The annual Value Added scoreboard enables comparison of the level of wealth created by the UK and Europe’s major businesses
The most recent scoreboard (published 26 June 2009) is based on company reports for the period 2007/08. It shows that the top 800 UK businesses increased their wealth creation - their ‘value added’ - by about 8% during this period. Value added by the top 750 European companies during the same period increased by 6%.
Science and Innovation Minister, Lord Drayson said:
“The marked increase in the value added by companies for 2008 was achieved in largely benign economic conditions, but it is pleasing to see UK firms continue to rank among the best in Europe. The UK is still one of the best places in the world for innovation and we will continue to support companies who innovate and invest in the future.”
Value added (VA) is defined as the difference between sales and the cost of bought-in materials, components and services. An alternative but equivalent formula is used to calculate VA from company accounts. Financial markets tend to reward companies showing consistently high value added performance with a high market capitalisation to value added (MC/VA) ratio, which represents expectation of future value.
The Value Added scoreboard 2009 can be downloaded at http://www.innovation.gov.uk/value_added.
