7/27/2019 Capital Confidence Barometer 8 DE0399
1/12
C]qf\af_k -)l afcl`]_dgZYd][gfgeqakaehjgnaf_$mh^jge**kapegfl`kY_g&
-*g^[gehYfa]k^g[mk]\gf_jgol`$mh^jge,)afG[lgZ]j*()*&
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Outlook AprilOctober 2013
?jgoaf_^gjoYj\
?dgZYd;YhalYd;gf\]f[]:Yjge]l]j
9faeh]jYlan]lgY[l2k]araf_jkl%egn]jY\nYflY_]Yk[gf\]f[]j]lmjfk
Expectations for global economic growth, corporate earnings and credit availability areat some of their highest levels in two years. Normally, this positive sentiment wouldljYfkdYl]aflgka_fa[Yfl[YhalYdafn]kle]flYf\E9Y[lanalq&
However, our respondents are gravitating toward lower-risk value-creation and growthstrategies, including organic growth, smaller bolt-on acquisitions, optimizing capital
kljm[lmj]$kljYl]_a[\an]kle]flkYf\egj]ja_gjgmk[gkl[gfljgdYf\gh]jYlagfYd]^[a]f[q&L`][mjj]flkalmYlagf[YfZ]klZ]\]k[jaZ]\YkY[gf\]f[]hYjY\gpY\ak[gff][lZ]lo]]f[gf\]f[]Yf\E9Y[lanalq&Hj]%fYf[aYd[jakak$][gfgea[k]flae]flYf\E9activity moved in harmony. However, in the new normal economy, these indicatorsYj]\][gmhd]\&EY[jg][gfgea[jakck$km[`Ykl`]=mjgrgf][jakak$MKk]im]kljYlagfYf\slowing emerging markets growth, have given companies pause. Consequently, someof the worlds richest and most mature economies, which would be expected to lead aj][gn]jq$dY[c[gf\]f[]oal`afl`]ajZgj\]jk$dgo]jaf_Yhh]lal]^gj[YhalYdafn]kle]flworldwide. But companies must not allow risk aversion to become the risk itself.
O]eYqZ]YlYfaf][lagfhgafl2nYdmYlagfd]n]dkYf\k]flae]flkm__]kll`]j]akY oaf\gog^ghhgjlmfalqlgk]ar]jkl%egn]jY\nYflY_]afYeYjc]l_Yafaf_ege]flme&@aklgjqk`gokl`Yljklegn]jkafYfq][gfgea[[q[d][Yf[j]Yl]\a^^]j]flaYdnYdm]Yf\position themselves for sustained market leadership. Now is the time to invest and
grow forward.Pip McCrostie$?dgZYdNa[];`Yaj$LjYfkY[lagf9\nakgjqK]jna[]k
Gmj]a_`l`?dgZYd;YhalYd;gf\]f[]:Yjge]l]jk`gokY
[d]Yjj]Zgmf\af[gjhgjYl][gf\]f[]&9^l]jq]Yjkg^
[gfk]jnYlan]\][akagf%eYcaf_$]p][mlan]kYj]kl]Y\adq
lj]f\af_lgoYj\Yfafn]klaf_Y_]f\Y&:mlYj][gehYfa]k
Z]af_Zgd\]fgm_`7
About this surveyL`]?dgZYd;YhalYd;gf\]f[]:Yjge]l]jis a regular survey of senior executivesfrom large companies around the world,conducted by the Economist IntelligenceMfal=AM!&GmjhYf]d[gehjak]kk]d][l=jfklQgmf_[da]flkYf\[gflY[lkYf\j]_mdYj=AM[gfljaZmlgjk&L`akkfYhk`glg^gmjf\af_k_Ym_]k[gjhgjYl][gf\]f[]afl`]][gfgea[gmldggc$Yf\ala\]fla]kboardroom trends and practices in the way[gehYfa]keYfY_]l`]aj;YhalYd9_]f\Y&
Hjgd]g^j]khgf\]flk
HYf]dg^Ydegkl)$.((]p][mlan]kkmjn]q]\af>]ZjmYjqYf\EYj[`*()+
;gehYfa]k^jge-([gmflja]k Respondents from more than*(k][lgjk
/1,;=G$;>GYf\gl`]j;%d]n]drespondents
1)*[gehYfa]kogmd\imYda^q^gjl`]>gjlmf])(((ZYk]\gfj]n]fm]
L`];YhalYd9_]f\Y
Based around four dimensions, it helpscompanies consider their issues andchallenges, understand their options andmake more informed capital decisions.
