How Quoted firms fared in Q1’2016 amid economic challenges

Proshare

Friday, May 20, 2016 3.38 PM / TheAnalyst

A cursory review of earnings report presented so far in Q1'16 revealed a weak performance across board in terms of revenue and profitability, which further reflects a sustained tough/challenged business environment in the face of falling microeconomic fundamentals, just as we had experienced in 2015.



We expect the microeconomic fundamentals to remain unimpressive, driven by weak Consumer spending due to layoffs, Effect of FX shortages on business, low FDI/FPI Inflow, disruptions of crude production by militants, Reduced Crude production/prices, low lending to real sector, High cost and scarcity of PMS.



Looking at the revenue performance across sectors, Construction or Real estate and Conglomerate sectors topped the performance table, followed by consumer goods sector, posting average sector growth of 29.31%, 28.50% and 13.27% respectively. However, ICT, Healthcare and Natural Resources sectors closed at the bottom of the performance table for Q1'16, posting negative average growth of -16.04%, -14.47% and -13.30%.

On the other hand, the profitability postures appeared unimpressive across sectors in the quarter so far. Majority of sectors posted negative average growth while only three sectors posted positive average growth. Oil & Gas Sector led the table by posting average PAT growth of 98.49% in Q1'16, followed by Consumer Goods and Natural Resources sectors, posting average growth of 57.77% and 3.41% respectively. However, Agriculture, Healthcare and Construction or Real Estate sectors posted huge negative average growth of 567.90%, 198.30% and 123.69% respectively.

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