Portugal revels in its strengths

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Portugal’s traditional strengths in pulp and paper, construction, retail distribution and injection moulds came to the fore among the country’s winners and shortlisted companies in last night’s Best of European Business Awards.

The competition – organised by the Financial Times and Roland Berger Strategy Consultants – also showed how in the Portuguese section of the contest, the best companies are using innovation, diversification and overseas investment to gain greater value from established skills and aptitudes.

Size limitations were most notable in the innovation category. “Portuguese companies are making important innovations,” said António Bernardo, managing partner of Roland Berger for Portugal and Spain. “But there is a clear deficit in the number of patents registered and spending on research and development when compared with France or Germany.”

The large company winner for value creation was Sonae, Portugal’s biggest conglomerate, which derives about 60 per cent of its income from hypermarkets, but is also active in shopping centre development, wood conglomerates and telecommunications.

Sonae, founded and led by Belmiro de Azevedo, one of Portugal’s best known entrepreneurs, successfully restructured its portfolio of companies in 2004, resulting in a significant improvement in operational results across all sectors.

The jury highlighted new investments in Germany, Greece, Italy, Spain and Portugal by Sonae Sierra, the group’s shopping mall development division, which resulted in strong growth and helped establish the company as a world player. Also shortlisted: Banco Espírito Santo and Cimpor.

The mid-sized value creation winner was Cofina, another conglomerate, which gains almost half its income from newspapers and magazines, but also has holdings in the wood pulp and steel sectors. Also shortlisted were Banif and Finibanco.

Mota-Engil, Portugal’s biggest construction group, was the large company winner for growth. The result of a merger in 2000 of the country’s fourth and fifth largest construction groups, bigger critical mass has given the group the financial and marketing capacity to expand its order book quickly. The jury also noted Mota-Engil’s successful diversification into the environmental protection and water treatment sectors, where it has become the leading private-sector group in Portugal. Also shortlisted were Gás de Portugal and PT Multimedia.

Novabase, an IT consultancy and information systems engineering company, was the mid-sized growth winner. In addition to establishing itself as the market leader in Portugal, the group has also scored successes overseas, including IT infrastructure projects in Spain and consultancy contracts in Saudi Arabia, Egypt and Japan. The jury highlighted its market leadership in sectors including public administration, banking, telecommunications and defence. Also shortlisted were Águas de Portugal and Unicer.

The big company winner for innovation was Grupo Portucel Soporcel, the world’s fifth largest pulp and paper producer. The jury was impressed by innovations that have helped make the group’s Navigator brand the world’s biggest-selling premium office paper as well as one of the few Portuguese brands in any sector to be widely recognised internationally. Also shortlisted were PT Multimedia and TMN.

Renova, one of southern Europe’s leading producers of paper tissue, was the medium-sized innovation winner. Its innovations include dermatologically-tested and moistened toilet paper as well as advances in adding aromas and improving the absorption and resistance of tissue products. This has helped the group gain a substantial market share in Spain. Also shortlisted were Logoplaste and Iberomoldes.

The large company winner in the New Europe category was Jerónimo Martins, one of Portugal’s leading retailer distributors. The jury noted its “ambitious internationalisation strategy” focused on Poland, which now accounts for 30 per cent of total sales. Also shortlisted were Millennium BCP and Mota-Engil.

The mid-sized winner for New Europe strategy was Simoldes, Europe’s biggest producer of injection moulds for plastic. The group
followed some of its biggest customers, which include leading automobile and electronic goods producers, as they moved production to New Europe, investing €42m ($51m) in successful new plants in Poland and Romania. Also shortlisted were Lena Construções and MSF-Moniz da Maia, Serra Fortunato.

The judges were: Luís Almeida Costa, professor of economics, Universidade Nova de Lisboa; Esmeralda Dourado, chief executive, Grupo Sag; Sérgio Figueiredo, editor, Jornal de Negócios; Francisco Murteira Nabo, chairman, Galp Energia; José da Silva Lopes, chairman, Montepio Geral savings bank; Rui Vilar, president, Gulbenkian Foundation, Portugal; Peter Wise, Financial Times, Lisbon correspondent.

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