That’s the finding of the Leaseurope/Invigors European Business Confidence Survey, which was conducted in June 2013.

The findings suggest that respondents are expecting a stable outlook over the next six months, with many of the survey’s measures showing little change from the previous survey conducted in December 2012.

The outlook for new business volumes over the coming six months remains positive, with 54% of those surveyed expecting new business volumes to increase, while just 20% anticipate a decline. Expectations on the level of bad debt show little change on the previous survey with the majority of participants (57%) forecasting that bad debt will remain unchanged over the coming 6 months. Similarly, 59% expect no change in margins, though only 19% now predict that margins will increase in their organisations, down from 39% in the previous survey. The results also show that nearly 55% of survey respondents forecast that net profits for their business will increase over the same period, a decrease from the 63% recorded last December.

Industry expectations on a number of key indicators covering service levels, expenditure and staffing indicate few major changes for the remainder of 2013, though just under half of respondents (48%) said that their organisations are targeting expansion. Growth was focused on asset classes such as agricultural equipment and green assets as well as geographic expansion within and outside of Europe.

Commenting on these results, Invigors EMEA partner Richard Ryan said: ‘Business sentiment in the European asset finance industry remains generally positive as most European economies maintain modest levels of growth and the Eurozone banking system continues on its path to recovery. More than a third of respondents in the June research are more optimistic about the prospects for their business while over 40% felt that these were unchanged.’

The result come as Leaseurope publishes the results of its Q2 Index, which tracks key performance indicators of a sample of 17 European lessors.

The latest Index shows that the weighted average ratios for Q2 2013 have improved compared to the same quarter of the previous year, with the exception of cost of risk.

Total new leasing volumes reported by the sample of firms reached almost €18bn, a big improvement on the weak volumes reported in Q1 2013. This upturn suggests that customers are slowly beginning to return to investment spending. The portfolio of outstanding contracts decreased slightly (-1.6%), as did risk-weighted assets (-0.8%). 

Total pre-tax profit of the companies in the sample experienced a substantial recovery in Q2 2013, increasing by 14.6% compared to Q2 2012. Similarly, the average profitability ratio grew from 25% in Q2 2012 to 27% in Q2 2013. 

Frank Stienstra, CEO of ABN AMRO Lease, commented that: ‘I am very pleased to see that financial ratios in Q2 2013 are an improvement on what we saw the previous year. It is particularly encouraging to observe the increases in profit and profitability, in spite of the pressure that has been put on portfolios. After many years of economic uncertainty in Europe, the recovery of new business volumes during the last quarter could be a sign that clients may be willing to resume their investment activities. If we want to see a continued improvement in KPIs, the leasing industry needs to maintain its strong value proposition.’