RIA Capital Markets
Cheque Centres Group
Sibcas
Scottish Equitable
Walter Scott & partners
Banking
Cairn Energy
support for high growth firms
Wood Mackenzie
Apex Hotels
Securities Broker
Aberforth Unit Trust Managers
Noble Financial Holdings Limited Sigma Capital Group Scottish Water
Distilling
Heineken
Canongate Books
Scottish Widows
Electronics
Bright Purple Resourcing
Lloyds TSB Scotland
Logistics Investment Management
Edinburgh Network Technologies
Forth Ports
Sandisk Scotland
Head Resourcing
Mcinroy & Wood
Barrie & Hibbert
Diageo Scotland
Downhole Products
Blue Planet Investment Advisers
Pelamis Wave Power
BlackRock International
Keiller Edinburgh
Property developer
Edinburgh
JDR Cable Systems
Life Sciences
Artemis Strategic Asset Management
Brewing
Surveyors Panel Management
Growing success
Standard Life
Valad Marine Harvest First State Investment Management Edinburgh Network Technologies
John Menzies
Lumison
Pensions
Tesco Personal Finance
Recruitment
Edinburgh Partners Limited
Insurance
AMA (New Town) Limited
Lothian Buses
JULY TO september 2012
ISP
‘Best Large European City of the Future’, ‘Best Large European City: Foreign Direct Investment StrateGY’ FINANCIAL TIMES FDI MAGAZINE 2012/13
iSSUE 41 » assembly rooms gather a crowd » enstratuSTM arrives » 10 questions for barrie & hibbert » the cultural olympiad » statistics
<capitalFOCUS
In this issue
the first word
W
06
08
16
04 snapshots
New connections – national and international
07 NEW ARRIVALS
Minneapolis-based enStratus™ move in
08 10 QUESTIONS FOR…
Andy Frepp, Chief Executive of Barrie & Hibbert
10
(cover story)
growing success The secret of Edinburgh’s success in producing
elcome to Invest Edinburgh, the quarterly investment promotion magazine for Edinburgh. Despite the global economy’s rather grim state, a higher number of Edinburgh-based established and emerging companies are doing very well (page 10). We report on a few success stories and explain why Edinburgh provides an excellent business environment for foreign direct investors. enStratus™, for example, were convinced: they chose Edinburgh as home for their new European HQ (page 7). Edinburgh is really proud to see the reopening of the Assembly Rooms (page 3): this iconic building – first opened in 1787 – now features the most modern standards in terms of sound and lighting. It’s reopening just in time for the Edinburgh Festivals. On page 8, 10 Questions are answered by Barrie & Hibbert, the Edinburgh-based providers of market risk management models and consultancy advice to financial institutions. And in this issue’s round table, we asked attendees of the Scottish North American Business Council’s conference how closer links between Edinburgh and North American businesses can be encouraged. I hope you enjoy this issue and, as always, feedback is most welcome to: editor@investedinburgh.com Tom Buchanan, Convenor of the Economic Development Committee
high growth businesses
14 INSIGHT
Opportunities for closer links on both sides of the Atlantic
16 added extras
City’s starring role in Cultural Olympiad
18 the statistics
The latest key indicators for the Edinburgh economy
Subscribe to Invest Edinburgh For a free quarterly subscription to Invest Edinburgh, or to obtain additional copies, please contact editor@investedinburgh.com Follow Invest Edinburgh on Twitter. www.twitter.com/investedinburgh Follow Invest Edinburgh on LinkedIn. www.linkedin.com/companies/invest-edinburgh THIS MAGAZINE IS PRINTED ON ENVIRONMENTALLY RESPONSIBLE PAPER MANUFACTURED USING 100% RECYCLED WASTE.
Invest Edinburgh is created in a partnership between Marketing Edinburgh Ltd and the City of Edinburgh Council. It is published by Resolve Creative, Suite 104, 47 Timber Bush, Edinburgh EH6 6QH t. +44(0)131 555 7585 w. resolve-creative.co.uk
2 INVEST EDINBURGH | July to September 2012 |
i nvest in Edinburgh Are you: • A retailer looking to expand into a dynamic new market? • A hotel developer or operator interested in opening a hotel in a global tourism hotspot? • A business looking to establish an office or contact centre in Scotland? • A property developer interested in development opportunities? If so, the City of Edinburgh Council and its partners can provide you with: • Free, confidential, impartial advice on your commercial property and land requirements; • Introductions to key business and civic leaders; • Assistance with recruiting and training staff with the skills you need; • Advice on accessing grants and other funding; • Guidance on doing business in Scotland; • High-quality market intelligence.
To find out more about how we can help you, please contact the Investor Support team at invest@edinburgh-inspiringcapital.com or on +44 (0)131 529 6600.
A new chapter beckons for an Edinburgh icon
One of Edinburgh’s most celebrated public buildings, the Assembly Rooms on George Street, is set to re-open to the public on 21 July, following an 18-month, £9.3 million restoration project. The refurbishment not only reinstates the iconic Georgian grandeur of the interior, but also transforms the venue into a versatile event space featuring improved acoustics, state-of-the-art sound system, modern lighting and modern standards of accessibility. The result is a 21st century facility with a 220-year historical pedigree. Funding for the project has come from The City of Edinburgh Council, with contributions from Heritage Lottery Fund, Historic Scotland, the Scottish Government and Creative Scotland. As a Category A-listed building located in the heart of Edinburgh’s New Town, a UNESCO-designated World Heritage Site, the renovation had to preserve the heritage of the building. This was captured in the Assembly Rooms’ Conservation Plan, which was endorsed by a host of prominent bodies including Creative Scotland, VisitScotland and Historic Scotland. First opened to the public in January 1787, the venue has established itself as a spiritual hub for the Edinburgh Fringe Festival. Shaped by the creative vision of LDN Architects and the expert eye of conservationists, period features such as the crystal chandeliers in the Ballroom and Music Hall and ornate cornicing have all been retained and enhanced.
www.investedinburgh.com
“People are going to be astounded by the grandeur and elegance of the first-floor rooms,” explains Shona Clelland, General Manager.“In addition to the decorative improvements that give the building its ‘wow-factor’, people will find the venue is lighter, airier and more contemporary, with a new heating and ventilation system, full air conditioning, brand new seating, sound-proofing and better circulation space.” An additional entrance provides visitors with direct access to a brand new Jamie’s Italian restaurant, managed by celebrity chef, Jamie Oliver. The installation of a lift also improves access for wheelchair users. The George Street lobby reinstates the interior as a high-end retail reception area. Two boutique outlets will serve to complement George Street’s already strong independent fashion retail offering. New York skincare brand Kiehl’s has already been confirmed as one retail tenant with their largest standalone store in Europe, while negotiations with another luxury retailer are well advanced. Re-opening on 21 July, Assembly Rooms will again play a starring role in the 2012 Edinburgh Festivals programme, which will also see a huge open air terrace immediately outside, featuring the Famous Spiegeltent and a free classical stage.
