Medium-sized industrial companiesin North-West Italy (2010)

Emanuela Salerno, Mediobanca Research Department

Genova, 24 may 2010

1

2

Territory

2

Section I

3

In 2007

• 1,867 medium-sized companies

(1,826 including groups)

• 23 medium-sized companies in

Genova

• 50-499 employees

• € 13-290m turnover

• Limited companies

Source: Unioncamere Research Centre

Territory Section I

4

Large groups8,4

Large, non Italian, groups

13,0

Medium-large10,3

Medium-sized18,3

Small businesses50,0

Italian manufacturing: VA by limited companies, 2007

Territory Section I

Fourth capitalism

Without allied industries

With allied industries

25-30%

Medium-sized

companies in North-

West Italy = 7,9%

Estimates based on Mediobanca and Unioncamere data

5

20.1

13.0

65.2

Natura delle aree

Other areas

Milan

Large industry

District and medium-size businesses

Medium-sized companies by territory in North-West Italy

Base value added, 2007

Territory Section I

58.9

10.3

30.8

MB-UC classification

Other areas Other LPSs Districts

6

Section II

Trends

7

What do firms do in North-West Italy

Trends Section II

283

556

913

917

1,405

2,471

4,270

148

335

426

693

1,036

721

3,222

Others

Iron and steel

Paper and printing

Chemicals

Food and drink

Personal and household goods

Mechanical goods

In 1996 Change, 1996-2007

Made in Italy 55,4%; non-domestic sales 38,7% of total Italian medium-sized businesses

Value added in €m, 1996-2007 - universe

Genova

Mechanical goods 44.1%

Chemicals 24.8%

Food and drink 13.1%

Paper and printing 12.6%

Personal and household goods 2.9%

Others 2.6%

Made in Italy 43.0%

8

72181

57 29 -14 60 48130 104

-27 -21 -21 -7 -8 -31 -13 -30 -21

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

From small companies To large companies Turnover ratio

Growth in North-West Italy

Trends Section II

Genova

• 1998: 18

• 2007: 23

• Chg.: +5667

Net changes, 1998-2007: 488 companies

Which companies in large industry are growing? Machinery and equipment, iron and steel, chemical

and metal treatment

179

9

Growth in VA from 1998 to 2007

Trends Section II

Medium-sized enterprises in North-West Italy

Total, Italian medium-sized enterprises

+43.4

+46.7

Liguria

Lombardia

Piemonte e Valle d’Aosta

Genova

Italian manufacturing industry

+60.8

+46.9

+30.3

+48.0

+22.4

% chg. – manufacturing, closed group, current prices

10

MSEs in North-West Italy: turnover and value added

Trends Section II

119,7122,1

130,5

136,2

151,3

165,2

167,8

145,8

100,0

115,4117,4

123,9126,7

135,0

145,6

146,3

127,1

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

MSEs in North-West Italy - turnover Italian MSEs - turnover

MSEs in North-West Italy - value added Italian MSEs - value added

Index 1998=100 – closed set – MB-UC estimates for 2008-09

11

MSEs in North-West Italy: staff and operating margins

Trends Section II

100.0104.2

114.3 113.3 109.7 107.5114.5 114.3

124.5

139.3136.7

129.0

101.6 104.1 105.6 106.6 108.2 109.0 109.9 111.0 113.1

113.4

80

90

100

110

120

130

140

150

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

MSEs in North-West Italy - EBITDA index Italian MSEs - EBIDTA index

MSEs in North-West Italy - Staff index

Index 1998=100 – closed set- MB estimates for 2008-09

12

Exports, 1998-2009

Trends Section II

100,0100,6

115,6

122,0124,9

127,5

140,5 152,0

172,6

196,1 202,3

179,7

180,3

204,1

154,7

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

MSEs in North-West Italy Total, Italian MSEs

MSEs in North-West Italy - mechanical engineering MSEs in North-West Italy - personal and household goods

