Design-Firm Financial Officers See Sharp Drop in 2009 Growth

Chief financial officers of more than 100 large and small engineering firms are forecasting 4% average annual growth for the group in 2009, the lowest average since 1996, according to a survey by New York City-based industry management consultant EFCG Inc. The firms, which had 2008 revenue totaling $43 billion, are more optimistic about prospects in 2010, expecting 5.5% growth. CFOs had expected 10% revenue growth for 2008 in the same survey done a year ago, says EFCG President Paul J. Zofnass. Among respondents, 59% say their current outlook for 2009 was unchanged from a few months ago, while 32% say it is worse and 9% better. CFOs expect average profit margins of 10.8% this year, down from actual margins of 11.5% in 2008. Respondents also project 10% growth in their 2009 federal-sector revenue, up from 8% last year. They also forecast a 5% hike in state- and municipal-sector revenue this year, down from 8% in 2008, but they see no change in private-sector sales. More than 75% of CFOs reported contract delays, slowdowns or cancellations, but only seven said they were cutting staff and only 24 report having a “formal” recession- planning program.