The refurbished Assembly Rooms will impress with its grandeur and elegance
The Assembly Rooms will be somewhere people will come to for a meal or to shop, as well as for events: •M usic Hall capacity: 500 people for banquets or 750 people theatre-style, (with space for an additional 200 people on the Balcony for performances). •B allroom capacity: 300 people for banquets or 400 theatre-style. •A further ten rooms offering flexible spaces for groups of up to 120.
www.assemblyroomsedinburgh.co.uk
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 3
<snapshots
Relax in comfort and style in Edinburgh One of Edinburgh’s most iconic city centre hotels is set to re-open shortly, as Scotland’s first hotel under the 127-yearold Waldorf Astoria luxury brand name. The Caledonian Hilton Edinburgh will officially re-brand on 1 September following an extensive £24 million investment programme, which includes the installation of 21st Century high speed internet to the 241-room luxury hotel. Award-winning brothers Chris and Jeff Galvin will take over the Pompadour Restaurant and the Brasserie De Luxe. The investment is the latest in a number of significant improvements to Edinburgh’s already vibrant hotel sector. The Sheraton Grand Hotel and Spa also completed a multimillion pound full bedroom refurbishment in 2012, which has seen the hotel’s public areas including conference centre, bar, restaurant and reception transformed. The investment has also created a new luxurious Grand Suite and exclusive ‘Club’ floor, which adds further value to the hotel’s current five star rating. Completing the round up of high end hotel developments in 2012 is the opening of the new Atholl Edinburgh hotel in late April – an establishment that helps to redefine the term luxury in accommodation. The Atholl Edinburgh offers customers a range of suites, each with its own dining room and personal chef trained by Michelinstarred chef, Michel Roux. Featuring handpicked furnishings and
The Atholl Edinburgh
designer kitchens (and, in the case of one suite, a private garden designed by the Laurent Perrier Chelsea Flower-award winner Luciano Giubbilei), the £5 million hotel sets a benchmark for exclusivity. > Further information: www. caledonianhiltonedinburgh.co.uk www. sheratonedinburgh.co.uk www.theatholl.com
Middle East and Asia open up Turkish Airlines launch a new direct route between Istanbul and Edinburgh on 16 July 2012. One of the top 40 busiest airports in the world, with more than 30 million passengers passing through it each year, Istanbul is now being promoted as the ‘natural hub’ of the world. Turkish Airlines operate more than 200,000 flights per year from Turkey’s metropolis and will operate four flights each week on its new route to Scotland. For Scottish business and tourism, the new route is excellent news. Turkish Airlines alone operate flights to 83 countries and more than 200 cities can be reached within four hours flying time from Istanbul. As well as serving as a direct link between Scotland and Turkey, the new route enhances Edinburgh’s connectivity to a range of global destinations including Hong Kong, Singapore, Shanghai, Beijing, Bangkok, Johannesburg, Cape Town, Delhi, Mumbai, Tel Aviv, Dubai, Narita and Osaka. “We will have competitive fares between Edinburgh and Turkey, and also onward beyond Turkey,” confirmed Serhat Sari, General Manager Scotland for Turkish Airlines.
4 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
Turkish Airlines is one of the fastest growing operators in the world. The constantly growing trading volume between the UK and Turkey has been one factor in the airline’s decision to launch the new route. “Edinburgh’s reputation as a worldrenowned centre for higher education, as well as being one of the most popular tourism destinations in the UK, were other
Planes, trains and the transport picture The face of Edinburgh’s public transport infrastructure continues to change apace in 2012, with a number of developments contributing to what will be a fully integrated transport network in 2014. In May, Global Investment Partners completed the £807 million purchase of Edinburgh Airport – a fee said to underline the passenger growth potential of the asset and it’s position as a key international transport hub. Work to connect Edinburgh Airport to the city centre with a 21st century tram system is on track to begin operations in summer 2014. An estimated 5.4 million passenger journeys are forecast for the first year alone. The latest project milestone saw the completion of works on Princes St, in June. As work progresses on the new tram line, significant investments in Edinburgh Waverley and Haymarket
> Further information: www. edinburghairport.com www.turkishairlines.com
> Further information: www.edinburghtrams.com
1 to watch Lingo24 What do they do? Lingo24 is one of the fastest growing translation agencies in the world today. The Edinburgh-based company, which has offices and employees across the globe, offers clients a 24-hour service, covering a vast range of technical topics including legal and financial services.
key reasons to choose to launch our new destination,” added Serhat. Turkish Airlines plan special fares to build the route over the medium to long term, promoting Istanbul’s status as a key hub for international travel.
mainline train stations are helping to equip both central hubs to serve the needs of the modern traveller – be they visiting for business or leisure. The £130 million upgrade of Waverley Station and its facilities, will create a welcoming environment: more than 34,000m2 of strengthened roof glass will transform the station concourse and platforms, while access is also being improved. Across the city centre, a £25 million investment in Haymarket station, part of the £1 billion Edinburgh-Glasgow Improvement Programme, began in May. Scheduled to take 11 months, the works will create an accessible integrated city centre train, tram, bus and taxi transport hub.
Why are they worth watching? Listed in the 2011 Sunday Times Fast Track report for International businesses, Lingo24 have grown by 57% a year, from £1.1 million in 2008 to £2.7 million in 2010. The business now employs more than 4,000 translators around the globe, translating in excess of forty million words a year in more than 600 language combinations for clients in 50 countries, including brands like Bloomberg, American Express, Orange, T-Mobile and MTV. Where have they come from? Lingo24 was founded in Aberdeen in September 2001 by Christian Arno and fellow Oxford alumnus, Jos Shepherd, to provide translation services in the UK and abroad.
www.investedinburgh.com
In 2008, a new Edinburgh HQ was opened, initially with just two staff, complementing offices in New Zealand, London, New York, Panama, China and Romania. What does it mean for the area? With many of the world’s leading financial companies in Edinburgh, Lingo24 now has nine employees at its headquarters in Scotland’s capital, including Account Managers and General Managers as well as communications and marketing specialists. Lingo24 focuses on translation of the written word, with websites, market research, travel and tourism, newswire and press releases constituting the biggest sectors. The business not only works with leading financial service institutions such as The Royal Bank of Scotland, but also major media and marketing companies, such as BigMouthMedia and Occupancy Marketing.
Fresh face to banking Virgin Money’s new Edinburgh office has just been named Scotland’s ‘Best Refurbished/Recycled Workplace’ by the British Council for Offices. The offices incorporate one of Virgin Money’s new Lounges, which offer customers a space to relax, freshen up or surf the net, as well as conduct their banking business. Wave Centre A new wave and current test centre is being built at the University of Edinburgh. When it opens in 2013, the £9.5 million facility will allow engineers involved in the development of marine energy devices to simulate waves of up to 28 metres in height and 12 knot currents for the first time. Edinburgh entry tops awards Edinburgh’s 2011/12 Hogmanay has won the Best Event category in the regional heat of the Scottish Thistle Awards, the top tourism awards in Scotland. The national award will be announced in November. Turing Festival This year’s Turing Edinburgh International Technology Festival, 23 – 25 August 2012, will be a global celebration of digital technology and culture, encompassing themes as diverse as future medicine, digital education, mobile media, citizen science, app development, gaming and digital government. Best European Airport Edinburgh Airport was named “Best European Airport: 5m-10m passengers” at the eighth Annual Airports Council International awards in Madrid, in June. Brave development The European Premier of Disney.Pixar’s new animated adventure, Brave, closed this year’s Edinburgh International Film Festival. Based in Scotland and exploring its myths, legends and destiny, the film is expected to boost Scotland’s economy by £140 million.
