THE TIMES 100 / THE BEST PERFORMING COMPANIES IN AMERICA : THE GIANTS : A New Season Blossoms
NOT SO LONG AGO, any talk of an economic recovery in California would probably have focused on the aerospace or construction industries. Or perhaps the need to boost international trade. But who would have thought that the seeds to the state’s fledgling recovery would be planted in such unfamiliar soil as “reduced-instruction-set computing” or “non-impact printing peripherals”?
But it is such technology that helped Hewlett-Packard Co. boost sales by 25% last year and spark growth at other California computer companies, helping to offset sluggish sales in other industries. Hewlett-Packard’s growth helped lift sales of the state’s 100 largest publicly held companies by 2% to $385.9 billion last year.
The modest gain bolsters the arguments of analysts who say California’s long recession has finally ended and its economy is on the mend.
The computer industry accounts for nearly 30% of the companies on this year’s Sales 100, and analysts said the strong gains they reported bode well for the region’s future economic health.
“When you look at the industries that are really key to the future of this state’s economy, computers are certainly near the top of the list,” said Lynn Reaser, chief economist of Los Angeles-based First Interstate Bancorp.
“High-tech is a growth industry, and it will remain so well into the 21st Century. I’d be concerned if our economy was more dependent on an industry without such a bright future,” such as steelmaking or shipbuilding, Reaser said.
With U.S. corporate spending on new equipment still strong, Reaser and other analysts say computer makers should see continued healthy sales gains in 1994.
Many other California industries that didn’t fare as well last year should also see some sales improvement as the state’s economy rebounds, Reaser said.
Hewlett-Packard, a prime beneficiary of the trend toward linking business and personal computers in vast electronic networks, saw its sales surge to $21.4 billion. It vaulted over Atlantic Richfield Co. to become the No. 2 sales company, behind perennial leader Chevron Corp., according to data compiled by Star Services, a San Francisco-based business research firm.
Apple Computer Inc., Intel Corp., Sun Microsystems Inc. and AST Research Inc. were just a few of the other high-tech companies that logged double-digit sales gains in 1993.
Solectron Corp. of Milpitas, which assembles circuit boards and other components, saw its sales skyrocket 133%--the largest percentage gain of any firm on the Sales 100. The company also premiered recently as one of the 500 largest U.S. industrial corporations in Fortune magazine’s annual ranking.
“Big Oil” got a little smaller in 1993, as prices sank to about $14 a barrel by the end of the year from $20 a barrel earlier. Sales fell 6% at Chevron, 2% at Arco, 4% at Occidental Petroleum Corp. and 18% at Unocal Corp..
Revenue at most defense companies also suffered as government contracts continued to shrink. Los Angeles-based Northrop Corp. saw sales drop 9%. Teledyne Inc. and Rohr Inc., which also depend on government work for much of their sales, posted even steeper declines.
Sales at Lockheed Corp. in Calabasas jumped 29% to just over $13 billion, moving the defense company up to the No. 6 spot on the list. However, much of Lockheed’s gain stemmed from the purchase of General Dynamics Corp.’s F-16 fighter jet division last year.
Mergers and acquisitions also played a key role in the revenue growth of health insurers, as the health care industry consolidates in response to a rapidly changing marketplace and the government’s reform measures.
Wellpoint Health Networks Inc., PacifiCare Health Systems Inc., FHP International Corp. and TakeCare Inc. were among the managed health care organizations that got bigger by buying other companies. Fountain Valley-based FHP is sure to move up on the next sales list too: Two months ago it agreed to buy TakeCare in a deal valued at $1.1 billion.
Many companies involved in other facets of the health care business also prospered. Sales jumped 26% at Amgen Inc., a biotechnology concern in Thousand Oaks. Revenue climbed 28% at Bergen Brunswig Corp., a distributor of pharmaceuticals and medical products based in Orange.
Results were mixed for California’s financial services sector. BankAmerica Corp. posted a tiny sales gains despite the state’s stagnant housing market and slack demand for business loans. First Interstate saw sales slip 6%, while Wells Fargo & Co.’s revenue dipped 7%.
Mortgage giant H.F. Ahmanson & Co., parent of Home Savings, suffered a 16% drop in sales. Great Western Financial Corp., parent of Great Western Bank, recorded an 11% revenue decline.
While many home buyers stayed on the sidelines last year, thousands of existing homeowners refinanced their loans to take advantage of the prolonged drop in mortgage rates. That was good news for Countrywide Credit Industries Inc., a Pasadena-based mortgage banker that aggressively pursued the refinance market: Its 1993 sales shot up 63% to $937.1 million.
Investors big and small kept pouring money into stocks and bonds last year, which helped Charles Schwab Corp. score a 21% sales increase and drove revenue up 66% at mutual fund giant Franklin Resources.
The Sales 100
Companies ranked by overall revenue.
