Margin grows with scale and efficiency profits in 2007
Valor Econômico - 12/17/2007
The combination of increase of productivity, gain of scale and reduction of financing expenses (because of the valued Real in relation to the dollar and the lower interest rates) has guaranteed the publicly-held industries an improvement in their profit margins until September. A study carried out by Economática based on the balance sheets released by 250 companies listed at Bovespa reveals that the average net margin of the companies increased 38.9% in the first nine months of the year, in comparison with the same period of last year. The operating margin (that shows the efficiency of the company before the payment of the taxes) has also gone up and went from 16.5% to 17.9% in the same comparison. These profits have been reached with minor increases in the prices in most sectors. Until September, the Wholesale Industrial Price Index (IPA-Industrial) issued by Fundação Getúlio Vargas (FGV) went 2.55% up - and 3.38% until November. The average net margin was 10.7%, in comparison with 7.7% in 2006. The calculation shows the relation between the net profits and the net income of the period. The sampling does not include the financial companies, groups that have gone public this year, neither Petrobras, Eletrobras nor Vale, which have a considerable weight in the sectors where they operate. According to the study, the net income of the companies has increased 7.9%, to R$ 379 billion (US$ 213 billion), and the net profits have grown 49.4%, to R$ 40.5 billion (US$ 22.8 billion). From the 16 sectors assessed, 13 have had an increase on the margin. The most relevant increases have been obtained by the chemical industries (64.99%), transportation and services (31.58%), telecommunications (21.19%), electric energy (21.18%), vehicles and parts (20.24%). There was a fall only in the areas of textiles (55.16%), commerce (4.41%), and construction (2.89%).