Beckman Nearly Doubles in Size
At first blush, it’s surprising that a company as large and venerable as Fullerton-based Beckman Coulter Inc. would appear on the Orange County Business Journal’s list of the fastest growing public company by revenue. After all, it’s easiest to grow when you’re small.
The medical instruments maker posted a 77.3% sales surge in the three-year period between June 1997 and June 2000, good for the No. 35 spot on this year’s list.
The main reason for the growth was the 1997 merger between Miami-based Coulter Inc. and Beckman Instruments Inc., the company founded in 1934 by the famed Arnold O. Beckman, who had invented the first pH meter. The merger, unlike many, has gone off well.
Beckman and Coulter had essentially no overlap in their product offerings, but served substantially the same customer base and the combined company was able to consolidate sales efforts. As a result, it has been able to downsize its workforce, from 10,500 in 1998 to its current 9,600. (Its OC employment has increased year over year 1% to 2,198).
The merger resulted in an almost four-percentage-point improvement in operating margins and a drop in interest expense as the company used the extra cash to pay down debt. That led to a higher debt rating.
Wall Street has been appreciative, sending its stock up 51% during the first eight months this year. In the past week, it went up even further on rumors that Abbott Laboratories Inc. might try to buy it. (See related story, Page 1.)
Beckman Coulter is Orange County’s largest employer in the manufacture of medical supplies, making everything from centrifuges for universities to DNA and protein systems for drug and biotechnology companies to blood tests for laboratories.
In March, Beckman Coulter announced, ahead of analysts’ expectations, that the Food and Drug Administration had approved two new blood tests for the detection of prostate cancer.
The company said the new tests, known as Access Hybritech PSAs, can be done in 20 minutes; that compares well with the previous system’s four hours. Men over 50 are urged to have prostate cancer tests, but only 21% of the estimated 90 million men in that age group in Europe and the U.S. do so.
In 1999, revenue increased 5% to $1.81 billion, but earnings increased three-fold to $106 million. Beckman Coulter Chairman and Chief Executive John Wareham said the company is expecting revenue to grow 5% this year. n