1993 Pct. ’92 sales change Rank Rank Company ($ millions) from ’92 1 1 Chevron Corp. 32,123.0 -6 2 3 Hewlett-Packard Co. 21,426.0 25 3 2 Atlantic Richfield Co. 17,189.0 -2 4 5 Safeway Inc. 15,214.5 0 5 4 BankAmerica Corp. 14,754.0 3 6 9 Lockheed Corp. 13,071.0 29 7 6 McKesson Corp. 12,203.1 6 8 7 Rockwell International Corp. 10,952.3 1 9 8 Pacific Gas & Electric 10,582.4 3 10 10 Pacific Telesis Group 9,244.0 -7 11 14 Walt Disney Co. 8,865.1 11 12 18 Intel Corp. 8,782.0 50 13 16 Apple Computer Inc. 8,445.5 17 14 12 Occidental Petroleum 8,116.0 -4 15 17 Fluor Daniel Inc. 8,100.9 18 16 13 SCE Corp. 7,821.1 -2 17 11 Unocal Corp. 7,261.0 -18 18 22 Bergen Brunswig Corp. 7,058.2 28 19 19 Vons Cos. 5,074.5 -9 20 21 Northrop Corp. 5,063.0 -9 21 20 Litton Industries 4,898.8 19 22 23 Wells Fargo & Co. 4,854.0 -7 23 24 Transamerica Corp. 4,833.0 6 24 28 Sun Microsystems Inc. 4,493.0 17 25 26 Consolidated Freightways 4,191.8 3 26 29 Times Mirror Co. 3,714.2 3 27 25 First Interstate Bancorp 3,628.2 -6 28 27 National Medical Enterprises 3,434.9 -3 29 31 Dole Food Co. 3,430.5 2 30 34 Gap Inc. 3,295.7 11 31 33 Seagate Technology 3,114.1 1 32 30 H.F. Ahmanson & Co. 3,100.0 -16 33 43 Merisel Inc. 3,085.9 38 34 32 Great Western Financial 2,978.3 -11 35 Southern Pacific Rail 2,918.6 1 36 35 Pacific Enterprises 2,899.0 0 37 51 Mattel Inc. 2,704.4 46 38 38 American President Cos. 2,658.9 3 39 37 Avery Dennison Corp. 2,608.7 -1 40 41 Computer Sciences Corp. 2,502.1 1 41 40 Longs Drug Stores 2,499.2 1 42 36 Teledyne Inc. 2,491.7 -14 43 42 Wellpoint Health Networks 2,449.2 8 44 53 PacifiCare Health Systems 2,407.0 32 45 55 FHP International Corp. 2,264.7 29 46 52 Fleetwood Enterprises 2,206.6 19 47 50 National Semiconductor 2,190.7 18 48 45 Carter Hawley Hale 2,152.7 -3 49 44 Conner Peripherals 2,151.7 -4 50 47 Syntex Corp. 2,126.7 5 51 46 Tandem Computers Inc. 2,022.6 -2 52 56 Quantum Corp. 2,002.7 30 53 49 San Diego Gas & Electric 1,980.1 6 54 72 AST Research Inc. 1,970.9 73 55 48 Golden West Financial 1,932.2 -5 56 67 Foundation Health Corp. 1,806.1 30 57 Airtouch Communications 1,798.7 104 58 54 Clorox Co. 1,732.7 4 59 66 Oracle Systems Corp. 1,692.9 29 60 39 Amdahl Corp. 1,680.5 -33 61 57 Advanced Micro Devices 1,648.3 9 62 63 MagneTek Inc. 1,533.9 13 63 58 Rykoff-Sexton Inc. 1,493.3 -1 64 75 First American Financial 1,398.4 25 65 62 Raychem Corp. 1,394.4 2 66 77 Amgen Inc. 1,373.8 26 67 65 Potlatch Corp. 1,368.9 3 68 71 Hilton Hotels Corp. 1,358.0 13 69 68 Varian Associates 1,343.4 5 70 74 Western Digital Corp. 1,267.2 11 71 60 Union Bank 1,265.8 -10 72 80 Silicon Graphics Inc. 1,262.0 33 73 76 Kaufman & Broad Home 1,237.9 13 74 61 Maxtor Corp. 1,237.8 -10 75 70 Foodmaker Inc. 1,218.9 -3 76 86 Applied Materials 1,204.9 51 77 78 Ross Stores 1,122.0 8 78 73 Jacobs Engineering Group 1,104.9 -4 79 79 20th Century Industries 1,103.8 10 80 82 Charles Schwab Corp. 1,097.4 21 81 59 California Federal Bank 1,084.1 -23 82 64 Glendale Federal Bank 1,066.8 -21 83 69 Rohr Inc. 1,034.0 -19 84 Solectron Corp. 1,021.7 133 85 81 Caesars World Inc. 1,013.5 8 86 97 Countrywide Credit Indus. 937.1 63 87 Cisco Systems 928.2 96 88 95 TakeCare Inc. 923.1 49 89 89 Adia Services Inc. 918.5 24 90 85 Sunamerica Inc. 898.8 7 91 83 Beckman Instruments 875.7 -4 92 84 Allergan Inc. 858.9 3 93 87 Smart & Final Inc. 837.2 9 94 ABM Industries 797.0 5 95 91 Pinkerton’s Inc. 772.0 10 96 90 National Health Labs 760.5 5 97 96 Marshall Industries 746.8 23 98 94 LSI Logic Corp. 718.8 16 99 Franklin Resources Inc. 717.3 66 100 SynOptics Communications 704.5 81
Source: STAR Services.
