Listed companies expected to show dwindling profits in Q2
Profits of listed companies fell in the second quarter compared to the first quarter of this year as well as the same period last year, according to analysts.
The combined second quarter 2023 profits of listed companies was expected to be less than 267 billion baht, reflecting the unimpressive performance of the energy stocks following the decline in oil prices, they said.
They also said the business environment has not been conducive to profitability and that there are both domestic and international challenges, including weak exports and a slow recovery in domestic consumption.
Securities analysts expect the total full-year profit of listed firms this year will be about 1.12 trillion baht and are hoping that a recovery in the second half increases market activity.
Asia Plus Securities Plc executive vice president Therdsak Thaveeteeratham estimated that second-quarter profits of listed companies may decrease slightly from the first quarter and range from 267 billion baht to just below 300 billion baht. In the second quarter of 2022 profits of listed companies reached 355 billion baht, propelled by oil prices at US$110-120 per barrel. However, this year, oil prices have fallen to about $70 per barrel, which could affect the business performance of the energy group.
In addition, it is anticipated that the profits for this period will be slightly lower compared to the previous quarter, as the second quarter is traditionally a low season for businesses. Based on five years of statistics (excluding 2020), most sectors have fewer stocks with significantly higher net profits in the second quarter. In particular, sectors like food and beverages, media, and energy have fewer notable profit-generating stocks.
However, it is still expected that the full-year profits will remain stable compared to 2022, when they were 980 billion baht. This will be driven by an export recovery and stimulus measures to boost the Chinese economy. In Thailand, a new government is expected to spur domestic consumption and private sector investment.
Kasikornbank expects the combined second-quarter profits of listed firms to be 5-10% less than the 260 billion baht generated in the first quarter of this year and far lower than the 350 billion baht earned in the second quarter of 2022. This is due to sluggish Thai exports, political uncertainty affecting spending and private sector investments, and delayed government budget disbursements, it said.
The combined full-year profit of listed firms this year is expected to remain stable compared to 2022 when it reached 980 billion baht. The estimated second-half profits are expected to be higher than the first half due to a recovery in exports, higher consumer prices, and increased government spending.
Tisco Securities expects second-quarter profits for this year to range from 270 billion to 280 billion baht, a 3% decrease compared to the first quarter. However, when compared to the second quarter of 2022, profits are expected to increase by 10%.
