THE TIMES 100 / THE BEST PERFORMING COMPANIES IN AMERICA : THE REGIONS : Health Care a Tonic for OC Economy : Respiratory and infusion therapy firm Abbey is a good example. It’s gone from near-collapse to 1993 earnings of $14 million.
Three years ago, Abbey Healthcare Group Inc. was teetering on the edge of financial collapse. But after sacking its top management and slashing costs, the Orange County company last year ranked among California’s most profitable public companies.
Costa Mesa-based Abbey is No. 3 on this year’s Times 100 list, based on its two-year average return on shareholder equity of 54.2%. The ranking is the highest ever by an Orange County company in the seven years The Times has compiled the annual guide.
“It’s not bad in three years to go from near bankruptcy to being ranked third in California,” said Timothy M. Aitken, the British investment banker who has been chairman of Abbey since 1991.
How did Aitken do it? He eliminated about 1,000 jobs, replaced the firm’s chief executive and other senior management, raised $340 million in capital and encouraged managers to be more entrepreneurial.
Aitken also went on a shopping spree. In the past two years, the company has spent more than $240 million on 31 mostly small companies. By far its biggest purchase was the $194-million acquisition last year of Total Pharmaceutical Care Inc., a home-infusion company based in Torrance.
Abbey’s earnings grew 30% to $14.3 million in 1993, while revenue was up 32% to $329 million from the previous year. The company attributes its earnings growth to concentrating on its fast-growing core businesses: respiratory therapy and infusion therapy.
“It’s lucky for Orange County that there are some strong health care companies here,” Aitken said, adding that it helps to pick up the slack from the shrinking defense industry. Four Orange County companies ranked among the top 20 on The Times 100 list, and 13 other firms in the county also made the list. Seven of those are in the health care field.
“Health care is still a growth industry, and that’s been good for Orange County,” said Don Booth, an economist with Chapman University in Orange. He said President Clinton’s health reform proposal, which would provide health coverage to about 37 million uninsured people, could help spur demand for companies that design and build medical equipment.
Other health care firms on The Times 100 list include PacifiCare Health Systems Inc., the Cypress-based health maintenance organization, although its ranking fell to No. 29 last year from No. 12 the year before. During 1993, PacifiCare purchased California Dental Health Plan of Tustin, a dental HMO, for $20 million.
Alan Hoops, president and chief executive of PacifiCare, said profit was dampened by its decision to raise about $100 million in a secondary stock offering to finance expansion.
“There are a number of acquisition opportunities,” he said, “and we felt we needed the capital to participate in this environment.”
One of Abbey’s competitors, Homedco Group Infusion, a hospital management company based in Fountain Valley, jumped to No. 17 on the most-profitable companies ranking. It did not make the list last year.
Imperial Credit Industries Inc., a mortgage banking firm in Santa Ana Heights, and Fidelity National Financial Inc., a property and casualty insurer in Irvine, ranked No. 12 and No. 13, respectively.
Imperial Credit’s earnings increased 35% to $18.4 million last year. The company, which originates or sells and acquires mortgage loans, was buoyed by new offices, which generated more loans.
Day Runner Inc., the Fullerton company whose name has become virtually synonymous with personal organizers, came in at No. 53. Its earnings rose 19% to $5.3 million on sales of nearly $82 million.
“Americans have been getting more organized for a number of years,” Chairman and Chief Executive Mark Vidovich() said. “We had a record year in terms of sales and earnings, partly because of some new products.”
First American Financial Corp., a property and casualty insurer in Santa Ana, ranked No. 38. And Anaheim-based food products maker Bridgeford Foods Corp. ranked No. 48.
Orange County Profit Leaders
Companies ranked by profit from continuing operations.
1993 Change Income in Income Rank Company ($ millions) ($ millions) 1 Rockwell International Corp. 583.6 96.1 2 Fluor Daniel Inc. 175.1 36.4 3 Allergan Inc. 104.5 8.7 4 PacifiCare Health Systems 66.7 19.1 5 FHP International Corp. 53.1 17.6 6 Fidelity National Financial 36.3 21.2 7 Downey Savings & Loan 28.6 -13.3 8 Bergen Brunswig Corp. 27.0 -31.3 9 Homedco Group 26.3 10.5 10 SPI Pharmaceuticals 21.5 -13.0 11 Armor All Products 21.1 3.3 12 Quantum Health Resources 16.6 3.9 13 Westcorp Inc. 14.0 11.7 14 Santa Anita Cos. 11.5 4.2 15 Amplicon Inc. 10.1 0.4
Source: STAR Services.
