Official figures from the Australian Bureau of Statistics suggest that businesses enjoyed a spike in profitability last year, despite sluggish sales volumes.
The ABS on Monday (4 March) released its Business Indicators results for December 2018, which showed trend growth in company gross operating profits at a healthy 9.6 per cent over the year to the December quarter.
Seasonally adjusted, that figure was even higher, hitting double digits at 10.5 per cent.
The figures were boosted by a strong performance that quarter, with trend growth up by 0.9 of a percentage point on the September quarter, or by 0.8 of a percentage point when seasonally adjusted.
That saw the seasonally adjusted estimate for wages and salaries also rise by 0.8 of a percentage point.
Inventories were fairly flat over the quarter in trend terms, but still posted a 1.2 per cent rise over the year.
Sales of goods and services were less than impressive, however.
Manufacturing sales fell by 1.7 per cent over the year (or by 1.2 per cent seasonally adjusted), while wholesale trade dipped by a smaller 0.2 of a percentage point (however, that was a 0.4 of a percentage point rise in seasonally adjusted terms).
The ABS noted that “valuation changes have had an impact” on the value of inventories it recorded for the quarter.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.