> Further information: www.lingo24.com
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 5
<snapshots
Royal opening for bio centres In 2010, the global life science industry (including pharmaceuticals and biotechnology) was estimated to be worth £801 billion: a value that had risen by more than 45% in three years. Now, Scotland’s most promising and ambitious life sciences enterprises, with an eye on exploiting that market potential, can benefit from a best in class physical environment. A three-storey BioIncubator at Edinburgh BioQuarter, branded Nine, has been specifically designed to support companies growing out of Scottish research and development. The 8,500m2 facility provides a specialist mix of office and laboratory
accommodation for life science companies of various sizes, including early stage startups and spin outs. Nine opened in May, with HRH Princess Anne, Chancellor of The University of Edinburgh, conducting the official opening. The visit also saw the official opening of the neighbouring Scottish Centre for Regenerative Medicine. Here, up to 350
scientists conduct research into conditions such as Multiple Sclerosis and heart and liver disease. They also carry out cuttingedge stem cell research to help find therapies for patients with conditions including Parkinson’s disease and motor neurone disease. Scotland’s thriving life sciences sector adds over £3.1 billion to the Scottish economy annually, and the country is internationally recognised in areas such as translational medicine, reproductive biology, diabetes, oncology, stem cells and infectious diseases. > Further information: www.edinburghbioquarter.com/nine
MADE in EDINBURGH
the complete picture with NC Tech
The iStar® 360° panoramic camera For NC Tech, the Edinburgh-based developer of high-resolution digital imaging equipment, 2012 has proved an exciting year with the official launch of iStar®, the world’s first automatic rapid 360º panoramic camera. The result of two years’ research and development, iStar® is the first 360º camera with the power to process its images internally, eliminating the need for post-production processing or stitching. Current 360º imaging systems typically require around 10–15 minutes to
6 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
generate a 50 megapixel spherical image. With iStar® the same spherical image is captured instantly in one single shutter release and the final image is ready in under 10 seconds. iStar® utilises the Lidar (Light Detection And Ranging) scanning process already used in the heritage, construction, surveying, architecture, mining and oil and gas industries. “The technology was initially developed with the military market in mind, but it has potential applications across multiple sectors, including police, engineering and heritage,” explained Neil
Tocher, Chief Operating Officer.“Since launching at SPAR International in Texas, in April, we also received significant interest from computer games developers who were interested in using the iStar® to render 360º environments for well known first person gaming franchises.” With zero set up time, the new system is small, light and robust, making it easy to transport and quick to deploy. In addition, the camera requires no specialist training, and can be used by anyone. “The development of iStar® has probably been the worst kept secret in the business and there was already a high degree of anticipation in the market about the product’s launch, with preorders well exceeding original estimates,” added co-founder, Cameron Ure.“We’re excited to bring this new camera technology to market and looking forward to it being deployed globally”. > Further information: www.nctech.co.uk
NewArrivals ENSTRATUSTM – WHY THEY HAVE COME to Edinburgh Who’s on the move? enStratus™, the Minneapolis-based cloud computing specialist, announced in April that it has chosen Edinburgh as the home of its new European HQ. enStratus™ is a cloud infrastructure management solution – a ‘console’ to the world of cloud computing – which allows businesses to access multiple cloud services from a single, consistent management platform. Why the move? Supported by a grant from Scottish Development International, enStratus™ selected Edinburgh as its new European office because of the excellent development resources, transport infrastructure and favourable exchange
rates. George Reese, Chief Technology Officer, said: “enStratus™ is excited to open our new office in Edinburgh, to serve our expanding customer base as well as our development and support needs. Our new European office allows us to continue to build on our global offerings by leveraging cloud skills from around the world and providing round the clock support.” Why is it important for Edinburgh? enStratus™ plans to hire up to 30 development, support and sales professionals in Edinburgh by the end of 2014 and is currently recruiting key staff in preparation for the opening of the Edinburgh office in Q2 2012. Cloud infrastructure is an
increasingly compelling option for many organisations and applications. As an IT model it provides game-changing flexibility in terms of cost, reliability, security and performance. enStratus’ move to Edinburgh reflects confidence in the growth of the technology and places Edinburgh on the map as a centre of cloud computing; a fact underlined by April’s arrival of London-based cloud specialists, Cloudreach, to the city. The new Cloudreach office already provides services to customers in Canada and the US, with Asia soon to follow. > Further information: www.enstratus.com www.cloudreach.com
Contract for economic growth Edinburgh’s freshly elected Council is led by Councillor Andrew Burns (right). A published ‘Contract’ underlines that the new administration he leads will build on the excellent economic development witnessed in the city over recent years. “We have a very clear focus on supporting business,” says Councillor Burns. “We will continue the ‘Team Edinburgh’ approach, drawing on the support and expertise of partners, both local and international, to understand the needs of business in the city and promote Edinburgh as a great place in which to do business. The economic welfare of our residents is at the heart of our approach to development.“ Edinburgh’s established strengths include sectors such as finance, renewables, life sciences, IT and creative industries. “We will seek to create new opportunities through cross-fertilising sectors – one example is the renewables and financial expertise that underpinned this year’s successful bid to host the UK’s unique Green Investment Bank. “The city’s bid for this bank reflected the powerhouse of expertise provided by green industry leaders and financiers, securing the backing of both public sector and private partners. We want to broker
www.investedinburgh.com
and share expertise among both local and international partners to help shape projects that offer future opportunities. For example, work is underway to upskill local people and enhance and promote opportunities for local companies to create supply chains in the green economy.”
“Our business support programme will evolve to deliver more support to high growth companies.” Edinburgh’s reputation for world-class events is also being supported with major capital projects to iconic cultural venues – all fully backed by the Council. These include the Assembly Rooms (p3) and The King’s Theatre, new office and convention space at the Edinburgh International Convention Centre – Atria Edinburgh – investment for the area surrounding Edinburgh Airport; new schools, the tram project and the Tax Increment Financed access road at the Waterfront.“All these commitments will enrich the physical fabric of the city.” Edinburgh is already a globally competitive business location: “we need
to play our part in continuing to attract and support the highly skilled and motivated people who attract companies to invest and locate here. Our business support programme will evolve to deliver more support to high growth companies. “We have a unique Local Investment Partnership, with Scottish Development International, Scottish Enterprise and the Chamber of Commerce, which helps harness international opportunities. We will also work closely with Edinburgh’s four universities to promote an international programme of activities and opportunities,” adds Andrew. “Finally, we must not be complacent, but look at best practice around the world. We must tap into resources from both public and private sector sources to support the infrastructure and quality of life in the city. In addition, we need to build on our international links to create new trade and investment flows and work with national agencies to showcase Edinburgh’s outstanding investment opportunities.” > Further information: www.edinburgh.gov.uk
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 7
<10 questions
IE> Are there regional variations in how your offices operate and in which markets they specialise? AF> Since 2007, we have opened offices in London, New York and Hong Kong. The development of risk management techniques and insurance solvency regulation across the globe presents evolving opportunities and challenges for us to align what we do to local market needs. As we have expanded, our core philosophy and approach has not changed. We maintain strong links with industry forums, professional bodies and regulators to support professional standards and developing regulation, ultimately promoting best practice in risk in that region.
“Edinburgh is a great location in which to live and work with excellent academic institutions, allowing us to attract talent both locally and internationally.”
