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Private Companies Enter 2015 on a Positive Note

January 05, 2015, 07:39 AM
Filed Under: Economic Commentary

Privately held U.S. companies are entering 2015 with strong profitability and healthy sales growth, according to Sageworks, a financial information company. Looking at statements collected by Sageworks over the past twelve months, private companies are growing sales at an annual rate of 8.6 percent.  Private U.S. firms are also seeing their highest net profit margins in three years, at 6.6 percent.  “We will continue to gather 2014 statements over the next few months,” said Sageworks Analyst Libby Bierman.  “However, the preliminary numbers indicate that private companies had another strong year.”
While manufacturing and wholesale companies haven’t quite returned to their stellar growth from 2012, they continued to grow sales at a strong rate, and both sectors are seeing profit margins improve from two years ago.  Construction companies, on the other hand, are not only continuing to grow sales at a strong rate, but they’re also seeing their rateof growth increase.
“2014 was a good year for private companies,” said Sageworks Chairman Brian Hamilton.  He points out that this performance has been consistent-- that private companies have been growing revenues and profits for the last three years.  “Given the outsized role private companies play in the U.S. economy, we’re surprised it’s taken so long for GDP and the unemployment rate to reflect this performance,” said Hamilton. “Slowly but surely, we’re finally seeing the broader U.S. economic indicators catch up to private company growth.”
The report can be found in its entirety here.

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