ANNUAL SURVEY
AIRLINES
JetBlue Airways
CEO and Director: David Neeleman
JetBlue has added some ‘frills’ to the ‘no-frills’ airline sector, offering leather seats, free live TV at each seat and a fleet of 47 new Airbus A320s—in addition to low fares.The result has been a 91.6% load factor in August and 64% revenue growth in first-half 2003.The three-year-old New York City-based carrier serves 22 US destinations. While many airlines have canceled aircraft orders, JetBlue plans to add another six Airbuses by year-end and placed an order for 100 Embraer regional jets.
www.jetblue.com
AUTOMOTIVE
General Motors
Chairman and CEO: G. Richard Wagoner Jr.
The world’s largest automaker continued to show strong sales this year—driven partly by some of its most sweeping buyer incentive offers ever—amid stiff competition from Asian and European rivals.The company’s sales gains were supported by a gradual rise in consumer demand, by industry sales records for its various truck models and by its ample brand portfolio, including a successful pitch to ‘new luxury’ buyers. GM’s other businesses include financial services, in-vehicle digital information products, digital TV, locomotives and diesel engines.
www.gm.com
BEVERAGES
PepsiCo
Chairman and CEO: Steven S. Reinemund
North American consumers have enjoyed Pepsi products since druggist Caleb Bradham founded the company a century ago.Today, PepsiCo’s beverage business goes beyond its original Pepsi-Cola products to include such other popular brands as Mountain Dew, Slice, Sierra Mist and Mug, which together account for nearly one-third of the US soft drink market. Its non-carbonated brands include Aquafina, Tropicana and Gatorade. PepsiCo Beverages North America posted revenues of more than $7 billion and profits of $1.6 billion last year. Its 2003 US marketing plan included a ground-breaking $1 billion sweepstakes prize.
www.pepsico.com
CHEMICALS
Rohm & Haas
Chairman and CEO: Raj L. Gupta
Rohm & Haas remains a leader in specialty chemical technology. Despite revenue growth weakness from the US economic slowdown, the chemical producer has shown improvements in 2003 as a result of last year’s corporate restructuring and this year’s introduction of new products.While some product lines remain flat,monomers, coatings and performance chemicals have registered strong growth rates.With investors encouraged by the company’s prospects for recovery —supported by new distribution agreements and partnerships signed this year—stock prices have remained steady.
www.rohmandhaas.com
COMPUTER HARDWARE
Dell
Chairman and CEO: Michael S. Dell
Dell, the company founded by its CEO in his college dorm with just $1,000, remains the United States’ top seller of x86 computer servers and the world’s number-one provider of personal computer systems. The firm this year again exceeded global industry growth rates. Among new clients is the US Army, which awarded it a supply contract worth up to $500 million. Michael Dell’s goal of offering customized computers directly to buyers led to $35.4 billion in sales in fiscal 2003, up from $31.2 billion the year before.
www.dell.com
COMPUTER SOFTWARE
Intuit
President and CEO: Steve Bennett
Intuit is a growing company with large profits—23% net profit margins versus a 15% industry average. The firm’s low-cost software packages include Quicken (personal finance), QuickBooks (small business accounting) and TurboTax (consumer tax preparation), as well as a portfolio of industry-specific offerings. Revenues in fiscal 2003 were up 26% over fiscal 2002, at $1.65 billion, and are expected to climb to $1.95 billion in fiscal 2004. On a GAAP basis,net income soared 145% during the period. R&D; investments should lead to new products.
www.intuit.com
CONGLOMERATES
United Technologies
Chairman and CEO: George David
It’s hard to compete with a conglomerate whose business units invented elevators and air conditioning, built the first working helicopter, and power more than 50% of the world’s airliners. United Technologies is a pioneer in many sectors, with innovations supported by $2.38 billion in R&D; investments last year.Of the group’s $28.2 billion in revenues in 2002, $4.6 billion involved sales to the US government. Information- and technology-sharing among its units is partly responsible for the group’s success. Shareholders have received cash dividends each year since December 1936.
www.utc.com
CONSTRUCTION AND ENGINEERING
Bechtel
Chairman and CEO: Riley Bechtel
Bechtel, the United States’ largest contracting company, is focused on the world’s mega-projects, and this year beat out competitors in a bid for a $680 million US government contract to repair Iraq’s war-damaged infrastructure. Its other US government projects include cleaning up inactive nuclear weapons sites and building major transportation systems. Founded in 1898, the San Francisco-based construction, engineering and project management firm has completed more than 20,000 projects in 140 countries throughout its history and secured another $12.7 billion in new contracts last year.
