Operating In Rough Waters

B.E. Industrial/Service 100 companies seek to grow earnings by battening down the hatches

it was swept off the BE INDUSTRIAL /SERVICE 100 list. Revenues for the construction and trucking firm plunged 53.5%. Although school and sewage construction projects spurred the performance of his general contracting division, the economy shredded the transportation unit and forced CEO Richard Copeland to make his first round of layoffs in 15 years.

Many established industrial/service companies were unable to gain adequate cover from the brutal elements. Witness last year’s performance of Lanham, Maryland-based Washington Cable Supply Inc., which lost its leadership position and ranking among the other industrial/service companies. Handling inventory management for a ravaged telecommunications sector, the company’s revenues plunged a staggering 77.14%, from $105 million to $24 million.

The enterprises of the St. Louis-based Roberts brothers were caught in a virtual whirlpool. Roberts Wireless Communications L.L.C. fell off the list, dropping 26% in revenues, from $34.5 million to $25.5 million, while Roberts Broadcasting Co. (No. 88 on the BE INDUSTRIAL/SERVICE 100 list) dipped about 5.6%, from $36 million to $34 million.

Broadcasting CEO Michael Roberts and his brother, Steven, who runs the telecommunications company, had to make a few changes to remain viable entities. They partnered with Univision to run a Spanish-speaking Univision station in Denver, and turned their St. Louis station into a UPN affiliate, becoming the first UPN station in St. Louis. The Roberts brothers are also working with the Federal Communications Commission to build two more UPN affiliates: one in Jackson, Mississippi, and one in Columbia, South Carolina. Michael is drawn to the UPN brand because much of its programming is targeted to young African Americans — content he expects to buoy sales in 2003 and beyond. As operators of a Sprint franchise (Roberts Wireless), the Roberts brothers have less control over the wireless side of the business. But since the telecommunications giant has substantially beefed up customer service, Michael expects the company to ring up more sales and profits in the coming year.

The war on terrorism and the conflict with Iraq have torpedoed a wide cross section of American business — and the BE 100S have not been excluded. Although the wartime economy has sapped consumer confidence and created skittish corporate purchasing departments, it has stoked federal government spending, from aviation to defense, to create a terrorist-proof America. As a result, a number of companies have benefited from the Bush administration’s expansive plans for homeland security.

One such entity has been Innovative Logistics Techniques Inc. (INNOLOG) in McLean, Virginia. Rocketing from $36 million to $94 million — a stunning 161% sales increase that propelled it from No. 75 to No. 39 on the BE INDUSTRIAL/SERVICE 100 list — the technical engineering firm was tapped as a subcontractor by Lockheed Martin to help develop the infrastructure of the recently formed Homeland Security Agency. The size of INNOLOG’s mammoth six-month contract: $65 million.

Hurt by the recession in the first half of 2002, INNOLOG was forced to fire 10% of its workforce. The company made an about-face in June when Lockheed Martin, a long-time INNOLOG client, won the contract

Pages: 1 2 3 4 5 6