Post 200

The Post 200 -- Industry Breakouts

The big got bigger in 2006. Bethesda's Lockheed Martin snapped up a couple local companies and bought a West Coast company specializing in peacekeeping and nation-building missions. General Dynamics of Falls Church wrapped up a deal to buy government technology contractor Anteon International Corp. as well as one for an ammunition maker in Quebec. Fall Church's DynCorp went public and quickly made plans for expanding into homeland security and new markets outside Iraq and Afghanistan, where it already is one of the largest U.S. contractors. Despite the moves, many contractors braced for a slowdown in the rate of growth in defense work. Arlington's CACI, a government technology contractor, attributed the deceleration to the change of control in Congress last November and increased competition, among other factors.

Click here to view all aerospace and defense firms in the Post 200.

Biotechnology firms showed some of their promise last year. MedImmune of Gaithersburg, the region's most successful biotech company, agreed to sell itself at a hefty premium to British drug giant AstraZeneca. Profit at Silver Spring's United Therapeutics rose on the strength of its chief product, the pulmonary hypertension drug Remodulin. Martek of Columbia continued to find new customers for its nutritional supplements derived from algae and fungi. Digene had matured enough that two of its top executives could step aside after rescuing the company 16 years ago when its scientist founders were running out of money. Celera Genomics, meanwhile, remade itself again, this time as a developer of diagnostic tests that scan patients for a predisposition to ailments such as breast cancer and heart disease.

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Energy prices soared, but demand softened last year, offering fresh challenges for local companies. Pepco of the District blamed lower profit on the weather, even after reaching new highs for peak electricity use over the summer. WGL Holdings, the District parent of Washington Gas Light Co., recorded a profit after adding almost 20,000 customers. Arlington's AES continued to seek power generation opportunities in far-flung places but had to cash out a stake in Venezuela after President Hugo Chavez moved to nationalize strategic industries. The United States' fourth-largest coal producer, Foundation Coal Holdings in Linthicum Heights, experienced higher expenses and some of its mining operations were hurt by weak performance. Demand, meanwhile, remained strong for the uranium that Bethesda's USEC sells to commercial nuclear plant operators.

Click here to view all energy firms in the Post 200.

Plenty of companies in this sector did well last year, but the two largest, Freddie Mac and Fannie Mae, continued to work through their accounting issues. Bethesda's American Capital Strategies, one of the region's biggest lenders to mid-sized companies, got bigger. So did CapitalSource of Chevy Chase. Allied Capital produced record profits but attracted the attention of investigators over allegations it had hired someone to obtain the phone records of a hedge fund manager. Arlington investment banker Friedman, Billings, Ramsey Group settled insider-trading charges and sold off nearly a third of its investment banking and securities brokerage operations. Sallie Mae, the Reston student loan giant, agreed to sell itself to a group of investors for $25 billion. CapitalOne wrapped up deals to buy two banks, making it the 11th-largest bank in America, based on deposits.

Click here to view all financial services firms in the Post 200.

It was a year of ups and downs for the consulting and professional services industry. Arlington personnel and financial management firm Watson Wyatt Worldwide lived up to its new international name and opened offices in Tampa and Frankfurt, Germany, and purchased its longtime partner in the Netherlands. The District-based Advisory Board said clients spent 17 percent more in 2006 than they did the year before. Its cousin, the Corporate Executive Board, posted a 27 percent revenue gain in 2006. GTSI, which sells technology products and services, prepared to say goodbye to its longtime chairman and former chief executive as it worked to correct its accounting. Maximus, a Reston firm that helps governments manage social-services programs, went to arbritration with Accenture over a big contract in Texas to help operate a human-services enrollment program.

Click here to view all government and professional services firms in the Post 200.

Several local companies found ways to capitalize on trends in the health-care industry last year. Sunrise Senior Living of McLean opened 30 communities nationwide as it worked to clear up questions regarding its accounting. Managed-health-care company Coventry Health Care of Bethesda focused on the rollout of the government's Medicare prescription drug plan and became the nation's sixth-largest private insurer of such plans. Pharmacy-benefit manager HealthExtras of Rockville signed its first Blue Cross Blue Shield client, the company's largest client to date. Bethesda's Chindex International began selling premium health insurance to Chinese citizens. Dialysis Corp. of America continues to open kidney dialysis centers. Hanger Orthopedic Group of Bethesda posted record sales at its network of medical offices that provide prosthetic-care services.

Click here to view all health care firms in the Post 200.

The hospitality industry fared well last year, as business travel was up and the supply of rooms tightened. Hotel manager Marriott International continued to do well in the United States and turned its attention to Europe, where the Bethesda company hopes to open 50 Courtyard-brand properties over the next few years. Arlington's Interstate Hotels & Resorts opened its first hotel in Belgium, bringing its total in Europe to seven. Domestically, LaSalle Hotel Properties of Bethesda bought seven hotels in urban markets, where demand is strongest. Profit at Silver Spring's Choice Hotels International rose, but there were signs that its growth was slowing and the company reorganized its management. Bethesda's Host Hotels & Resorts reaped the benefits of its $4 billion purchase of 38 Starwood properties in 2005, as revenue per available room jumped.

Click here to view all hospitality and travel firms in the Post 200.