1. Preserving capital: reshaping theoperational and capital base
2. Optimizing capital: driving cashand working capital and managingthe portfolio of assets
3. Raising capital: assessing futurecapital requirements and fundingsources
4. Investing capital: strengtheninginvestment appraisal and transactionexecution
7/27/2019 Capital Confidence Barometer 8 DE0399
2/12
51%g^j]khgf\]flkZ]da]n]l ]_dgZYd][gfgeqak
aehjgnaf_$[gehYj]\oal`**afG[lgZ]j*()*
51%g^j]khgf\]flkYj]hgkalan]YZgml
[gjhgjYl]]Yjfaf_k$[gehYj]\oal`+(
in October 2012
O`Ylakqgmjh]jkh][lan]gfl`]klYl]g^l`]_dgZYd][gfgeqlg\Yq7
31%
47%
22%
Oct-12
13%
36%
51%
Apr-13
20%
28%
52%
Apr-12
Improving Stable Declining
27%
44%
63%
23%
38%
52%
30%
44%
51%
26%
30%
49%
15%
5%
32%
Economicgrowth
Employmentgrowth
Corporateearnings
Creditavailability
Short-termmarket
stability
Apr-12 Oct-12 Apr-13
% positive view
Hd]Yk]af\a[Yl]qgmjd]n]dg^[gf\]f[]afl`]^gddgoaf_Ylthe global level
40%
21%
17%
5%
17%
Spain
France
Italy
Netherlands
UK
;gmflja]koal`l`]egklf]_Ylan]na]og^l`]ajdg[Ydeconomy relative to the global economy*
"H]j[]flY_]%hgaflkhj]Y\Z]lo]]fdg[YdYf\_dgZYd][gfgea[k]flae]fl
;gmflja]koal`l`]egklhgkalan]na]ogfl`]_dgZYd][gfgeq
65%
64%
58%
54%
63%
53%
50%
42%
35%
44%
Japan
France
Germany
UK
China
Australia
Brazil
US
India
South Korea
*
=[gfgea[gmldggc
;gf\]f[]khYfkd]Y\af_][gfgea[af\a[Ylgjk
Gmjj]khgf\]flkaf[j]Yk]\[gf\]f[]khYfkk]n]jYdd]Y\af_
][gfgea[af\a[Ylgjk&9l.+$hgkalan]k]flae]fllgoYj\_dgZYd
][gfgea[_jgol`akYlalk`a_`]kld]n]daflogq]Yjk&Egj]l`Yf
half of the respondents are positive on corporate earnings and
]ehdgqe]fl_jgol`&;gf\]f[]YZgml[j]\alYnYadYZadalq`Yk
Ydkgaf[j]Yk]\ka_fa[Yfldqgn]jl`]dYklkapegfl`k$Yf\
short-term market stability has more than doubled.
These increasingly positive views, coupled with favorable
sentiment about the regulatory environment for business
growth, would normally signal an increase in both capital
afn]kle]flYf\E9&@go]n]j$[gf\]f[]akfglljYfkdYlaf_
into action.
J]Zgmf\af_dgZYd][gfgea[[gf\]f[]
Gn]jYdd][gfgea[[gf\]f[]`Ykaehjgn]\ka_fa[Yfldq^jge
G[lgZ]j*()*&AflglYd$0/na]ol`]][gfgeqYk]al`]jklYZd]
gjaehjgnaf_mh^jgeZgl`kapegfl`kY_g.1!
