Investor sees profits bounce back
AFP/The Local · 14 Jul 2009, 12:04
Published: 14 Jul 2009 12:04 GMT+02:00
Investor, the industrial holding firm controlled by the influential Wallenberg family, announced net profits of 16.85 billion kronor ($2.14 billion) for April 1 to June 30 after a 3.5 billion kronor net loss a year earlier.
The company, which holds stakes more than 130 firms worldwide, is widely considered as a good bellwether for the Swedish business climate.
Chief executive Börje Ekholm said that while the global economy was "on the way" to recovery, hopes of a swift end to the recent turmoil were premature.
"I am concerned that the recovery process may not be as robust as we hope," he said in a statement.
Ekholm pointed to rising unemployment and high levels of personal debt among US consumers -- whose spending, he said, accounts for 20 percent of global GDP.
"I don't think we should count on a sustained rebound in consumer spending until the consumers' balance sheets have been shored up. I am concerned that some 'green shoots' may turn into yellow weeds along a slow road to recovery," he added.
The Investor chief executive said the Asian economies, led by China, would emerge first and in better shape than Europe and the US from the current downturn.
"Continued investments in developing a strong presence for our companies in these markets will be strategically important and rewarding," Ekholm said.
In its interim report for the period January to June, Investor said its net asset value totalled 126.6 billion kronor, compared to 115.2 billion at the end of 2008 or 138.7 billion kronor for the first six months of 2008.
"We have enjoyed a couple of strong months in the stock markets," explained Ekholm said. "We have invested 5.3 billion kronor the last six months at long-term attractive valuations."
Investor said net profits in the first six months totalled 13.83 billion kronor against a 12.45 billion kronor net loss the same period a year earlier.