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WEEKLY E-MAIL

THE PROFIT REPORTING SEASON

By Rebecca Lowe

As the month of August draws to a close, so too does reporting season, with 119 of the ASX 200 companies having reported full-year earnings and 20 companies yet to report (as at 28 August 2017).

Whilst the results of the companies that have reported thus far have been reasonable, they haven’t been great. Around 90% of companies produced a profit which is above the long term average of 87% but this was down from the February 2017 reporting season of 94%.

The strongest performing sectors have been mining and energy companies (benefiting from cost cutting and favourable commodity prices), housing market dependent companies (more homes built) and real estate investment trusts.

Some of the key results of the ASX 200 stocks that reported full year results are as follows:

  • Of the 90% of companies that reported a profit, 60% reported a lift in profits and of those companies, 65% increased profits on the prior year
  • O78% reported revenue increases and 73% reported expenses increases
  • OCash levels are up 23.5% to almost $108 billion
  • O91% of companies elected to pay a dividend and of those companies, 69% lifted the dividend, 16% were cut and 15% were unchanged

The results indicate that corporate Australia remains in reasonable shape evidenced by a significant majority of companies reporting a profit for the past year, most lifting profits and paying a dividend, cash holdings are high and companies have been successful in raising revenues and reducing expenses.

Rebecca Lowe
Senior Para-Planner
Authorised Representative No. 453075

If you have any questions or comments, please email me at rebecca@gfmwealth.com.au

Disclaimer: This document is not an offer or invitation to any person to buy or sell any interest in or deposit funds with any institution. The information here is of a generic nature, and does not take into account your investment objectives or financial needs. No person should act upon this information without firstly seeking competent, professional advice specifically relating to their own particular situation.

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