Yf\9hjad*()*0(!&
O`ad]_dgZYd][gfgea[k]flae]fl`Ykaehjgn]\ka_fa[Yfldq$
kge]g^l`]ogjd\kegkleYlmj]][gfgea]kdY[c[gf\]f[]
oal afl`]ajZgj\]jk$o a[ Ykdac]dq Y\YfY\n]jk]afm]f[]
gf[YhalYdafn]kle]flYf\E9&
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7/27/2019 Capital Confidence Barometer 8 DE0399
3/12
Oct-12 Apr-13Apr-12
13%
59%
28%
10%
48%
42%
12%
47%
41%
QCreate jobs/hire talent
QKeep current workforce size
QReduce workforce numbers
Oal`j]_Yj\lg]ehdgqe]fl$o`a[`g^l`]^gddgoaf_\g]kqgmjgj_YfarYlagf]ph][llg\gafl`]f]pl)*egfl`k7
Na]ohgaflL`]_jgol`\ad]eeY
O`]f\g]kjakcYn]jkagfalk]d^Z][ge]Yjakc7
Gn]jk]n]jYd:Yjge]l]jk$o] Yn]gZk]jn]\Y\ak[gff][l
Z]lo]]feY[jg][gfgea[[gf\alagfkYf\[gjhgjYl]Y[lagf
aehjgnaf_[gf\]f[]Yf\kljgf_\]Yd^mf\Ye]flYdk`Yn]
fgld]\lgYj]Zgmf\afE9&
L`ak[gjhgjYl][Ymlagfakmf\]jklYf\YZd]&L`]_dgZYd
fYf[aYd[jakak YkZ]]f\jYofgml$oal`ege]flkl`Yl
km__]kl]\lmjfYjgmf\l`Ylf]n]jeYl]jaYdar]\&9ea\l`ak
h]jkakl]fl[jakak]fnajgfe]fl$l`][mjj]fl_]f]jYlagfg^
[gjhgjYl]d]Y\]jk YkdYj_]dqhmjkm]\_jgol`l jgm_`
gj_Yfa[e]Ykmj]kgjghlaearYlagf]^ gjlk&L`]q`Yn]dYj_]dq
Z]]fj]oYj\]\ZqZgYj\k gjl`]k][gfk]jnYlan]afklaf[lk&
@go]n]j$o]eYqZ]f]Yjaf_l`]hgaflo`]j]l akkmklYaf]\
[Ymlagfalk]d Z][ge]kjakcq&Gj_YfarYlagfkafk]Yj[ g
_jgol`eYqf]]\lglYc]Yfaf gje]\jakclgY[ a]n]
l`]ajkljYl]_a[gZb][lan]kYf\lggmlhY[][geh]lalgjk&
>ajkl%egn]jY\nYflY_]akY[gfklYfl$]n]faflg\YqkeYjc]lk&
D]Y\af_[gehYfa]kYj]dYqaf_l`]_jgmf\ogjc^gjlYcaf_
Y[lagfo`]fl`]lae]akja_`l&L`Yle]Yfk`gfaf_l`]aj
;YhalYd9_]f\Y2f]%lmfaf_l ][YhalYdkljm[lmj]$\]faf_
[gj]Zmkaf]kk]k$]p][mlaf_\an]kle]flko`]ff][]kkYjq$Yf\
hmllaf_afhdY[]hjgh]jjakceYfY_]e]flYf\_gn]jfYf[]&
EgklaehgjlYfl$ale]YfkYfko]jaf_l`]im]klagfk$O`]j]
\gqgmoYfllg_jgo7Yf\O`YloaddallYc]7
3%
16%
11%
5%
65%
More than 5%
3%5%
1%3%
Zero growth
Negative growth
:q`goem[`\gqgml`afcgj]ph][ll`]_dgZYd][gfgeqlg_jgoafl`]f]pl)*egfl`k7
39%
38%
23%
Stagnation inthe Eurozone
Slowing growthin emerging
markets
US debt ceilingchallenges
O`Yl\gqgmZ]da]n]lgZ]l`]_j]Yl]kl][gfgea[jakclgqgmjZmkaf]kkgn]jl`]f]pl.)*egfl`k7
65%g^j]khgf\]flk]ph][ll`]_dgZYd][gfgeq
lg_jgoZq)+
42%g^j]khgf\]flk]ph][llg[j]Yl]bgZkgj`aj]
lYd]fl$[gehYj]\oal`*0afG[lgZ]j*()*
3
Dgokaf_d]%\a_al][gfgea[_jgol`Yfla[ahYl]\
AflglYd$0,g^j]khgf\]flk]ph][llgk]]kge]_jgol`afl`]
global economy, but most recognize it is unlikely to reach peaks
dYklk]]faf*((.(/&L`]][gfgea[mf[]jlYaflql`Yl^gddgo]\
that period has been so long and pervasive that typical cyclical
behaviors have changed.
Global economic risks persist
Global market risks are well known by corporate boards.Eurozone issues and slowing growth in emerging markets pose
material challenges to their businesses. In response, many
companies have adjusted their strategies to compensate for
these risks, while others view them as a source of opportunity.
