this business activities recover in 2021 and first three quarters of 2022time of companies record advances on your invoice (+ 48.7%) due to inflation and 21.1% increased gross value added (VAB). this net ordinary incomeoutstanding results and excluding taxes almost doubled by September (+94.7%) and both this indicator and cost effectiveness assets (4.2%) have already reached pre-pandemic levels.
These are data from quarterly statistics. central balance sheet (CBT) was released by the Bank of Spain this Thursday, and it is clear from its report that companies in general did not pass on all the increase in energy and generation costs to their customers, to customers in certain sectors: purification, power generation, trade and accommodation. Statistics also include data exclusively third trimester Parallel to the slowdown in economic activity, the company shows a loss of activity in its profits.
The report attempts to answer two questions linked to the current exceptional context of inflation: To what extent can companies transfer the increase in production costs to their selling prices? And to what extent is the improvement in the gross value added distributed between the company’s property and its employees?
Are costs passed on to prices?
The report examines so-called evolution to answer the first question.sales margin” (gross economic result divided by turnover), for the purpose of “analyzing the extent to which companies are able to transfer the increase in average production costs to their selling prices”.
The answer that emerges from this is that companies generally do not reflect all of the supported cost increases in their prices. “Companies lost revenue in real terms,” he sums up. General Manager of the Bank of Spain, Economy and Statistics, Angel Gavilan. However, this answer does not apply to all industries. The report notes: refinery industry It is one of the oil companies that managed to better reflect the cost increase in their prices. points to the industry. electricity generation (Not so for marketers). In addition, the sectors Trade and hostel In the report, it is stated that they will also be able to transfer the increase in energy costs to prices “in the context of a strong recovery in demand after the lifting of the restrictions associated with the epidemic”.
The answer to this first question is heterogeneous according to the sector, as well as within each sector. The central balance sheet report, in general, lmost vulnerable companies, those with the worst financial situation, reflecting their costs in a higher price. However, companies exportersaccumulating highest business margin in recent years and those that support a larger weight energy and oil costs They are businesses that have to bear some of the increase in costs at the expense of making less profit. Inside colloquial language, This triple trend in companies can be summed up in three phrases: ‘I have to raise prices and margins to survive’; “I can’t raise prices because I’ve lost my competitiveness” or “I can afford not to raise prices now because I’ve saved some profits in recent years”.
How is the benefit distributed among the company and employees?
To answer this question, the Bank of Spain starts with a second indicator that it calls. “gross value added margin” and It is calculated from the ratio of the company’s gross economic result to the gross value added (VAB).
Growth so far in 2022 gross economic result It grew 38.5% (templates increased by 3.6% and average wages increased by 3.2%), well above personnel costs that rose 6.9%. This means that in 2022 the distribution of companies’ best results turns in favor of operating profit. General Manager of the Bank of Spain, Economy and Statistics. Ángel Gavilán, “To a disproportionate level?” he asks. And he answers: “No, until we reach the same levels as in 2019.”
Understanding central balance sheet statistics
The latest installment of the Central Balance Sheet (CBRT) quarterly statistics released this Thursday, 905 companies sent data for the first three quarters of 2022 until last November 14. This sample of 905 companies represents 12.7% of the Gross Value Added of all companies. Within the framework of this statistic, it is understood as follows: Gross added value (VAB) the difference between total production value minus intermediate costs (net acquisitions and other operating expenses). In case personnel expenses are excluded from GVA, Gross Economic Result (REB).
In the next step, if financial income is added to the RA and the debt interest payment and depreciation are subtracted, Net Ordinary Result (RON). In addition, taking into account the extraordinary results and the payment of taxes, we arrive at what is called ‘in terms of this survey.The result of the exercise‘.