File: A UNESCO statement added that 43 percent of young people have no access to internet at home.
MILAN - The coronavirus pandemic that has tipped the world into recession isn't affecting all multinational firms equally, according to a study by Italian bank Mediobanca. While most are losers, there are some huge winners from the crisis.
The study is based on the financial results during the first nine months of 2020 of more than 160 firms with over 3 billion euros (R54-billion) in annual revenues. On average, the firms saw their sales drop by 4.3 percent.
- THE WINNERS -
- Internet -
The study found that internet firms were the biggest winners. Sales for the sector -- of which online retailers including Amazon account for about a third -- jumped by 18.4 percent and net profits by 21.8 percent.
"Web giants have shown once again their capacity for innovation and their flexibility during the crisis" in knowing how to "profit from the confinement measures adopted by governments" to slow the spread of coronavirus, as well as "changing consumer habits", said Mediobanca.
Food delivery services saw a boom, with sales jumping 47 percent. Sales of video games soared 40 percent and online retail rose by 33 percent.
On the other hand, online travel sales tumbled by 52 percent.
- Retail -
Large retailers saw their revenues climb by 8.8 percent and net profits jump by 19.2 percent. Many have been pushing into online sales, which soared by 80 percent, helping their overall performance.
"Large food retailers which were not affected by confinement measures benefitted from the restrictions placed on restaurants, the use of remote work and consumers' propensity to stock up," said the bank.
Consumers are constantly changing their behaviour, the experts added. The average purchase is rising, but consumers are shopping less frequently. Consumers are showing a preference for local shops, as well as hard discounters and small grocery stores compared to large supermarkets. Click and collect services as well as home delivery are booming as well as new payment services (such as via smartphones).
File: Factors such as fear of parcel theft, online fraud, and high mobile data costs have long hindered South African e-commerce growth, experts say.
- IT -
Another winner is the IT industry, which benefitted as the pandemic pushed firms to accelerate a shift toward digital operations and cloud computing. Artificial Intelligence and 5G mobile communications also received a boost. Overall the sector saw sales rise by 5.7 percent and net profits climb by 11.6 percent.
- DRAW -
- Pharmaceutical -
Even if net profits fell by 10.1 percent, the pharmaceutical sector managed a 3.1-percent increase in sales. The first wave of the pandemic in the second quarter forced many hospitals to cancel elective treatments, which pushed drug sales into the red.
Firms that are able to successfully bring a Covid-19 vaccine to market could see huge increases in sales.
- The energy sector -
nergy firms were battered thanks to the drop in oil prices and demand for energy, with revenues tumbling by 32.3 percent, and many posted net losses.
While the rebound in oil prices helped many in the third quarter, Mediobanca said it is difficult to forecast what 2021 will look like for the sector.
- Transportation -
Manufacturers in the transport sector also suffered.
With car dealerships closed in many countries, auto manufacturers saw sales fall by 17.4 percent and net profits plunge 66 percent.
Aircraft manufacturers, who get paid when they deliver aircraft, saw revenues tumble 30 percent and posted losses.
- Fashion -
"2020 looks like it will be the most difficult year ever for the fashion industry," said Mediobanca.
The closure of shops hurt the industry, as did the drop in tourism -- shopping by well-heeled tourists making up an important clientele for luxury brands.
Revenues fell by 21.3 percent despite double-digit rises in online sales, pushing firms into the red. There was an improvement in the third quarter, with the Chinese market returning to an expansion.
"2021 will likely be a year of growth even if a return to pre-crisis sales levels won't happen until 2022 for many companies," said Mediobanca.