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Top 100 analysis: Sales and profits rise for Top 100 in last year

The Ulster Business Top 100 Companies 2020 showcases the performance of Northern Ireland’s largest firms, in conjunction with data from Dun & Bradstreet. Jonathan Cushley breaks down all the numbers in perhaps the last ‘normal’ year for many firms post-coronavirus

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Jonathan Cushley

Jonathan Cushley

Jonathan Cushley

The latest edition of the Ulster Business Top 100 Northern Ireland Companies comes at a time of unprecedented challenges and hardship for the provinces businesses in general.

According to the Northern Ireland report published by Danske Bank the local economy is set to shrink by a staggering 11% with unemployment doubling. The province according to the report may not return to its pre-coronavirus level until late 2022 or into 2023.

The 2020 edition of the Top 100 listing incorporates analysis of the financial performance of companies with fiscal year ending in 2018/2019 and 2020, so while this provides a sound basis in understanding the strength of the provinces top businesses we will potentially start to see a decline in performance over the coming years and especially in the 2022 and 2023 compilations.

SUMMARY

The Top 100 companies continue to perform well across each measure. Sales have grown to £27.5bn from £24.9bn (year-on-year comparison) a growth of 10.4%. 

The strong turnover growth mirrors the 2019 performance when sales increased by 9.4%, however, success isn’t solely indicated by a strong sales performance. By looking at the top line (sales/turnover/revenue), the bottom line (the generation of pre-tax profits) and by looking at the return shareholders make on their investments, a stronger picture emerges and this will help understand the current effect of the current pandemic on our top businesses over the coming years.

Profitability of the top companies also increased from £935.6m to £1,029.1m an increase of 10%. Profit margin for the companies is 3.7%. Tangible net worth of the Top 100 now sits at £7.2bn.

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SALES/REVENUE

Since its inception the Ulster Business Top 100 has used sales/revenue/turnover as its primary driver for inclusion. Sales within the Top 100 have reached their highest recorded levels of £27.5bn up from a prior year like for like figure of £24.9bn. 

For the first time four of the businesses posted sales in excess of £1bn, Moy Park Ltd retained its long standing top spot, followed by W&R Barnett Ltd, Glen Electric Ltd and Dunbia Ltd. It should be noted that Glen Electric Ltd, the Newry-based subsidiary of heating, renewable energy and domestic appliance manufacturer Glen Dimplex which has re-entered the Top 100, has filed accounts for an 18 month period.

Another indicator of the strong sales performance across the listing is that only 19 of the companies have posted reduced sales year on year, with some exceptional growth performances namely MRP Land Ltd (63) – 435%.

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Top 100 sales

Top 100 sales

Top 100 sales

 

PROFITABILITY

This year’s listing has seen the Top 100 companies return to a position of increasing profitability, while still not reaching the heights seen in 2018 when profits peaked at £1.05bn.

Pre-tax profits now sit at £1.02bn, up from a year-on-year comparison of £935.5m – an increase of 10%.

With a turnover of £27.5bn producing profits of £1,029m the companies produced a pre tax margin of 3.7%

Fourteen of the Top 100 companies posted losses during their last financial year, with Short Brothers after currency adjustment posting losses of £32.5m, Queen’s University losses of £29m and Thompson Aero Seating Ltd losses of £27.7m.

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Top 100 profit

Top 100 profit

Top 100 profit

 

 

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Top most profitable companies

Top most profitable companies

Top most profitable companies

 

NET WORTH (SHAREHOLDER VALUE)

In conjunction with sales and profitability overall success of a business may be gauged from the value of the company to its shareholders. In its simplest form the tangible net worth of a business is the shareholders funds (issued capital) plus retained profits (losses) minus intangibles assets. An intangible asset is a non-physical asset that has a multi period useful life – commonly patents, goodwill etc.

The value of the Ulster Business Top 100 to its shareholders using the 2018/19 financial year-end figures is sitting at £7.18bn. As the Top 100 is relatively fluid with companies entering and leaving the list net worth comparison can be distorted.