Orange County Market Value Leaders
Companies ranked by stock market valuation.
4/8/94 Market Value Book Value Market as Rank Company ($ millions) ($ millions) % of Book 1 Rockwell International Corp. 8,763.1 3,041.7 288 2 Fluor Daniel Inc. 4,105.3 1,044.1 393 3 Allergan Inc. 1,330.9 521.9 255 4 PacifiCare Health Systems 1,321.6 319.3 414 5 FHP International Corp. 778.9 387.6 201 6 Western Digital Corp. 716.5 140.4 510 7 Beckman Instruments 713.5 346.5 206 8 Community Psychiatric Ctrs. 687.1 415.3 165 9 AST Research Inc. 680.4 328.6 207 10 Bergen Brunswig Corp. 596.0 417.8 143 11 Quantum Health Resources 520.2 86.6 601 12 Homedco Group 461.2 88.8 519 13 Armor All Products 406.7 109.8 370 14 First American Financial 352.9 264.2 134 15 SPI Pharmaceuticals 297.2 143.2 208
Source: STAR Services.
Orange County Stock Leaders
Companies ranked by percent gain in stock price.
% Change 4/8/94 3/31/93 Stock Stock Stock Rank Company Price Price Price 1 Western Digital Corp. 224 18.25 5.63 2 FileNet Corp. 178 26.37 9.50 3 Watson General Corp. 143 5.00 2.06 4 Advanced Logic Research 113 6.12 2.88 5 Quantum Health Resources 86 34.50 18.50 6 CMS Enhancements 84 4.13 2.25 7 DVI Health Services 78 9.37 5.25 8 Safeguard Health Enterpr. 73 14.25 8.25 9 CorVel Corp. 67 22.50 13.50 10 Datum Inc. 66 4.37 2.63 11 Regency Health Services 66 16.62 10.00 12 Quiksilver Inc. 64 14.12 8.63 13 Microsemi Corp. 55 4.25 2.75 14 Pacific Scientific 54 23.62 15.38 15 Trimedyne Inc. 53 11.50 7.50
Source: STAR Services.
Orange County Revenue Leaders
Companies ranked by overall revenue.
1993 Revenue % Change Rank Company ($ Millions) From 1992 1 Rockwell International Corp. 10,952.3 1 2 Fluor Daniel Inc. 8,100.9 18 3 Bergen Brunswig Corp. 7,058.2 28 4 PacifiCare Health Systems 2,407.0 32 5 FHP International Corp. 2,264.7 29 6 AST Research Inc. 1,970.9 73 7 First American Financial 1,398.4 25 8 Western Digital Corp. 1,267.2 11 9 Beckman Instruments 875.7 -4 10 Allergan Inc. 858.9 3 11 Fidelity National Financial 575.4 51 12 Homedco Group 480.4 37 13 Carl Karcher Enterprises 460.4 -8 14 SPI Pharmaceuticals 404.0 -15 15 National Education 355.9 -5
Source: STAR Services.
Orange County Revenue Growth Leaders
Companies ranked by 1993 sales growth.
1993 1993 Annual Sales Revenue Rank Company Growth % ($ millions) 1 AST Research Inc. 73 1,970.9 2 Fidelity National Financial 51 575.4 3 Quantum Health Resources 47 201.7 4 Plaza Home Mortgage 46 100.4 5 Homedco Group 37 480.4 6 Regency Health Services 34 140.3 7 CorVel Corp. 33 76.4 8 Abbey Healthcare Group Inc. 32 329.1 9 PacifiCare Health Systems 32 2,407.0 10 FHP International Corp. 29 2,264.7 11 Bergen Brunswig Corp. 28 7,058.2 12 First American Financial 25 1,398.4 13 Microsemi Corp. 21 120.3 14 Fluor Daniel Inc. 18 8,100.9 15 Amplicon Inc. 16 177.6
1993 Profit/Loss Rank ($ millions) 1 -49.8 2 36.3 3 16.6 4 6.6 5 26.3 6 6.7 7 3.9 8 14.3 9 66.7 10 53.1 11 27.0 12 62.1 13 2.1 14 175.1 15 10.1
Source: STAR Services.
