Friday 23rd August 2019
Home General Business News Largest Suffolk companies increase investment despite 'more cautious approach'

Largest Suffolk companies increase investment despite 'more cautious approach'

E-mail Print PDF

Turnover and profit growth has slowed among Suffolk’s largest 100 companies and they are showing signs of caution with reduced debt, according to a study of their latest annual accounts. However, the Suffolk Limited study by Grant Thornton and law firm Birketts also showed that investment in fixed assets across the county's largest businesses rose 4.5 per cent to £1,612 million in their latest financial year and average salaries have risen by 4.4 per cent.

Rob Thomson, director at Grant Thornton's Ipswich office said:“With ongoing uncertainty around Brexit and its potential impact on the economy, Suffolk Limited has returned to a more cautious approach to business with a significant reduction in debt and gearing. However, when encountering challenging trading conditions, the Suffolk economy has a proven track record of resilience and we hope this will continue well into the future.” Debt across the top 100 fell by 10.2% to £668 million and evidence of a more prudent approach was also reflected in a rise in interest cover to 9.4 from 7.7 last year.

The study showed combined turnover for the largest 100 companies owned and managed in the county rose by 2.1% to £5.2bn. Total operating profit increased by a similar 2.2% to £279m, although profit before tax remained flat for the first time in some years at £261m. However the results were affected by the loss of Servest, a large facilities management company; comparing the top 100 with the same companies as last year showed a turnover up 10.8%, operating profit up 8.1% and profit before tax up 2.4%. Meanwhile, the ten largest businesses by turnover contributed 40% or £2.1bn of Suffolk Limited’s total revenues and 39% of overall operating profit at £109 million.

Rob Thomson said: “The removal of Servest Limited’s significant turnover could have seen a reduction in Suffolk Limited 2018’s overall revenues. So, it is very pleasing to see that the rest of the top 100, including new entrants, have performed strongly to not only maintain a turnover in excess of £5bn, but to build on the previous year’s figure."

Transport and motor retail sector took over from services to become the largest employer (8,997 people) with 27% of Suffolk Limited’s workforce and the average salary for Suffolk Limited increased by 4.4% to £24,989.

Retail and wholesale remained the largest sector by number of companies (24) while the second largest, transport and motor retail (21 companies) delivered the largest turnover at £1,722m (32.9% of total turnover), up 11.5%. The highest turnover increase was reported by property and construction (13 companies), up 16.1% to £794m. All six sectors saw increases in turnover.

Property and construction also reported the largest operating profit of £69m and the highest increase of 26.4%. Retail and wholesale, manufacturing, and transport and motor retail all saw operating profit fall, down 5.4% to £45m, 3.2% to £24m and 0.2% to £62m respectively.

The report’s Growth Index featured those companies in the top 100, and also the next 100 largest businesses, which achieved the fastest growth in turnover. Thirty-nine firms which made the Index showed growth of 20% or more in the last year, with 13 of these from the 100 to 200 tier (compared to 24 companies in 2017 and 8 from the 100 to 200 tier). Four companies showed growth of at least 100% and two of these were new entrants into Suffolk Limited. The 200 fastest growing companies were split across a range of sectors, with the strength of services, property and construction, and Transport and Motor Retail seen in the top 100 continuing into the next tier.

Jonathan Agar, CEO of Birketts, added: “The 2018 Suffolk Limited results spell good news, especially the readiness to address staff investment and reward which, if sustained, should augur well for attracting and retaining the skilled resources needed to power the Suffolk economy forward. The performance of the 100 to 200 tier is also encouraging with twice as many businesses in this group growing in excess of 20% compared to their larger peers, suggesting a robust pipeline of new, dynamic businesses coming through.”

“The future is undoubtedly less certain than it has been for some time but I remain convinced that Suffolk’s brightest year’s lie ahead and the diversity of businesses throughout the county will flourish in all market conditions. Suffolk business is fit for the future.”

Last Updated ( Wednesday, 28 November 2018 13:51 )