Global Public Cleantech Companies See Strong Growth

LONDON, May 10, 2011 /PRNewswire/ -- The aggregate net income of public specialized cleantech companies worldwide grew 126% to US$5.1b between 2009-2010, according to a new report by Ernst & Young. The report, Seizing transformational opportunities: Global cleantech insights and trends report 2011 features the organization's first annual report on the population and performance of 'pure-play' cleantech companies.(1) The number of companies also grew over 9% between 2009 and 2010 to 399 organizations while their combined market capitalization grew 27% to US$243.2b.

On several key measures the tracked companies showed strong growth despite challenging economic conditions. Total revenues over the 12 months to the end of September 2010 reached US$152.8b, an increase of 21% from the same period in 2009. Total market capitalization increased 27%, 7% due to same-company annual growth and 20% due to the addition of new public companies. The companies have a median 'time since incorporation' of just 13 years, yet employ nearly 500,000 individuals.

Gil Forer, Ernst & Young's Global Cleantech Leader, comments: "The growth in the population of pure-play public cleantech companies and the improvement in their financial performance signifies the industry's ability to create new market leaders. These companies are at the forefront of the transformation to a more resource-efficient and low-carbon economy."

Regional influence

The Asia-Pacific region hosts the largest number of companies (149), whose revenue grew 44% between 2009 and 2010. Asia-Pacific companies have the highest median headcount per company (400 employees) reflecting the region's low-cost manufacturing workforce. China accounts for the greatest share of the Asia-Pacific company population, home to 52 companies with an aggregate headcount of 133,200 and a combined market capitalization of US$60.1b—the highest market value of any country.

Europe is the leader in terms of cleantech company revenues which reached US$72.8b in 2010. The region is the second-largest in terms of the number of companies (128), headcount (156,700) and market capitalization (US$85.5b). With 44 public cleantech companies, Germany is the regional leader in terms of the number of companies; Spain is the regional leader in terms of cleantech company market capitalization, with an aggregate value of US$20b.

With 117 public cleantech companies, North America is third-largest in terms of population.  Regional revenues were US$23.2b in 2010, an annual increase of 34%. The United States is home to largest number of cleantech companies (72) globally with a total market capitalization of US$45.1b.

Forer continues: "The growth of the global cleantech market is being propelled by corporate adoption of clean technologies, government strategies to exploit cleantech for national competitive advantage and entrepreneurs who see the opportunity to participate in what many observers characterize as the next industrial revolution. Public pure-play cleantech companies are part of a broader global market that consists of thousands of venture-backed start-ups, private entities and large Fortune 1000 corporations."

Segment analysis

Examining the public cleantech market across 13 different sub-segments showed that solar constitutes over 25%, with 102 companies, of the total company population surveyed. These solar companies employ more than 160,000 individuals and generated more than US$52.8b in revenues. Wind is the second largest segment in terms of number of companies, followed by the energy storage industry. The youngest of all the segments in terms of time since incorporation is biofuels, with a median age of seven years.

New entrants

The global public cleantech population increased nearly 10% through 38 IPOs in 2010 which raised US$9.7b. IPO activity was propelled by a spate of listings by Chinese companies. The 20 Chinese IPOs in 2010 raised US$4.7b, accounting for 53% of the deal activity and 49% of the capital raised. The solar segment saw the largest number of IPOs in 2010, with 11 deals representing 29% of activity and 17% of capital raised. Wind offerings, however, raised the most capital of any segment − US$3.0b − thanks to several large deals from China. The US$3.2b IPO by Enel Green Power SpA on the Milan Stock Exchange was the largest cleantech IPO of 2010.

Forer concludes: "We can expect further growth in the number of pure-play public companies as well as improving financial performance as the economic recovery continues. Additionally, the return of global IPO activity to pre-downturn levels and a strong pipeline of offerings in China will likely generate a significant number of new entrants. Political instability in the Middle East and the natural disaster in Japan in particular may cause national governments to further promote domestic cleantech industries."

Notes to editors:

About the report - Seizing transformational opportunities: Global cleantech insights and trends report 2011

The objective of the report is to provide annual quantitative measures of the pure-play cleantech population as it grows and matures − including the number of companies, headcount, revenues, net income, market capitalization and debt  − and offer insights into unique geographic and industry sub-segments.

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This news release has been issued by EYGM Limited, a member of the global Ernst & Young organization that also does not provide any services to clients.

(1) "Pure-play" is defined as companies whose clean energy focus is designated A-1 Main Driver (50%–100% of value) by Bloomberg New Energy Finance (BNEF); excludes listed investment funds and acquisition vehicles.

SOURCE Ernst & Young