Greece in Figures 2008 - Icap

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Total assets and turnover of manufacturing recorded single-digit growth rates, but profitability decreased sharply. In
more detail, the total assets of the 5,167 firms in the industry increased by 7.5% to €70.3 billion, while sales reached
€60.5 billion, 9.9% higher than a year earlier. However, costs increased faster and profits dropped sharply. Pre-tax income
decreased by a dramatic 46.1% to €1.6 billion. As a result, all financial indices worsened; ROE dropped from 11.0% in
2007 to 5.5% in 2008. However, this decrease in profitability may prove to be mostly due to cyclical reasons and may not
reflect structural weaknesses. To a large extend it was due to companies, which were in the black in 2007, but plunged
into the red in 2008. At the same time, the losses of the companies which were in the red in both years did not increase
substantially. Therefore, an improvement in profitability is imminent when the economy recovers.
The energy-water sector comprises 218 businesses, but the industry totals reflect the presence of the Public Power Corporation
(PPC) and other large public-sector entities. Total sales grew impressively, from €8.5 billion to €14.8 billion. However,
to a large extend this was due to the increased turnover of HTSO, the public power grid manager. Gross profits
dropped sharply, by almost 30% and the gross margin fell from 16.0% to 6.4%. Pre-tax income decreased dramatically
from €382 million in 2007 to €74 million in 2008, mostly because PPC moved into the red.
Despite the economy’s slowdown and a sharp drop in private construction activity, the financial situation of the construction
industry improved in 2008. Turnover of the 2,292 companies in the sector increased by an impressive 21.8% and
reached €8.4 billion. Gross profits increased at an almost equal rate, but the faster rise in administration, marketing and
financial expenses, as well as worse non-operational income, reduced pre-tax profits sharply, to €80 million in 2008 from
€371 million a year earlier. This, however, was largely due to the worse performance of several large businesses, which
suffered a decrease in profits or even plunged into the red. It is indicative that the group of the very large companies
(250+ employees) suffered losses. Most financial indicators worsened especially liquidity and debt to equity.
After years of solid growth, commerce stalled in 2008. Turnover growth was slow, pre-tax profits decreased and total
assets increased only modestly. In more detail, total sales in the largest sector increased by 5.1% to €80.9 billion. Gross
profits increased slightly less and the large rise in administration, marketing and financial costs cut net income by 29.4%
to €1.9 billion. Total assets increased by 10.7% and reached €58.8 billion. Most financial indices worsened. A case in point
is ROE, which fell to 13.5%, from 20.5%. It remained, however, the highest among all industries.
Corporate sector: Key Financial Ratios 2007-2008
(Exclusive of Banking, Insurance and Finance)
Gross margin % Net margin % Debt to equity Current ratio
Sector 2007 2008 2007 2008 2007 2008 2007 2008
Agriculture-fishing 18.64 17.57 2.37 -1.32 0.69 0.71 1.24 1.27
Mining-quarrying 26.90 17.77 10.05 3.82 0.55 0.52 1.45 1.40
Manufacturing 21.19 18.78 5.32 2.61 0.55 0.57 1.36 1.34
Energy-water 15.96 6.43 4.51 0.50 0.49 0.52 1.02 0.96
Construction 13.69 13.63 5.39 0.96 0.50 0.54 1.51 1.47
Commerce 20.37 20.25 3.47 2.33 0.73 0.74 1.21 1.22
Hotels-restaurants 32.79 31.02 1.38 -2.99 0.51 0.50 0.91 0.93
Transport-communications 41.76 39.40 10.82 5.02 0.61 0.66 1.08 1.04
Other services 25.00 24.73 14.25 10.29 0.43 0.45 1.19 1.23
Total 22.27 20.33 5.72 3.06 0.56 0.58 1.24 1.24
The downturn in tourism affected the Greek hospitality industry, which comprises 3,490 Ltd and SA hotels and restaurants.
Turnover increased by a sober 5.5% and reached €4.1 billion. Gross profits fell somewhat and the industry moved
into the red to the order of €121 million, compared with pre-tax profits of €53 million a year earlier. This was largely due
to the losses reported by large companies, which were in the black in 2007. Total assets increased to €13.8 billion. The
industry’s gross margin was trimmed but remained at a very high 31.0%; but all other indices worsened.
Growth in transport and communications slowed in 2008. Total turnover of the 882 businesses in the industry increased
by only 4.6%, το €12.2 billion, while gross profits were trimmed. The gross margin, however, remained the highest
among all sectors at 39.4%. Pre-tax profits dropped by more than 50% to €614 million. This was largely due to the
cut in OTE income, which was only partly covered by the improved results of Cosmote. Total assets increased by a solid
15.1% to €31.9 billion.
Other services sector comprises 5,896 businesses of several distinct sectors, such as leisure, educational services,
health care, real estate, etc. (see Table A.1.) The performance of this diverse industry deteriorated in 2008. Total assets
increased by only 6.5% to €58.9 billion. Turnover rose by only 4.9% and reached €20.7 billion. The increase in gross profits
was even lower. This, together with the hefty increase in financial expenses and the lower non-operating income, resulted
in a 24.3% drop in pre-tax profits to €2.1 billion. Nevertheless, the sector includes the most profitable Greek company,
OPAP, which in 2008 reported a net income of €986 million.
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