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Wednesday, Feb 21, 2024
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Fastest Growers Keep Pace

The latest batch of Orange County’s fastest-growing public companies kept pace with last year’s mix, combining for a 24% growth rate on revenue.

This week’s Business Journal Special Report features 37 public companies that have headquarters in OC and have increased revenues by at least 15% over the past two years. The businesses—compiled for the Business Journal by investment bank and research firm B. Riley & Co.—combined for $83 billion in revenue for the 12 months ended June 30, versus $67 billion for the same period two years ago.

It was easier to make last year’s list, which featured a threshold of 10% revenue growth and included 49 companies. Last year’s crop also combined to post a 24% increase in revenue, topping $90 billion.

This year’s edition has three lists, separated by company size. The small category includes businesses with recent revenues up to $99.9 million; the midsize category features those that had revenues between $100 million and $499.9 million; and the large category included companies with more than $500 million in revenue.

Large

The list of large companies features 13 businesses that combined for $79.8 billion in revenue, up 22%, or by more than $14 billion. That puts the average gain in sales per company at a little more than $1 billion. All were profitable, accounting for about $5 billion in collective net income.

The large companies employed more than 13,700 workers here as of the time of the Business Journal research last month, up 7% year-over-year. The OC headcount accounted for about 7% of the 194,369 workers the companies employ overall.

• No. 5 Western Digital Corp. in Irvine was the most profitable on the list, with $1.6 billion in net income in the 12-month period through June. It had 21% growth in revenue to $15.1 billion.

• Santa Ana-based Ingram Micro Inc., which distributes computer and other technology products, was the biggest company on the list by revenue. The No. 11 company had $43.3 billion in revenue, a two-year increase of 19%, or $7 billion. That was the biggest increase on the list by dollar value.

• Sunstone Hotel Investors Inc. made the list at No. 13 with a 16% increase in revenue to $1 billion. The dollar-value increase was about $142 million. That, for comparison, is more than the dollar-value increase for all of the small companies combined, or $126 million.

Midsize

The midsize companies list had 10 entries with collective revenue of $2.8 billion, up 62% over two years. Seven of the companies were profitable, and the 10 combined for a loss of about $60 million for the recent year. The entries had 3,072 employees in OC, up about 5%. They combined for 12,834 employees overall, up 20%.

• Irvine-based auto financing company Consumer Portfolio Services Inc. had a nearly 61% increase in revenue to $270.4 million. It had about $26 million in profit.

Consumer Portfolio, which landed on the list at No. 4, focuses on the subprime category of car buyers.

“As a finance company, for us to grow revenues and earnings, we really need to grow the portfolio that we manage,” Chief Operating Officer Robert Riedl said. “So for the last three-plus years, we’ve been growing that.”

Riedl said the company’s portfolio hit a low point in the middle of 2011 at about $625 million.

The value today is more than $1.5 billion, he said.

“The way we [grow our portfolio] is by buying new loans at the dealership level,” he said. “Three years ago, we were doing $40 million a month in terms of new loans. Today it’s close to $100 million a month. … To put that into context, before the financial crisis, in 2007, we did about $125 million a month.”

Riedl said factors such as increased car sales in general and strong capital markets have helped Consumer Portfolio grow.

The company in September announced that it sold $273 million worth of notes backed by automobile receivables.

Small

The small-companies list had 14 entries that combined for $404.6 million in revenue, up about 46% over the past two years.

Six companies on the list were profitable for the year through June, helping offset the overall losses by some $71 million. The 14 combined for an overall loss of $20 million.

The businesses on the small-companies list combined to employ 1,131 workers in Orange County, up 14% year-over-year. Companywide, the total number of employees was 1,656, up about 24%.

• Irvine-based True Drinks Holdings Inc. ranked No. 3 with 250% revenue growth to $2.7 million.

It develops and markets natural drinks and gets about 90% of its sales through its flagship brand, AquaBall, said Lance Leonard, chief executive since July 2012. He has worked in the international food and beverage industry for more than 20 years, including at Nestlé and Mars Inc.

He said broader distribution and exports have been part of the company’s recent growth spurt.

“In the last year and a half, we were able to get into national distribution channels, like Kroger, Safeway, Stop & Shop in the East … 35 retail outlets,” he said. “We also found that the same issues that we were having in North America, like childhood obesity and diabetes, are the same problems in emerging markets, Latin America and Asia. So we have some partners in those markets. We’re developing the business to have a global footprint.”

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