THE TIMES 100 : The Best Performing Companies in California : SECTOR BY SECTOR : As Industries Lost Ground, Coping Was In

By California’s usually strong standards, 1991 was not a year to write home about--practically no matter what business you were in.

Profits dropped in six of eight broad industry categories surveyed for The Times as the recession that started in mid-1990 tightened its grip, companies retrenched and consumers reined in spending.

“Clearly, the fact is we were in a recession throughout 1991,” said Frederick Cannon, senior economist at Bank of America in San Francisco.

Not surprisingly, financial services firms--reeling from troubled commercial and real estate loans and soured junk bond investments--were hit particularly hard, according to a survey of 608 public companies prepared for The Times by MZ Group. That sector’s income plunged 75%, to $841.7 million.

Among the state’s biggest financial institutions, Security Pacific Corp., now part of BankAmerica Corp., reported the worst results for 1991. Its $774.5-million loss, much of it attributable to ill-advised real estate loans, contrasted with 1990 income of $161.3 million. First Interstate Corp., Glenfed Inc., CalFed Inc. and UnionFed Financial Corp. also came in with sizable losses.

The aerospace and defense sector, where widely publicized parings continue as companies adjust to reduced military and airline business, showed an overall profit decline of 17.5%. These companies weighed in with a total 1991 income of $1.5 billion.

The poor showing reflected earnings declines for many of the big guns, notably Northrop Corp., Lockheed Corp. and Rockwell International Corp.

In California’s technology industry, income declined 36%, to $1.86 billion. That was hardly stunning news, given the industry turmoil that has been the rule since the recession began.

Apple Computer Inc. of Cupertino, for example, reported a 35% drop in income last year, to $325.4 million, despite a hard-won 13% increase in sales. The results reflected a strategy of cutting prices--and, therefore, margins--to boost volume.

Despite sluggish spending, the retail sector managed to show a 19% gain overall. A good bit of that respectable showing was thanks to Gap Inc., the San Bruno-based manufacturer and retailer whose casual cotton shirts, shorts and jeans found a ready audience in the sober economic climate. Gap’s 1991 income rose 59% to $229.9 million, and sales climbed 30% to $2.5 billion.

On the down side, supermarket giant Safeway Inc., based in Oakland, suffered a 9.3% decline in profit in 1991. It might be that everybody has to eat, but food stores found in this recession that shoppers were after bargains. That chopped profit margins for many chains that had invested in higher-priced, service-oriented departments such as delis.

The energy sector showed a modest 4.6% decline in income, which totaled $2.6 billion for the group’s eight companies. Of the biggest companies, Chevron Corp., Occidental Petroleum Corp., Unocal Corp. and Atlantic Richfield Co. all showed steep drops as low oil and gas prices took their toll. Occidental, with a 122.5% profit plunge, also showed the effects of a massive corporate overhaul.

Profits in the entertainment and leisure group, which encompasses movie production companies, newspapers, casino hotel operations and theme parks, sank 28.1% to $896 million. Demand for newspaper advertising continued to sag , the recession took its toll on leisure travel and Hollywood underwent a painful retrenchment that made for some unhappy endings.

At the state’s nine publicly held utilities, slow demand pushed income down 3.5%. A hodgepodge of companies was lumped into the “other” category--including office-temporary services, pharmaceutical companies, food service concerns, miscellaneous industrial companies, shipping companies, consumer products and biotechnology firms.

PROFITS Profits by sector, in billions of dollars 1991 total: $13.0 1990 total: $16.4

REVENUE Revenue by sector, in billions of dollars 1991 total: $428.1 1990 total: $435.8

Industry Performance / A Look At the Numbers

COMPANIES BY SECTOR Numbers of companies by industry. Total: 608 Retail: 28 Entertainment & Leisure: 37 Aerospace & Defense: 14 Utilities: 9 Financial Services: 74 Energy: 8 High Tech: 206 Other: 232

REVENUE BY SECTOR Percent of $428.1 billion in 1991 (vs. 435.8 billion in 1990) for all 608 companies. Retail: 8.9% (8.1%) Entertainment & Leisure: 3.7% (3.4%) Aerospace & Defense: 8.9% (8.8%) Utilities: 6.1% (5.9%) Financial Services: 16.5% (17.1%) Energy: 17.4% (20.8%) High Tech: 16.6% (14.7%) Other: 22.0% (21.0%)

PROFITS BY SECTOR Percent of $13.0 billion in 1991 (vs. 16.4 billion in 1990) for all 608 firms. Retail: 4.2% (2.8%) Entertainment & Leisure: 6.9% (7.6%) Aerospace & Defense: 9.3% (8.9%) Utilities: 14.9% (12.2%) Financial Services: 6.5% (20.5%) Energy: 20.2% (16.7%) High Tech: 14.3% (17.8%) Other: 23.7% (14.3%)

EMPLOYEES BY SECTOR Number of employees worldwide in 1991 for all 608 firms. Figures in thousands (total 2.25 million) Retail: 250.6 Entertainment & Leisure: 180.7 Aerospace & Defense: 292.3 Utilities: 91.7 Financial Services: 253.2 Energy: 125.0 High Tech: 461.3 Other: 594.0 Figures in parentheses are for 1988. Percentages may not add up to 100% due to rounding.