FiREapps Q4 2016 Currency Impact Report Shows Decrease in Negative Currency Impact
(SCOTTSDALE, Ariz.) – FiREapps release of its Q4 2016 Currency Impact Report depicts a loss of $10.47 billion to currency impact by North American and European companies, a smaller loss compared to Q4 2015. However, it also shows fewer companies are reporting material impacts to investors and analysts.
FiREapps analyzes the earnings calls of more than 1,200 publicly traded North American and European companies each quarter to collect data on the negative impact and volatility of various currencies.
In the fourth quarter of 2016 a total of 296 companies – 245 in North America and 51 in Europe – reported negative currency impact, as compared to the 409 companies that reported in Q4 2015. The companies that quantified negative impact in Q4 2016 suffered a collective loss 71 percent lower than the $36.85 billion in impact reported in Q4 2015.
Negative currency impact for Q4 2016 can be estimated to $20 billion collectively if all of the companies that reported in Q4 2015 had reported in Q4 2016. That leaves $10 billion left unreported most likely because they did not believe the impact to their EPS was material.
“Management Discussion & Analysis reporting requirements are lax and only require ‘material’ impacts to be reported, allowing corporations not to quantify or report currency impacts,” said Wolfgang Koester, CEO of FiREapps. “They don’t have the accurate data or visibility into their exposures to realize they do indeed have material impacts.”
The industry standard for currency impact to EPS is $0.01, meaning any amount of impact more than $0.01 is material.
FiREapps has been working with multinationals for nearly 20 years, helping them better analyze and mitigate risk in order to limit the negative impact of currency to $0.01 EPS or less. Managing the impacts of foreign currency fluctuations does not need to be difficult with the help of technology that can access accurate and timely data to provide visibility into currency exposures.
For media inquiries please contact Angie Schuster at +1 (480) 443-7333 Ext. 166 or by email at ASchuster@FiREapps.com.
FiREapps is the leading provider of Corporate Currency Analytics and FX exposure management technologies. Established in 2005, FiREapps developed the first solution to automate foreign exchange exposure management for multinational companies. Through a combination of software solutions and expert analysis, FiREapps helps companies ensure they’re accurately measuring and managing their FX exposures. Numerous Fortune 500 companies rely on FiREapps technology to help them reduce FX risk and increase efficiency every day.
FiREapps is headquartered in Scottsdale, Arizona, with offices in Portland, London and Frankfurt.
For more information, visit www.fireapps.com/ or call +1 866-928-FIRE (3473).