Altman Index: U.S. Middle Market Grew by 8.94% in Q2/17



According to the Golub Capital Altman Index, middle market private companies experienced year-over-year revenue growth of 8.94% and EBITDA growth of 2.29% during the first two months of  Q2/17. This compares to an increase of 8.45% in revenue and a decline of 1.64% in earnings year-over-year in Q1/17.

Lawrence E. Golub, CEO of Golub Capital, said, “Middle market companies showed strong profit growth in the second quarter of 2017, after three quarters of modest year-over-year declines. Although a tight labor market continues to put pressure on margins, the improvement in earnings suggests that the middle market firms in our sample were more effective at cost control than in prior quarters. Across sectors, revenue growth was consistent with the healthy pace of growth in the first quarter of 2017.

“The technology sector once again led revenue growth, benefiting from continued demand for productivity-enhancing technology. In aggregate, the Golub Capital Altman Index results for the second quarter of 2017 are consistent with a 2-3% rate of U.S. GDP growth.

The Golub Capital Altman Index, which is produced by Golub Capital in collaboration with renowned credit expert Dr. Edward I. Altman, is the first and only index based on actual sales and earnings data for middle market companies.

Altman said, “The rebound in the consumer sector stands out. Consumer sector earnings increased by more than 6% year-over-year, after several lackluster quarters and an unusually negative first quarter of 2017. Businesses have had to adapt to increases in wages and other operating costs; challenges remain, but the improvement in second quarter earnings is a welcome sign of progress.”

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