The profitability of publicly traded companies in Taiwan plunged by 26.23 percent year-on-year in the first three quarters of this year, led by shipping and semiconductor firms hurt by higher crude oil prices and a slowing global economy, the Securities and Futures Bureau (SFB) said in a statement released on Thursday.
The SFB statistics included listed companies on the Taiwan Stock Exchange (TWSE) and those that trade on the over-the-counter GRETAI Securities Market.
Based on the bureau’s data, aggregate sales of TWSE-listed firms from January to September increased by NT$982.9 billion (US$29.95 billion), or 9.78 percent, from a year earlier. However, cumulative pre-tax profit declined by NT$241.5 billion, or 20.73 percent, during the same period, the bureau said.
Add in GRETAI-traded companies, whose before-tax income dropped by NT$85.5 billion, and the profitability of all publicly traded companies fell by NT$327 billion, or 26.23 percent, from a year earlier, the bureau’s data showed.
As of Sept. 30, the benchmark TAIEX had dropped 32.8 percent from Jan. 1, the TWSE’s data showed.
The figures also showed that among the top 20 companies who led the decline in profitability, the majority were from the semiconductor and shipping sectors.
But in terms of the scale of the decline, the shipping and finance/insurance sectors posted the largest annual falls at 82.72 percent and 80.64 percent respectively. There was also a noticeable profitability decline in the auto sector, which registered a fall of 60.03 percent, the bureau said.
Aside from higher crude costs and a gloomy economic climate, profitability was affected by a new measure requiring companies to book employee stock bonuses as an expense and to book impairment losses on financial assets in the face of the global credit crisis, the bureau said.
Bonus expense and asset impairment losses totaled NT$106.19 billion in the first nine months of the year, accounting for 43.97 percent of the total decline of NT$241.5 billion in pre-tax income for listed companies.
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