High-Tech Provides a Boost : Valley Firms Move Up in Ranking of State’s Leading Companies
Aided by a profitable year for high-technology industries, big businesses in the San Fernando Valley moved up in the rankings of California’s largest companies during 1984, according to a recent survey of the state’s 500 largest publicly held companies.
There were 32 Valley companies among California’s top 500 in 1984, two more than in 1983.
In the survey, compiled by California Business magazine, Valley firms showed greater growth than other California businesses in the top 500.
17 Improve Positions
Although revenues of California’s top 500 firms grew by 7.6% last year, the Valley firms on the list in both 1983 and 1984 reported a combined revenue increase of 8.6%.
Of the Valley companies on the list both years, 17 improved their positions over 1983, while 10 slipped down the ladder.
One Valley firm maintained its 1983 position in the top 500. Four other Valley firms broke into the top 500 after failing to make the list in 1983. Two Valley firms in the top 500 for 1983 fell off the list for 1984.
‘Stable Group’ in Valley
Although financial companies were ranked by total gross income, all other companies were rated by total revenues.
The Valley has a “stable group of large- and medium-sized firms that produce very high-value products,” said David Hornbeck, research director at the Bureau of Business Services and Research at California State University, Northridge.
Hornbeck said the group includes Burbank-based Lockheed Corp., the Valley’s largest firm and the eighth largest in California, and an array of West Valley firms that produce computer-related products, including Tandon Corp., Dataproducts Corp. and Micropolis Corp.
Of the Valley’s 32 firms that qualified for the top 500, 13 produce computer products or electronic gear. Ten of those 13 improved their ranking in 1984.
High-technology companies, which in the survey were defined as those dealing in com puter and electronic products, constituted the fastest growing economic sector in the state. The high-tech companies accounted for only 6.9% of the total revenue of California’s top corporations in 1984, but that was up from 5.1% in 1983.
Hornbeck said he expected the Valley’s large high-technology firms to continue to prosper because they have proved to be “large enough to survive the recent shakeout that hurt so many small computer firms.”
Stream of New Products
He said large firms, once industry leaders with large research staffs, are able to develop a stream of new products “for which there is a great demand, and for which they can command very high prices.”
Hornbeck said the university’s research bureau tallied $3.5 billion in sales of computer-related products in the Valley in 1984, up from $2 billion in 1980.
In contrast with high-technology industries, the engineering and construction industries in California posted the sharpest decline in revenue, a 17.5% drop from 1983.
Few New Plants
The magazine reported that the recession of a few years ago left plant utilization so low that there was sufficient room for business expansion without building many new plants.
Energy continued to be California’s largest industry, accounting for five of the top 10 corporations, including No. 1-ranked Chevron. Energy companies were responsible for 24% of total revenues among the top 500 corporations, down from 30% in 1983.
The survey found that, although revenues of California’s top firms grew last year, overall there was less profit.
Aerospace, Defense to Gain
Return on net worth, a common measure of profitability, was 10.16%, down slightly from 10.2% in 1983 and down sharply from 14.9% in 1980.
The magazine predicted that aerospace and defense industries would continue to prosper, boosted by stepped-up government spending.
Only four of the Valley’s 32 largest publicly held companies showed a loss in 1984.
Valley Federal Loses
Veta Grande Cos. of Northridge, a precious-metals firm, lost $30.2 million on revenues of $27.8 million.
Also losing money was Van Nuys-based Valley Federal Savings & Loan, which showed a loss of $11.5 million on total gross income of $301.1 million.
Two Burbank firms also showed net losses. They were Compact Video, which lost $1.7 million on sales of $35.7 million, and Fairmont Financial, an insurance firm that lost $1 million on revenue of $53.3 million.
THE VALLEY’S BIGGEST PUBLIC COMPANIES In millions of dollars
Ranking in 1984 State 1984 net 1984 1983 revenues income Lockheed Corp. 8 11 $8,113.4 $344.1 Walt Disney Productions 45 52 $1,656.0 $97.8 MCA Inc. 47 44 $1,651.2 $94.9 Tandon Corp. 110 117 $400.8 $29.4 Dataproducts Corp. 111 118 $398.6 $26.0 Valley Federal Savings & Loan 126 135 $301.1* -($11.5) loss House of Fabrics 150 140 $239.6 $9.7 Familian Corp. 152 184 $233.4 $2.8 Summit Health Ltd. 163 175 $200.0 $13.4 Informatics General Corp. 169 153 $191.2 $4.7
*Reported as gross income Source: California Business
