Many listed companies managed to improve profitability in the first half of the year. A sample of 153 half-year financial statements, representing about 45 percent of listed companies, showed that consolidated pretax profits have risen to 16.3 percent of turnover in the first half of this year from 13.2 percent in the same period last year. There is a comparable rise when one looks at parent company results: Profits rose to 19.1 percent of sales, up from 16.8 percent. Overall, companies in the sample show a considerable rise in their turnover and a far more impressive rise in profits. In the consolidated results, turnover has risen 8.6 percent and pretax profits 33.8 percent compared to the first half of 2002. In parent company results, turnover is up 10.4 percent and profits 25.3 percent. The results are even more impressive given that the year’s first half was marked by the war in Iraq, when uncertainty before the start of operations and during the early stages actually depressed sales. Back then, experts were very pessimistic, and their forecasts agreed that there would be a significant drop in sales and a comparable one in profits for the period. But the rapid recovery of a more certain climate helped results: The second quarter was much better than the first. Obviously, a better picture about the profitability of listed firms will be provided at the end of the year, when financial statements are accompanied by accountants’ comments, which often reveal hidden losses. However, first-half results are a good indicator, especially this year, when the first half was considered the most difficult period in recent years. A closer reading of financial statements shows that many companies managed to cut their costs, either by restructuring their debt or by cutting other expenditure. This they achieved without hurting their sales. Most companies took advantage of low loan rates and turned a good part of their short-term debt into long-term. Since conditions in the stock market, especially early in the year, were not favorable for a capital increase, many companies issued bonds. The far greater improvement in consolidated results also showed that many companies also took steps to restructure their subsidiaries. Some were absorbed into the parent company or consolidated into bigger units. The most profitable firms were publishers and retailers, despite a slight decrease in turnover. Wholesale trade, machinery, chemicals, mobile telecoms and banks also showed big profit gains.