Andy Frepp Chief Executive, Barrie & Hibbert
Barrie & Hibbert has established a world-class reputation among clients for managing the uncertainty of financial markets. They deliver solutions for their clients in an easy to use, cost effective way, using their own stochastic models. Now a part of Moody’s Analytics, in 2012 the firm will help its global client base manage $25 trillion of assets.
8 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
IE> Since it was founded in 1995, Barrie & Hibbert has always been based in Edinburgh. What advantages does this bring and why does Edinburgh continue to represent the best location for your HQ? AF> Our world-class reputation is testament to the outstanding quality of our people. In Edinburgh Barrie & Hibbert has built one of the largest teams in the world committed to the commercial development and delivery of stochastic models (for random systems) and calibrations. This team includes economists, physicists, mathematicians, software engineers and actuaries, drawn from both local and European institutions. Edinburgh is a great location in which to live and work with excellent academic institutions, allowing us to attract talent both locally and internationally.
IE> The business has grown over the past 17 years based on the accuracy and impartiality of its stochastic financial modelling among insurance customers. What differentiates your approach from the competition? AF> There are three things that differentiate B&H: 1. Stochastic modelling is what we do, so we have a clear focus. 2. Our products are ‘ready to go’ so have low implementation costs with built in updating. 3. Our products are fully transparent and we actively look to transfer knowledge to our clients. IE> In today’s interrelated global economy, to what extent does local/ regional market knowledge help Barrie & Hibbert decode the uncertainties of international financial markets? AF> The knowledge of local markets allows us to understand the distinct risk management challenges and how we should evolve our products to meet those challenges.
www.investedinburgh.com
IE> Since 2008, the global markets have at best been described as volatile. How has the business had to adapt its approach to stochastic modelling? AF> One of the key elements of what we do is understanding and modelling extreme financial events. The volatility of the last few years has given us real data that allows us to both validate and improve our capabilities. IE> Over the years the business has expanded from life insurance into other fields such as asset management, pensions and retail distribution. Where do you see future opportunities lying? AF> The global insurance sector still remains very attractive as we expand our products and services to meet more of our clients’ needs. However, there are significant risk management challenges for pension funds and individuals that we believe our products and services can help with. IE> What made Barrie & Hibbert so attractive to Moody’s Analytics that they chose to acquire the business in December 2011? AF> The reputation for our specialised expertise and unique product offerings for insurance risk management. Adding Barrie & Hibbert’s skills and experience to Moody’s Analytics’ expands their ability to help insurers meet worldwide solvency modernisation initiatives, including Solvency II and other regulatory challenges, and reinforces their commitment to assisting financial institutions as they address a growing array of risk management needs. This combination benefits our clients by providing them with a broader and more robust set of tools and services to assess financial risk and respond to regulatory requirements. IE> You recently won the Queen’s Award for Enterprise in International Trade, in April 2012 – what difference has this made to the business? AF> The Award reflected the focused efforts of the whole Barrie & Hibbert team, who have worked hard to expand the global reach of the business and achieve the business growth where exports now account for more than half of turnover. Success brings an enhanced profile – more people are aware of Barrie & Hibbert outside our industry, and, of course that we are based here in Edinburgh.
IE> With more than 150 customers in 30 countries, and more than 60% of insurers in the global fortune 500 already using your products and services, how does the business intend to continue its international expansion? AF> The company is committed to international expansion, delivering state-of-the-art modelling tools to help insurance, pensions, and advisory clients to identify, quantify and manage financial risks. In many regions we have only just scratched the surface of possibilities for our products and services and so we see significant further opportunities in the markets we are already in, which we can better capitalise on now we are part of MA and have access to their global distribution platform. IE> To what extent do legislative changes in Europe and across the world, and the threat of increased financial regulation, create opportunities for growth? AF> Legislation has been a major driver of growth and will continue to be for many years.
Andy Frepp, A graduate in Mathematics, with an MBA and a qualified Actuary, Andy has over 20 years’ experience in the life insurance, asset management and retail financial services industries. Before joining Barrie & Hibbert, Andy was the Director of Marketing & Distribution for one of the UK’s largest asset managers.
www.barrhibb.com.
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 9
<feature
From a standing start, less than 20 years ago, John Menzies plc has created the world’s second largest global aviation services business: Menzies Aviation.
T
Edinburgh is proving to be a remarkably successful and resilient city during this extended period of global economic instability. Its secret reflects a unique mix of culture, skills and connectivity, supplemented by outstanding business support services.
he capital’s success spans sectors of established strength, such as financial services, as well as technologies of tomorrow; including clean technology, creative industries and life sciences. Belgian biotechnology company Galapagos announced a research partnership with the Edinburgh Cancer Discovery Unit (ECDU), in June, becoming the latest company to exploit the depth of world-class research being undertaken in the city. In the same month, travel search firm Skyscanner signed a lease in the heart of Edinburgh’s new technology strip, dubbed ‘Silicon bridges’, in order to take advantage of the growing internet startup community based around the University of Edinburgh’s School of Informatics. Opportunities also persist for the city’s more established companies, including John Menzies plc. Founded in Edinburgh as a bookseller in 1825, its wholly-owned subsidiary Menzies Aviation is the world’s second largest global aviation services business. From a standing start, less than 20 years ago, it now operates in more than 29 countries. Its worldwide team of more than 17,000 people handle in excess of 800,000 flights, and 1.7 million tonnes of cargo per annum. More than 500 airline customers are supported through a network spanning 132 locations.
10 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
www.investedinburgh.com
Growing success
NURTURING AMBITION Edinburgh’s success at nurturing companies with similar ambition and high growth potential is now a key part of the city economy. This spring, Edinburgh-based Cupid plc, DEM Solutions and Reactec Ltd joined Skyscanner in competing in the international Deloitte EMEA Fast 500 award programme, as UK 2011 winners in the Deloitte Technology Fast 50. The opportunities appeal to high fashion as well as high-tech, with specialist retailers including Parisien brand Kooples and US fashion retailer Hollister, the latest brands to open outlets in the city this year. While online-retailer Amazon integrated retail and technology, opening a development centre next to Microsoft’s office on Princes Street. Regardless of the internet-age, research underlines what every retailer has always known – location counts. That fact is particularly true for those companies described as ‘High Growth Firms’ (HGF). Most commonly, HGFs are defined as ‘enterprises with average annualised growth in employees or turnover greater than 20% per annum, over a three year period.’ In Edinburgh, many HGFs (see table 1) are local subsidiaries of foreign direct investors into the city, or UK/Scottish firms that have been acquired by foreign owners.
