PROFITABILITY among companies in the region has fallen during the last four quarters.

The latest Experian corporate health check reveal that profitability is now at its lowest level since the recession.

"No other region has suffered such a consistent decline over the last year,'' said Peter Brooker, from Experian.

"Nationally, profitability rose as the pessimism of the last year has evaporated and most other parts of the country have seen profitability rise or remain at about the same level.''

He said recent company results nationally had been accompanied by much-improved business confidence since the start of the year.

"While the pound is still uncomfortably high, output growth is picking up, unemployment is down to its lowest level since 1980, wage pressures have eased, there are no inflationary pressures and there are signs of improvement in some economies in south east Asia,'' he said.

"Export orders in March rose for the first time in 18 months and overall economic activity is picking up in some, but not all, manufacturing sectors.''

Mr Brooker said that on the positive side companies in the region have been able to improve their average profit margins after several quarters when they have fallen back.

Overall, Mr Brooker said the recovery is not consistent in all sectors and the contrast between thoses sectors exposed to world markets and those sheltered from international competition can still be seen. He said: "Many sectors that rely heavily on exports continue to suffer from lower profitability."

"However, the overall balance has now shifted in favour of higher profitability, with fewer than half of the 24 industries covered in the health check in decline.''

He said the recovery in consumer confidence and spending also had a positive effect on domestic markets.

Strongest among those during the first quarter were the leisure, media, retail and support service sectors.

The survey revealed that construction and textiles had also recorded encouraging profitability growth but there was disappointing news from the chemical, electrical and food manufacturing companies involved.

"Perhaps the most surprising result over the last year has been the IT sector, which has seen profitability fall for four consecutive quarters, this is possibly the result of major IT investments being postponed until after the millennium.''

Converted for the new archive on 25 January 2001. Some images and formatting may have been lost in the conversion.