Video: 'Smaller companies are robust' After a strong autumn, the prospects for Britain's smaller companies have dulled this winter, said Cazenove's Paul Marriage. However, the Cazenove Capital UK Smaller Companies fund manager said smaller companies that had survived the past couple of years would be more than equipped to face economic challenges. "After a strong third quarter for the sector, momentum has slowed a little into the last three months as it is clear that most companies will end the year facing headwinds rather than the modest tailwind that we had quietly hoped for," he said. However, the past two years have provided plenty of opportunities for management to be tested by volatile demand patterns and most have learnt to cope. Mr Marriage said executives were reporting a picture of a tougher global economy, especially in Europe, and he was making adjustments to his portfolio to reflect this. "Elementis, a long-time portfolio superstar, was cautious on Europe and its oil and gas business in the US in particular," he said. Having met the management earlier in the autumn we felt this was a possibility, and we lightened our load considerably into their recent slightly disappointing statement. Despite problems in the eurozone influencing decisions, Mr Marriage does not like to base his investment strategy on macroeconomic events. He prefers a "bottom-up" style, focusing on individual stock fundamentals and balance sheet health. Plexus, the electronic manufacturing services firm, has been a standout performer in the past month. The business is managing growth carefully and is now meeting and beating market forecasts. As such it has become a much more mature business and shareholders are reaping the benefits," he said. "Johnston Press has been a bit of a hold-the-front-page investment for us," said Mr Marriage. We met this company recently. It is now a nationwide media business that generates cash and it has scope to grow digital revenues more quickly than the steady decline of print.