www.bechtel.com
CONSUMER DURABLES
Whirlpool Corporation
Chairman and CEO: David R. Whitwam
Ranked as the world’s leading manufacturer and seller of major home appliances, Whirlpool operates some 50 manufacturing and technology research centers worldwide, with nearly 68,000 employees. The company markets its products in more than 170 countries under the Whirlpool, KitchenAid, Brastemp, Bauknecht, Acros and Consul brands, among others. It has completed a number of acquisitions that have served to expand both its product lines and its market share. Annual sales hit $11 billion last year, and its commitment to product innovation will continue to support healthy revenue gains.
www.whirlpool.com
CONSUMER NON-DURABLES
Procter & Gamble
Chairman, President and Chief Executive: Alan G. Lafley
Procter & Gamble is the United States’ number-one maker of household and personal care goods, with 12 of its brands reporting annual sales of more than $1 billion. Some of its best-known brands, from a portfolio of 300 marketed in more than 150 countries, include Bounty, Charmin, Crest, Folgers,Vicks, Pampers and Clairol. The company’s R&D; investments, which topped $1.7 billion in 2002, have led to the development of new products and technology that support its market leadership, while helping beat Wall Street’s earnings expectations.
www.pg.com
DEFENSE AND AEROSPACE
Lockheed Martin
Chairman and CEO: Vance D. Coffman
After landing the largest defense deal ever just a few years ago—the more than $200 billion Joint Strike Fighter contract with the US government— Lockheed Martin continues to hold its place as the world’s premier defense contractor.The US Department of Defense accounted for 57% of sales in 2002, with NASA and other government agencies accounting for another 20%.The company has joined forces with Northrop Grumman to develop an orbital space plane, to replace the Space Shuttle, by 2008.
www.lockheedmartin.com
DIVERSIFIED SERVICES
Automatic Data Processing (ADP)
Chairman and CEO: Arthur F. Weinbach
With more than $7 billion in revenues and a growing international clientele, ADP is one of the world’s largest computing services firms and a market leader in each of its four business segments. Its employer services unit offers human resources and payroll solutions to more than 450,000 employers in 26 countries, while its brokerage services unit provides securities processing. The firm’s dealer-services business offers computer solutions for automakers and car dealers, and the claims-services division provides auto-repair estimates and claims processing.
www.adp.com
ELECTRONICS
Sony Electronics
Chairman and CEO: Howard Stringer
Sony Electronics, a division of Sony Corporation of America, manufactures and markets consumer and professional audio and video equipment, computers and peripherals, recording media and energy products, semiconductors and other electronic components. Many of its consumer products are developed by its R&D; teams and often set the industry standard. In the US, Sony operates four research and engineering facilities as well as six manufacturing plants. Products in the pipeline include a hand-held PlayStation game device by end-2004 to complement its high-profit home video game systems.
www.sony.com
ENERGY SERVICES/ELECTRICITY
Southern Company
Chairman, President and CEO: Allen H. Franklin
One of the country’s largest electricity producers, Southern Company has more than 38,000 megawatts of electric generating capacity and over 4 million customers throughout the southeastern United States. The Atlanta-based company is also a star performer, posting $1.3 billion in net income last year, despite the fact that its retail rates are 15% below the national average. ROE was 15.8%, placing it in the top quartile among electric utilities. Its common stocks, which have paid dividends since 1948, are among the market’s most widely held shares.
www.southernco.com
ENERGY SERVICES/EQUIPMENT
GE Power Systems
Chairman and CEO: John G. Rice
GE Power Systems is the world’s leading power generation technology and services firm and accounts for more than 70% of GE’s total sales. Its products include compressors, turbines, generators and nuclear reactors. Since entering the global wind energy industry last year, the company has received more than $2 billion in orders and commitments, making this an important growth area. GE Power Systems, which reported $23 billion in revenues in 2002, will continue to pursue its acquisitions strategy to further consolidate its market leadership.
www.gepower.com
FOOD
ConAgra Foods
Chairman and CEO: Bruce Rohde
A walk down any supermarket aisle is a virtual romp through ConAgra’s portfolio of famous household brands, including Hunt’s, Armour, Parkay, Hebrew National, Gulden’s and Healthy Choice, among many others. The company has come a long way from its origins in 1867 as a small Nebraska food company. It is now one of North America’s largest packaged food producers, serving the consumer grocery, restaurant and food-service sectors. Its social responsibility programs include "Feeding Children Better," the United States’ largest corporate initiative to fight child hunger.
