Earnings season: Headwinds aplenty

Corporate profit season

The profit-reporting season has largely concluded, although there are a small number of ASX 200 companies to report. CommSec has assessed the results of the 120 companies that reported half year (HY) results (results for the six months to December) and 32 companies that reported for the full year (FY) to December. (Results are up to and including February 25). Aggregate half-year profits are up 25.2 per cent on a year ago while aggregate FY earnings are up 183 per cent.
Overall 101 companies or 84 per cent of HY companies produced a profit for the half year while only two of the FY companies didn’t report a profit. And 59 per cent of the HY companies reported an improvement in profit while 83 per cent of FY companies reported a similar lift in earnings.
As at June the 152 companies had cash balances of $102.5 billion, up 25 per cent on the previous reporting periods.
The vast majority of ASX 200 companies paid dividends. Of the HY reporting companies, 83 per cent issued a dividend while 80 per cent of the FY reporting companies issued a dividend.
Just like last reporting season, aggregate earnings results for Corporate Australia were solid, but analysts wanted more. Bloomberg reports that 29 per cent of companies beat market expectations for earnings per share (positive surprises) while 49 per cent disappointed.