“Headwind is increasing”
German top 100 companies are weakening
December 26, 2023, 5:07 a.m
After the Corona crisis, the tense world situation is causing grief in the executive suites. A third of the top 100 companies are leaving the financial year with a loss in sales. According to a study, the German automotive industry remains the driving force.
According to a study, Germany’s 100 top listed companies have felt the effects of the difficult conditions this year. According to data from the auditing firm EY, 66 of the 100 companies with the highest sales recorded an increase in revenue in the first nine months, while 34 recorded a decline compared to the same period last year. In the previous year, almost all companies (93 percent) had increased sales. EY does not expect any major growth leaps in the coming year.
“The headwind is increasing,” said Henrik Ahlers, CEO of EY Germany. “Many companies have recently only grown slightly – if at all – and often with growth rates below the inflation rate.” The global political uncertainties and wars led to considerable uncertainty among both companies and the population.
Automotive industry growth driver
According to the information, the growth driver of the top 100 this year was the automotive industry, whose sales increased by 11 percent in the first nine months. However, the air is becoming increasingly thin for the industry in view of sluggish global new car sales, said Ahlers.
According to the information, other industrial companies recorded a total increase in sales of 5 percent in the first three quarters, while trading companies recorded an increase of 4 percent. Things went worse for the healthcare industry, which recorded a 12 percent drop in revenue after the Corona boom. Logistics companies shrank by 14 percent, the chemical industry recorded a decline of 20 percent. The decline in sales was greatest at 44 percent among energy suppliers due to significantly lower electricity prices.
The combined operating result (EBIT) of the groups rose sharply by 32 percent to a good 135 billion euros compared to the same period last year. The increase is primarily due to the energy company Uniper’s record loss of almost 45 billion euros in the wake of the gas crisis in 2022. This pushed the overall balance down at the time. If the effect is eliminated, there would be a decline in overall profit of 8 percent in the first three quarters of 2023.