European firms predict double-digit profit growth in 2011

These are among the findings of an online study conducted by Simon-Kucher and Partners among 200 managers in the construction, chemicals and base-material industries in Europe.

The respondents aim to improve sales while taking advantage of pricing measures; cost cuts will be kept to a minimum.

Beyond this, over half of the managers plan to strengthen investments in research and development (R&D) and step up their international expansion.

‘The managers show that they now place more trust in long-term strategies. We won’t be seeing many snap decisions for quick-profit wins,’ said Sebastian Strasmann, co-author of the study and director at Simon-Kucher and Partners.

Managers are said to have diverging opinions about the levels of profit growth: more than 10 per cent of the respondents foresee a profit surge of more than 20 per cent in 2011.

Eighteen per cent, mostly from the building-material industry, expect stagnating profits. Managers from the building-technology industry are most optimistic, planning a 20 per cent profit increase. Base-material, building-material and chemical sectors foresee a lower rate of 12 to 14 per cent.