The majority of Canadian chief executives say they are “somewhat confident” about the prospects of revenue growth over the foreseeable future, according to a survey by PricewaterhouseCoopers.
The annual PwC Global CEO survey found that 59% of Canadian CEOs expected growth this year, with 63% expressing the same level of confidence for the next three years.
That’s better than the global average for either time period, which stands at 49% for one year, and 51% for three years.
One difference between Canadian CEOs and their foreign counterparts is where they expect their growth to come from: 54% of Canadian CEOs see it coming from existing markets, compared to 37% globally.
One in four Canadian executives said growth would come through mergers and acquisitions, compared to 13% globally.
“Given the current economy, it’s not surprising that CEOs in Canada are modest in their projections for growth in the coming years,” says Dean Mullett, co-head of PwC Canada’s economic and credit crisis task force. “That said, those companies that are well prepared to manage through this downturn do have a much more positive outlook and know that they will come through better in the end.”
The funding for all this growth is expected to come from internally generated cash flow for the most part, according to 88% of Canadians, with the global average being 76%.
Perhaps evidence that the credit crisis is not as bad in Canada, 37% said they would tap debt markets, compared to 18% globally. Private equity remained an option for 27% of Canadian execs, compared to 19% globally.
But that does not mean they are unbridled optimists. Eighty-three percent of Canadian execs said they were either “extremely” or “somewhat” concerned about the state of the world’s major economies.
“We’ve also found that CEOs in Canada are more likely to feel that the recent problems in the markets will increase the cost of finance, delay investment plans and reduce their ability to enter new markets,” says Mullett.
Despite rising unemployment, it appears that top talent is being retained amid layoffs, making it harder to find workers with the skills CEOs seek. Sixty-three percent of Canadian chief executives said this was of concern, and 81% said they were unable to find the right skills in the available labour pool. Retention of key staff is recognized as a key challenge by 85%.
The PwC Global CEO Survey is based on interviews with 1,124 CEOs across 50 countries, including 41 in Canada.