Scotland’s top private businesses grew employment, increased sales and substantially improved profits in the last 12 months, according to a review of the country’s leading 100 private firms by Grant Thornton.
The new Scotland Ltd report assesses the commercial performance of Scotland’s top limited businesses. This year it reveals that Scottish private firms grew total revenue by 9%, increased employment by 12% and boosted profits by almost a third (32%). Indeed, 40 of the top 100 firms recorded double-digit profit growth.
The overall financial statements of the country’s 100 leading limited businesses show operating profit hit £882 million from total revenues of £20.6bn, all generated using a work force of 103,807 people. Businesses also managed to collectively decrease their long term debt position by 38% in the past 12 months from £2.8bn to £1.7bn, whilst increasing the levels of cash held by 11% to £1.2bn.
Grant Thornton UK’s Scotland Ltd 2014 report is compiled using the most recent publicly available accounts of Scotland’s top performing private businesses, using a measure of turnover and profits.
Kevin Engel, Managing Partner, Scotland at Grant Thornton, said: “Our analysis highlights a common thread in Scottish industry – resilience. The Top 100 Ltd companies may operate across a variety of sectors but they have achieved growth in some of the toughest trading conditions. The overall picture is of increased demand, productivity and confidence. A dynamic, agile and entrepreneurial spirit has created robust, hungry and confident businesses.
“The contribution of Scotland’s private sector to the economy is not in question, but this report provides some fantastic success stories. The dramatically increased profile of Scotland over the last 12 months has created a window of opportunity for Scottish businesses and the achievements of the nation’s leading firms should be commended.”
Business Minister Fergus Ewing said: “This survey underlines the confidence that exists amongst Scottish businesses, and builds on recent surveys from the Office of National Statistics and Bank of Scotland which highlight a strengthening labour market and strong economic growth.
“Scotland has the highest employment rate, lowest unemployment rate and lowest inactivity rate of all four UK nations. Economic output has now surpassed pre-recession levels, with the Scottish economy showing the fastest annual growth since late 2007. In addition, recent figures have shown that Scotland has the highest number of registered businesses on record.
“The latest budget for Scotland outlines key measures that will help secure continued economic growth, including our £4.5 billion of investment in infrastructure in 2015-16 and continued support for business through the delivery of the most competitive business tax environment in the UK.”
Key Scotland Ltd findings of the Top 100 private Scottish businesses:
- Combined turnover of £20.6bn, a growth of 9%
- Combined employee numbers grew from 92,467 to 103,807, an increase of 12%
- Long term debt has decreased by 38% in the past 12 months from £2.8bn to £1.7bn
- The Top 100 companies collectively hold £1.2bn of cash
- 68% have a turnover of greater than £100m (15 have a turnover in excess of £300m)
- 51% saw their operating profit grow in the past year with 40% seeing double digit profit growth
- Arnold Clark Automobile Ltd recorded the highest turnover of the Top 100 businesses at £2.5bn
- There are nine automotive and motor retail businesses in the Top 100
- 38 based in Glasgow, 24 in Edinburgh, 11 in Aberdeen, eight in Stirling and six in Inverness
- Oil & gas is the fastest growing sector by turnover and has the highest profit margin
The sector breakdown of the Top 100 Ltd companies reveals than while there remains a place for heavy industry, Retail & wholesale and Food, beverage and leisure are the areas that dominate Scotland’s private sector, accounting for 42 of the Top 100 companies.
John Clark, Chairman & Group Managing Director at John Clark Motor Group added: “The last few years have seen challenges for all businesses in Scotland but also opportunities. It’s been constant hard work, across a balance of supporting our dealership management teams and staff to deliver what our customers want as well as tight financial controls, plus also driving both organic and acquisition led growth through our group business development and finance teams. We have seen success though, with 2014 set to see the continuation of a series of record annual results where we have more than doubled turnover and tripled profits.
“The Scotland Limited report reinforces what we saw and heard from our customers. Barring the uncertainty of the Independence Referendum period, we have been reaping the benefits of an economy in recovery, where the Scottish growth was ahead of the UK. However, there are still bank interest rate rise, oil price and Eurozone economy challenges ahead, all of which could see reduced consumer and business confidence. Most importantly, following a credit crunch led period of under investment, there are serious skills gap across most sectors. We are doing our part by increased again investment in apprenticeships and training. If confidence can be maintained and growth focused support from government remains, we are cautiously optimistic that our success of recent years will continue.”