SA Business Index: Total value slides as new leaders make their mark
The total value of the 2024 South Australian Business Index is more than $8 billion less than the year prior, as former stalwarts of the top 10 depart to make way for new leaders that are set to dominate for years to come.
Two of South Australia’s biggest companies are no longer present in the top 10 of the SA Business Index – the most-trusted ranking of the top 100 companies in the state.
Once a mainstay in the top five of the Index, Peregrine Corporation is no longer on the Index after its $1 billion sale of OTR was completed in the last financial year.
Another massive void at the top of the Index had to be filled after concrete giant Adbri was acquired for a cool $2 billion earlier this year. Now under interstate and international owners, the business is ineligible for inclusion in the list.
The two major departures caused some chaos in the top 10; there are now three companies in the top 10 that weren’t there last year.
The most impressive rise into the list’s leaders is metal detector and mining tech outfit Codan, which landed in fourth position this year having narrowly missed out on a top 10 placement in 2023, making do with 11th place.
The state’s agricultural services giant Elders also climbed a few spots to claim 7th, while Land Services SA leapfrogged Flinders Ports and Discovery Parks to rank 8th.
While Peregrine and Adbri’s exclusion from the 2024 list doesn’t entirely explain the $8 billion drop in the total value of the 100 companies, they did have a cumulative value of nearly $6 billion.
The remaining $2 billion can be chalked up to a number of factors: SA’s beer and wine companies are worth less than they used to be, Santos and Beach Energy are both worth about $1 billion less than last year, and many of the companies at the bottom end of the Index have seen valuation declines of more than 50 per cent.
Read more: SA’s top 100 companies: The full list for 2024
Naturally, Santos dominates the South Australian business landscape. It is worth about $16.6 billion more than Argo Investments (the number two ranked firm on the list), makes up $23 billion of the state’s $27 billion oil and gas sector, and is worth about 38 per cent of the entire list’s value.
This makes for an anticlimax at the annual SA Business Index lunch but does pull focus to the medium-to-large businesses that are clamouring for spots in the remainder of the Index.
Some notable stories include Exact Contracting’s monumental rise up the ranks. Last year, the company was ranked 77th. This year, it rose 49 positions to crack the top 30 and claim 28th place.
On the other end of the spectrum, the biggest slide was from glaucoma treatment firm Nova Eye Medical, which dropped down 53 places to 78th.
Other major movements include People First Bank, which rose nine places to hit 12th. Its new ranking is largely due to the merger between People’s Choice Credit Union and Heritage Bank, completed in 2023. This merger created one of the largest customer-owned banks in Australia, with the combination of assets driving its rise up the Index.
There are plenty of stories to be told when looking at how individual sectors performed. A few have been previewed this week by InDaily, such as how the oil and gas industry underperformed on a revenue basis, or how companies in the state’s alcohol sector slid down the Index.
Other narratives include the resilience of the tourism industry. For example, Discovery Parks stayed strong with an 11.43 per cent increase in revenue, highlighting the recovery and growth of domestic tourism in South Australia post-COVID.
The construction sector, like last year, had a mixed 2024. The movement of construction companies was primarily driven by whether or not they won contracts during the period according to HLB Mann Judd analysis, but there were no major changes in how the industry operated over the past 12 months.
As reported today, tech was a standout for South Australia and is showing plenty of signs of future growth. Codan, for example, rose spectacularly. As did Leader Computers, which climbed the ranks on the back of 21.98 per cent revenue growth, reflecting the high demand for its products.
The Index also demonstrates the strength of Adelaide’s private companies, which make up the bulk of the list’s value at $43.1 billion, compared to $18.6 billion for listed firms.
Methodology
To be eligible for the Index, businesses must be a South Australian entity incorporated in SA, have a head office in SA, or be an SA-operated entity, majority owned by South Australians.
The Index is based on an estimated ‘market capitalisation’, which values each constituent within the Index to enable ranking. For listed entities, given these companies have securities that trade on the ASX, this is readily identifiable using market observation. We note, all listed entities have been valued as at 28 August 2024. For unlisted entities, HLB Mann Judd has used their professional judgement to estimate a market capitalisation using the market valuation approach.