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 11
<feature <Feature
Edinburgh – crowned ‘the best LARGE EUROPEAN city of the future’ by fDi Magazine 2012/13 A high proportion of Edinburgh’s 100+ HGFs are in finance, IT and the business service sector – areas of established commercial strength. Furthermore, an analysis by The City of Edinburgh Council shows that more than two-thirds of currently trading HGFs are already more than ten years old. Be they ten years or ten months old, there’s a parallel in the factors that underpin commercial success for both high growth start-ups and mature companies. Their location must provide access to critical skills and advisors, good connections to national and international markets, and an excellent quality of life – to help recruit and retain the right personnel. GROWTH FACTORS These factors are cited time after time as key differentiators, a fact acknowledged by Sandy Begbie, Group Operations Officer at Standard Life (right). The Edinburghheadquartered provider of long-term savings and investments has more than six million customers worldwide. “Edinburgh’s international reputation undoubtedly helps. The quality of life here compares very well internationally and we pay competitive salaries, so we find that retention is very strong across all our resource specialisms.” Standard Life’s business plan is focused on the UK, but it has operated internationally for well over a century; a tradition that continues through operations in Ireland and Germany, in Hong Kong, and its joint ventures in India and China; as well as Standard Life Canada and possible new ventures. Canada, Standard Life’s first foray overseas, was established in 1833. “It remains a very important market for us,” says Sandy, who sits on the board of Standard Life Canada. With about 2,000 employees, Standard Life Canada reflects its Edinburgh parent in scope and provides long-term savings, investment and insurance solutions to more than 1.4 million Canadians, most of whom won’t be aware that the company is ultimately owned in Scotland. “However, expansion overseas, is now more about flexibility and local access,” adds Sandy.“The days of building up a large
12 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
overseas infrastructure are past. We have a strong franchise, strong investments and market competitive platforms. Today, it’s about how to leverage our competencies into new markets.” SUPPORTING success That same challenge is exercising the minds of those in charge of Edinburgh’s smaller HGFs, currently looking to achieve their own ambitions. For them, public sector support and advice can be a vital ingredient to success. The City of Edinburgh Council funds the High Growth team based in Edinburgh’s Chamber of Commerce, where John Hughes is an advisor. “There’s no doubt a key factor in Edinburgh’s success is our great academic institutions,” says John.“Edinburgh does exceptionally well, with 400+ graduates each year from the School of Informatics at the University of Edinburgh alone. The School is ranked third in the world and top in Europe; but other disciplines across the city’s four universities are also strong.” There’s also a very good support network for these companies.“The city has many entrepreneurs who are happy to share their experience as mentors and another advantage is the very active business angel community,” adds John.“We complement and add value to the work of national agencies and other partners in this area. The focus of support is to help access new markets and introduce new products.”
25 Companies in Edinburgh meeting HGF criteria* for three 3-year periods between 2002 and 2011 Aberforth Unit Trust Managers Ltd
Investment Management
AMA (New Town) Limited
Property developer
Apex Hotels Limited
Hotel operator
Scottish Widows Group Limited
Pre-tax profits (£’millions)
Company
Sector
£1,215.5
Insurance and pensions
Artemis Strategic Asset Management Ltd
Investment Management
Standard Life PLC
£971.0
Insurance and pensions
Blue Planet Investment Advisers Ltd
Investment Management
Heineken UK Limited
£730.9
Brewing
“We find that retention is very strong across all our resource specialisms.”
Bright Purple Resourcing Ltd
Recruitment
Cairn Energy PLC
£467.7
Oil
Canongate Books Limited
Publisher
Cheque Centres Group Limited
Moneylender
Diageo Scotland Limited
£258.0
Distilling
Downhole Products Limited
Oilfield designer
Lloyds TSB Scotland PLC
£162.0
Banking
In its Economic Strategy, The City of Edinburgh Council has committed itself to aligning its business support activities with other business-facing Council services, to help businesses prosper.“Support is tailored towards those with the potential to generate sustainable growth in jobs and investment, whether long established organisations or newer enterprises,” explains Council Leader Andrew Burns. It seems Edinburgh’s mix of culture, skills and connectivity, supplemented by outstanding business support, does indeed provide a unique recipe for high growth success.
Edinburgh Network Technologies Limited
ISP
Tesco Personal Finance PLC
£134.9
Banking
First State Investment Mgt (UK) Ltd
Investment Management
Scottish Equitable PLC
£112.0
Insurance and pensions
Head Resourcing Limited
Recruitment
Walter Scott & Partners Limited
£75.7
Investment Management
JDR Cable Systems (Holdings) Limited
Power cable manufacturer
Forth Ports Limited
£56.3
Port operation
Keiller Edinburgh Limited
Property developer
Lumison Ltd
ISP
Artemis Asset Management Ltd
£51.4
Investment Management
Mcinroy & Wood Limited
Investment Management
Wood Mackenzie Limited
£48.3
Consultancy
£37.5
Logistics
£37.5
Investment Management
Marine Harvest (Scotland) Ltd
£33.1
Seafood
£30.1
Buses
£23.1
Water
invest@edinburgh-inspiringcapital.com www.twitter.com/InvestEdinburgh
A CENTRE OF professional excellence Edinburgh is a natural focus for conferences and conventions offering a forum where professionals can meet to exchange knowledge and ideas. The economic value of business tourism in Edinburgh was estimated recently to be in excess of £300 million per annum and the Edinburgh Ambassador programme has been one catalyst helping the city grow its share of this international market. Securing a conference not only has a positive economic impact on the destination, but also creates ideal opportunities for local industry and raises the international profile of the host institution. The ambassador network now extends to more than 600 professional people, each of whom has a major influence over their association’s choice of conference destination.
Top Edinburgh-based companies* by pre-tax profits (2010)
Noble Financial Holdings Limited
Investment Bank
John Menzies PLC
Pelamis Wave Power Limited
Wave energy
First State Investment Management
RIA Capital Markets Limited
Securities Broker
Sandisk Scotland Limited
Electronics designer
Sibcas (Holdings) Limited
Portable accommodation
Lothian Buses PLC
Sigma Capital Group plc
Investment Management
Scottish Water Business
Surveyors Panel Management Ltd
Surveyor
Valad (Europe) PLC
Property Investor
Edinburgh Partners Limited
£21.8
Investment Management
Walter Scott & Partners Limited
Investment Management
BlackRock International Ltd
£18.8
Investment Management
(UK ) Limited
Stream Limited
Table 1
Table 2
* “Enterprises with average annualised growth in employees or turnover greater than 20% per annum, over a three year period, and with more than 10 employees at the beginning of the observation period.”
Source: Bureau van Dijk, FAME *Excluding trusts
Edinburgh International Conference Centre the School and ultimately attract the best talent to Edinburgh and to Scotland.” Another Ambassador, Raj Bhopal, agrees. Professor of Public Health at the University of Edinburgh, he helped bring the IEA World Congress of Epidemiology to Edinburgh. “If you want to sell Scotland, you might as well say Edinburgh, it’s just so well known – particularly in North America. “It was a very good place for a conference of this kind, because Scotland has made a big contribution to epidemiology and public health. Also, Edinburgh’s easy to get to. People want to come ... it is one of the most spectacular cities in the world.”
“Their leadership and expertise are essential when attracting a conference to the city,” explains Ambassador Programme Manager, Elaine Miller. Conferences showcase Scotland’s capital as a modern, dynamic city that’s continuing to develop its centres of excellence into new fields of expertise and ground-breaking research. Edinburgh Ambassadors Edinburgh hosted The Federated Logic Conference (FLoC). “This conference helped to get the School of Informatics on the international platform,” explains Professor Leonid Libkin, School of Informatics, and an Edinburgh Ambassador.“The event was attended by more than 1,200 delegates and consisted of eight conferences and 50 workshops. A conference like this helped us showcase
ThE economic value of business tourism in edinburgh is estimated to be in excess of £300 Million per annum.
Edinburgh Ambassador Programme: elaine.miller@marketingedinburgh.org
www.investedinburgh.com
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 13
<insights
Round table:
In May, the Scottish North American Business Council (SNABC) met in Edinburgh to debate ‘Developing Transatlantic Relations’. Aligned to the British-American Business Council (BABC), which has more than 2,500 corporate members and 250 chapters, the SNABC facilitates links between Scottish and North American businesses. We asked some of those attending: “What are the key challenges for business on both sides of the Atlantic and what opportunities might this raise for closer links between Edinburgh and North American businesses?”
