9-month earnings snapshot from Greek blue chips; Winners and Losers

The top players on the Athens bourse took a big knock in the first nine months of the year due to the pandemic that severely tested the companies, especially in the second quarter of the year.

According to data collected by Business Daily, large caps saw a 22 percent drop in turnover, exceeding revenue drops seen across the broader corporate sector (-15.2%),  as shown by figures from the Hellenic Statistical Authority.

In particular, the main conclusions drawn from data available so far (for EYDAP, Sarantis and Coca Cola HBC net profit figures after taxes and minority interests, are not yet available) are three:

1. The pandemic significantly reduced turnover, to a greater extent than it affected Greek companies in general, as it fell from 33.6 to 26.3 billion euros. It should be noted, of course, that of these losses, 7.3 billion euros (or 22%), most of it is due to the decline in sales of three companies that have been disproportionately affected by the pandemic: Aegean, ELPE and Motor Oil. If these three companies had been excluded from the calculations, turnover decreases from 18.72 to 17 billion euros, ie by 9.2%.
2. In terms of net profitability and without counting the three companies for which there is no data (EYDAP, Sarantis, Coca Cola HBC), there is a transition from a positive result of 741 million euros to losses of 113 million euros . In this case, also, a large part of the change stems from Aegean and the two refineries, totaling 675 million euros.
3. Despite the serious deterioration in bottom line results, the operating profitability of the blue chips indicates that they remain relatively resilient to the downturn. In particular, operating profit (before taxes, interest and depreciation - EBITDA) has decreased by 21%, from 3.43 to 2.71 billion euros. A strong boost to overall operating profitability was given by PPC, whose EBITDA jumped from 196 to 708 million euros.

Ranking based on net profits

• The "king" of profits in the Greek market is OTE, as it reported net profits of 317 million euros in the 9 months, compared to 247 in the corresponding period of 2019, achieving an increase of 28.1%, the third largest among blue chips. The increase in traffic in telecommunications networks and, in general, the acceleration of the digital transformation, as a result of the pandemic, favors OTE.
• Second in line, based on net profitability, is Mytilineos with profits of 102 million euros, reduced by 15.6% compared to 2019. By utilizing a wide portfolio of activities and expanding the profit margin in energy thanks to lower gas prices, Mytilineos is eyeing earnings close to levels seen in 2019 and the 9-month figures show that it is quite close to this target.
• OPAP is ranked third, despite the reduction of its profits by 47.9%, to 73 million euros. Although OPAP received a strong blow from the closure of its network stores in the second quarter, due to the restrictive measures, it has managed to compensate the losses to a significant degree by strengthening its online presence.
• In fourth place is TERNA Energy and, in fact, with an impressive increase in profits by 43.9%, to 59 million euros. The company's large investments in renewable energy, which are showing resilience to the coronavirus, are behind this success as the shift to "green" growth favors companies with positions in RES.
• A pleasant surprise are the earnings of Titan, which ranks fifth, with a profit of 58 million euros, up by 28.3%. The cement industry benefited from the increased demand in its largest market, the US, but also from improved conditions in the Greek market, with an increase in demand for cement for public and private projects.
• PPC deserves to be ranked in the top position of profitability, although its profits do not look impressive at first sight for a company of its size (13 million euros). Its achievement is that it managed to reverse losses of 353 million euros, in the corresponding period last year, and show a positive result. This is due to the 20% increase in tariffs, the large drop in wholesale prices and fuel costs, but also to reduced payroll costs.
• In a difficult environment for the construction sector, GEK TERNA remained profitable, although with a significant decrease (60.3%), showing a net profit of 12 million euros. It is noteworthy that its operating profitability rose by 9%.
• Last on the large cap list of profitable companies is HELEX, which showed profits of 4 million euros, reduced by 37.3% compared to 2019, as the limited trading activity on the stock exchange reduced revenues by 14%. However, the last quarter is expected to be much better, as since the beginning of November there has been a large increase in trading on the ATHEX.
• In the group of losers, during the 9 months of 2020, are highly capitalized companies that are severely affected by the pandemic: Fourlis, with losses of 3 million euros, Lamda Development (-19 million), Motor Oil (-107 million), Aegean (-187 million) and ELPE (-381 million). In its own category is Ellaktor, which doubled losses from last year at 54 million euros due to challenges in the construction industry and losses from the past.