www.conagra.com
FRANCHISES
Krispy Kreme Doughnuts
Chairman, President and CEO: Scott A. Livengood
Krispy Kreme’s hot doughnuts have been enjoyed by US consumers since 1937. However, 2003 marked the company’s foray into the international market, with the opening of its first store in Australia and its first European store (in London), the opening of its first franchise in Canada and the concession of development rights for stores in Mexico. The company produces more than 7 million of the doughy treats daily, prompting net sales of $491.5 million in fiscal 2003, up from $394.3 million in 2002.
www.krispykreme.com
HEALTH SERVICES
UnitedHealth Group
Chairman and CEO: William W. McGuire, M.D.
UnitedHealth Group has grown from a regional HMO into the largest health services company in the US, with more than 17 million medical members and 50 million customers. Its five business segments offer individual and corporate health plans, Medicare and Medicaid options, specialized care coverage, consulting, publishing, and drug development and marketing services. The firm has annual sales of $25 billion and typically surpasses Wall Street analysts’ revenue and share-price expectations. Strong new business sales are already in the pipeline for 2004.
www.unitedhealthgroup.com
HOTELS
Starwood
Chairman and CEO: Barry S. Sternlicht
Starwood is one of the world’s largest hospitality companies, with more than 740 properties in some 80 countries. Owned and managed properties are operated by its St. Regis, Luxury Collection,Westin, Sheraton, Four Points and W Hotels subsidiaries. Another business unit, Starwood Vacation Ownership, is a resort interval ownership company. Proceeds from the sale of several properties this year were earmarked to pay down existing debt, and company executives have announced a goal of growing EBITDA by 8%-10% and EPS by 15% yearly.
www.starwood.com
INSURANCE
MetLife
Chairman and CEO: Robert H. Benmosche
MetLife is the United States’ largest non-medical health provider of employee benefits and holds numberone positions in the group life, group long-term care, short-term disability,commercial dental,payout annuities, automobile and homeowner- insurance sectors. As the country’s largest life insurer, it had some $2.4 trillion of life insurance in-force at end-2002 and employs more than 36,000 workers.With the MetLife blimp already one of the company’s most recognized symbols, this year it also acquired Chicago’s Sears Tower—the tallest building in the United States.
www.metlife.com
LEISURE
Starbucks
President and CEO: Orin C. Smith
Since Starbucks began selling its fine coffee blends in Seattle more than three decades ago, a cup of coffee is no longer just a cup of coffee. It is now what the company calls the "Starbucks experience," which includes a full menu of hot and cold coffees and beverages enjoyed amid comfortable seating often with live music, coffee tastings and community events.The formula is repeated successfully at more than 7,000 locations worldwide, serving up a 24% rise in annual consolidated net revenues, to $4.1 billion, in fiscal 2003.
www.starbucks.com
LOGISTICS
United Parcel Service (UPS)
Chairman and CEO: Michael L . Eske w
UPS moves more than 13.3 million packages and documents each day and is ranked among the world’s most admired companies. The world’s largest package-delivery company this year unveiled a series of new package-flow technologies that include hardware, software and process changes.The new systems, to be fully implemented by 2005, not only will allow customers greater flexibility to make in-transit changes to their deliveries but also should allow UPS truck drivers to reduce annual mileage by more than 100 million miles.
www.ups.com
MEDIA AND ENTERTAINMENT
Viacom
Chairman and CEO: Sumner M. Redstone
Viacom has had to contend with a global decline in advertising sales this year.However,the company not only has fared better than most competitors; it also is well positioned to take advantage of an expected market recovery in 2004. The global media conglomerate is active in 166 countries and territories worldwide, with interests in broadcast and cable TV, radio, outdoor advertising, Internet, publishing, cinema, video rentals and theme parks. Its brands include CBS, MTV, Showtime,VH1, Simon & Schuster, Blockbuster Video and Paramount Pictures.
www.viacom.com
METALS AND MINING
Alcoa
Chairman and CEO: Alain Belda
Alcoa remains the world’s leading producer of primary aluminum, fabricated aluminum and alumina, with more than $20 billion in revenues and 127,000 workers in 40 countries. Its other businesses include vinyl siding, precision castings and fiber-optic cables. The vertically integrated company is involved in technology, mining, refining, smelting, manufacturing and recycling.As a testimony to its output quality, company reports contend that 70% of the aluminum Alcoa has ever produced is still in use today, including the cap on the Washington Monument— installed in 1884.
