When the European Demolition Association (EDA) published its first report into the industry at the end of last year, it suggested that the data it had collected – during 2014 – showed “a certain stability in the evolution of the demolition business”.
With more than half of this year’s d&ri100, as in previous years, being made up of European companies, the question was to what extent this stability would be borne out by our respondents during 2015.
Here are some of the messages to come out of this year’s survey.
US has greater average turnover
The 100 companies in this year’s list are responsible for a combined turnover of US$5,875,640. This in turn breaks down to $3.3 billion for European companies, $2.2 billion Americas and slightly less than $400 million for the rest of the world. On that basis, Europe has increased its grip on the market compared to the relatively slender lead it had over the Americas. However, with more than twice as many European companies in the list as their transatlantic counterparts, the Americas has the edge in terms of average turnover per company. Of the top 10 companies in this year’s table, the combined turnover of the five American companies was more than $250 million greater than the British, Belgian and Norwegian contractors who also formed the d&ri100’s upper echelons.
NorthStar continues to shine
Europe may have the most companies in the d&ri100 – more than 60 of them – but the United States has the largest single business. NorthStar Group Services, formed two years ago as the result of a merger between LVI and NCM Group Holdings, quickly claimed top spot in last year’s d&ri100 and retained it with some comfort this time round. Indeed, the company increased its already colossal – in demolition terms – turnover by more than $140 million, posting a total for 2015 of close to $620 million. (The turnover figures for the d&ri100 are listed in US dollars; where companies have supplied in other currencies these are converted using an average exchange rate for the whole of the 2015 calendar year).
Keltbray leads European challenge
It may be difficult to see NorthStar’s position being usurped in the next few years, but that doesn’t mean that other companies aren’t giving it a good try. United Kingdom-based Keltbray had a successful year, turning over more than $300 million, to retain second place. The first mover in the top 10 was Penhall, from fourth to third and in the process dislodging Brandenburg Industrial Service Company to sixth. However, the most significant change within the top 10 was another UK business, Erith Contractors, which climbed eight places to fourth. Winner of a Contract of the Year award at D&Ri’s World Demolition Awards last November, Erith looks set to benefit from the industry’s surge in activity related to London and the south east of England and it would be no surprise to see the company keep up the momentum when next year’s list is published.
The big companies still hold sway
For another example of NorthStar and Keltbray’s pre-eminence, compare the total value of the d&ri100 with their own figures. At a shade under $6 billion, the total turnover for our 100 companies in 2015 was almost half a billion larger than 12 months ago, but around one-sixth of the overall figure was contributed by just those two companies. It’s far from an isolated incident as well. The top five companies between them generated almost $1.5 billion of turnover – a quarter of the total. When the other companies making up the top 10 are added in, the total rises to $2.37 billion. A cumulative $3 billion is reached with Cardem, in 18th place and the first company in the list with turnover during 2015 under $100 million.
The rest of the world
McMahon Services remains the first company in the list outside Europe and North America, at the same retaining its place in the top 20, but only just. The Australian company suffered a drop in turnover and fell five places in the list. Canadian companies Quantum Murray and Priestly Demolition once again continued to challenge just outside the top 20 along with a slew of UK companies such as Ron Hull Demolition, John F Hunt Demolition, the Cuddy Group and Brown and Mason, which broke the $50 million barrier after a rise in turnover of more than 10%.
Small companies make big climbers
The middle third of the list had some of the most improved companies when considering their percentage improvement in turnover compared to 2014, with countries on both sides of the Atlantic represented. The USA’s Adamo Group climbed 22 places to 34th on the back of an increase in turnover from $28 million to $48 million, while the UK’s 777 Group advanced from 82nd last year to 36th, more than doubling its turnover to $42 million in the process. Another UK-based company, Cantillon, was not quite as successful but still posted more than $35 million, which was enough to result in a climb of 30 positions and a place in the top half of the table. Going the other way was Brazil’s Fabio Bruno, which dropped out of the top half after seeing its turnover fall to just over $30 million. Immediately ahead of Fabio Bruno was Italian contractor Despe, which can probably consider itself unlucky to have fallen seven places after realising a similar turnover level to 2014. Perhaps some of the outstanding performances described above were a factor.
New entrants help increase numbers
Altogether there were seven new entrants to this year’s d&ri100. Of those four were from Europe and three from North America, so in that sense the geographical balance was observed. The European companies included Russia-based Raz-Max, whose demolition projects in St Petersburg and the surrounding area were featured in the previous issue of D&Ri. Among those representing the US demolition industry were B&B Wrecking, which brought up 100th place with turnover of just over $15 million – a significant milestone in itself.
$15 million is no longer enough
For a place in the d&ri100, the bar has been raised to the point where $15 million is no longer enough for a seat at the table. Compared to the telephone numbers at NorthStar and Keltbray’s end of the list, it is not a huge sum, but it’s $2.5 million more than would have been enough to populate the list two years ago. The picture has changed to the extent that all the countries immediately outside the top 100 are at or around the $15 million level. However, the volatile and rapidly changing nature of so many industries at the moment, not just demolition, means that we can take nothing for granted.
D&Ri would like to thank all the companies who supplied information for this feature.
This article is taken from the May-June issue of Demolition & Recycling International magazine. To read it in full, including the listing of companies and other data from the survey, or to receive the magazine on a regular basis, please visit www.khl.com/s