According to the survey on the access to finance of non-financial corporations in Romania, published by National Bank of Romania, firms kept largely an unchanged view on the evolution of the main financial indicators for April 2017 – March 2018, except solely for labour costs and other costs. Thus, a higher number of companies showed that these indicators posted a moderate increase versus the previous round (49 percent compared to 37 percent and 40 percent compared to 28 percent respectively).
At the same time, the share of companies that reported higher loan expenses picked up marginally (from 9 percent in October 2016-April 2017 to 12 percent in the current round), while for 85 percent of companies loan expenses remained unchanged. The profit and the profit margin dropped for 38 percent and 37 percent of firms respectively, these percentages being slightly higher compared to the previous round.
Reflecting aggregate data, a larger share of both SMEs and large companies reported higher labour costs and other costs. Large companies were, to a greater extent, affected by the change in loan expenses, with 24 percent of them recording a pick-up in this indicator (compared to 15 percent in the previous round).
The evolution of financial indicators for exporters and importers was not significantly different from that seen by companies overall, except for the turnover, which saw a rise for a larger share of the firms that belong to the two categories. By economic activity, agriculture firms posted notable developments. Amid a higher share of the respondents in this sector that recorded a smaller turnover and a significant hike in labour costs and other costs, the number of firms whose profit declined posted a marked advance from 29 percent in October 2016 – April 2017 to 41 percent in the current round.
For the other sectors no significant changes are noticeable compared to aggregate developments, or to the previous survey. The indebtedness level (calculated as a ratio of debt to assets) did not witness notable changes, with the shares of companies that opted for one of the four answers posting 1 to 3 percentage point adjustments.
Pressing problems
The results of the current survey show that the greatest obstacles encountered by companies in performing their activity over the last six months refer to: the unpredictability of the fiscal environment, high level of taxation, competition and production costs. Compared to the previous round, the problems that became more serious relate to fiscal unpredictability, production costs and the availability of skilled staff. By company size, the obstacles generate a different impact.
Thus, problems such as competition and the lack of demand have a greater impact on the activity of SMEs than on the activity of large companies, while for the latter the availability of skilled staff is a more pressing problem than for SMEs.
The largest part of the companies polled do not view access to finance as having been a pressing problem in the last six months (66 percent of firms), similarly to the results of the previous survey.
Companies with non-performing loans are much more seriously affected by the lack of access to finance compared to firms with performing loans.
Depending on the economic activity, access to finance is a less pressing problem for companies in sectors such as services and utilities. High taxation is the greatest problem facing agriculture companies, while the other sectors view the unpredictability of the fiscal environment as their number-one problem. For trade companies, the availability of skilled staff is a lesser problem than for the other sectors. Competition weighs much more heavily on trade firms than on firms in the other sectors, with companies in the construction and real estate sectors being the least affected.
For further information: Survey on the access to finance of non-financial corporations in Romania