Developing transatlantic relations
Thomas J. Donohue, US Chamber President and CEO The biggest challenge is to spur faster economic growth so that we can create more jobs and opportunities for our citizens. One of the best ways is to expand the transatlantic commercial relationship, which is already the largest in the world. When you count trade, investment, and sales by foreign affiliates of our companies, the relationship exceeds $5 trillion. Directly and indirectly, we support millions of jobs in each other’s economy. We should launch and complete a US-EU Economic and Trade Pact to lower barriers, converge regulations, and expand job-creating trade and investment. Further opening transatlantic markets and enacting other growth-generating initiatives would be of particular benefit to Edinburgh – a competitive, world class city that has much to offer across an impressive range of business sectors. Keith Neilson, CEO, Craneware As the financial shadow remains on both sides of the Atlantic, this is the time for politicians to lead the change in how we both want to do business. The deficit raises an opportunity
14 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
to influence efficiencies in business, in both the UK and North America, through innovation. North America has always been open to new ideas and our common language allows us to generate a good dialogue to further these innovative ideas in partnership. Ven Kocaj, Northeast Regional Managing Partner, Deloitte & Touche LLP There’s an expression in the USA, ‘You build your team in the off season’. This is the time for us to foster the opportunities for continued growth. We need to keep the pedal to the metal so in ten years we’ve not wasted opportunities to grow intellectual capital. Regulatory frameworks on both sides of the Atlantic need to ease cross border capital-raising activity. In the USA this year, the JOBS Act (Jumpstart Our Business Startups) secured bipartisan support and will make it easier for small business to raise investment in the USA. We’ve seen a recent decrease in companies setting up in the US and we need to reverse this trend especially in the knowledge economy. There’s a particular opportunity for universities in the UK to promote innovations.
“There’s ... a clear recognition that britain is different to the eurozone.”
Iain McMillan, Chairman, SNABC The overriding point, both in the UK and US, is not to retrench. Isolationism on free trade, which can happen, would be disastrous. All the evidence supports the argument that free trade improves economic performance. Despite the shared language, many companies fail in exporting between the US and UK because they don’t get the right agent or partner. Many have a good plan but don’t succeed, as they need the right advisors on the ground. SNABC helps facilitate these vital introductions through its networks.
“when you count trade, investment and sales by foreign affiliates of our companies, the relationship exceeds $5 trillion. ” Gerard McCabe, Managing Director, Turner & Townsend cm2r Inc, Toronto Canada invests more in the UK per capita per head than any other country. Most Canadian companies are run on traditional Scottish principles, which helped ensure in 2008 that the Canadian economy was in good financial shape. Our own business has doubled in size in the last two years and the Canadian economy is set to grow by 2% this year and 2.5% next year, built around strong performance in life science, financial services and natural resources. Areas such as Toronto, with a strong life science sector, recognise the same strengths in their own sector here in Scotland. There’s also a clear recognition that Britain is different to the eurozone. There are definite opportunities here and now.
www.investedinburgh.com
Rhian Chilcott, International Director, CBI We must get global regulatory and legislative frameworks right. At the height of the global financial crisis, at the G20 in 2008, governments all worked together on the immediate issues, and promised to align policy better afterwards. But too often they haven’t. America and Britain both need to improve their links to the dynamic rising economies. There’s an opportunity here: America could use Britain’s links to the Commonwealth, and the UK could use the USA’s position in Latin America, to help enter new markets. We can also do much more between ourselves: an EU-US free trade agreement is an absolute must. We also need to rethink immigration and visa policy to be much more business-friendly. Kristen Neller Verderame, Head of Global Government Relations, Booz Allen Hamilton Cyber security is so important and the dangers it presents in scale and scope offer a real opportunity for technology companies. There are many areas where US and UK researchers and companies can work together. The UK is great at research and our shared language ensures cities in the UK are a perfect springboard for international expansion by North American companies. Andrew Fulton, President, SNABC What is good for Scotland is generally good for Edinburgh too, given the capital’s importance to the national
economy. In the prevailing global trading conditions, private sector networking groups like the BABC have a vital role in sparking the eventual upturn. Mind you, many of the current challenges and opportunities are not unlike those when we set up SNABC in 2000. On the plus side, the UK remains the biggest foreign investor in the USA and vice versa. There is excellent cooperation between the various trade organisations of the UK and USA and indeed Canada too. And a decade ago we were working hard to promote transatlantic spin-offs from our innovative universities and this remains a principal goal of SNABC.
“this is the time for us to foster the opportunities for continued growth. We need to keep the pedal to the metal so that in ten years time we’ve not wasted opportunities to grow intellectual capital.” Martin Uden, Managing Director, British Business Embassy, UKTI The opportunity is to network. This year is an opportunity for all companies to network on an unprecedented scale through the London 2012 Olympic Games: with figures such as Eric Schmidt of Google, Apple’s Sir Jonathan Ive and Howard Stringer, chairman of Sony Corporation of America attending London for a series of business summits at the British Business Embassy. The events at the British Business Embassy are just one part of the story. We’re also planning to stream live footage in English regions, Scotland, and internationally, to extend the reach of the programme, bringing business people together wherever they are based in the world.
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 15
<AdDed Extras
Cultural diplomacy
The greatest show on Earth
2008: Macbeth, based on Shakespeare, Edinburgh International Festival
Tenor Saxophonist, Konrad Wiszniewski
Edinburgh is set to play a starring role in the London 2012 Cultural Olympiad, the largest artistic celebration in the history of the modern Olympic and Paralympic movements.
16 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
As the countdown to the London 2012 Olympics continues, awareness has grown of the parallel programme – the Cultural Olympiad – designed to showcase the UK’s rich arts and culture. Since it’s inception in Paris in 1906 as an Olympic Arts Competition, the Cultural Olympiad programme has expanded in line with the scope of its better-known sporting partner. However, this year’s Cultural Olympiad will be the most ambitious yet, not only in terms of size and number of events but in remit and aims… helped significantly by Edinburgh’s involvement as the home of the world’s largest annual arts programme, the Edinburgh Festivals. Combined, the Edinburgh Festivals attract around 4 million attendees, involve more than 25,000 artists and 3,000 venues and generate in excess of £261 million for the Scottish economy. Of this, £245 million is injected into the Edinburgh City Region directly. In August, as the world’s elite and emerging athletes gather in London for the start of the London 2012 Olympics, the world’s elite and top emerging talent will be drawn to Edinburgh for this year’s Edinburgh Summer Festivals programme. “Three years ago Festivals Edinburgh began planning for what was going to
be a momentous period for Scottish and UK culture with the arrival of the 2012 Olympics and 2014 Commonwealth Games,” explains Amy Saunders Special Projects Manager, Festivals Edinburgh. “Jonathan Mills, Director of the Edinburgh International Festival, drew on Australia’s experience during the 2000 Sydney Olympics to propose a joint strategic approach to how Edinburgh’s Festivals could connect more effectively in an Olympic year and enhance relations with stakeholders; locally, nationally, and internationally, while also looking towards the Commonwealth Games in 2014.” By working closely with partners including the Scottish Government, The City of Edinburgh Council, Creative Scotland, VisitScotland, Marketing Edinburgh and the British Council, a strategy emerged to extract maximum return from Edinburgh’s recognised festival pedigree. Not only has this joined up approach contributed towards the largest Cultural Olympiad in the history of the modern Olympic movement, it also serves to showcase Scotland, and in particular Edinburgh’s appeal as a business, education and tourism destination.
