Shining through: Top 50 Rising Stars

Great businesses push the boundaries. Business XL brings you the 50 fastest-growing entrepreneurial companies in the UK today – with their combined sales of over  £850 million and profits exceeding £110 million 

1. IOKO365
Turnover: £27.5 million
Pre-tax profits: £3.6 million
Location: London
‘The catalyst for the growth has been digital convergence,’ says John Griffin, chief global sales and marketing officer at IOKO365, which designs, builds and maintains IT platforms for clients seeking to operate across TV, mobile and web platforms, such as the BBC and Disney. Given that IOKO manages as well as installs its systems, Griffin says there is a healthy mix of one-off fees and recurring revenue. Overseas expansion should provide a sound base for future growth, with footholds in the Middle East, Russia and, more recently, the US, where the telco AT&T has already been bagged as a client.
Griffin expects ongoing growth of around 30 per cent a year as media companies continue to innovate. ‘I don’t see Google or Apple slowing down,’ he says.

2.Lighter Life
Turnover: £18.7 million
Pre-tax profits: £3.1 million
Location: Essex
While obesity is a serious problem in the UK, weight-loss specialist Lighter Life has managed to pile on a healthy amount of pounds. The company, which works through a network of counsellors as well as supplying all its clients’ low-calorie food, shows a bulging turnover of £18.7 million, having almost doubled in size since last year. Octavia Morley, Lighter Life’s chief executive, sees increasing interest in the company’s services as people search for healthier lifestyles. ‘In the past four years, we have really started to grow, and that is partly because of client referrals. The results of the programme are visible on people, so they then recommend us to friends,’ she says. Morley even claims that clients will save money as they tighten their belts, giving the company some credit-crunch appeal.

3.The Listening Company
Turnover: £37 million
Pre-tax profits: £2.6 million 
Location: Richmond, Surrey
A call centre with a consultancy arm, The Listening Company is set to boost turnover to £47 million by next year-end, claims CEO Neville Upton. ‘I set the company up because I thought there was a big market for people who wanted a quality service – a lot of call centres fall short of consumer expectations,’ he says. BT, Volvo, Shell and Microsoft are among the luminaries on the client list, and rugby supremo Lawrence Dallaglio has recently been brought into the fold to help push leadership initiatives among the 2,500 staff. ‘We have 31 project managers and I haven’t lost one in five years. That gives us the power of continuity,’ adds Upton. Disillusionment with overseas call-centres and the need to cut costs by outsourcing during these lean days all augur well for the company in the near future.

4.SimplyBiz
Turnover: £10.7 million 
Pre-tax profits: £4.5 million  
Location: West Yorkshire
Ken Davy walked off with a fortune when he sold LSE-listed financial advisory business DBS Management to software group Misys for £75 million. It wasn’t long before he started up again, though, and in the past six years he’s grown his current company SimplyBiz to a turnover of £10.7 million. The mission of SimplyBiz is to offer comprehensive support services to independent financial advisers (IFAs) without tying them into a ‘network’. Davy is bullish about his ability to win IFAs over from other organisations. ‘The only inhibitor is the total size of the marketplace,’ he states, adding that there are roughly 10,000 IFA firms in the UK, of which SimplyBiz boasts a market share of 15 to 20 per cent.

5.Rico Logistics
Turnover: £36 million 
Pre-tax profits: £2 million  
Location: Berkshire
Sam Sharma has come a long way since he resigned from a DIY centre to set up his own business with a friend from college with £1,000. With courier and delivery concern Rico Logistics, Sharma has built up a fast-growing, profitable organisation with a presence in 35 sites across the UK and over 1,000 vehicles. ‘We’ve enjoyed great dividends over the years,’ he says. ‘We now need to invest more in the infrastructure of the business to make it more robust.’ According to Sharma, getting the staff training right has been a decisive factor in the company’s growth story. ‘We interact with customers all day long,’ he says. ‘The truth of the transport side of the business is that they will book with you based on your personality.’

