IBISWorld, Australia’s largest industry research company, has named the Top 500 private companies for 2020-21. Published on IBISWorld’s Industry Insider blog, the list provides a glimpse into the changing dynamics of the Australian economy and its effect on each industry. According to IBISWorld, the Top 500 private companies generated $261.3 billion in revenue, a 6.0% increase on the previous year.*
Approximately 60% of companies on the list recorded revenue growth in 2020-21, a similar figure to the previous year. However, this figure was significantly higher over the three years through 2018-19, where three quarters of the list recorded revenue growth. The lower proportion of companies recording growth is symptomatic of the continued effects of the COVID-19 pandemic on the economy throughout the year. Restrictions on travel and gatherings at major events and the extended lockdown in Victoria contributed to many businesses losing revenue throughout the year.
On the other hand, many companies were able to return to growth as restrictions eased in other parts of the country. The pandemic also provided some businesses with opportunities to grow, such as many in the motor vehicle and other discretionary retail sectors, and transport and medical sectors. Forty-one new companies entered the Top 500 list in 2020-21, highlighting the year’s turbulent nature.
Best performing companies
Australian Scholarships Group recorded the largest increase in revenue for the year, at 185.7%. The company is structured as a friendly society and issues insurance bonds, which it uses to maintain a scholarship fund. The company generates the majority of its revenue from investments in the Australian and global equity markets as well as property and infrastructure funds. ‘Equity markets both in Australia and overseas recovered strongly from the sharp falls at the start of the COVID-19 pandemic,’ explained IBISWorld Senior Industry Analyst Matthew Reeves. The Financial Asset Investing industry grew by 3.9% in 2020-21.
Probe Group’s revenue grew 96.7% in 2020-21. This is the company’s second year in a row on the best performers list, as it has continued to pursue an acquisition strategy. Probe Group acquired fellow administrative service provider, Stellar Group in October 2020. The company also saw strong growth in its existing businesses in Australia and overseas. ‘However, the Facilities Management and Other Office Administrative Services industry as a whole saw revenue decline, largely due to increased remote working’, said Mr Reeves.
Specialist medical service provider, Aspen Medical, recorded substantial growth over the past two years, as the COVID-19 pandemic substantially boosted demand for its services. The company’s revenue grew by 87.7% in 2020-21, and it now ranks as the 54th largest company on the list. Aspen Medical has received contracts from governments in Australia, the United Arab Emirates and the United States to assist with vaccine rollouts. The company has also assisted in hotel quarantine management in Australia. Furthermore, in November 2020, Aspen Medical was one of two medical service providers to win contracts rolling out almost 700 healthcare clinics and hospitals in Indonesia.
Motor vehicle wholesaler and dealer Ateco recorded its third straight year of double-digit growth in 2020-21. The company launched a new four-wheel drive parts and accessories retail business called Upfitter in November 2020, and acquired the Renault Group dealership business in Australia in April 2021. ‘Falling consumer and business confidence following the outbreak of COVID-19 caused sales to drop sharply at the end of 2019-20’, said Mr Reeves. ‘However, with overseas travel largely restricted, spending on other discretionary items such as motor vehicles increased’. Ateco’s performance is also a clear example of the advantage large businesses that offer a diversified product range have over their smaller counterparts. The SME Motor Vehicle Dealers industry only grew by 0.5% in 2020-21.
Courier service provider Allied Express rounds out the top five, with revenue growth of 50.0% in 2020-21. The company delivers around the country and has benefited strongly from growth in demand for online retail among both individuals and businesses. The Online Shopping industry grew 35.3% during the year and the Courier Pick-up and Delivery Services industry is estimated to have grown 4.0% in 2020-21.
Worst performing companies
Adelaide Airport suffered the largest revenue decline during 2020-21, falling 39.7% during the year. ‘The national border closure and interstate travel restrictions have meant that the Airport Operations industry has been one of the most significantly affected by the COVID-19 pandemic, falling 55.5% in 2020-21, said Mr Reeves. Adelaide Airport’s domestic and international passenger numbers fell 53.9% during the year.
The Melbourne Cricket Club (MCC), as manager of the Melbourne Cricket Ground (MCG), also experienced a sharp decline in revenue over the year to March 2021. This decline was directly attributable to COVID-19 restrictions. The MCG typically plays host to 45 AFL matches a year, with average attendance of around 50,000 people. However, only seven matches were played in the 2020 season, and no crowds were allowed. Furthermore, while the Boxing Day test cricket match and the domestic T20 Big Bash League were played in front of crowds, COVID-19 restrictions placed significant caps on attendance. Overall, the Sports and Recreation Facilities Operation industry fell 2.8% in 2020-21, following a 15.8% decline in 2019-20. The MCC’s March year-end reporting date contributes to the discrepancy between the company’s revenue performance and that of the wider industry.
Media companies have faced turbulent times throughout the COVID-19 pandemic. These challenges are reflected in the performances of advertising agency, QMS Media and radio broadcaster, Nova Entertainment. ‘Sharp falls in consumer and business confidence following the outbreak of COVID-19 saw demand for advertising drop sharply’, said Mr Reeves. QMS Media derives most of its revenue from the provision of outdoor advertising services. Advertising is also the major revenue stream for the Radio Broadcasting industry. Consequently, weak economic conditions brought on by the pandemic pushed many businesses to cut back on advertising in order to reduce expenses during lockdowns.
The Multi-Unit Apartment and Townhouse Construction industry has faced significant headwinds during the COVID-19 pandemic. ‘The industry was already facing oversupply issues and the outbreak of the pandemic only added to the strain on investor confidence’ explained Mr Reeves. Meriton, one of the largest residential apartment developers in the country, was not immune from these challenges. The company’s revenue fell 21.6% in 2020-21. In August 2020, Meriton announced that it had halted major construction projects in Melbourne and Sydney amid ongoing economic uncertainty. The company, as with other larger operators in the industry, has faced greater effects than the SME Multi-Unit Apartment and Townhouse Construction industry. Reduced foreign investment has had a greater proportional impact on larger players in the industry. By contrast, industry SMEs tend to focus more on smaller construction projects, such as townhouses, which are more oriented to the domestic market.
*Updated 23 November 2021 to reflect latest available data.
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