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“Significant” number of AIM companies unaffected by Covid-19

AIM_coronavirus_marketsAs Covid-19 rattles markets worldwide, a “significant” number of UK listed small cap businesses remain unaffected by the pandemic, a study has found.

Despite ongoing volatility and widespread market uncertainty caused by the coronavirus pandemic, 38% of firms listed on AIM, the London Stock Exchange’s international market for growth companies, have reported no real impact on trading.

According to FinnCap Group, which carried out the study, 7% of AIM companies have even upgraded their trading forecasts.

Raymond Greaves, head of research at FinnCap Group, said: “It is very interesting to note that a significant number of AIM companies are either seeing minimal or positive effects on their prospects as a result of Covid-19.”

Many firms have announced cost reduction programmes, either through redundancies or furloughing, as well as store closures, according to the report, which highlighted that companies are trying to protect longer-term capital expenditure.

“It’s worth noting too that they are seeking to protect their capex, which will underpin their long-term growth. This is encouraging as it shows that businesses are planning for a post-pandemic future and will be a key factor in how quickly and effectively the corporate sector and the economy will bounce back once the worst of the coronavirus crisis is over,” Greaves added.

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