CreditorWatch: The true impact of COVID

  • Written by Slingstone

CreditorWatch: Company financials hold the truth about COVID-19 impact

The financial records of Australian businesses are instrumental in understanding the true impact of COVID-19, according to a new whitepaper released today by Australian digital credit agency, CreditorWatch, in conjunction with financial risk management firm CreditSource.

The paper follows a successful recent webinar CreditorWatch CEO Patrick Coghlan held with CreditSource CEO Shavantha Mallawa that analysed the financials of several high-profile companies.

In the paper, CreditorWatch assessed the financial records of a number of public companies to reveal how COVID-19 has impacted different businesses and sectors differently. This is largely dependent on how the individual business has responded and adapted to the pandemic. It’s this forward-thinking and innovative energy that is the real good news story to come out of this year.

Patrick Coghlan, CEO, CreditorWatch says “Although many businesses are suffering, there are also clear winners. A lot of businesses are finding their entrepreneurial spirit, producing new goods, adapting their goods or embracing technology.”

However, a deeper look into financials shows that there can be stark differences among businesses in the same industries. Take mining as an example. Fortescue announced a 49 per cent rise in profits due to continued demand for iron ore from China. But, Whitehaven Coal, who primarily serves Indonesia and India, has seen revenue drop by 94 per cent as these countries have been severely impacted by COVID-19.

“As for the coming 12 months, it’s difficult to predict how businesses will perform because
we just don’t know how COVID will continue to play out. Innovative firms should continue to do well. But we don’t know how long the virus will last, whether there will be more lockdowns and how long government incentives will be in place for or what other stimulus may be introduced,” says Patrick.

Company financials are a valuable source of information for creditors to understand if their suppliers and customers can afford to do business. While it’s impossible to guess how COVID will continue to affect businesses, financial analysis gives creditors more confidence in who they’re trading with, helping them make informed decisions.

Shavantha Mallawa, CEO, CreditSource says “We analyse financials from ASX listed entities to private enterprises and SMEs. The financial trends seen in the, more visible, public companies are true for the smaller organisation as well. Irrespective of  size the challenges and opportunities remain the same.”

CreditorWatch continues to support creditors in this regard with its Financial Risk Assessment product, a joint-initiative provided to clients in partnership with CreditSource.

For more information, access the full white paper ‘Financials Stripped Bare: The COVID-19 Effect’.

About CreditorWatch

CreditorWatch is a digital credit reporting agency, headquartered in Sydney. From sole traders through to ASX listed companies, more than 50,000 Australian businesses now use CreditorWatch to make affordable, informed credit decisions, avoid high-risk customers and ensure they get paid on time.

CreditorWatch customers can easily search for and monitor the credit history, court actions, payment defaults and insolvency notices associated with any business entity in Australia (including sole traders, trusts and partnerships) giving them an incredibly accurate picture of the risk posed to their business.

The company was founded in 2011 and has offices in Sydney, Melbourne and Brisbane. Find out more at www.creditorwatch.com.au.