6.Daisy
Turnover: £33.2 million 
Pre-tax profits: £2.1 million   
Location: Lancashire
Matt Riley is used to winning awards, but he was more than usually excited to be named Bank of Scotland Entrepreneur of the Year. That might have something to do with the fact the recognition came with a £5 million interest-free loan, which enabled him to go on an acquisition spree, adding four companies to his business-to-business telecoms group. ‘We’re planning three more deals before Christmas,’ says the 34-year-old, slightly breathlessly. ‘Then we’ll take a look at what we need to get to the next stage of growth.’ Daisy has grown turnover 67 per cent to £19.9 million in the past two years, organically and through acquisition, while profits have exploded from £93,000 to £2.1 million. ‘June had the best sales ever – when people are looking to save money, telecoms comes straight to mind,’ says Riley.

7.John M Henderson
Turnover: £25.6 million 
Pre-tax profits: £3.2 million  
Location: Scotland
Oil and steel engineering company John M Henderson quadrupled sales to £25.5 million in the past year after a lucrative contract win in Korea. Price increases in coke, needed for the steel process, have led to renewed investment by steel companies in developing their own materials, which has stoked the company’s sales of coke ovens. Rising energy prices have also played into Henderson’s hands: oil was originally a sideline but the company invested in it and revenues from that side of the business have doubled in the past two years. In addition to this, Henderson has recently teamed up with a renewable energy company. Chief executive Alistair Lauchlan says: ‘If we can get involved early in this area, it’ll give us a chance to grow.’

8.S Lucas
Turnover: £11.4 million 
Pre-tax profits: £1.2 million  
Location: Kent
Sam Lucas formed spray paint and coatings specialist S Lucas with a £50 loan nearly 40 years ago. Since then, this family-owned operation has gone on to complete work at the Barbican, St Pancras Eurostar terminal and, more recently, Heathrow’s Terminal Five. MD Danny Lucas, Sam’s son, puts the company’s success down to its family-based work ethos. ‘There’s no advertising in construction, it’s all done by word of mouth and repeat orders,’ he comments. ‘Every job could be your last if you don’t offer on-time delivery and high-quality service, no matter how small it may be.’ Having weathered two recessions already, Lucas is unfazed by the prospect of a slowdown, saying that one of the company’s strengths is its flexible workforce. ‘We have contract managers who are prepared to change out of their suit and work on site if need be,’ he says.

9.FDM Group
Turnover: £49.8 million
Pre-tax profits: £4.3 million
Location: Sussex
‘We are a margin-led growth story,’ enthuses Rod Flavell, seasoned IT services man and hot seat incumbent at outsourced IT solutions star FDM. With its origins in staffing, FDM has seen its consultancy business outgrow its contracting offering, with Flavell successfully exploiting a niche between expensive, larger IT services providers and the lower-cost offshoring option. The company has enjoyed buoyant demand for its services from clients including Barclays and the BBC in spite of the current economic malaise. From rather modest four per cent top line growth to £25.4 million, interim profits at the pre-tax line powered ahead by 31 per cent to £2.4 million. City number crunchers see profits moving to £5.1 million this year.

10.Kingdom Security
Turnover: £8.5 million 
Pre-tax profits: £1.0 million  
Location: Merseyside
Ex-policeman Terry Barton founded security guard business Kingdom in 1993. Over the past two years, it has almost doubled turnover to £8.5 million while pre-tax profits have swelled 71 per cent to £1 million. Senior operational executive Mark Wallace explains that Kingdom’s growth is down to Barton’s decision to bring in management expertise from outside (in HR, IT and other areas) rather than following industry norms of simply promoting existing employees. ‘We took the decision not to employ traditional salespeople,’ adds Wallace. ‘We have sales teams to arrange meetings, but only executive-level people go to those meetings.’ Another breakthrough for the business, according to Barton, has been in the area of guard welfare. Flexible working hours and perks such as VIP Premiership football tickets have kept annual staff turnover down to 16 per cent, roughly half the industry average.

11.Redhall
Turnover: £43.2 million
Pre-tax profits: £2.3 million
Location: West Yorkshire
Engineering support star Redhall continues to clinch contracts in regulation-driven sectors such as chemicals, food manufacturing and nuclear services. Results for the half to March show a 116 per cent surge in pre-tax profits, reflecting both organic and acquisitive growth.

