesses likewise said merchandise exports are likely to post higher growth this year than in 2012, while over 81-percent project imports to rise from a year ago.

While most executives have positive business sentiment, some concerns remain regarding the readiness of the Association of Southeast Asian Nations Economic Community (AEC) and charter change.

The survey showed that even as more than 95 percent of respondents said they are aware of the AEC which would be established in 2015, over 64 percent are of the view the country is not prepared for regional integration.

More than 78 percent said they are already preparing to take the challenges and opportunities posed by the AEC, while over 17 percent said otherwise.

As for charter change, specifically the removal of foreign ownership restrictions under the 1987 Constitution to attract more foreign investments, close to 91 percent of respondents favor the initiation of amendments to economic provisions.