Biggest companies see record sales but profits are squeezed
Singapore's largest companies have been smashing sales records but, at the same time, their profit margins are also being squeezed, a latest survey by DP Information Group shows.
This findings were from a study of over 40,000 audited financial returns for the year ended May 31, 2010.
The DP Information Group study also found that wholesale, services and property firms are gradually dominating Singapore’s corporate scene, while finance and manufacturing have taken a step back.
In the list of the top 1,000 companies in sales – known as the S1000 – there were 65 finance sector firms that were ranked when the financial crisis hit in 2008. Today, this number has been halved to 33.
Similarly, the number of manufacturing firms listed in the S1000 has dropped 21.4 per cent over the same period.
Taking their places are firms from the commerce and wholesale, property and services sector. The commerce and wholesale sector saw the biggest increase on the list – 390, up from 354 in the 2009 rankings.
Property firms make up 53 of the firms on the top 1,000, up from 35 in 2009.
The combined sales of S1000 reached a new high of $1.98 trillion, a 22.9 per cent rise from the same period in the previous year.
However, their profit margins have not recovered to the pre-crisis levels. The companies' average profit margin was 6.98 per cent, down from 8.17 per cent in the financial period just preceding the financial crisis of 2008.
"Singapore's biggest companies are making money, but not at the same rate they were three years ago," says DP Info managing director Chen Yew Nah.
DP info's analysis also covers separate categories in the SME1000 (the top 1,000 small and medium enterprises in Singapore) and the SI100 (the 100 Singapore companies generating the most international revenue).