CAC 40: TotalEnergies, ArcelorMittal, Engie or LVMH… CAC 40 giants record profits

(BFM Bourse) – The CAC 40 giants are in shiny well being regardless of the outbreak of struggle in Ukraine and inflation at its peak. The Parisian dimension heavyweights have already collected round 73 billion in profits within the first half. That is 24% larger than within the first half of 2021 TotalEnergies, ArcelorMittal, Engie or LVMH stand out particularly throughout this era

Nothing can cease the expansion of huge French corporations: regardless of the struggle in Ukraine and record inflation, in response to a calculation made on Thursday by AFP, the CAC 40 has already gathered round 73 billion in profits within the first half, thanks primarily to luxurious and development. In uncooked supplies

For now, 38 corporations within the CAC 40, the index that mixes the most important French market capitalizations from numerous sectors, have launched their outcomes, with rail producer Alstom and spirits specialist Pernod Ricard having a stagnant monetary 12 months. They made 24% extra revenue than within the first half of 2021, when these similar corporations generated 58.8 billion in revenue, when Eurofins Scientific was not but within the CAC 40.

So the primary French teams have largely recovered from the Covid-19 pandemic and continued to develop regardless of the outbreak of struggle in Ukraine on the finish of February, which additional strengthened the inflation related to the post-confinement financial restoration. The good well being of those teams makes Economy Minister Bruno Le Maire “proud”, not against a tax on distinctive profits, which was finally rejected after a debate in Parliament.

“It’s fairly ambiguous as a result of all the weather for a disaster had been there (…) however the efficiency is sweet”, feedback AFP Benedict Houtfort, founding father of FinTech Scales, specialist within the digitization of relations between listed corporations and buyers.

Raw supplies and luxurious on the occasion

Inflation has not affected all companies equally. For instance, within the case of uncooked supplies and vitality, rising costs have inspired corporations in these sectors.

Oil and fuel big TotalEnergies greater than doubled its revenue within the second quarter and achieved the CAC 40’s finest internet end in a half with greater than 10.4 billion euros. It was adopted by the world’s quantity two steelmaker ArcelorMittal, which took benefit of rising metal costs to succeed in round 8 billion euros. NG, France’s important fuel provider, has already greater than doubled its profits to five billion euros.

Another CAC 40 heavyweight, luxurious additionally rose regardless of a slowdown in gross sales in China, certainly one of its key markets, as manufacturers had been in a position to elevate costs with out dropping clients.

“They depend on an prosperous buyer who does not thoughts value will increase,” Mimoja Bogeska, managing director of wealth administration firm Monocol Asset Management, advised AFP. “They have additionally benefited from the strengthening of the greenback in opposition to the euro as a result of their manufacturing prices are in euros and so they promote rather a lot in {dollars},” he added.

LVMH, (*40*) and L’Oréal thus elevated their mixed profits by greater than 36% in comparison with the primary half of 2021 with snug margins. Luxury group Hermes has already introduced on the finish of July, a revenue of 1.64 billion euros within the first half, up 39.7% in a 12 months due to gross sales development in all areas.

“The hardest half is forward of us.”

For Ms Hautfort, the nice common efficiency of the CAC 40 can also be defined by the cost-cutting plan adopted to fight the Covid-19 pandemic, which is able to bear fruit in 2022.

Some teams have nonetheless suffered from the shock wave of the struggle in Ukraine, akin to Renault and Societe Generale which withdrew from Russia after the outbreak of the battle. The Renault maker offered its stake to Avtovaz, which notably makes the Lada, and Societe Generale offered its stake to the Rosbank financial institution, leading to a cost of a number of billion euros.

“The hardest half is forward of us,” stated Ms Hautfort, who believes the financial context within the second half ought to weigh on enterprise.

With inflation and key central financial institution price hikes, which elevate the price of borrowing and due to this fact make new financing harder, some financial gamers are even anticipating a slowdown within the world financial system.

Evidence of investor mistrust, the CAC 40 inventory market index has misplaced almost 10% because the begin of the 12 months, regardless of being very optimistic in July with the discharge of outcomes. “All valuations have been rising for a while, however the markets have been caught up by the basics. Yet valuations stay excessive,” stated Ms Bogeska.

(with AFP)

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