How is Italian capitalism changing? Greater emphasis on manufacturing and less on energy and services. A greater presence of large international groups (including those of Italian origin) and growth in medium to large-scale manufacturers with a capacity for expansion abroad. In short, those that are managing to combat the crisis are corporate groups exposed to competition, that great driver of competitiveness, while businesses in more “protected” industries suffer, unable to sell their services on the open marketplace. Once again, Mediobanca has painted us this complex picture in its annual analysis on the leading Italian enterprises, a report now in its 49th edition with nearly half a century of annual reports and other numbers on manufacturers, banks, insurance companies and mid-sized to large-scale service firms.
So let’s take a look at the rankings. Headlines in both Il Sole24Ore and Corriere della Sera report that Exor-FCA has surpassed Eni in the rankings of big industry. Indeed, during the first six months of 2014, revenues for Exor, led by the Agnelli family through the Fiat-Chrysler merger, exceeded 58 billion (and were 113.7 billion for the full year 2013) compared to 56.6 billion for Eni (which posted 114.7 billion in 2013). In 2013, Exor-FCA was already first in terms of number of employees, at 306,000, the same level of the early 1980s (but at that time, 80% of all Fiat employees worked in Italy, whereas now only 26% does, and sales in Italy account for barely 8% of the group’s total revenues). In short, thank you Chrysler and globalisation. And with the name change, all that we see of Fiat is the initial “F” in “FCA”, which stands for Fiat Chrysler Automobiles.
Eni has maintained its title as champion in profits at 13 billion for 2012-13, followed by Enel (3.5 billion) and Exor (2.4 billion).
But what else do we see in the rankings? Having been essentially unchanged for years, we now have a new entry in the top 20: General Electric Italia (formerly “Nuovo Pignone” from Florence), which now leads the American group’s oil and gas business (and is one of the best examples of the importance of international investment in helping Italian industry to grow) and which has jumped from 29th to 19th place thanks to investment in Avio.
Others moving up in the rankings include Edison, Luxottica, Poste Italiane and Esselunga (the supermarket chain owned by Bernardo Caprotti), as well as Salini (construction) with the acquisition of Impregilo, all working hard to grow and to be more competitive and more profitable.
Among the top 20, we have nine companies in the energy industry, six in manufacturing (in addition to Exor-FCA at number one and GE Italia, the new entry, there is also Finmeccanica, Luxottica, Prysmian, and Pirelli, all with strong sales abroad), and five in infrastructures and services. Seven groups are state owned, and five are controlled by international entities.
Mediobanca’s ranking only includes groups whose head offices are in Italy. As such, it does not include Techint, led by the Rocca family, which would place sixth behind Telecom with 19.1 billion in revenues; STMicroelectronics, which would place 20th with 6.1 billion in revenues; or Ferrero, which would come in at 12th place with 8.1 billion – all of whom would further strengthen the presence of manufacturing. In the same way, it does not include the Italian business of the French firm Lactalis, which is owned by Parmalat.
Finally, the rankings also show an improvement in mid-sized manufacturers, which, in many cases, posted increases in revenues on the order of 20-55%. This includes SimiGroup, Stevanato, Ballarini, Stefano Ricci, Uteco Converting, Casa Vinicola Botter, Ecuador, Fosber, Chimec, Euroitalia, and the MCZ Group, all dynamic, efficient, competitive “pocket-sized” multinationals and testament to the fact that good Italian capitalism and industry still has a few tricks up its sleeve.