BgZ[j]Ylagfka_fYdkhdYff]\_jgol`
Forty-two percent of respondents expect to hire talent or
[j]Yl]bgZkYkljgf_aehjgn]e]fl^jge*0afG[lgZ]j*()*&
Even more encouraging, plans for workforce reduction are at
)($l`]dgo]kll`]q`Yn]Z]]faflogq]Yjk&
?dgZYd;YhalYd;gf\]f[]:Yjge]l]j
7/27/2019 Capital Confidence Barometer 8 DE0399
4/12
Oct-12 Apr-13Apr-12
QImproving
QStable
QDeclining
30%
44%
26%
14%
37%
49%
25%
45%
30%
Hd]Yk]af\a[Yl]qgmjd]n]dg^[gf\]f[]af[j]\alavailability at the global level
51%
50%
46%
33%
31%
32%
12%
13%
16%
4%
6%
6%
Less than 25%
25%49.9%
50%74.9%
75%100%
Apr-12 Oct-12 Apr-13
O`Ylakqgmj[gehYfqk[mjj]fl\]Zl%lg%[YhalYdjYlag7
Oct-12 Apr-13Apr-12
33%
49%
18%
33%
43%
24%
34%
45%
21%
QIncrease
QRemain constant
QDecrease
@go\gqgm]ph][lqgmj[gehYfqk\]Zl%lg%[YhalYdjYlaglg[`Yf_]gn]jl`]f]pl)*egfl`k7
Lghn][gmflja]koal`l`]`a_`]klhgkalan]na]ogf
_dgZYd[j]\alYnYadYZadalq
)& ; afY
*& MK
+& 9mkljYdaY
,& ;YfY\Y
-& BYhYf
24%g^j]khgf\]flkhdYflgaf[j]Yk]l`]aj
\]Zl%lg%[YhalYdjYlagmh^jge
)0kapegfl`kY_g
49%g^j]khgf\]flkna]o[j]\alYnYadYZadalqYk
aehjgnaf_$[gehYj]\oal`*.afG[lgZ]j*()*
,
9[[]kklg[YhalYd
;j]\alaf[j]Ykaf_dqYnYadYZd]
In addition to having an improved outlook on the global
][gfgeq$[gehYfa]kYj]egj][gf\]fll`Yf]n]jYZgmll`]aj
ability to access the credit markets.
When asked about credit availability, almost half of respondents
k]]aehjgn]e]fl$l`]`a_`]kld]n]daflogq]Yjk&Gfdq),
j]hgjlY\][daf]Y_Yaf$l`]dgo]kld]n]daflogq]Yjk&
?dgZYd;YhalYd;gf\]f[]:Yjge]l]j
9hh]lal]^gjd]n]jY_]_jgok
O]eYqZ]f]YjYfaf][lagfhgafl$oal`[gehYfa]kdYj_]%k[Yd]
changes to capital structure now nearing completion. Debt-to-
capital ratios remain fairly constant today, but the appetite for
leverage is expected to accelerate over the next year. However,
the question remains why organizations are not already taking
greater advantage of available credit.