12.Cheapflights
Turnover: £15 million 
Pre-tax profits: £2.9 million  
Location: London
Profits for flight comparison website Cheapflights have been soaring, due to a combination of growing internet usage, the shift toward online advertising and a proliferation of inexpensive airline operators (minus XL Leisure Group, of course).

13.Velcourt Group
Turnover: £21.3 million 
Pre-tax profits: £2.6 million   
Location: Herefordshire
While agriculture in the UK has been on the wane, Velcourt has shown healthy signs of growth. The company provides smaller farms with working capital and sector expertise in exchange for a fee and a cut of their profits. CEO James Townshend says: ‘Agriculture is out of synch with the global economy at the moment as we are seeing a global recovery.’

14.MDM Timber
Turnover: £24.3 million 
Pre-tax profits: £1.3 million
Location: Essex
Wood supplier MDM Timber is bucking the construction industry trend by reporting record profits. MD Malcolm Allum primarily attributes the company’s growth to its ability to make deliveries to its clients – timber merchants – on demand. He says: ‘Of course we are not immune to recession, but we are confident, being based in the South East, that we are in the right area of the country for contracts, particularly with the London 2012 Olympics on the way.’

15.Aukett Fitzroy Robinson
Turnover: £20.3 million 
Pre-tax profits: £2.3 million  
Location: London
Formed through the long-touted reversal of the flourishing Fitzroy Robinson into the listed, but financially struggling, Aukett in 2005, Aukett Fitzroy Robinson is an award-winning architecture and design group with hubs in London, Moscow and Abu Dhabi.

16.Amphion Innovations
Turnover: £1.5 million 
Pre-tax profits: £5.8 million   
Location: London 
Amphion invests in and nurtures high-growth ventures in the medical and technology sectors. Perhaps signifying the quality of its assets, the company continues to raise sizeable sums of money for partner companies in spite of the ravages of the credit crunch.

17.Freshwater UK
Turnover: £6.5 million 
Pre-tax profits: £920,000  
Location: Cardiff
Freshwater CEO Steve Howell recounts: ‘I left the BBC in 1997 to start up a PR business in Newport. We rebranded and listed on AIM last year in order to continue our acquisitive strategy of expanding outside Wales.’ The goal is ‘to create a network of PR agencies, specialising in areas such as public affairs, technology, healthcare and utilities.’

18.Bond International Software
Turnover: £29.4 million  
Pre-tax profits: £5.1 million  
Location: West Sussex
Established in 1973, Bond International Software offers IT solutions to HR and recruitment companies. In the past year, it has seen turnover grow by 71 per cent. MD Tim Richards notes that part of this growth came from the £1 million acquisition of Team Spirit Software earlier this year, which follows the purchase of the Gowi group. Meanwhile, healthy organic growth has allowed the company to expand its international presence, with offices in Hong Kong and Canada opened in the past two years. Clients include recruitment concerns Michael Page and Manpower, but Richards observes that there is a good spread of clients across the public and private sectors, and in multiple locations around the world.

19.Television Systems
Turnover: £27.5 million 
Pre-tax profits: £2.0 million      
Location: Berkshire 
Broadcast media specialist Television Systems (TSL) has been going 23 years, but has grown particularly fast in the past four or five thanks to the advent of high-definition (HD) technology and the increasing global opportunities it has brought, according to CEO David Phillips. The business specialises in the systems and equipment that enable broadcasters to get a picture from its source to the viewer. That could be anything from building HD trucks to designing a workflow to adapt live sports content for overseas audiences. ‘We’ve just opened a Dubai office, and we see that as a springboard for expansion into India, Pakistan and the African countries,’ says Phillips, who adds that TSL recently played a key role in facilitating the BBC’s HD coverage of the Beijing Olympics.

20.Tectrade
Turnover: £27.5 million  
Pre-tax profits: £1.1 million  
Location: Surrey
Tectrade’s MD, Ken Hogan, describes the current economic downturn as a phoney war. ‘We keep looking for signs of business falling off, but we’re just not seeing it,’ he comments. From its bases in England and Holland, the company helps larger organisations consolidate their servers and the data stored on them – a big growth area, especially now that rising energy prices have sent running costs soaring. Hogan says Tectrade’s resilience is partly because the company delivers cost savings, and partly because its clients are larger, more stable organisations that themselves are growing and increasing in complexity. ‘We look at a customer over the next three years. If we don’t do a good job, we’re not losing one year’s revenue, we’re losing three years’ revenue,’ he states.

