BARCLAYS: This is the most depressing chart in Europe.

LONDON – Europe's corporate sector has struggled with a major problem since the 2008 financial crisis — the death of profitability.

The chief suspect, according to Barclays analysts, is low inflation.

While sales in Europe are at post-crisis highs, companies have been unable to capitalise and boost their profit margins because prices have remained stagnant, the Barclays analysts, led by Dennis Jose, said in a note to clients.

"Essentially European companies appear to have maintained sales growth this cycle by sacrificing on pricing," Barclays said.

"This may be because European companies are price-takers rather than price-setters. Substantiating this, the strong relationship between Pricing and developed market inflation suggests that disinflation has driven poor profitability."

This has meant European profit growth has lagged far behind behind those in the US, creating what Barclays called the most depressing chart in Europe.

It measures average earnings per share in Europe and the US.

Here it is:

By Ben Moshinsky.

Full story at Yahoo News.