Through partnership with the UK and Scottish Governments and British Council, the Edinburgh International Festival has helped co-create the Edinburgh International Culture Summit on 13-14 August. More than 50 ministers from around the world will gather at this inaugural event, designed to harness the power of culture as a catalyst for dialogue among nations. The Scottish Government’s Year of Creative Scotland provides the perfect backdrop against which to debate and explore the value of the arts and creative industries and thus discover new common ground between nations. “With the help of our partners we hope to host delegates before and after the summit, offering them the opportunity to explore and sample the largest cultural arts programme in the world,” adds Amy.“As with our previous work with international delegations from the likes of China, Brazil, India and South Africa, we hope to not only demonstrate the prestigious platforms Edinburgh’s festivals offer, but also help promote Scottish work to overseas partners.”
As well as the Culture Summit, this year will see a dedicated delegates centre established in Creative Scotland’s city centre office, while a microsite has been established to allow representatives to tailor their own itinerary, ensuring each delegate receives the ultimate Edinburgh Festival experience. “In trialling these new ways of working together, we aim to boost the profile of Edinburgh’s wider Festival offering, capitalising on the fact that the world’s attention will be focused on the UK for the Olympics and exploiting this activity for long term benefits,” says Amy.
Cultural Olympiad highlights
©Alan McAteer NVA’s speed of Light: this August, Edinburgh’s Arthur’s Seat will be the stage for a remarkable fusion of public art and sporting endeavour. The iconic mountain will be brought to life by 5,000 participants in a mass choreographed act of walking and endurance running. Red Baraat at the Edinburgh Mela: This larger than life Brooklyn-based nine-piece band set out on their first ever UK tour, creating a fusion of bhangra, jazz, funk and Latin sounds. (2 August)
Mela dancers
2008: Macbeth: A spectacular adaptation of Shakespeare’s timeless Scottish play, developed by the Edinburgh International Festival and directed by Grzegorz Jarzyna. (11-18 August) Scota-land: part of the Royal Bank of Scotland Imaginate Festival. A story of Destiny, adapted especially for children and shown across ten schools in Scotland. (27 August – 7 September) The Edinburgh Jazz and Blues Festival’s World Jazz Orchestra: Featuring musicians of different nationalities in every chair and directed by world-renowned saxophonist, Joe Temperley. (28 July) World Writers’ Conference 2012–2013 at the Edinburgh International Book Festival. Fifty leading authors from across the globe come together to discuss a range of themes. This groundbreaking event mirrors a debate in 1962, which led to a popularity explosion in literary festivals. (11-27 August)
Festivities on George Street, Edinburgh
www.investedinburgh.com
www.festivalsedinburgh.com
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 17
<THESTATISTICS
ANNUAL STATISTICAL OVERVIEW
Total population, City Region [3]
1,608,490 ... of which economically active [12]
74%
Households, Edinburgh [3]
220,195 ... in full-time employment [12]
52%
Households, City Region [3]
714,334 ... in part-time employment [12]
4%
7,728 Self-employed [12]
Net in-migration, City Region [3]
Employee jobs by industry
30 20
12,027 Unemployed and seeking work [12]
0
8%
latest GVA edinburgh (£million)
5 0-1
Managers and senior officials [1]
17% Financial and insurance activities [1]
£4,648
20000
Professionals [1]
19% Public administration; education; health [1]
£3,519
16000
Associate professionals and technical occ. [1]
16% Distribution; transport; accommodation and food [1]
£2,136
12000
Administrative and secretarial [1]
12% Business service activities [1]
£1,800
8000 4000
Skilled trades [1]
7% Real estate activities [1]
£1,112
8% Production [1]
£1,111
Tourism in edinburgh
latest registered enterprises in edinburgh
Nights stayed in Edinburgh (000s) [10]
1,605
Expenditure (£M) [10]
£1,015 Accommodation and food services [4]
1,400
£311 Construction [4]
Average expenditure per visit [10] Annual Airport Passenger volume [7]
Other
Financial and insurance activities
1112
Public administration; education; health
1800
4648
Distribution; transport; accommodation; food
2136
Business service activities 3519 Real estate activities
1,075
LATEST TRENDS Airport Passengers [7]
Q1/2012
Retail
Q1/2012
Footfall (number of pedestrians on Leith Walk) [13]
1,869,311
556,180
% Annual Change
-2.4%
Annual change
Hotel Occupancy [9]
64.2%
Sales (Edinburgh) % change on Q1 2011 [13]
-5.9%
% Annual Change
-3.5%
Sales (Scotland) % change on Q1 2011 [14]
-0.5%
Forward booking Q3/2012 [16]
59.6%
Sales (UK) % change on Q1 2011 [15]
1.6%
% Annual Change
-3.7%
UK Average Consumer Price Index [1]
3.5%
Labour Market
Q1/2012
Jobseeker’s Allowance Claimant Count* [20]
-11.9%
Housing Average House Prices [18]
11,927
£225,910
9.5%
% Annual Change [18]
4.3%
Jobseeker’s Allowance Claimant Rate* [20]
3.5%
House Sales [18]
2,081
% Annual Change
0.2%
% Annual Change [18]
7.3%
Vacancies advertised by Jobcentre Plus* [21]
2,938
Average house sales comparator cities [19] [i]
1,396
% Annual Change
31.6%
% Annual Change [19]
2.0%
*monthly average
Business
Q1/2012
Business Start Ups [22]
Scottish/UK GDP
573
Q1/2012 v Q1/2011 % change 0 -2 -4 -6 -8 -10 -12 Airport Passengers
0.5 0.0 -0.5 -1.0 -1.5 -2.0 -2.5
-0.1%
Total Gross Value Added, UK [1]
-0.3%
5
1,493
Services Sector, Scotland [12]
0.1%
% Annual Change [23]
32.1%
Services Sector, UK [1]
-0.1%
3
Construction Sector, Scotland [12]
-2.5%
Construction Sector, UK [1]
-0.2%
0%
Retail Sales
Total GDP
Services Sector
Construction Sector
6
41.8%
% Annual Change [24]
Footfall
7
New Incorporations [23]
7
Forward bookings Q3
Q1/2012 Claimant Rates [i]
% Annual Change [22]
Foreign Direct Investment Projects [24]
4 2 1 0 Edinburgh
Comparator Cities
Scotland
Aberdeen
Glasgow
For monthly updates on Edinburgh’s Economy see ‘Essential Trends’ and ‘Edinburgh Economy Watch’
SourcES
18 INVEST EDINBURGH | JULY to SEPTEMBER 2012 |
1 2 3 4 5 6
Office of National Statistics General Register Office for Scotland National Records of Scotland Scottish Corporate Sector Statistics (2010) Valuation Office Agency Edinburgh Solicitors Property Centre
7 Edinburgh Airport/(BBA) 8 Office of Rail Regulation 9 STR Global 10 VisitScotland 11 International Congress and Convention Association 12 Scottish Government
Software & IT Services
13 14 15 16 17
Financial Services
Business Services
In the five years between April 2007 and April 2012, 38 companies from North America invested in Edinburgh and created 2,400 jobs in the city. The vast majority of these companies came from the United States – the most recent one being enStratus™ (see New Arrivals on p7 in this issue). Most companies that invested in Edinburgh (12 out of 38, or 31.6%) are operating in the Software & IT Services sector; other companies with an appetite for Scotland’s capital are from the Business Service sector (7 out of 38, or 18.4%), or Financial Services industry (5 out of 38, or 13.2%). The biggest move in terms of capital investment was conducted by New York-based investment firm BlackRock who, in March 2011, created 250 jobs in Edinburgh and thereby doubled the size of its workforce. The biggest inward investment in terms of job creation was conducted by amazon.com. The Seattlebased online-retailer created 500 jobs with its Customer Contact Centre in May 2011. This information was derived from fDi Markets, the Financial Times’ Crossborder Investment Monitor.