7/27/2019 Capital Confidence Barometer 8 DE0399
5/12
25%
20%
22%
24%
21%
21%
21%
41%
31%
18%
13%
16%
12%
5%
10%
Extend maturity(short-term
debt ratio)
Reduceinterest cost
Optimizing thecapital structure
(non-stressedsituation)
Retirematuring debt
Removerestrictivecovenants
Apr-12 Oct-12 Apr-13
O`YloaddZ]l`]hjaeYjqhmjhgk]g^qgmjj]fYf[af_7
29%g^[gehYfa]k]ph][llgj]fYf[]dgYfkgj
\]ZlgZda_Ylagfk
Na]ohgafl;j]\alYnYadYZadalqYkd]Y\af_af\a[Ylgj
Gmjkmjn]qk`gokY a_`]jfmeZ]jg [gehYfa]k]ph][laf_
Yfaf[j]Yk]afl`]aj\]Zl%lg%[YhalYdjYlag$^jge)0af
G[lgZ]j*()*lg*,afl`ak:Yjge]l]j&;gmhd]\oal`Y
dYj_]af[j]Yk]afl`gk][alaf__j]Yl]jgn]jYddYnYadYZadalqg^
[j]\al^jge*.lg,1!$l`akka_fYdkl`Ylj]khgf\]flk
Yhh]lal] gjd]n]jY_]akhgak]\lgjak]&
L`jgm_`gmll`]][gfgea[[jakak$[gehYfa]kafhj]k]jnYlagf
eg\][Ye]lgna]ol`]mk]g [j]\alYkf]_Ylan]&:mll ]
j]hmlYlagfg [j]\al$dac]l`]][gfgeqYldYj_]$akkdgodqZ]af_
j]`YZadalYl]\&9 l]jk]n]jYd:Yjge]l]jkafo a[ egj]l`Yf Yd g j]khgf\]flk Y\dgo\]Zl%lg%[YhalYdjYlagk$afl akakkm]
l`Yle]lja[^Yddklg,.&
9lYlae]g^Yehd][j]\alYnYadYZadalqYf\`aklgja[Yddqdgo
hja[af_$d]Y\af_[gehYfa]kYj][geaf_lgna]o[j]\alYkY
lggdlg^m]dl`]aj_jgol`Y_]f\Y&
Oct-12 Apr-13Apr-12
20%
38%
42%
16%
30%
54%
18%
39%
43%
QCash
QDebt
QEquity
O`Ylakl`]dac]dqhjaeYjqkgmj[]g^qgmj[gehYfqk\]YdfYf[af_afl`]f]pl)*egfl`k7
5
gjl`]f]pl)*egfl`k$l`gk][gehYfa]kl`YlhdYflgj]fYf[]
\]Zl*1!kYql`]qoadd g[mkgfj]f]e]flk$af[dm\af_j]\m[af_
interest rates, extending maturities and removing covenants.
;Yk`\geafYl]kf]Yj%l]je\]YdfYf[af_
L`]hj]\geafYflmk]g^[Yk`lgfYf[]ljYfkY[lagfkak
indicative of companies ongoing cautionary mindset.
Egj]l`Yf`Yd^g^j]khgf\]flkhgafllg[Yk`Ykl`]ajhjaeYjq
kgmj[]g^\]YdfYf[af_gn]jl`]f]pl)*egfl`k&D]kkl`Yf
gf]%l`aj\kYql`]qhdYflgmk]\]Zl+(!Ykl ]ajhjaeYjq
source, despite reporting abundant credit availability.
Companies reluctance to leverage their own equity may be a
symptom of volatility in the capital markets.
?dgZYd;YhalYd;gf\]f[]:Yjge]l]j
7/27/2019 Capital Confidence Barometer 8 DE0399
6/12
Oct-12 Apr-13
25%
3%
31%
41%
15%
2%
31%
52%
Q Growth
Q Cost reduction andgh]jYlagfYd]^[a]f[q
QEYaflYafaf_klYZadalq
Q SurvivalO`Ylakl`]hjaeYjq^g[mkg^qgmj[gehYfqkgj_Yfa[_jgol`gn]jl`]f]pl)*egfl`k7
30%
19%
More rigorousfocus on core products/
existing markets
New sales channels
Dgo]jjakc
14%
12%
9%
16%Exploiting technology
to develop newmarkets/products
Changing mix of existingproducts and services
Increasing R&D/productintroductions
Investing in newgeographies/markets
Higher risk
Apr-11 Oct-11 Apr-12 Oct-12 Apr-13
51%
49%
52%
41%
52%
% focused on growth
O`a[`klYl]e]flZ]kl\]k[jaZ]kqgmjgj_YfarYlagfk^g[mkgn]jl`]f]pl)*egfl`k7
A^qgmj[gehYfq`Yk]p[]kk[Yk`lg\]hdgq$o`a[`g^l`]^gddgoaf_oaddZ]qgmj[gehYfqk^g[mkgn]jl`]f]pl)*egfl`k7
Apr-12 Oct-12 Apr-13
45%
36%
50%
14%
13%
16%
Organic growth(e.g., investing inproducts, capex,
talent retention, R&D)
Inorganic growth(e.g., acquisitions,
alliances, JVs)
Afn]klaf_jgol`
11%
12%
11%
6%
8%
5%
24%
31%
18%
Pay down debt
Pay dividends
Buy back stock
J]lmjflgklYc]`gd\]jk
.
