Partner Article

Yorkshire elite invests £500m in search of growth

Yorkshire’s largest 150 companies are revving up for growth, having driven revenues up by £5bn and increased investment by 20% in the last year, but challenges remain as profits dip by 3%, according to the Yorkshire Report 2013, released this week by accountancy and business advisory firm BDO LLP.

The top 150 saw revenues increase to £88.8bn from £83.8bn last year, and £79.6bn the year previous. Yorkshire’s biggest businesses also boosted future growth by investing an extra £500m to take the total to almost £3bn in the reporting period – a huge step in the right direction.

But conditions are still tough, with operating profits going the other way by falling 3% to £4.34bn this year, a reduction of £140m.

Ian Beaumont, partner and head of BDO LLP in Yorkshire, said: “Weak consumer spending and continued uncertainty in the Eurozone – still Yorkshire’s biggest overseas market – combined with squeezed margins and intensified competition, have contributed to the drop in operating profits.

“But there are strong signs that the region is lifting its head from the recessionary mire; we have a lot to be positive about.”

According to the Yorkshire Report 2013, an extra 10,000 people have been taken on in the reporting period, with a total of 480,000 now employed by the group of 150 companies.

Businesses have also increased gearing – the proportion of a company’s net debt compared with its equity capital – from 33% to 38%, a reversal of last year’s downward trend which, says Beaumont, is a “good sign they are becoming less focused on paying down debt and more conscious of a future worth investing in”.

The Yorkshire Report 2013, now in its seventh year, compiles the latest published accounts from Yorkshire’s largest top 150 businesses based on revenue, analysing trends and acting as a barometer of health for the region.

Of the 150 companies analysed, 122 made a profit – another positive uplift from the 117 last year and 105 the year previous. The retail sector was the largest contributor to both revenue and profits. Food retailers Asda/Walmart and Morrisons continue to dominate, accounting for £39.5bn of the £88.8bn turnover, with other retailers contributing a further £4.5bn to the economy.

This was posted in Bdaily's Members' News section by Mark Lane .