21.First Derivatives
Turnover: £12.6 million  
Pre-tax profits: £4.7 million  
Location: Northern Ireland
Guided by founder and capital markets mover and shaker Brian Conlon, First Derivatives provides services and software products to ‘a roll call’ of blue-chip investment banks in London and New York. While the credit crunch rages, Conlon, chief executive, describes the services side of the group as ‘our business-as-usual side’, identifying the algorithmic programme trading business as an exponential growth sweet spot. ‘Volumes are going up, despite the markets going down,’ he enthuses. Building on its expertise in areas such as real-time trading risk and market data, First Derivatives delivered a sixth consecutive year of strong growth for the year to February 2008. ‘We’re now hoping to expand geographically, broadening the range of products we provide to capitalse on the trend towards outsourcing in the investment banking world,’ says Conlon.

22.Hallin
Turnover: £36 million  
Pre-tax profits: £6.2 million  
Location: Scotland
After a decade of organic growth in a buoyant sector, oil and gas services specialist Hallin Marine Subsea International recently bought engineering consultant Prospect Flow Solutions for £3 million in shares and cash. The company, which operates in South East Asia and the Middle East, will pay up to another £1.6 million if certain targets are met by 2010.  Chief executive officer John Giddens, the former Royal Navy diving officer who set up Hallin ten years ago, declares ‘we do not rule out further acquisitions’.

23.Crantock Bakery
Turnover: £8.7 million  
Pre-tax profits: £807,000
Location: Cornwall
Cornish pasty-maker Crantock Bakery has seen growth in turnover of 24 per cent following a nationwide increase in business-to-business demand for its products. This includes supply to national outlets such as Oggy Oggy, Cornish Bakehouse and Morrisons. As well as having reached nationwide coverage, the company also supplies outlets in Portugal, Spain and Cyprus for the “Brits abroad” market. MD Nick Ringer believes the pasty remains a sturdy perennial in the snack world, commenting that ‘the “food on the go” market is expanding at the moment’.

24.Hexagon Human Capital
Turnover: £28.6 million 
Pre-tax profits: £2.8 million  
Location: London
“Leadership talent” venture Hexagon was floated on AIM in 2007 by CEO Jonathan Wright, a former racing driver and once the engine behind Alexander Mann, where he forged a business relationship with Dragons’ Den star and Hexagon investor James Caan. Wright expects Hexagon to profit in foul weather and fair: ‘In bull markets, there is demand for [interim managers] to carry out acquisitions and push through integration, whereas in difficult markets, private equity players often kick out CEOs and need short-term replacements.’

25.Wireless Data Services
Turnover: £35 million 
Pre-tax profits: £2.2 million  
Location: Dorset
As mobile phones and wireless applications become increasingly sophisticated, Wireless Data Services has found a larger market for its support services. WDS has grown sales 41 per cent to £35 million in the past year, largely through international expansion, most recently in South Africa and the US. CEO David Ffoulkes-Jones comments: ‘Despite the downturn, we are showing no signs of slowing down. This is because, even if people aren’t buying new phones, they will still be accessing the same services.’

26.Forest Environmental
Turnover: £16.3 million  
Pre-tax profits: £2.3 million
Location: London
‘Asbestos is a diminishing market; once removed, it’s gone for good. That’s why we’ve diversified into other areas,’ explains Raimon Boix, operational director of Forest Environmental. The asbestos removal company has seen growth of 47 per cent to £16.3 million in the past year through a strategy of extending its UK operations nationally to six offices and moving into areas such as graffiti removal, leak-sealing and safe chemical
clean-ups. The company is also setting up in the Middle East.

27.Murgitroyd
Turnover: £25.6 million  
Pre-tax profits: £2.87 million  
Location: Glasgow
European patent and trademark attorney Murgitroyd is continuing to make steady progress, bedding in a couple of acquisitions and seeing turnover rise by 12 per cent to £25.7 million. For chief executive Keith Young, there is  ample opportunity for growth. ‘The IP attorney market is fragmented, much like the accountancy firms were 20 to 30 years ago.’ The group has recently acquired two IP firms and will be considering others. ‘We like selective  acquisitions that are easy to undertake, so there are no surprises like pension schemes and property leases.’

