AFP Releases Corporate Cash Indicators™ for 1Q13

Forward indicator is negative for second consecutive quarter.

News provided by

Association for Financial Professionals

Apr 29, 2013, 08:36 ET

WASHINGTON, April 29, 2013 /PRNewswire-USNewswire/ -- For the first quarter of 2013, the AFP Corporate Cash Indicators^™ (AFP CCI) showed a reading of +10 over the fourth quarter of 2012, and +8 year-over-year.

The forward indicator showing expectations for the second quarter of 2013 was negative at -5, following a negative reading in the fourth quarter of 2012 and only the third negative reading in the history of the survey.

Performance for the indicators is determined each quarter by the Association for Financial Professionals (AFP) and underwritten by State Street Global Advisors. The indicators measure recent and anticipated changes in corporate cash balances by calculating increase percentage minus decrease percentage.

AFP Corporate Cash Indicators™
+10	1Q13 v. 4Q12
+08	1Q13 v. 1Q12
-05	2Q13 expectations

Represents "increase" percentage minus "decrease" percentage.

First quarter 2013 indicators show that 38 percent of reporting organizations had greater cash balances at the end of 1Q13 than they had at the end of 4Q12, while 28 percent had cut cash reserves.

Year-over-year, 35 percent held greater balances at the end of 1Q13 than they had at the end of 1Q12, while 27 percent held smaller cash balances. Companies also reported that their investment selection for cash and short-term investments had become more aggressive.

The slower pace of cash accumulation is consistent with brighter outlook many companies have for the future. Anecdotally, treasurers indicated they would be using cash balances to pay down debt, make capital expenditures and, in some cases, acquisitions.

"For the first time, the index has shown negative for two consecutive quarters," said Jim Kaitz, AFP's president and CEO. "The change we saw at the end of last year may be the beginning of a trend."

The AFP CCI™ provides treasury and finance professionals, policymakers and market analysts with timely data on a determinant of economic activity: corporate cash. Each quarter, AFP asks select members whether their short-term holdings increased or decreased in the past year and past quarter; whether investment selections for those holdings changed; and whether they expect cash holdings to increase or decrease in the coming quarter. AFP members have agreed to participate in this ongoing study on a long-term basis.

AFP began collecting quarterly data in January 2011 and has now collected nine data sets. See www.afponline.org/CCI. The next set is slated to be published July 29, 2013.

AFP Corporate Cash Indicators^™is a trademark of the Association for Financial Professionals. All AFP Corporate Cash Indicators^™survey questions and reports are the copyrights of the Association for Financial Professionals, and all rights are reserved.

ABOUT AFP® (www.afponline.org)
The Association for Financial Professionals (AFP) is the professional society that represents more than 16,000 treasury and finance executives. Headquartered outside Washington, DC, AFP provides members with news, economic research and data, financial certification programs, networking events, financial analytical tools, training, and public policy representation to legislators and regulators. AFP's global reach extends to over 150,000 treasury and financial professionals worldwide, including AFP of Canada; London-based gtnews, an on-line resource for the treasury and finance community; and bobsguide, a financial IT solutions network.

SOURCE Association for Financial Professionals