FT Global 500 2010

This is the 14th annual ranking of the FT Global 500, providing a yearly snapshot of the world's largest companies. For the first time, a Chinese company, PetroChina, has overtaken Exxon Mobil as the world's most valuable company. The total market capitalisation of the Global 500 companies has risen by 50 per cent from $15.6bn to $23.5bn. The only year we have seen a comparable rise was in the Global 500 2000 report. The FTSE All World index has risen by 53 per cent over the same period in dollar terms. The 500th company is worth $16bn, compared to $10bn last year. Banks regain their position as the most valuable sector from the oil and gas producers. The market value of banks has more than doubled from $1,937bn to $4,030bn.

The main table here, and the many available on FT.com, show how corporate fortunes have changed in the past year, highlighting relative performance of countries and sectors.

The companies are ranked by market capitalisation - the greater the stock market value of a company, the higher its ranking. Market capitalisation is the share price on March 31 2010 multiplied by the number of shares issued. The figures in the main FT Global 500 were converted into a common currency, the dollar, to allow comparison.

We have included all companies where the free float - the proportion of shares in market circulation - is at least 15 per cent. Companies are then valued on the lines of shares that are quoted on the stock market. The full value of a listed stock is included even if part of it is tightly held. Unlisted lines of stock are excluded. Investment companies are not included.

For each company the main Global 500 table shows the rank in 2009 and 2010, the country, market capitalisation, sector, turnover, net income, total assets and employees. The price, price earnings ratio, dividend yield and the company's year-end are included in the Global 500 on FT.com.

A company's country allocation in the FT Global 500 is based on incorporation and stock market listing, along with market perception, largely following the FTSE guidelines. This can lead to what may seem like some anomalies. For example, EADS and STMicroelectronics, both incorporated in the Netherlands, are classified as French because the main quotes are on the Euronext Paris exchange. Schlumberger and Seagate Technology are classified as US, although they are incorporated in the Netherlands Antilles and the Cayman Islands respectively. The Jardine companies appear under Hong Kong despite their Singapore listings and incorporations in Bermuda.

It is possible to show only a small selection of the information in the printed report, so we have additional FT 500 tables for Europe, US, UK and Japan on www.ft.com. The web also has tables showing the newcomers to the list (and those who have disappeared), largest rises and falls in rank, market capitalisation by sector and by country, as well as a list ranking all the Global 500 companies by sector.

Companies can be ranked by any of their key statistics such as turnover (as used by Fortune magazine in its Global 500), employment or profits. While each can be interesting, we feel there are more weaknesses with these methods. Turnover, for example, does not adequately allow for banks and some financial services companies, while profits will be distorted by write-offs. A common problem affecting most methods other than market capitalisation is timing. As profit and turnover figures come from annual reports, any ranking based on them must be out of date. As annual reports are staggered through the year, some of the numbers used for the rankings would be relating to a period two years before publication of the ranking.

In contrast, it can also be argued that a ranking based on market capitalisations contains a forward-looking element, as share prices include a view on investors' expectations.

The FT Global 500 companies can be followed in the newspaper and on www.ft.com. A table listing all the FT Global 500 companies appears daily in the UK edition (and on Mondays in the international editions) and in the data archive on www.ft.com. Through the week the FT 500 companies are identified on the international editions' stock listing pages by a Maltese cross symbol. The constituents of that list are updated quarterly with successive updates shown at www.ft.com/ft500.

Data queries to [email protected]. Data from Thomson ONE Banker, Thomson Reuters Datastream and individual companies. Compiled by Anne-Britt Dullforce.

© The Financial Times Limited 2010. All rights reserved.
FT and Financial Times are trademarks of the Financial Times Ltd.
Not to be redistributed, copied or modified in any way.
Euro2day.gr is solely responsible for providing this translation and the Financial Times Limited does not accept any liability for the accuracy or quality of the translation