By Maximilian Clarke
Fast growth international companies listed on London's AIM market must focus on planning in order to assure growth in the face of increasing global uncertainty, PricewaterhouseCoopers have said.
AIM companies are surprisingly confident about their prospects, a survey carried out by the leading professional services firm found. Respondents also thought the AIM market had emerged leaner and fitter as a result of the recent shake-out of companies exiting the exchange. However, with global economic conditions once again unceratin, we urge companies to consider developing scenarios to deal with the impact of a renewed recessionary period.
In the “Thriving on AIM” report, PwC found that the average target for revenue growth over the next 12 months is 24%, some way ahead of comparable surveys of FTSE 250 firms (average 12% target for growth) and private companies (average 18% target for growth). One in five AIM companies are looking to expand turnover by over 50% in the next year, against a backdrop of challenging market environment.
“There are some encouraging signs regarding profitability but there is also a concern that AIM companies adopting aggressive growth strategies could be caught out by recent global macro-economic events and a possible recession,” said David Snell, AIM leader, PwC. “One notable finding is that AIM companies in our survey looking to new geographic markets as a source of growth see the US (28%) and the EU (24%) as their main focus. With recent Eurozone difficulties and continuing issues in the US economy, more AIM companies should consider emerging markets as potential markets for growth.”
“The government has an important role to play in supporting investment in AIM companies which are likely to be a key part of our economic recovery. AIM companies are calling for a simpler tax system, lower rates of corporate and employment taxes and greater investment incentives. They also recognise the importance of a skilled workforce and identify investment in education as a priority for government. The government’s recent commitments to alleviate the burden of export paperwork and local regulation in target export markets with the help of the UKTI is the type of initiative that these companies need.”
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