KYRIBA REPORT DECLARES NORTH AMERICAN/EUROPEAN CORPORATIONS' US$27.87 BILLION FX VOLATILITY EARNINGS

KUALA LUMPUR, Oct 27 -- Kyriba’s Currency Impact Report (CIR), a comprehensive quarterly report that details the impacts of foreign exchange (FX) exposures among 1,200 multinational companies based in North America and Europe, reveals US$27.87 billion in total impacts to earnings from currency volatility. (US$1 = RM4.145)

According to a statement, the combined pool of corporations reported US$23.62 billion in tailwinds and US$4.25 billion in headwinds in the second quarter of 2021.

North American companies experienced greater headwinds than their European counterparts, reporting US$2.32 billion in FX-related negative impacts — a decrease of 153 per cent from the previous quarter.

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By comparison, European corporations reported US$1.93 billion in negative impacts — a decrease of 45 per cent from the previous quarter.

“Headwinds and tailwinds reveal the vulnerability North American and European multinational corporations’ revenues and earnings per share have to currency movements,” said Chief Evangelist for Kyriba, Wolfgang Koester.

“With many reporting 10 per cent or more of earnings were the direct result of currency gains or losses, CFOs have a long way to go to mitigate risk.”

Highlights from the October 2021 Kyriba Currency Impact Report include the average earnings per share (EPS) impact from currency volatility reported by North American companies in Q2 2021 held steady at US$0.03 — three times greater than the recommended standard of US$0.01 EPS impact.

In addition, publicly traded North American companies that qualified to be monitored in the Q2 2021 CIR reported a combined US$22.93 billion in positive currency impacts, and US$2.23 billion in negative currency impacts.

Meanwhile, publicly traded European companies that qualified to be monitored in the Q2 2021 CIR reported a combined US$686 million in positive currency impacts, and US$1.93 billion in negative currency impacts.

The U.S. dollar (USD) remained the currency most mentioned as impactful by European companies on earnings calls for the fourth quarter in a row, followed by the euro and the Brazilian real ranking third.

All companies analysed in the report conduct business in more than one currency, with at least 15 per cent of their revenue coming from nations located outside of their headquarters.

More details at www.kyriba.com.

-- BERNAMA