Enterprises' profitability is continuously decreasing

In the 2nd quarter of 2008, enterprises’ total profit was 11.5 billion kroons, which is nearly 3 billion kroons less than in the same period of the previous year. Production inputs appreciation, recession, thereof cautious consumers have contributed to the situation where on highly competitive market those who can more effectively restrain costs are in better position. The profit in forestry, mining, hotels and restaurants, construction, wholesale and retail trade decreased the most. Agriculture and education were in loss.

Total profit of enterprises, 1st quarter 2003 – 2nd quarter 2008

The net sales of enterprises totalled 170 billion kroons, which in current prices was 2% more than in the previous year. Retail and wholesale trade and manufacturing enterprises accounted for the biggest share in net sales, respectively 41% and 21% of the total volume. The weak growth in net sales is mainly caused by the influence of retail and wholesale trade where the growth was very small — only 1%. The growth of the net sales was the biggest in agriculture and education enterprises, at the same time the costs also grew most in these activities.

Similarly to the growth of the net sales, the growth rate of enterprises’ costs also slowed down, but still costs grew faster than net sales. The increase of costs was 4% in the 2nd quarter. The costs grew most in agriculture, education, hotels and restaurants activities. The labour costs increased 14% during the year. As a result the productivity of labour costs on the basis of value added decreased 12%.

In the 2nd quarter of 2008, enterprises invested 9.7 billion kroons, 3% less than in the 2nd quarter of 2007. Investments were made mainly in construction, alteration of buildings and structures and in the acquisition of machinery, equipment and inventory. Investments grew only in the acquisition of buildings, structures and other equipment, machinery, inventory. Other investment categories decreased. The biggest decrease was in the acquisition of land.