28.Intelligent Environments
Turnover: £6.2 million 
Pre-tax profits: £890,000  
Location: Surrey
Intelligent Environments provides online software products for financial services organisations and their customers. CEO Phillip Blundell says: ‘We don’t see banks as being able to slow down their software spend for at least another couple of years because they haven’t actually replaced the systems they need to.’

29.Tangerine
Turnover: £10.7  
Pre-tax profits: £1.3 million     
Location: Lytham
Founder and chairman David Haythornthwaite wants to make Tangerine – a collection of companies specialising in the manufacture of animal nutritional supplements – a great organisation. ‘We’re very profitable,’ he states, referring to more recent results. ‘We started in the farm business but diversified into the veterinary business.’ The intention is to push the international presence of the company. Predicted turnover for next year is £15.5 million.

30.Tangent Communications
Turnover: £17.3 million 
Pre-tax profits: £2 million      
Location: London 
Digital marketing specialist Tangent Communications is building new websites, reorienting its business and looking for bargain acquisitions. The company, which more than doubled operating profits last year to £2.4 million thanks to acquisitions, still has more than £2.5 million cash, says joint chief executive Nicholas Green, who sees ‘cheaper’ and ‘more realistic’ takeovers in prospect as corporate deals dry up.

31.Intelligent Waste
Management Solutions
Turnover: £5 million  
Pre-tax profits: £500,000 
Location: London
Intelligent Waste Management Solutions’ stated purpose is to increase the amount of waste diverted from landfill sites. Clients now include Caffè Nero, H&M and Allied Carpets. IWMS director Philip Mossop says the innovative aspect of the business model, aside from offering consultancy-type services, is to sell a company’s waste and then share in the profits once it has been disposed of. ‘We resell the waste to be recycled around the world,’ he says. With regulatory changes pushing alternative means of waste disposal, Mossop sees the range of clients spreading to the SME sector. Two years down the line, he fully expects the company to reach sales of £10 million.

32.CyDen
Turnover: £4 million  
Pre-tax profits: ‘Occasional’  
Location: Swansea
CyDen is seeking to disrupt the beauty and healthcare market by developing a device that allows hair removal in the home. ‘The market that would explode this industry is the consumer business,’ says CEO Ron Petersen, who is also the co-founder of Longbow Capital, which helped get the company up and running in 2004. To this end, the boffins at CyDen have created an intense ‘pulsed light device’ that can be used in the home and is purportedly more effective than traditional hair removal methods. At present,
the company only has turnover of £4 million and posts ‘occasional’ profits, but recent funding of £2.8 million from Unilever Ventures and a lucrative partnership ‘with a major retailer’ should see sales rocket.

33.Tristar
Turnover: £40 million  
Pre-tax profits: £1.8 million
Location: Middlesex
CEO Dean De Beer led a management buy-out of chauffeur company Tristar in January. The deal was backed by venture capitalist Octopus, which had been attracted by annualised growth of 20 per cent over the past two years. The company has operations in the UK and US and an affiliate network covering 44 countries, including China and Russia where De Beer says Tristar has seen particularly rapid growth.

34.Renewable Energy Holdings     
Turnover: £4.5 million 
Pre-tax profits:  -£1.2 million
Location: Isle of Man
Fast growth has helped Renewable Energy Holdings turn 2007’s £1.2 million interim loss into a £1.1million first-half pre-tax profit. This AIM-listed company, which backs and operates renewable energy projects and licenses its proprietary wave energy technology, lifted turnover 155 per cent in the six months to June to £4.6 million – £50,000 more than its turnover for the whole of 2007. Chief executive Mike Proffitt is clearly delighted with the company’s performance. He declares: ‘There is growing interest in renewable energy technologies, and we are well positioned to take
advantage of the increased opportunities.’

35.Hunter and Partners
Turnover: £13.1  million 
Pre-tax profits: £2.4 million  
Location: London
Architecture and building consultancy Hunter and Partners has grown by 31 per cent over the past year to £13.1 million, something it puts down to an ability to attract high-calibre graduates for its different areas of operation. Edward Keelaghan, MD of the group, says most of the company’s growth has been organic, although the acquisition of West Sussex County Council’s architects department was also a factor.

