Britain’s 100 private equity backed companies with fastest growing profits revealed
6 February 2012
Britain’s 100 private-equity-backed mid-market companies with the fastest-growing profits are revealed in the latest Sunday Times Deloitte Buyout Track 100, published today.
Now in its sixth year, the annual league table ranks companies by growth in profits (ebitda) over the last two years of available accounts. This year’s league table features well-known brands including lingerie retailer Agent Provocateur (No 8, owned by 3i); fashion retailer Jack Wills (No 43, backed by Inflexion); and restaurant operator Yo! Sushi (No 89, owned by Quilvest).
Life assurance specialist Partnership, owned by Cinven, takes the top spot. Its profits grew an average of 346% a year, from £1.9m in 2008 to £36.9m in 2010, the highest growth figure seen on any Buyout Track 100 table. The company sells long-term care plans, life assurance and equity release schemes as well as annuities exclusively to people whose life expectancy is significantly shortened due to medical conditions.
Despite the tough economic climate, the 100 companies have grown their combined profits by an average of 51% a year over two years to £1.3bn. Together they employ 91,577 staff, having added 22,731 employees to their workforce over the last two years.
The Buyout Track 100 is sponsored by Deloitte, Lloyds Bank Wholesale Banking & Markets and Skillcapital. It is compiled by Fast Track, the Oxford-based networking events and research company, which champions the UK’s top-performing private companies and entrepreneurs.
Despite the focus on cost-cutting in the economic downturn, the Buyout Track 100 research shows that these private-equity-backed companies have performed well. Mark Pacitti, head of London corporate finance advisory at Deloitte, title sponsor of the league table, commented:
“Despite the many challenges facing the UK economy, it is very pleasing to see so many successful private-equity-backed businesses. It is clear that strong management teams supported by private equity investors can deliver above average performance which in turn makes them attractive M&A candidates.”
Top 10 companies on the Buyout Track 100 league table
|National rank [2011 rank]||Company Activity||Location of HQ||Annual profit
growth over 2 yrs
|Latest profit (£000)‡||Latest staff||Year end||Main shareholders|
Life assurance specialist
|Central London||346.4%||36,905||273||Dec 10||Cinven (73%),
|2||Ambassador Theatre Group
|Central London||164.4%||16,317||2,465||Mar 11||Exponent (77%), management (23%)|
|Essex||154.8%||†6,572||170||Jul 11||Climate Change Capital
(80%), management (20%)
Wellington boot manufacturer
|Edinburgh||145.3%||16,039||56||Dec 10||Searchlight Capital Partners
(>50%), others (<50%)
|Marlin Financial Group
|West Sussex||92.8%||†10,492||82||Dec 10||Duke Street (58%),
Home care provider
|Woking||87.3%||7,865||3,093||Mar 11||August Equity (>50%),
Discount book retailer
|West Midlands||87.3%||*10,264||2,141||May 11||Endless (38%), Anthony
Solomon (51%), management (11%)
Luxury lingerie retailer
|Central London||84.8%||3,251||260||Mar 11||3i (62%), others (38%)|
Environmental services provider
|Aberdeen||83.5%||6,196||250||Dec 10||Lime Rock Partners (80.5%),
Garrick family (18%)
Visual effects software
|Central London||83.2%||†5,184||130||Dec 11||Carlyle Group (>50%),
management & staff (<50%)
‡ Profits are defined as earnings before interest, tax, depreciation and amortisation (ebitda)
† Not filed at Companies House * Annualised figure
Fifty-four of the companies on the table are backed by private equity for the first time, including Hunter (No 4), the upmarket Wellington boots maker, in which Searchlight Capital Partners bought a controlling share in December; Agent Provocateur (No 8) where 3i paid £60m for a majority stake in November 2007; and Cath Kidston, where TA Associates bought a majority stake in March 2010, in a deal that valued the company at £100m.
Thirty-seven companies have been transferred between private equity houses. Of these, 26 were secondary buyouts, seven were tertiary, and four were quaternary. The other nine deals are made up of six public-toprivate buyouts, two debt-for-equity restructurings, and one turnaround acquisition.
Growth by acquisition
One third report that acquisitions have helped grow profits. Some have grown through buy-and-build strategies, such as home care provider Enara (No 6, backed by August Equity). Others have acquired competitors, including office equipment supplier Danwood (No 85, backed by Bregal Capital), which has acquired more than 30 companies in its 40-year history.
Companies operating in counter-cyclical sectors are well represented on the league table. They include discount retailers such as Poundland (No 86, backed by Warburg Pincus) and the two companies with the highest margins on the league table, debt collectors Lowell Group (No 45, owned by TDR), which has 68% margins; and Marlin Financial Group (No 5, owned by Duke Street), which has 57% margins.
Well-represented industry groups include consumer businesses, such as high street or online retailers. They represent 28 companies on the league table, and include patisserie and café chain Patisserie Valerie (No 88, owned by Luke Johnson and Risk Capital Partners). Technology, media and telecoms accounts for 26 companies on the table including The Foundry (No 10, owned by Carlyle), which makes visual effects software used in films such as Black Swan, Tintin and Avatar.
More than half of the Buyout Track 100 companies are based in London (38) and the southeast (19). The remainder are headquartered in the north (18), Midlands (14), Scotland (4), east (3), southwest (2), Wales (1) and Northern Ireland (1).
The 10 Biggest
The research includes a separate table of the ten private-equity-backed companies with the fastest-growing profits in excess of £50m. The 10 Biggest is topped by Infinis, which runs renewable power plants in the UK. The company was spun out of WRG, a waste disposal company, which Terra Firma delisted in 2003 in a £531m deal. Profits have grown an average of 53% a year over the last two years, to £100m in 2011.
The full findings were published in a special eight-page supplement with the business section of The Sunday Times on 5 February, and are available at www.fasttrack.co.uk.
When using this information please credit: The Sunday Times Deloitte Buyout Track 100.
Notes to editors:
Fast Track has published league tables of top-performing private companies with The Sunday Times for the past 15 years, and its invitation-only dinners provide a valuable opportunity for entrepreneurs to network and also meet its sponsors. The company was founded and is run by Dr Hamish Stevenson, who holds an associate fellowship at Green Templeton College, Oxford University.
League table criteria
Companies are ranked according to the compound annual growth in their profits over two years, based on their latest available figures (either 2008 to 2010, or 2009 to 2011). The research therefore carries the caveat that their performance may have changed since. Profits had to exceed £1m in the base year, and £3m in the latest year, but had to be less than £50m. There is a separate table of the 10 Biggest private equity-owned companies with the fastest-growing profits, where the latest profits exceed £50m.
Profits are defined as earnings before interest, tax, depreciation and amortisation (ebitda), which is generally used by private equity houses as the best indicator of a company’s profit.
Companies had to be registered in the UK, independent, unquoted and ultimate holding companies. At least 20% of a company’s shares had to be owned by a private equity fund.
The research was carried out by Fast Track between 30 August 2011 and 1 January 2012. The vast majority of companies were interviewed by telephone and/or visited by the Fast Track research team.
About Lloyds Bank Wholesale Banking & Markets
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