British companies outperform European rivals in wealth creation

British companies outperform European rivals in wealth creation

	Published : Mon, 03 Jul 2006 09:40 By : Paula Demarzio Print this Story

LONDON - British companies are some of the best wealth creators in Europe outperforming their big rivals, according to the fifth annual Value Added Scoreboard released by the Department of Trade and Industry (DTI). The report said that the wealth creation by big British companies surged by 10 percent over the last year. This rate is bigger than that of France and Germany.

The report compared the wealth creation by 700 big European companies with 800 UK companies. Key findings include:

* There was a robust performance by the top UK companies as evidenced by the fact that there are 197 UK companies in the top 700 wealth creators. This number is more than any other European country.
* UK companies were able to create wealth more efficiently last year. For the UK 800 the efficiency rating was 161 percent as compared to 173 percent for the UK 197. Both figures are comfortable above the 153 percent for the European 700.
* At the top of the value-added league table are oil companies Shell and BP followed by DaimlerChrysler, Siemens, Deutsche Telekom and French oil company, Total.
* Some of the UK companies that find a mention in top 20 include HSBC, Vodafone, Royal Bank of Scotland and GlaxoSmithKline.
* The 197 UK companies in the top 700 had a combined value of £403 billion, while the 96 German companies had a value of £310 billion. The 91 French firms finding mention in the top 700 were worth £288 billion.

Mike Tubbs, an industrialist who was involved with the report said that the French and German strategy of trying to build nationalized companies in every sector was not working. “We have got a good sector mix. We tend to have quite a high presence in the sectors which give a higher return on inputs, and a lower presence in the sectors which have lower returns but high investment requirements, such as the automotive, electronics and engineering sectors," he added.

Commenting on the report, Secretary of State for Trade and Industry, Alistair Darling, said the report vindicated UK as the fourth largest economy in the world. "This is an outstanding performance from UK companies across a wide range of business sectors. Their wealth creation is a firm foundation for continued UK prosperity," he said. "The Government is committed to continuing to create and maintain the best possible conditions for businesses to innovate to ensure our continued competitiveness in the global economy."