Victorian Firms Gloomy on Profit Outlook

By AAP
August 17, 2020 Updated: August 18, 2020

Victorian businesses were already pretty pessimistic heading into the harsh stage four lockdown, with more than half predicting a decrease in profitability over the next three months.

The August Sensis Business Index survey, conducted just as Melbourne went into lockdown, showed 54 percent expecting profitability to decrease.

That compares with Sydney where only about a quarter expect a decline in profits and almost one-in-three expect to make a profit.

Sensis CEO John Allan said the survey showed just how hard some industries had been affected.

“There are some sectors that were less affected, but the hospitality and accommodation sectors were virtually shut overnight,” Allan said releasing the survey on Aug 18.

“And that continues to be the case in Victoria.”

Looking over the next 12 months, Melbourne and Canberra businesses were the most worried.

The survey of 1000 businesses from across the country viewed the national economy performing worse than individual state economies.

Almost two-thirds of firms believe the national economy will be worse in 12 months, while they were slightly more positive about their states at 57 percent.

Not helping the grim mood, more than one-in-four businesses have been knocked back trying to get finance over the past three months.

The figure was worse for businesses in regional towns where more than a third failed to secure a loan.

Nearly two-in-five business believe it is more difficult to get a loan since the start of the pandemic.

The ANZ-Roy Morgan weekly consumer confidence survey will be released on Tuesday.

Consumer confidence – a pointer to future retail spending – has been in decline for seven straight weeks, mainly as a result of the second wave of the virus in Victoria.

It now stands at its lowest level since late April.

The Reserve Bank will also release the minutes from its August 4 board meeting.

Colin Brinsden in Canberra