There are few big surprises in the latest Top 100 list. Most companies are in the same general area of ranking as last year, the first seven in exactly the same position. Kingdom Holding Company — no surprise — is again in the No. 1 slot, Saudi Basic Industries Corp. (SABIC) at No. 2. Al-Rajhi Bank is up from 11th place on last year’s list to No. 8 this year, otherwise no major changes. There are 14 newcomers to the list. What shines out clearly from the list, however, is growth across the board. The average increase in revenue in the Top 100 list was an extremely healthy 19 percent; it almost certainly reflects a similar growth in business income throughout the country. That is real growth, and well ahead of last year’s GDP growth of 6.5 percent.
In some companies, growth has been remarkable. The Top 15 growth performers are all more than double the list average. Comparisons with growth performance in previous years can make the picture even more impressive. Zahran’s growth (63 percent in 2005) was just two percent in 2004, Arabian Drilling’s (53 percent in 2005) was 11 percent the previous year. In the case of Bank AlJazira and the National Industrialization Company (commonly known as Tasnee), they have done remarkably well three years in a row. AlJazira had 120 percent growth last year, 75 percent the year before, and 72 percent in 2003. In Tasnee’s case, it was 85 percent growth in 2005, 70 percent in 2004 and 261 percent in 2003. Both have consequently leapfrogged up the list, AlJazira from position 87 in 2002 to 40 today and Tasnee from 81 to 17 in the same period. These are exceptional achievements. It is rare for a company to maintain year-on-year growth significantly beyond the national average — which is why the list of top growth companies tends to be the one that alters most every year.
Sipchem’s astounding 9,208 percent growth is a story in itself (see article on Sipchem on Page 16). It is almost impossible for it to repeat the feat, resulting largely from a new plant coming on stream. Were it to do so, it would rocket it to near the head of the Top 100 list. Nonetheless, it will be surprising if it does not achieve further major growth next year and beyond as other projects come on stream. As an upcoming major petrochemical player in the region, Sipchem is headed for growth way beyond the national average and its robust productivity contradicts the disappointing performance of its shares on debut on the Tadawul just over a fortnight ago, when they fell below the offering price. That particular escapade says all too much about punter ignorance of what the market is about. Anywhere else and Sipchem shares would have risen substantially at first trading.
Some major companies do not make it on to the list, not because they have insufficient revenue but because, as private companies, they choose not to make public their financial position. That situation is expected to radically change over the next three or four years for two reasons — companies going public and possible regulation changes to make large-scale private companies more financially transparent. Of the companies on the list, nearly half are publicly listed at the moment. There are, however, at least 70 companies hoping to go public in the next year or so.