(Bloomberg) — One in fifteen European companies are facing significant pressure to restructure this year after being hit by higher financing costs and weakening consumer demand, with Germany, Austria and the Nordics particularly under strain, according to a report by Boston Consulting Group. Around a third of businesses in Germany and Austria also face what BCG dubs “transformation pressure” or early signs of weakening performance and financial stability which require improvement, the consulting firm said in a presentation Monday. That compares with around 21% across Europe as a whole, an increase from 14% in 2023.
The company compiled financial information from more than 2,000 public companies in Europe, and drew on company statements and interviews. The pressure in Austria and Germany in part comes from the “structure of the sectors,” said Jochen Schönfelder, a senior partner at BCG in Cologne. “One reason is the high exposure to China and Russia, with the second being a high exposure to energy-heavy industries.
” He also noted the two countries had been particularly impacted by the “consumer crisis,” with demand slumping for fashion and other items. Real estate, telecommunications, media and technology firms and retail were the three sectors most under stress across Europe. Around 68% of real estate companies are showing these early signs of strain, up from around 26% in 2023, according to BCG.
The data highlights how the continent is still confronting t.
