Societe Generale Reports Weak Q4 Results But Overall Solid 2018

The Group managed to report a slight uptick in revenues year-over-year.

Societe Generale has published its financial results for the final quarter and full-year of 2018. Although the fourth quarter of 2018 was sluggish for the firm, as a whole, the group managed to report a slight uptick in revenues year-on-year.

Specifically, revenues for Societe Generale came in at €25.51 billion for the whole of 2018. When compared to the previous year, this is up by 0.6 percent. This increase was largely thanks to a solid performance in its Retail Banking & Financial Services units as well as resilient activity in its French Retail Banking arm, the company said.

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However, when looking at revenues only for the final quarter of 2018, the results don’t hold up. During the period revenues were €5.93 billion, which is down by 4.8 percent when measured against the same quarter of the previous year.

As revenues went up in 2018, so did operating expenses. Specifically, during the year total operating expenses were €17.6 million, which is two percent higher than that in 2017. For the final quarter, operating expenses were €4.63 million, which is a slight increase of 0.9 percent.

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Taking a look at Societe Generale’s Global Markets & Investor Services’ unit, where fixed-income, foreign exchange and commodities trading, as well as Prime Services falls under, revenues fell by 8.3 percent in 2018 year-on-year. According to the report, revenues for the sector we dragged down by an unfavorable market environment thanks to political tensions in Europe and the trade war between the US and China.

For the full year, revenues of fixed income, currencies and commodities fell by 16.8 percent when measured against the previous year. In the fourth quarter of 2018, revenues were €366 million, which represents an even larger drop of 28.8 percent from Q4 of 2017.

Although commodities reported a good quarter, particularly in the energy and carbon market, rate activities were hit by the unfavorable market and credit was hurt by widening spreads.

Commenting on the results, Fréderic Oudéa, the Group’s Chief Executive Officer said: “Our first priority is, and will remain, to increase value for shareholders while consolidating our capital trajectory.”

“We will be even more selective in our capital allocation, prioritising the Group’s areas of excellence. Moreover, in a more uncertain economic environment, we will continue to work on our operating efficiency with an additional plan to reduce costs in Global Banking & Investor Solutions and we are further prioritising cost control. All these measures and the Group’s transformation will enable us to improve our operational profile and pursue the improvement in the structural profitability of our businesses.”

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