New figures released today support recent reports that business confidence is rising, albeit from rather depressed levels given the economic downturn.

The Business in Britain survey from Lloyds TSB Commercial charts the performance and views of more than 2,500 UK firms. The latest results show that firms are hopeful of an increase in sales and orders by the end of 2009 but profits will continue to fall for many as the recession makes it difficult to make price rises.

The survey’s business confidence index, which tracks firms’ expectations for sales orders and profits over the coming six months, has risen to a balance of -3%, from the record low of -32%, six months ago.

The balance of firms expecting an upturn in sales has risen to +1%, with 31% anticipating a rise and 30% expecting a fall. While not hugely positive by itself, this figure may be perceived as a positive development when compared to a balance of -28% when the survey was conducted six months ago. Then, only 20% expected a rise and 48% believed there would be a fall.

John Maltby, managing director, Lloyds TSB Commercial said:

“A major factor in the dramatic fall into recession has been plummeting business confidence – and restored confidence is the key to any recovery. So this evidence that firms are regaining faith in their business prospects is good news.

“But the survey indicates a levelling off in the downturn, rather than a return to strong growth. For the time being, profits will remain under pressure and investment will be on the backburner. And that means businesses will need support in order to ensure the momentum of any recovery.

“The somewhat more positive outlook, with growth projected in export markets, means that there are opportunities and we hope that British firms can seize the initiative.

“Banks will play a crucial part in helping firms face this challenge. Throughout these challenging times, Lloyds TSB remains dedicated to providing solid financial advice and to supporting every reasonable request for financial support. We’re committed to helping UK businesses, not only to survive the recession, but to prosper as the economy recovers.”