2005 to be a year of caution.

A survey by Plimsoll Publishing Ltd has revealed that the top 2000 companies in the UK Computer Software industry are in one of four different moods based on their current financial strength. It appears that 35% seem to be entering 2005 in a cautious mood.

35% of companies in the Computer Software industry are uncertain how 2005 will be. Their recent financial performance has been at best satisfactory. Their sales are falling by 9%, with margins averaging 3.7%. Nevertheless, most of these companies could be described as prudent as they hardly carry any debts. If 2005 proves unfavourable, their balance sheets should offer some protection, but they must keep a close eye on aggressive competitors. 21% of companies are upbeat regarding their prospects for 2005. These companies are not having any trouble achieving extra sales growth, with many having increased sales by 11.9%. They are also not seeing any reduction in margins - typically they reported margins as high as 8.5%. Their priority for 2005 should be to build on their existing success. This will not be as easy in today's highly competitive industry.

www.plimsoll.co.uk