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Annual Report
> Chairman's Message
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In last year’s message, I concluded with the view that the global outlook for 2005 was for continued
steady growth, although at slightly lower rates than in 2004. However, several factors were apparent
that had the potential to undermine this relatively benign scenario, notably increases in interest rates
and oil prices and, above all, the unpredictable pace of economic growth in China. In the event, while GDP
growth rates in most major industrialised countries have eased slightly, as forecast, they have generally
stayed reasonably healthy. The US economy proved remarkably resilient in the face of increases in interest
rates, surging energy prices and natural disasters. The Canadian economy, with further impetus from its
strong natural resource base, grew at a level comparable to 2004. Growth in the UK and the euro region
remained positive, but was slower than in North America. However, the manufacturing sector in the UK,
notwithstanding growth in the wider economy, remains difficult in the face of apparent indifference from
the government. The gentle upturn in Japan has continued, while the Australian growth rate eased slightly.
Underpinning this economic performance among the richer nations has been the continued remarkable growth in
the Far East. The pace of Chinese expansion has been maintained, and other newly-industrialised countries,
in particular India, have also continued to grow appreciably faster than OECD countries. With their lower
costs and high levels of savings, inflation and interest rates in the rest of the world have remained
relatively low. Increases in natural resource prices, in particular energy, has been a less benign side
effect, and the impact on world economic equilibrium gives cause for concern.
The AMC Group’s pre-tax profit for the year is a record at £31.6 million. Excluding the impact of this year’s property profits that are classified as exceptional items in the accounts, the 2005 result is still 93% of the comparable 2004 figure. It was acknowledged last year that the 2004 results of the AMC Group benefited from market conditions that would not be repeated, so the 2005 profit is highly satisfactory. Going into 2006, the prospects are for a continuation of modest growth. However, the factors which have given cause for concern in previous years have still, for the most part, not been properly addressed by the authorities, and in some cases, such as the US deficits, have intensified. Soaring energy prices have added to the possibility of a downturn. AMC will continue to plan judiciously in the face of these uncertainties, but at the same time will be alert to identifying and building on available opportunities. The skill and commitment of the staff at all levels will be evident from the achievements of 2005 and I express my confidence in their continued ability to meet the challenges of the future. H Stodieck Chairman 22 March 2005 |
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