Family businesses shine on WSE's trading floor

As shown in the report of the auditing and consulting company Grant Thornton’s Family Companies on the WSE, 139 family companies are currently listed on the WSE Main Market or 32 percent of all entities of this floor. Only in 2011-2020, 64 companies defined as family companies for the purposes of the report had their debut on the WSE. Most family businesses on the WSE have their headquarters in the Mazowieckie (41), Dolnośląskie (17), and Wielkopolskie (15) provinces.

“There is a long-term perspective in the management of family businesses. Thanks to this, they can cope better than other companies in periods of market turbulence. It may also result from a greater propensity to accumulate and reinvest capital, which is associated with a lower propensity to pay out dividends for investors. Family companies should therefore be an attractive alternative for investors looking for safe long-term investments,” Dariusz Bednarski, VP of Grant Thornton, managing partner of the Advisory Department, said.

Although for family businesses a more important goal than the current financial result is long-term, safe development, these enterprises in many cases – especially in periods of market turmoil such as a pandemic – show higher profitability than non-family companies. The EBITDA profitability in the last reported 12 months (IVQ'19-IIIQ'20) for family companies was 12.3 percent, while for the remaining 10.8 percent. The net profit in this period amounted to 2.7 percent in family businesses, and a loss of 1.5 percent was recorded for the remaining companies. Even greater differences are visible in the return on equity (ROE), which amounted to 5.1 percent and minus 2.2 percent, respectively.

(WBJ)