Q4/2011
Total Gross Value Added, Scotland [12]
Hotel Occupancy
Scottish GDP vs UK GDP Q4 2011
Q4/2011
% Annual Change
fell 6.41% over same period)
Royal Bank of Scotland Group Standard Life plc Cairn Energy
29/03/12 22/06/12 % change 276.4 227.5 329.4
242.2 225.7 256.1
-13.7 -3.5 -25.1
The City of Edinburgh Council Scottish Retail Consortium British Retail Consortium Lynn Jones Research Scotland’s Global Connections Survey 2009 18 Register of Scotland
Murray International Trust
999.0
959.0
-3.3
13.3 96.4 410.6 204.0 1.4 394.1 10.3
9.75 59.5 300.0 194.5 1.1 283.7 13.0
-29.0 -33.9 -28.5 -7.3 -25.7 -71.9 26.8
596.0 128.0 238.4 186.7
570.5 123.6 190.0 190.0
-4.5 -3.3 -12.9 1.6
6.2
5.3
-30.26
633.6 99.4 246.2 499.3 691.0 227.0 484.9 704.1
562.6 75.0 229.8 478.0 670.0 210.5 447.7 647.0
-11.8 -20.6 -5.5 -4.3 1.0 -9.2 -7.6 -8.1
FTSE aim all share
For more annual statistical information see www.edinburgh.gov.uk/edinburghbynumbers
Tourism
FTSE 100 (
FTSE 250
+ 85
Consumer Products
1,340
9,386,082 Administrative and support service activities [4]
-84 75
Gross value added of Edinburgh, £ million (2009) Total = £16.7 billions
2,495
3.7 Information and communication [4]
-54 -74 -64 45 65 55 Men Women
Textiles
3,290
12,030 Wholesale, retail and repair [4]
Average nights stayed in Edinburgh [10]
-34 5-44 -24 3 25 20 Age band (years)
0
latest
3,267 Professional, scientific and technical activities [4]
Visits to Edinburgh (000s) [10]
-19 16
Average gross disposable household income* per resident in major UK cities (2009)
latest
Personal services [1]
edinburgh COMPANY Index – share price comparison (pence)
10
10%
London
Net in-migration, Edinburgh [3]
40
Greater Manchester
344,400
Glasgow
495,360 Number of people aged 16–64 [12]
50
Bristol
Total population, Edinburgh [3]
Inward Investment from North America to Edinburgh
Age structure of Edinburgh (2010)
latest
Edinburgh
latest Labour Supply and market
Population (‘000s)
Population & Households
19 Land Registry (English & Welsh Cities) 20 Department of Work and Pensions 21 Jobcentre Plus 22 Business Gateway 23 FAME 24 FDI Markets
population On 30 May 2012, the National Records of Scotland (NRS) published their 2011 mid year population estimates. According to their calculations, the population of Edinburgh in mid 2011 was 495,360 – an increase of 9,240 over the year. This is the highest annual increase ever experienced (1.9%).
[i] Comparator cities are Birmingham, Bristol, Cardiff, Glasgow, Leeds, Liverpool, Manchester, Newcastle and Nottingham.
Havelock Europa plc Bowleven plc Craneware Cupid Ltd Dawson International plc IndigoVision Group plc Omega Diagnostics Group plc
FTSE small cap John Menzies plc Melrose Resources Optos plc Wolfson Microelectronics plc
FTSE fledgling index Johnston Press plc
major investment trust companies Aberforth Smaller Companies Trust Caledonian Trust Edinburgh Dragon Trust Edinburgh Investment Trust Edinburgh US Tracker Trust Scottish American Investment Trust The Scottish Investment Trust plc Scottish Mortgage Investment Trust plc
Figures were taken from www.google.co.uk/finance for closing price on 22/6/12.
10000 8000 6000 4000 2000 0 -2000
Annual population change 2001 to 2011: City of Edinburgh
1 0 9 8 7 6 5 4 3 2 1/0 002/0 003/0 004/0 005/0 006/0 007/0 008/0 009/1 010/1 2 2 2 2 2 2 2 2 2 200
Given the population growth over recent years, it is likely that Edinburgh’s population is now over half a million. Importantly, for employers and investors, Edinburgh’s population structure differs from the national average with more young adults and fewer children and older adults.
The population growth in Edinburgh has been largely in the economically active age groups. While the retired age population of Scotland has increased by more than 10% in the last 10 years, Edinburgh’s retired population has grown by only 1%.
Follow the Council’s Strategy & Research LinkedIn Group to keep informed about latest findings/surveys
| JULY to SEPTEMBER 2012 | INVEST EDINBURGH 19
Edinburgh In brief... EASY ACCESS TO MARKETS A wealthy population: average Gross Disposable Household Income Per Resident
£13,600
£13,300
£19,700
£17,200 £13,600
London
An increasing population
2 200
Edinburgh
448,000
7 200 Glasgow
Manchester
Bristol
468,000
2 201
IN GOOD COMPANY
500,000
FDI in the City of Edinburgh number of projects number of jobs
2061 1887
1090 970 12 2007
888
34
26 18
13 2008
2010
2009
2011
Top 5 Edinburgh-based companies by pre-tax profits (2010) £m
Aberdeen 2hrs 30mins
New York 7hrs 40mins
Stockholm
1
Scottish Widows Group Ltd
2
Standard Life PLC
£971.00
3
Heineken UK Ltd
£730.90
4
Cairn Energy PLC
£467.70
5
Diageo Scotland Ltd
£258.00
£1215.50
2hrs 5mins
Glasgow 50mins
Istanbul 4hrs 20mins
Direct links and times from Edinburgh
TRANSPORT LINKS and TELECOMMUNICATIONS
See overleaf for more statistics... All rights reserved. Material contained in this publication may not be reproduced, in whole or in part, without prior permission of the City of Edinburgh Council (OR OTHER COPYRIGHT OWNERS). Whilst every effort is made to ensure that the information given herein is accurate, no legal responsibility is accepted for any errors, omissions or misleading statements.
Ed in bu rg h
Gl as go w
8 M .9 bi t/s ec Bi rm in gh am
Lo nd on
8 M .8 bi t/s ec
h nc sy es. nd iti ba c ad UK ro jor e B ma ag n er d i Av pee s
8 M .9 bi t/s ec
4 hrs
9 M .5 bi t/s ec
London
1 M 0.1 bi t/s ec
40mins
Liv er po ol
Dublin