Industries with the Highest Profit Margin in the UK in 2020

1. Pension Funding in the UK

Profit Margin 2020: 43.7%

The Pension Funding industry comprises defined benefit (DB) schemes and defined contribution (DC) schemes. Over the past decade, the industry has been transformed by the ongoing shift from DB to DC schemes, which in 2020-21 are estimated to account for 57.6% and 42.4% of total industry assets respectively. Industry revenue, which is calculated by combining contributions and investment returns, has increased over the past five years. The increase in contributions was fuelled by the phased introduction of automatic enrolment in pension schemes, which began in October 2012 and was fully phased in by February 2018. Record high levels of employment... Learn More

2. Electricity Distribution in the UK

Profit Margin 2020: 43.4%

Operators in the Electricity Distribution industry maintain an extensive network of lines and cables across the United Kingdom, carrying electricity from the high voltage transmission grid to industrial, commercial and domestic users. Electricity Distribution Network Operators (DNOs) have regional monopolies, so pricing in the industry is heavily regulated by the Office of Gas and Electricity Markets (Ofgem) in the United Kingdom and the Northern Ireland Authority for Utility Regulation (NIAUR) in Northern Ireland. In the United Kingdom, there are currently 15 different DNOs managed by seven operators, and 14 Independent Distribution Network Operators (IDNOs) working primarily to connect new housing,... Learn More

3. Immersive Technology in the UK

Profit Margin 2020: 41.3%

Immersive technologies, such as virtual reality (VR), augmented reality (AR), mixed reality (MR) and haptics, integrate visual content with the physical environment, thus ‘immersing’ the user of associated devises, such as head-mounted display (HMD) units, in a simulated setting. Operators in the Immersive Technology industry design and develop immersive visualisation software programs, systems and networks. Operators subsequently sell these solutions and the intellectual property to clients under licence, and may also undertake bespoke projects related to the development of immersive tech and related content on behalf of clients, generating revenue and profit by charging clients a fee. The manufacturing of... Learn More

4. Private Equity in the UK

Profit Margin 2020: 40.9%

The United Kingdom is the largest European centre for the management of private equity investments and funds, and second only to the United States in terms of global importance. Private equity firms pool investment funds to purchase other companies. They attempt to improve a company's performance by implementing managerial and operational changes, before selling the company for a profit, generating return for their investors. The industry's key source of revenue is fees derived from management fees, calculated as a percentage of assets under management (AUM), and from performance fees on the total return from an invested company's initial public offering... Learn More

5. Gas Distribution in the UK

Profit Margin 2020: 40.3%

Operators in the Gas Distribution industry maintain a 284,000 km gas pipeline network across the United Kingdom. The industry is primarily comprised of eight Gas Distribution Networks (GDNs) across Great Britain, owned by four companies which operate regional monopolies. To protect consumers, operators are heavily regulated through price control frameworks. There are also eight smaller networks operated by independent gas transporters (IGTs) that primarily connect new build homes and industrial sites to existing networks, while a further two IGTs operate the Northern Ireland distribution network. The Office of Gas and Electricity Markets (Ofgem) is the regulatory body for Great Britain,... Learn More

6. Real Estate Investment Trust Activities in the UK

Profit Margin 2020: 39.4%

Real estate investment trusts (REITs) are closed-ended investment firms that are listed on stock exchanges. This structure came into existence in the United Kingdom on 1 January 2007 through the Finance Act 2006. REITs manage and develop property on behalf of shareholders. These firms add value by allowing liquid, quick and readily available investment in property, as well as providing financial returns. REITs are seen as attractive investment vehicles, as they are tax efficient, being exempt from corporation tax. However, they must pay out 90% of their net property income to their shareholders.

The past five years have been characterised by... Learn More

7. Investment Trusts in the UK

Profit Margin 2020: 39.3%

Investment trusts are closed-ended funds that raise capital by issuing a set number of shares when they are launched. They are constituted as public limited companies. Funds raised are invested in a range of stocks and shares in order to generate investment returns and income. Industry firms are involved in managing and administering investment trusts and receive a fee for their services. Therefore, industry revenue is equivalent to the fees earned. Fees are calculated as a percentage of the value of assets under management (AUM).

The industry has expanded during the past five years. Industry growth was driven by improvements in... Learn More

8. Building Project Development in the UK

Profit Margin 2020: 38.0%

Operators in the Building Project Development industry bring together the financial, technical and physical resources required to complete a property development. Upon completion, the property may be delivered to a client for subsequent use or sale, or the developer may retain equity interest and derive income via rental fees charged. The financial and operational performance of development markets rests on a plethora of economic and socio-economic factors, ranging from property valuations and price movements to market sentiment and credit conditions.

Despite the referendum dampening investor sentiment and cooling property markets, the collective performance of UK property developers remained resilient in the... Learn More

9. Legal Activities in the UK

Profit Margin 2020: 36.1%

Solicitors, barristers, patent agents, notaries and bailiffs carry out legal activities on behalf of private and corporate clients. Over the five years through 2019-20, industry revenue is expected to expand at a compound annual rate of 1.4%. Widespread business uncertainty following the EU referendum, a decline in merger and acquisition (M&A) activity and falling residential property transactions are expected to have limited industry revenue growth during the period. In the current year, however, revenue is forecast to rise by 1.4% to £35.7 billion. An increasingly large number of client firms have required legal support to comply with changing laws and... Learn More

10. Spirit Production in the UK

Profit Margin 2020: 35.9%

Over the past five-year period, operators in the Spirit Production industry have had to contend with volatile exchange rates and changing consumer preferences. Export demand suffered in 2015-16 due to poor economic conditions in Europe and a strong pound. However, despite rising health consciousness which has led to a long-term decline in alcohol consumption, increased demand for whisky and gin has offset any negative effects on industry performance. In addition, the weak pound following the EU referendum in June 2016 has supported demand for premium spirits in overseas markets. Over the five years through 2019-20, industry revenue is expected to grow at a compound... Learn More