Norfolk’s leading companies have experienced growth in turnover, employment and investment over the last 12 months, with tech playing an increasingly important role in the county’s economy.
The results of the annual Norfolk Ltd study, carried out by financial advisory company Grant Thornton in conjunction with law firm Mills and Reeve, provide an in-depth financial analysis of the performance of the 100 largest companies which are owned and managed within Norfolk. The study has become a recognised barometer of Norfolk’s overall economic performance.
The findings of the 2018 report, unveiled to Norfolk business leaders at a breakfast event at Norwich Research Park, showed that combined turnover for Norfolk Limited’s constituent members grew by 7.6 per cent to £5.7bn. This represents a significant increase, well ahead of national GDP growth.
Investment (fixed assets) also increased by 4.8 per cent showing some confidence for the future, whilst employment grew by 1.9 per cent to 42,369 people, continuing the upward trend seen over the past four years and outstripping national employment growth. The average wage for those employed by the top 100 companies rose by 4.8 per cent to £25,406, demonstrating the investment Norfolk businesses are making in their people.
Services remained the largest sector of employment (50.6 per cent) with the biggest job rises seen in manufacturing and construction, up 6.7 per cent to 4,619 people, and food and agriculture, up 6.5 per cent to 3,529 staff. Oil, gas and energy was the only sector to see headcount fall, down 4.6 per cent to 2,571.
Combined operating profits however fell by 12.2 per cent to £205.2m, with rising input costs checking growth across some sectors, most notably Oil, Gas & Energy where profits fell by 104.5 per cent. If the Oil, Gas & Energy sector is excluded from the results, operating profits increased by 0.8 per cent.
The Norfolk Limited study was based on the latest company accounts available and as such, provides a valuable insight into how the county’s leading companies have performed against a backdrop of continued uncertainty, particularly regarding the UK’s relationship with the EU.
Speaking at the 2018 Norfolk Limited launch event which was themed around ‘Innovation in our vibrant economy’, Toby Wilson of Grant Thornton’s Norwich office, said: “This year’s findings, on the whole, reveal a broadly positive picture for Norfolk’s leading businesses but one underpinned by the feeling that there is scope to increase investment further. Significant levels of cash remain uninvested, a feature most likely caused by continuing uncertainty around our relationship with the EU.
“Turnover growth has been achieved but has not generally converted to increased profitability, which for many has been dampened by rising input costs. Particularly affected are the food and agriculture and oil, gas and energy sectors. While the latter has shown some signs of recovery, its performance has impacted overall results.”
The Norfolk Limited study also analysed a breakdown of the financial data by sector. Six of the seven sectors saw growth in turnover, led by retail and leisure (10.8 per cent), Services (9.9 per cent) and food and agriculture (9 per cent). Only oil, gas and energy reported a decline, down 4.3 per cent. Three sectors increased operating profit with motor retail and motor services delivering the biggest rise (16.1 per cent), followed by manufacturing and construction (7.9 per cent) and Services (5.3 per cent).
The Norfolk Limited 2018 launch event also reflected on the continued level of innovation across the county with Mills & Reeve sharing insights from the firm’s ‘Defying Gravity’ initiative, which looks at how ambitious businesses can achieve growth in an age of uncertainty. This is where tech can play a big role.
Toby added: “The composition of this year’s top 100 businesses has changed significantly, with ten new entrants and two long standing components, Jeyes and Gardline, leaving due to a change of ownership. Outside the Norfolk Limited population there also continues to be evidence of increased activity in the creative, scientific and tech sectors.
“This indicates the county’s future will be shaped by both new, emerging businesses and established companies adapting to survive and thrive in a moving landscape. At the heart of such change will be innovation and disruption.
James Hunter, partner at Mills & Reeve’s Norwich office added: “Our Defying Gravity report identifies the key factors which sets those businesses who have thrived over the past decade of disruption, apart from the rest. Norfolk is home to some shining examples of innovative, progressive companies who are making a vital contribution to our local economy. Through greater collaboration and sharing successes, we hope others will be inspired to follow their lead.
“Whilst challenges may exist for some time until a greater degree of certainty over Brexit prevails, we expect the breadth and strength of Norfolk’s economy to continue to encourage dynamic businesses to make long term investments and drive future prosperity.”
During the Norfolk Limited 2018 event held at Norwich Research Park, guest panellists Minnie Moll, Chief Executive, Jarrold Retail; Marcus Hemsley, Director, Fountain Partnership; John Potter, Owner & Managing Director, Potters Leisure Ltd and Jeff Ward, Chief Executive Officer, Centurion Safety Products, gave their views and answered questions from delegates.
For a copy of the Norfolk Limited 2018 report, contact Grant Thornton at NorfolkLtd@uk.gt.com.
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