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Australasian Capital Confidence Barometer, May 2011: Optimising capital - Ernst & Young - Australia

Australasian Capital Confidence Barometer, May 2011

Optimising capital

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If businesses haven’t already, it will be important to recalibrate debt and equity levels to the new operating environment, maximising value and minimising the average cost of capital.

Simple working capital measures remain important, with Australasian respondents unanimously recognising that improvements need to be made around reducing past due receivables, improving service quality, reducing days of sales outstanding and identifying strategic sourcing opportunities.

Lessons learnt from the downturn

Going forward, the leading companies will be those that take a structured "root and branch" approach to improving working capital by working even more closely with key customers and suppliers, driving ever greater efficiency out of the supply chain, sharing real-time information about supply and demand and having robust risk management policies in place.

Australasia: where do you believe you have further room for improvement in your cash cycle?

Australasia: where do you believe you have further room for improvement in your cash cycle?

Australasian businesses are also moving on to the challenges of building sustainable improvements into their business operations.

41%

Optimising capital structures is a key focus area increasing to 41% from 26% in October.

If businesses haven’t already, it will be important to recalibrate debt and equity levels to the new operating environment, maximising value and minimising the average cost of capital.

A further 21% of Australasian businesses said that organic growth through investment in their existing business would be their priority when optimising their asset portfolios returns.

What do you consider most important in driving portfolio returns?

What do you consider most important in driving portfolio returns?

Synergy identification and achievability continue to be the priority consideration driving transaction execution, indicating that Australasian executives understand the importance of optimising business performance post transaction and into the future.

What is the most important when planning for a transaction?

What is the most important when planning for a transaction?

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