MAC: Mines and Communities

London Calling on Forbes - yet again

Published by MAC on 2006-05-24

London Calling on Forbes - yet again

by Nostromo Research

24th May 2006

"The Greatest In The World"! That's the new corporate listing which Forbes magazine - progenitors of the world's most comprehensive financial survey of multinationals - has just come up with.

"It does not hurt to be big if you want to compete in a global economy.", says the magazine. " But size alone is no guarantee of success, which is why we have taken a second look at the Forbes Global 2000 to find big companies that are absolutely great at what they do."

To create the list, Forbes' has re-examined data on the sales, profits, assets and market value of the world's largest corporations. It's then organised them by industry and "put them through rigorous screens in search of companies with manageable debt and the best balance of long- and short-term return on equity, sales growth, earnings growth and return to shareholders."

In other words, if you have a few dollars to spare and your primary concern is stashing more greenbacks in your pockets.Forbes is telling you where to put them.

But Forbes also claims that it "cull[ed]... companies with problematic accounting techniques, earnings quality or corporate governance problems...[and] that had legal or other challenges that might impede future growth". Out of 2,000 companies, fewer than 150 cleared the Forbes' hurdles.

Strange you might think (we'd call it bizarre) that, of the companies included in its Herculean tally, Forbes selected only five minerals producers, of which at least three certainly have "legal or other challenges" nagging at their heels. These are:

* Anglo American of the UK (ranked at 116 in the full list);

* Peabody Energy, ranked at 873 and:

* Freeport Copper, at 880.

The other two highflyers are CVRD (305th) and Chalco (the Alumininum Corp of China) coming in at 876.

So, where are BHPBilliton and Rio Tinto, which consistently out-perform their fellow extractors on the Forbes Global 2000? Surely, not so weighed down with "other challenges" that they fail to make the new list?

Some are born great, some achieve greatness, some have greatness thrust upon them.

And others, obviously, just get "Forbsed"

source: Forbes magazine, May 23 2006

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