Assessing the Consumer sector’s exposure to a ‘no-deal’ Brexit. With Donald Tusk, the President of the European Council, warning this week that a ‘no-deal’ Brexit “is more likely than ever before”, we have assessed the listed Consumer sector’s exposure to a ‘no-deal’ Brexit scenario and the risks attached. As very few companies have published a detailed analysis of the challenges that Brexit represents (and their mitigation plans), we have looked at the number of references to “Brexit/EU Referendum” in recent UK earnings reports. The main five areas of risk identified are (1) Economic uncertainty including a weakened £; (2) Consumer confidence/spending; (3) Input/raw material cost volatility; (4) Workforce recruitment/retention; and (5) International trade. What is less clear is the extent to which comprehensive preparation has been made to ensure companies continue to run smoothly – deal or no deal. We conclude therefore that either UK small/mid cap Consumer sector plc feels prepared, or perhaps companies have run out of things to say amidst the deep uncertainty.