36.Craneware
Turnover: £18.6 million  
Pre-tax profits: £4.2 million 
Location: Scotland
West-Lothian-based Craneware is thriving on providing financial software to help US hospitals optimise their billing. This is something the hospitals are under mounting fiscal and legislative pressure to do in today’s economic and political climate. Chief executive officer Keith Neilson boasts of ‘a strong pipeline of new sales opportunities’, with contracted future revenue of around £16 million.

37.Goals Soccer Centres
Turnover: £20 million
Pre-tax profits: £7 million     
Location: Scotland
Interest in the national game shows no sign of diminishing as far as Goals Soccer Centres is concerned. Operating 29 five-a-side football complexes, it has added four new centres in the current year. On the international scene, Goals has granted a master franchise in South Africa and hopes the franchisee will have a number of sites operational in time for the 2010 World Cup.

38.Green Park Interim and Executive Resourcing
Turnover: £9.1 million 
Pre-tax profits: £2.2 million      
Location: London 
Raj Tulsiani founded Green Park Interim and Executive Resourcing in 2006 and got sales to £2.2 million in the first year. The company has 80 interims on its books, working in retail, the public sector and headhunting for VCs. Anticipating sales to hit £16 million for 2009, he notes that ‘during a recession, demand doesn’t stop, it’s just that the needs of businesses change’.

39.Buyagift
Turnover: £12 million  
Pre-tax profits: £1.1 million
Location: Herts
Online present specialist Buyagift continues to show how a web business should be run, posting solid growth and profits year after year. Working with more than 400 suppliers to bring customers over 1,000 gifts and experiences, MD and co-founder Dan Mountain says the recent opening of an office in Paris indicates the strategy of the company. ‘With international expansion, it could become a £40 million to £50 million company,’ he says.

40.Galleon
Turnover: £4.5 million  
Pre-tax profits: £-400,000
Location: London
Entertainment-focused multi-media intellectual property group Galleon is expanding fast, powered by a series of partnerships and deals in China and elsewhere around the world. Interims showed profit of £330,000 and sales of £5.7 million.

41.CBG
Turnover: £7.4 million  
Pre-tax profits: £1.6 million 
Location: Manchester
CBG, an independent adviser providing insurance broking, employee benefits, wealth management and specialist sports injury insurance services, posted healthy profits for its most recent year-end and has strengthened its offering with a couple of acquisitions.

42.K3 Business Technology
Turnover: £34.1 million 
Pre-tax profits: £3.6 million 
Location: Manchester
Energetic CEO Andy Makeham has been driving software business K3 Business Technology for eight years, but the benefits have only shown through in the past couple of years. Makeham has concentrated on the retail and manufacturing sectors and sold off non-core activities.

43.Vindon Healthcare
Turnover: £4.9 million  
Pre-tax profits: £1.3 million 
Location: Oldham
Vindon Healthcare supplies environmental control products to the pharma sector. Products, which also serve the food and life sciences sectors, include controlled environment chambers, blood banks and plasma freezers.

44.Pacific Direct
Turnover: £18.7 million  
Pre-tax profits: £2.7 million 
Location: Bedford
Pacific Direct manufactures and supplies luxury branded toiletries and guest amenities to hotels, cruise lines and airlines. Founded by Lara Morgan in 1991, the company now distributes to more than 100 countries.

45.Dillistone
Turnover: £4 million  
Pre-tax profits: £1.1 million 
Location: London
AIM-listed recruitment software group Dillistone delivered record results for the half to June. Pre-tax profits powered ahead   to £949,000 on turnover increased almost a third to more than £2.5 million, boosted by orders taken towards the end of 2007. 

And five to watch….

46. Distribution Technologies – Reading-based provider of financial planning and sales technology

47. Trimega Laboratories – Substance misuse testing company, specialising in the development of drug and alcohol testing services

48. Revolymer – A university spin-out that has developed a ‘removable chewing gum’

49. Aspect Maintenance – Ex-banker William Davies’ venture that provides property maintenance services

50. Fluidata – Young and ambitious Piers Daniell’s blossoming internet services provider