Average wage in top 100 Suffolk firms soars by 14% - but profits take hit
PUBLISHED: 08:00 27 November 2019 | UPDATED: 16:16 27 November 2019
Carl Middleditch/Grant Thornton
Workers in Suffolk's top 100 firms have seen their wages rocket in the last year, according to a report.
Accountancy firm Grant Thornton's latest Suffolk Ltd report showed average salaries across the county's Top 100 businesses rose by an astonishing 14% from £24,989 to £28,604 - which may have hit profits.
That compared to lower rises in neighbouring counties, with Essex up 11.1% (£30,036), Cambridgeshire, 4.5% (£36,509) and Norfolk by 4.8% (to £25,406).
But the report - which provides an in-depth, annual health check of the top 100 privately owned businesses in the county is compiled by financial experts Grant Thornton in partnership with law firm Birketts - also showed that while turnovers were up, profits were down.
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The report, revealed at a breakfast event at Wherstead Park, Ipswich, excludes pubs and brewery giant Greene King, which has its headquarters in Bury St Edmunds, as this would skew its results, and also companies which don't have their headquarters in the county.
Overall , the workforce among the Top 100 grew by 7.8% to 35,964, and turnover was also up 7.2% on last year from £5.2bn to £5.6bn, with just under 70% of the Top 100 companies reporting an increase.
The largest financial turnover growth came from transport firm Maritime Group Limited (3) in Felixstowe, which saw its turnover rise by just over £50m from £255m to £305m, while Peal Estates Properties Ltd (86) of Woodbridge saw the biggest percentage increase at 146% to £17.3m.
There were 13 new entrants to the index. Facilities management firm Vertas Group Limited (22) of Bury St Edmunds reported impressive revenue growth of 34%, and last year's new entrant, marine plant hire firm I&C Holdings Limited (95) of Wherstead, Ipswich, increased its operating profits by 667% and revenue by 234%.
But while some companies have performed strongly, others are facing more challenging times.
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Operating profit fell by 2.5% with only 48 companies increasing profits before tax, although it's thought this could be down to an increase in employment across the county.
Grant Thornton director Rob Thomson said: "Many Suffolk businesses have quite rightly focused on retaining their talent as well as increasing their workforce which, as we've seen, has helped to drive topline growth forward. However, an increased Suffolk Limited headcount and rise in average wages (by 14% to £28,604) has had an impact on profitability.
"Overall, businesses in Suffolk are performing well in an uncertain market and are showing great skill, resource and commitment to deliver dynamic growth. Despite a more mixed performance this year, it is right to celebrate the tremendous achievement of the Suffolk business community in delivering yet another set of solid results."
This year's standout sector was Transport and Motor Retail, which continued to enjoy the largest share of turnover (31.7% or £1.7bn). Turners (Soham) Holdings Limited remained the largest company in the sector and retained number one spot in the Top 100 for a second year running thanks to continued growth.
It saw revenue rise by 4.5% and operating profit by 4.3%, with both exceeding the sector average results overall.
The Food and Agriculture sector had a tough year with a slight decrease in turnover of 1.2%, a decline in operating profit of 40.6%, and employee numbers dropping by 617 on the previous year.
But Woodbridge-based Green Label Foods Limited (12) - owner of the Gressingham Foods duck meat brand - continued to buck the trend. Its latest filed accounts show sustained turnover growth with revenues of £109m and a healthy operating profit due to strong sales and investing in new products.
Birketts chief executive Jonathan Agar said: "This year's Suffolk Ltd has seen a trend in increased gearing across most of the sectors, indicating that the Top 100 are taking advantage of low interest rates. This could signify renewed growth ahead as businesses are using their borrowing power to re-invest in fixed assets.
"However, this is not shown across the board. Gearing in the manufacturing sector is unchanged from 2018, whilst its turnover and operating profit has both declined, resulting in the sector's shrinking presence in the index."
Now in its eighteenth year, Suffolk Limited is compiled using the most recent publicly available accounts (as at October 2019) and provides a yardstick against which the county can assess its economic performance.
To see the report, click here