Reports highlight industry optimism

Catering and hospitality firms are optimistic about the future, judging by their willingness to take on extra debt.

So conclude three Plimsoll reports on the borrowing trends of 2,264 restaurant and catering firms, 1,710 hotels and 783 catering equipment suppliers.

Between 40% and 44% of respondents in all three reports had the confidence to boost borrowing in their past financial year.

Of the 21% (suppliers) to 25% (restaurants) of loss-makers, half had inspired sufficient confidence to secure loans. Among profitable firms, 37-43% had increased their asset value last year, most through borrowing.

Restaurants and catering had the biggest debt increase, perhaps due to high start-up and expansion levels. Financially strong companies increased loan levels by a total £1b and weaker firms by £4.5b.

Among hotels and suppliers, stronger firms reduced debt by £77m and £179m respectively, while debt increase among weaker players totalled £3.8b (hotels) and £2.6b (suppliers).

One-fifth of companies boosted sales by 20% or more and profit margins by 10% upwards, well above industry averages.

l Call 01642 230977 for the £305 reports (5% less for Caterer readers).