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Businesses defy Brexit uncertainty with fifth consecutive year of growth

The Northamptonshire Limited study, conducted by financial and business advisers Grant Thornton, each year analyses the performance of the 100 largest, privately owned companies in the county to provide a recognised barometer of the overall health of Northamptonshire’s economy. 
The report also includes a Growth Index, highlighting the 20 companies with profit increases in excess of 35%.
 The 2017 report findings, unveiled to more than 100 local businesses at a special breakfast event hosted by Grant Thornton, revealed that combined turnover of the top 100 companies increased by 9.5% from £5.48 billion to £5.99 billion.
Profits (measured by EBITDA – Earnings before interest, tax, depreciation and amortisation) also grew by a healthy 13.5% from £336 million to £381 million.
The top 100 businesses also continued to invest in new staff with an 11.8% increase in employment to 35,132 people and, after last year’s fall in average wages, salaries rose by just under 1% to an average of £28,553.
Mike Hughes, from Grant Thornton’s Northampton office, who presented the findings said: “From Britain voting to leave the European Union to the subsequent fall in the value of the pound, it has certainly been an interesting year for businesses.
“The economy was predicted to take a major hit but actually grew in the period following the referendum with a similar positive picture here in Northamptonshire.
The county’s 100 largest companies have seen continued growth in turnover and profits, strong investment in new employees and significant M&A activity.
“In the period covered by the report, it is clear they are continuing to enjoy a healthy and robust trading environment and despite political uncertainties ahead, are looking confidently to the future.”
The survey also showed that the county’s large businesses (turnover greater than £50m) achieved more than double the rate of turnover growth than SMEs – 11.6% compared to 4.9% – reversing last year’s trend.
Profit growth remained similarly high for both groups at 13.1% (large) and 14.1% (SMEs).
Large businesses invested significantly more in fixed assets than SMEs, possibly indicating they were less cautious on future prospects following the Brexit vote and were quicker to recover confidence in growth.
The Northamptonshire Limited report also analyses the performance of the top 100 companies by sector.
Half of the eight sectors grew turnover and six reported an increase in EBITDA, highlighting a more mixed picture across the board.
The stand-out sector was Property and Construction which saw the highest increase in turnover of 40.4% to £1bn and reported a growth in EBITDA of 51.6% to £64.2 million.
The Food, Drink and Leisure sector continued to struggle, partly fuelled by reduced consumer demand following the devaluation of the pound, with turnover falling by 1% and profitability remaining the same.
Mr Hughes said: “Overall, Northamptonshire businesses are performing strongly. Two thirds of the top 100 are on a real growth curve which bodes extremely well for the future.
"While undoubtedly further uncertainty lies ahead as we negotiate our exit from the EU and the full impact of currency revaluation will not be seen until next year’s report, the county’s businesses have a solid foundation upon which to build.”
The findings were presented at Northampton Saints Rugby Club and this year included a panel discussion between Guy Schanschieff founder of Bambino Mio, Roz Bird from Silverstone Park and Debbie Foster from Faccenda Foods.

For a full copy of the Northamptonshire Limited report, please contact eve.moore@uk.gt.com

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