International survey reveals most industry professionals believe profits will stay the same or increase by middle of next year
Almost two thirds of construction firms worldwide expect to maintain or increase profit by the middle of next year, according to a survey by KPMG.
The finding comes in KPMG’s annual global construction survey, compiled by interviews with 108 senior construction professionals across 30 countries. Sixty-four per cent of those interviewed believed profit levels would stay the same or improve by 2010.
However, Fiona McDermott, KPMG’s UK head of building and construction, warned that although the construction industry was reporting a relatively positive outlook, with around half of respondents reporting order books and profit at similar levels to a year ago, there may be worse in store for the industry later on.
She said: “Many companies are living off the profits of contracts secured before the recession, and whether such performance can be maintained is dependent on a number of factors, not least a general economic recovery. Although the sector appears to be in fairly good shape at the moment, we have to ask ourselves: will 2010 be the year that industry feels the pain already experienced by other sectors of the economy?”
The survey also found that the majority of respondents do not feel that government stimulus packages will bring a significant increase in opportunities in the next 24 months, with just 12% of worldwide respondents believing they will be of substantial help. However, those respondents in Asia Pacific were much more optimistic than those in the rest of the world, with 82% of those in the region expecting a moderate or significant increase over the next 24 months.