Index 1998=100 – universe (chained values), MB and MB-UC estimates for 2008-09

13

MSEs in North-West Italy and large enterprises, 1998-2008

Trends Section II

101.6113.8 118.7 119.7 122.1

130.5136.2

151.3165.2 167.8

100.0

104.0111.9

114.1 115.4 117.4 123.9 126.7135.0 145.6 146.3

169.8145.5

182.5

109.6

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

MSEs in North-West Italy - turnover MSEs in North-West Italy - value added

Italian MSEs - turnover Italian MSEs - value added

Larger groups - global consolidated turnover Larger groups - value added in Italy

Index 1998=100, closed sets – MB and MB-UC data, MB estimates for 2008

14

Net per capita value added at 1998 prices

Trends Section II

100.0 103.5100.7

99.1 99.097.5

100.4 100.8

104.0

108.1

103.0

100.198.4

97,796.3

99.6 100.2

103.1

107.8

95

98

100

103

105

108

110

113

115

118

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Base Index1998 = 100

All MSEs MSEs, NW Italy Italian GDP

Expansion

Transformation

Expansion

Closed sets, 1998-2002 and 2002-2007 (3/5 of MSEs)

15

Net per capita value added at 1998 prices in North-West Italy

Trends Section II

103.0

96.3

107.8

100.0100.5 96.8

119.2

102.8 102.1

110.8

9598

100103105108110113115118120

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Base Index1998 = 100

MSEs, NW Italy MSEs, mechanical engineering MSEs, personal and household goods

Expansion Transformation

Expansion

Closed sets 1998-2002 e 2002-2007 (3/5 of MSEs)

16

Finance

Section III

17

Financial structure

Finance Section III

-35.3 -32.3 -31.1 -28.1 -19.8 -21.8

-22.7 -23.5 -17.6 -30.2 -38.8 -41.0

-42.0 -44.2 -51.3 -41.7 -41.4 -37.2

63.6 65.9 60.3 46.5 42.9 38.1

36.4 34.1 39.7 53.5 57.1 61.9

Italian MSEsMSEs in

North-West Italy

MSEs in Genova Medium-large companies in North-West

Italy

Large Italian groups

European multinationals

Short-term debt M/L term debt Net capital Current assets Fixed assets

% of tangible capital invested – universe data for 2007

18

Financial strenght in North-West Italy in 2007

Finance Section III

NTC = Net tangible capital

B = Borrowings

MSEs, North-West Italy MSEs, Genova

NTC /

Net fixed

assets

B (short-

term)/ net

working

capital

NTC /

Net fixed

assets

B (short-

term)/ net

working

capital

Average ratio 129.6% 49.1% 129.1% 51.7%

No. of companies

With ratio > 90%

From 75% a 90%

From 50% a 75%

From 25% a 50%

< 25%

1013

85

171

166

391

336

154

377

357

602

13

0

4

3

2

4

1

5

4

8

Total companies

Share, 2 strongest categories

Share, 2 weakest categories

1,826

60%

31%

1,826

53%

27%

22

59%

23%

22

55%

23%

Data, MB-UC universe

19

MSEs that have become large enterprises: where are they now?

North-West – 221 companies Italy - 564 companies

Finance Section III

Independent36.9%

Default7.5%

Bought by Italian groups37.9%

Bought by non-Italian

groups17.7%

Independent33.9%

Default7.9%

Bought by Italian groups41.6%Bought by

non-Italian groups18.6%

Annual average default rate in North-West Italy:

0.7% (0.2% of MSEs in North-West)

Annual average default rate in Italy:

0.8% (0.2% of MSEs in Italy)

20

Solidity standing

Finance Section III

63.7

48.9

52.0

52.8

49.5

51.3

50.2

38.4

33.9

31.8

43.6

43.3

38.9

44.4

43.3

43.8

45.8

49.8

4.5

7.5

4.7

8.3

6.1

5.4

6.0

15.8

16.3

Genova

Piemonte e Valle d'Aosta

Lombardia

Liguria

2007 new entries, NW Italy

MSEs in North-West Italy

Italian MSEs

Total manufacturing SMEs

All Italian SMEs

Solid Intermediate Problematic

% of companies in 2007 – R&S-Unioncamere credit scoring model

Mediobanca Research Department

Piazzetta M. Bossi 1, Milan, ItalyWebsite: www.mbres.it