www.alcoa.com
NETWORK SYSTEMS
Cisco Systems
President and CEO: John Chambers
If you use the Internet, the chances are that you are doing so with help from Cisco Systems, the world’s leader in Internet networking. Some analysts estimate that more than 80% of Internet data traffic flows through Cisco equipment.However, in a move to counter a foreseeable drop in the global market for routers and switchers,which remain its core technology markets, the company has already identified new growth areas, including Internet Protocol (IP) telephony, consumer networking and network security.
www.ciscosystems.com
OIL AND GAS
Shell
Chairman: Sir Philip Watts
In addition to its oil exploration and production ventures in 41 countries, Shell markets its oil products through a network of 46,000 retail outlets that make it the world’s sinsingle largest branded retailer. To put this in perspective, Shell’s retail network is about twice that of McDonald’s. The company’s gas and power division has both upstream and downstream operations to process and transport natural gas, develop power plants and market gas and electricity worldwide. Shell produces 3.5% of the world’s gas and 3% of the world’s oil.
www.shell.com
PHARMACEUTICALS
Pfizer
Chairman and CEO: Henry A. McKinnell, Ph.D.
Pfizer pushed itself to the top spot among global pharmaceuticals companies with its acquisition this year of Pharmacia, which brought new drugs for therapeutic areas into its portfolio and added other products to its pipeline. Pharmacia had been a rival, best known for its Rogaine and Nicorette consumer products. Pfizer, which merged with Warner-Lambert in 2000, has some 200 products under development, which eventually will be added to such other best-selling brands as Viagra, Celebrex, Lipitor, Zoloft, Sudafed and Benadryl.
www.pfizer.com
RETAILING
Wal-Mart Stores
President and CEO: H. Lee Scott
Wal-Mart remains the world’s largest retailer, serving more than 138 million global customers weekly. It is also one of the United States’ largest private employers, with more than a million ‘associates’ nationwide, and one of the largest corporate contributors to charity, with more than $200 million in donations last year. The company operates several formats, including its f lagship Wal-Mart retail stores, Sam’s Club members-only warehouse clubs, and smaller Wal-Mart Neighborhood Markets. Sales in the fiscal year ended January 2003 totaled $244.5 billion, a 15% rise over the previous year.
www.walmart.com
TELECOM EQUIPMENT
Motorola
Chairman and CEO: Christopher B. Galvin
CEO Chris Galvin’s decision to retire has cheered investors who feel his departure will prompt aggressive restructuring plans and higher corporate margins. The challenge for Galvin’s successor will be to help Motorola regain some lost ground. Although best known for inventing the cell phone, Motorola remains a global market leader in other segments, including digital cable settops and cable modems. New cell phone innovations and the spin-off of several non-core business units are expected.
www.motorola.com
TELECOM SERVICES
Verizon Communications
CEO: Ivan Seidenberg
Verizon is still the United States’ largest provider of wireline and wireless communications.With more than 137 million access line equivalents in nine out of the top 10 US markets, it reaches one-third of the country’s households. It also has over 34 million wireless customers, with its wireless footprint covering nearly 90% of the population.As one of the world’s leading communications providers, it also operates in more than 30 countries. Despite troubled market conditions,Verizon still racked up $67 billion in sales last year.
www.verizon.com
TOBACCO
Altria Group
Chairman and CEO: Louis C. Camilleri
Altria Group’s Philip Morris USA division is the United States’ leading cigarette manufacturer, with a 50% retail share and $5 billion in operating income last year. The company estimates four of every 10 cigarettes sold in the US is a Marlboro—its topselling brand. Its other brands include Benson & Hedges, Parliament and Chesterfield. The company has adapted well to new marketing guidelines under the 1998 tobacco settlement agreement, and its market share remains strong.
www.altria.com
WHOLESALE
Costco Wholesale
President, CEO and Director: James D. Sinegal
Costco Wholesale is a leading international operator of membership warehouses selling a wide variety of bulk products at below regular retail and wholesale prices. In addition to brand-name products, Costco also sells goods under its Kirkland Signature private label.The company operates 420 warehouses (each averaging more than 130,00 square feet) in the US, Puerto Rico, Canada, the UK, Taiwan, Korea, Japan and Mexico. It has more than 103,000 employees and plans to open another 10 stores by year-end. Revenues rose 10% in fiscal 2003, to $41.7 billion.
www.costco.com
