, Singapore

Here's the one thing Singapore firms must learn from 3Q's soft earnings season

Some earnings drags are temporal.

According to CIMB, Singapore’s 3Q results season was soft. Earnings dampeners included  competition, weak selling prices, slower sales and lower translated earnings from overseas. Rising costs did not seem to be too much of a problem. The bright spots were higher rentals and good execution.

CIMB noted that the one lesson from the 3Q earnings season is the need to sieve out the earnings drags that are temporal and those that indicate a more structurally adverse trend.

Here's more:

As overseas earnings stack up for Singapore‟s listed companies, issues like forex movements will come up once in a while when the regions they operate in suffer a bout of forex weakness.

SingTel, UOB and OCBC all had weaker contributions from their overseas markets that saw a bout of currency depreciation. For others like Super Group, it was a mix of currency and structural issues that depressed overseas operations so the need to differentiate which is which is important.  

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