?jgol`
9hh]lal]^gj_jgol`j]Zgmf\k
9k[gf\]f[]afl`]_dgZYd][gfgeqj]lmjfkYf\[j]\alavailability improves, companies are reporting an increasedappetite for growth and a steady move toward investment.
O`]fYkc]\YZgmll`]aj[gehYfa]k^g[mkgn]jl`]f]pl)*egfl`k$egj]l`Yf`Yd^g^j]khgf\]flk-*![al]\_jgol`more than all other responses combined, and a major rebound^jgeG[lgZ]j*()*&=n]fYea\l`ak_jgoaf_ghlaeake$f]Yjdq gf]%l`aj\g^[gehYfa]k+)!j]eYaf^g[mk]\gf[gklj]\m[lagfYf\gh]jYlagfYd]^[a]f[a]k&;gehYfa]k^g[mk]\gf]al`]jklYZadalqgjkmjnanYd`Yn]\][j]Yk]\ka_fa[Yfldq&
HdYfk^gj]p[]kk[Yk`k`a^llgoYj\_jgol`kljYl]_a]k
Companies with excess cash are deploying it toward growthYf\YoYq^jgej]lmjfaf_allgklYc]`gd\]jk&AflglYd$-1g^respondents are pursuing either organic or inorganic growthwith their excess cash; organic growth continues to be theeYbgjhj]^]j]f[],-!&Gfdq,)aflglYdkYql`]qYj] ^g[mk]\gfj]lmjfaf_[Yk`l`jgm_`hYqaf_\gof\]Zl$
hYqaf_\ana\]f\kgjZmqaf_ZY[cklg[cY\jghg^)(h]j[]flY_]hgaflkkaf[]G[lgZ]j*()*&
Gj_Yfa[_jgol`\jan]fZqZYdYf[]\jakchgjl^gdag
;gehYfa]kYj]dYj_]dq^g[mk]\gfdgo]j%jakc_jgol`kljYl]_a]kmuch more cautious approaches than one would expect, givenaf[j]Yk]\[gf\]f[]Yf\[j]\alYnYadYZadalq&L`ak`YkZ][ge]l`]f]ofgjeYdafl`]hgklfYf[aYd[jakakogjd\2_jgol`activities perceived as higher-risk are more cautiously pursued.Companies will want more and longer-lasting evidence of anupturn before making major investments.
?dgZYd;YhalYd;gf\]f[]:Yjge]l]j
7/27/2019 Capital Confidence Barometer 8 DE0399
7/12
O`a[`Z]kl\]k[jaZ]kqgmjgj_YfarYlagfk^g[mkgn]jl`]f]pl)*egfl`k7
@go\gqgml`afcl`]ZgYj\jggeY_]f\YYlqgmj[gehYfq`Yk[`Yf_]\^jgeYq]YjY_g7
Greater focus today
Apr-13
Stayed the same
Less focus today
65% 25% 10%
63% 27% 10%
9%30%61%
12%33%55%
12%38%50%
12%39%49%
16%39%45%
19%41%40%
dnaycneicfEcost control
Riskmanagement
Capitalallocation
Regulatoryissues
Investorrelations
Growth innovation R&D
Growth new geographic
markets
17%36%47%People
(attracting/retaining talent)
Corporategovernance*
* Only asked in April 2013
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]^[a]f[q$[gkl[gfljgd$jakceYfY_]e]fl$[YhalYdYddg[Ylagf$
j]_mdYlgjqakkm]k$afn]klgjj]dYlagfkYf\[gjhgjYl]
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Zmad\af__j]Yl]jklYc]`gd\]jY[[gmflYZadalq&
Jakca]j_jgol`e]Ykmj]k$af[dm\af_j]k]Yj[`Yf\
\]n]dghe]fl$Yj]dgo]jgfl`]Y_]f\Y&@go]n]j$l`]
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eYqZ]l`]lae] gjZgYj\klgY[ a]n]jklegn]jklYlmk&Apr-13
Apr-13
40%
Oct-12
38%
Apr-12
32%
9%
Oct-12
10%
Apr-12
13%
Apr-13
27%
Oct-12
30%
Apr-12
31%
Apr-13
24%
Oct-12
22%
Apr-12
24%
Preserv
ingOptim
izing
Rais
ing
Investing
TheCapitalAgenda
7
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;gehYfa]k]ph][ll`]aj;YhalYd9_]f\Yhjagjala]klg[gflafm]lgegn]lgoYj\afn]klaf_gn]jl`]f]pl)*egfl`k&L`]aj^g[mkgfafn]klaf_`Ykegn]\kl]Y\adqmhoYj\gn]jl`]dYklq]YjfgoYl,(!$o`ad]hdYfklghj]k]jn]$ghlaear]Yf\jYak][YhalYdhave held steady or declined slightly. While companies arerepositioning toward an investment mindset, they continue topursue organic growth and portfolio-optimization strategies.
