businesses are growing increasingly confident about their intermediate and
longer-term prospects, according to the AFP
Corporate Cash Indicators™ (AFP CCI™), underwritten by State Street Global
Advisors. The forward indicator measuring expectations for the second quarter of
2013 was at -5, following a -4 reading during the previous quarter and only the
third negative reading in the history of the survey.
"For the first
time, the expectations index has shown negative for two consecutive quarters,"
said Jim Kaitz, AFP's president and CEO. "The change we saw at the end of last
year may be the beginning of a trend of companies deploying their cash."
The AFP Corporate Cash Indicators™ measure recent and anticipated changes in
corporate cash balances by calculating increase percentage minus decrease
percentage. The AFP CCI™ are produced by the Association for Financial
Professionals and are underwritten by State Street Global Advisors.
other AFP CCI™ measures released on Monday showed the pace of cash accumulation
was slowing the opening three months of 2013. The 2013 Q1 quarter-to-quarter
measure was +10 versus a reading of +13 a year earlier. The 2013 Q1
year-to-year measure was +8, which was not only down from +13 a year earlier
but also the lowest year-to-year comparable in the history of the AFP CCI™.
April 2013 AFP Corporate Cash Indicators™
1Q13 v. 4Q12
+08 1Q13 v. 1Q12
Represents the percentage of
respondents indicating a increase in cash holdings versus those indicating a
decrease in cash holdings.
team sees the results as being consistent with financial professionals and
other executives growing more confident about their organizations' prospects.
"Companies that are confident about their ability to generate cash in the
future through increased demand for their products and services tend to be more
willing to deploy the cash that they have on hand today," said Kevin Roth,
AFP's Managing Director of Research.
"In fact, survey participants told
us that they would be using corporate cash balances to pay down debt, make
capital expenditures and, in some cases, acquisitions," Roth added.
AFP CCI™, launched in January 2011, provide treasury and finance professionals,
policymakers and market analysts with timely data on a determinant of economic
activity: corporate cash. The next set will be published July 29, 2013.
AFP Corporate Cash Indicators™ is a trademark of the Association for
Financial Professionals. All AFP Corporate Cash Indicators™ survey questions
and reports are the copyrights of the Association for Financial Professionals,
and all rights are reserved.