The Australian profit reporting season has so far proven to be very strong.
In fact profit news in countries like the US, Japan and some European countries have also been as strong.
Australia has been stronger than expected at the start of the reporting season.
The AMP’s Dr Shane Oliver says that while it’s still early days, 20 of the 25 major companies to have reported so far (or 80%) have seen their results beat expectations.
He says outlook statements have generally been positive consistent with a continuing recovery, and dividends have been increasing again.
Those companies over-performing included Newcrest, Leightons (see below), Rio Tinto, James Hardie, BHP, Cochlear and JB Hi-Fi.
"The results so far provide confidence that profits will grow 20% or so over the year ahead," Dr Oliver said.
Dividends are ahead nicely: BHP lifted its payment, and Newcrest and Rio have restored their payments to shareholders. JB Hi-Fi boosted its payout, as did Leighton on Friday.
Dr Oliver says the reporting season rolls on this week with companies such as Fosters, Mirvac, OneSteel, Ansell, Brambles, Coca Cola, CSL, AMP, Qantas, Wesfarmers and Billabong due to report.
In the US estimates for fourth-quarter reports from Standard & Poor’s 500 companies continues to rise.
Reuters says more companies reported results that beat estimates last week.
Of the roughly 380 S&P 500 companies that have already reported fourth-quarter results, 73% have beaten estimates, well above the 61% that beat estimates in most quarters up to the slump started.