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7/27/2019 Capital Confidence Barometer 8 DE0399
8/12
3%
69%
23%
5%
Return tohistoric highs
Improve
Remain the same
Decline
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Apr-11 Oct-11 Apr-12 Oct-12 Apr-13
38%
41%
31%
25%
29%
Do you expect your company to pursue acquisitions in the
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39%
30%
35%
50%
37%40%
32%
29%
34%
Likelihood ofclosing acquisitions
Quality ofacquisition
opportunities
Number of
acquisitionopportunities
Apr-12 Oct-12 Apr-13
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46%
38%
9%
7%
53%
35%
6%6%
Over US$1b
US$501mUS$1b
US$51mUS$500m
US$50m or less
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conservatism persists
Consistent with sentiment over the past six months, deals
are likely to remain smaller in size despite record amounts of
YnYadYZd][Yk`Yf\aehjgnaf_[j]\al[gf\alagfk&AflglYd$00
of respondents planning acquisitions expect deals to be under
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companies overall strategy toward organic growth and lower-
risk sentiment.
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by an increasing number, and a higher quality, of acquisition
opportunities. Thirty-nine percent of companies say there are
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Twenty-nine percent of respondents expect their company will
hmjkm]gf]gjegj]Y[imakalagfkafl`]f]pl)*egfl`k&
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to improve
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companies expect global deal volumes to improve over the
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7/27/2019 Capital Confidence Barometer 8 DE0399
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Oct-12 Apr-13Apr-12
27%
42%
31%
7%
49%
44%
18%
41%
41%
QIncrease
QRemain at current levels
QDecrease
7/27/2019 Capital Confidence Barometer 8 DE0399
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31%
45%
14%
5%
5%
We remain optimistic and havenot changed our approach
We remain optimisticbut will apply further rigor
We are less optimistic and arereconsidering our strategies
We are less optimistic andhave turned our attention
more toward developed markets
We have discontinued our emergingmarkets strategies for now
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Top inbound investors
1. South Korea2. Mexico3. Canada
Top inbound investors
1. US2. Australia3. UK
Top inbound investors
1. US2. South Korea3. Australia
Top inbound investors
1. US2. South Korea3. UK
Top inbound investors
1. US2. Spain3. South Korea
4. US
5. Canada
1. China
2. India
3. Brazil
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7/27/2019 Capital Confidence Barometer 8 DE0399
11/12
14%
17%
15%
612 months 12 yearsIn progress/planning
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38%
29%
17%
16%
Sale ofbusiness unit
Spinoff/IPO ofbusiness unit
Sale ofentire business
Contribution ofbusiness unit
to joint venture
Life sciences*
Technology
Automotive
Power and utilities
Oil and gas
Mining and metals
Financial services
Consumer products
7/27/2019 Capital Confidence Barometer 8 DE0399
12/12
Ernst & Young
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2013 EYGM Limited.
All Rights Reserved.
EYG no. DE0399
BSC no. 1304-1059591NY
This publication contains information in summary form
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Name Telephone Email
Global
Pip McCrostie
Global Vice Chair
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#,,*(/10((-(( [email protected]
Steven Krouskos
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+1 212 773 3975 [email protected]
Americas
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9e]ja[YkD]Y\]j
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+1 212 773 2922 ja[`Yj\&b]Yff]j]l8]q&[ge
=mjgh]$Ea\\d]=Ykl$Af\aYYf\9^ja[Y=E=A9!
Joachim Spill
=E=A9D]Y\]j
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+49 6196 996 25366 bgY[`ae&khadd8\]&]q&[ge
9kaY%HY[a[Yf\BYhYf
John Hope
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#0-**0,.111/ bg`f&`gh]8`c&]q&[ge
Kenneth G. Smith
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#0)+,-0*.,(( c]ff]l`&keal`8bh&]q&[ge
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