Seven of the Top 100 companies have posted a negative tangible net worth, with an aggregate figure of £242m.

Tangible net worth of £7.18bn represents a return against sales of 26.1% and a shareholders return (profitability/worth) of 14.3%.

Northern Ireland Water Ltd continues to be the most valuable business with tangible net worth of £1,049m, followed by Queen’s University, NI Electricity Networks Ltd, Glen Electric and Almac Group Ltd.

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Top 100 shareholder value

Top 100 shareholder value

Top 100 shareholder value

 

EMPLOYEES

A total of 104,210 people are employed by Northern Ireland’s Top 100 Companies, an increase on the 85,744 employed by the companies in the 2019 listing.

Moy Park Ltd (10,126), Almac Group (5,150), Glen Electric (4,780) Dunbia (4,433) and Northern Ireland Transport Holding Company (4,202) make up the top five employers within the listing.

Each employee within the Top 100 accounted for £264,197 of turnover – sales/employee and accounted for £9,874 profit – profit/employee.

The impact of the coronavirus has already been alluded to. Northern Ireland employment will become the first underlying indicator within the compilation of the Top 100 listing which will be impacted. Already a number of top companies have announced pandemic-related redundancies and with the Northern Ireland employment rate at a record high of 72.3% in November 2019, the labour market is likely to be tumultuous for a number of years.

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Top 100 employees

Top 100 employees

Top 100 employees

 

GEOGRAPHY

The number of businesses within the listing remain fairly static from a headquarter location – historically there was always a propensity of businesses within the east of the province – looking at the geography of the 2019 listing – 66 businesses are located in Belfast, Co Antrim and Co Down – 34 businesses in Counties Armagh, Fermanagh, Londonderry and Tyrone.

Interestingly, if we look at 15 years ago we see a decided shift not necessarily noticeable year-by-year. The number of businesses headquartered in Belfast has dropped by 10, in Co Antrim by seven while those based in Co Down have increased by five and those in Co Tyrone up 10.

 

NOTES

A date of June 26, 2020 has been used as the cut off for the filing of accounts enabling inclusion in this year’s Ulster Business Top 100.

The listing has been compiled using a combination of data sourced from Dun & Bradstreet’s information database and company filings retained by the UK Companies House.

1. Glen Electric Ltd has filed accounts for an 18-month period.

2. Both Short Brothers plc and Schrader Electronics Ltd file financial figures in US dollars, Lakeland Dairies Ltd file financial figures in euros – to allow for comparison their financial results have been converted to their currency value (£) at their financial year end.

3. Linden Foods Ltd is no longer a subsidiary of Fane Valley Co-operative Society Ltd. It is now 50% owned by Forestview Trading and 50% owned by New Meat Division Holdings Unlimited – this reflects in both Linden Foods & Fane Valley results.

4. Kainos Group plc – results relating to turnover and profit has been provided from preliminary results provided 26/05/20; tangible net worth figures quoted continue to relate to 31/03/19.

5. Herbert Corporate Holdings Ltd is a new company registered 25/07/18 and as such was not eligible for inclusion in previous Top 100 listings.

6. Isaac Agnew Ltd & Agnew Commercials Ltd are both subsidiaries of Isaac Agnew (Holdings) Ltd. Consolidated accounts for Isaac Agnew (Holdings) Ltd are not filed at Companies House.

7. James E McCabe Ltd & Philip Russell Ltd are both subsidiaries of Golf Holdings Ltd. Consolidated accounts for Golf Holdings Ltd are not filed at Companies House.

8. EP Kilroot Ltd & EP Ballylumford Ltd are both subsidiaries of EP UK Investments Ltd. The latest filed accounts for EP UK Investments Ltd do not reflect their acquisition of Ballylumford & Kilroot power stations that took place on 12/06/19.

9. Lynn’s Country Foods Ltd has extended its current accounting period to 28/02/20 from 01/09/19.

10. Power NI Energy Ltd has restated revenue figures for its prior year.


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