Large companies across the nation are seeing a decline in their financial health, which may also be the case for small and medium-sized businesses.
Analysis from Lincoln Indicators shows around two-thirds of ASX-listed companies are exposed to unacceptable levels of financial risk, with those in healthcare, materials, utilities and energy sectors seeing the highest amounts of distress.
Consumer services, financial, retail and telecommunications sectors, on the other hand, have witnessed much stronger levels of growth.
Chief Executive Officer of Lincoln Indicators Elio D'Amato said there are several steps firms can take to improve their business finance.
"These companies were able to shift their financial health score by focusing on improvements through restructuring, cost reductions, asset sales and dividend cutting," he commented.
Mr D'Amato explained how the banking and financial sector has generally performed better as a result of stronger regulatory measures and operating conditions.
"On the other hand, the consumer discretionary sectors have generally deteriorated due to a combination of weaker consumer spending and sector competition," added the expert.
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