CoStar Group joined a parade of information technology companies showing growth in the past year. The Bethesda company, which sells commercial real estate data, added more than $3 million in annual subscriptions since last May. NeuStar of Sterling, which manages phone number and Internet address databases for the telecommunications industry, attributed a healthy increase in revenue to its role in allowing people to transfer phone numbers from one handset to another. Lanham's Vocus, a maker of press-release software, acquired an online press-release distribution company called PRWeb and signed nearly 350 new subscription agreements, bringing its client base to about 1,700. McLean data-mining specialist MicroStrategy lined up new customers and announced plans to buy a company jet.

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Washington is home to a diverse collection of manufacturing interests. Harman International of the District, which produces high-end audio equipment for the car, agreed to sell itself last month. The District's Danaher conglomerate snapped up a few more companies last year, including a dental-products company and an Australian maker of medical instruments. Alexandria's Cuisine Solutions had steady growth in its prepared foods business. So did chemical maker W.R. Grace of Columbia, which continued to expand despite operating under bankruptcy protection as it responds to a slew of asbestos-related personal injury lawsuits. Other companies hit their own bumps in the road: Winchester cabinet maker American Woodmark dealt with a slumping housing market, and some big construction projects wound down for Manassas steel concern Williams Industries.

Click here to view all manufacturing firms in the Post 200.

The digital revolution continued to roil the media industry last year, pushing companies to find new ways to deliver their content. Gannett experimented with shrinking the size of one of its newspapers, repackaged its TV shows for sale to Web and video outlets, and bought an Internet search company. Online revenue at The Washington Post, and revenue from its Kaplan educational services company, showed healthy gains even if advertising sales at the newspaper did not. RadioOne chief executive Alfred C. Liggins III looked for opportunities for radio on the Internet as the company worked to deal with accounting questions. Perhaps the biggest news was XM Satellite Radio's announcement that it had agreed to merge with rival Sirius, a deal that would bring together the nation's only two satellite radio providers.

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The slowdown in the residential housing market took wind out of the sails of the local real estate industry last year. Reston's NVR, the region's biggest home builder, had sales drop 10 percent. Comstock Homebuilding of Reston put the brakes on a few of its condominium projects. Alexandria's AvalonBay Communities expanded its portfolio of rental projects. Several real estate investment trusts posted strong returns. Federal Realty of Rockville bought seven new retail and mixed-use projects. American Community Properties Trust is about halfway through developing a mammoth planned community in Charles County. And Columbia's Corporate Office Properties Trust continued its expansion, adding 1 million square feet to its roster.

Click here to view all real estate firms in the Post 200.

It was a year of pluses and minuses for the local telecommunications industry. Reston's Sprint Nextel struggled through its first full year as a merged company, laying off workers, as some of its highest-paying wireless customers fled to other carriers. One of its former subsidiaries, NII Holdings, fared better by selling Nextel service in Argentina, Brazil, Chile, Mexico and Peru. Telephone traffic on XO Holdings' networks jumped 80 percent, though Primus Telecommunications was delisted from the Nasdaq stock market. Wireless phone reseller InPhonic settled a dispute over mail-in rebates and separately reported that it would have to restate results for two quarters. RCN set out to battle Comcast and Verizon by offering bundles of cable television, high-speed Internet and phone services.

Click here to view all telecommunications firms in the Post 200.

Many of the region's banks watched their profit margins get squeezed by customers pushing for higher rates on deposits and lower rates on loans. Expansion slowed but it didn't come to a complete halt. Alexandria's Burke & Herbert opened a branch in Annandale, Virginia Commerce of Arlington opened five, and McLean-based Cardinal Financial stepped out of Northern Virginia to plant its flag in Bethesda. Chevy Chase Bank, the metropolitan area's largest local bank, dwarfed them all in assets and kept getting bigger. It opened 15 branches last year and reached a deal with the University of Maryland to change the name of its sports field to the Chevy Chase Bank Field at Byrd Stadium. Provident Bankshares out of Baltimore moved up to second in size of assets, followed by Sandy Spring Bancorp.

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In the Washington area, some local companies are categories unto themselves. Strayer Education of Arlington opened eight college campuses around the country last year and plans to open another eight this year as enrollment at the for-profit education company continues to grow. Alexandria's Bowl America also had designs on expansion but, for now, only plans to rebuild its bowling center in Falls Church. CompuDyne of Annapolis eyed expansion of another sort: It decided to market its security products and prison locks to homeland-security authorities as it sought to reverse 2005 losses. Likewise, the District's Varsity Group tried to diversify beyond its core offerings of textbooks and school uniforms only to retreat from an attempt to sell sporting goods online. Fairchild, which sells motorcycle gear and aircraft parts, thought it had a deal to sell itself, but the talks fizzled, and the McLean company hunkered down to sort out some tax issues.

Click here to view firms in the "Other Industries" category in the Post 200.

Some of the region's largest companies are private, so private that a few of the best known, such as Geico and Carlyle, don't participate in The Post's survey. Of those that do, Mars, the giant candy maker, is the biggest. It would have ranked fifth on this year's list of public companies. The McLean company spent much of the past year touting its efforts to curb advertising aimed at young children and putting more healthful snacks in school vending machines. Allegis Group, the staffing company founded by Baltimore Ravens owner Stephen J. Bisciotti, continued to grow, buying a New Jersey information technology staffing firm. Clark Construction celebrated its 100th anniversary last year and is at work building the roughly $600 million Washington Nationals ballpark in Southeast along the Anacostia River. Discovery Communications brought in new executives from NBC who began trimming the Silver Spring company's payroll as they focused on future growth opportunities. Kettler is a new addition to The Post 200. As one of the nation's 15 largest developers of multifamily projects, the company found ripe new areas for development around Metrorail and Virginia commuter rail stops.

Click here to view the largest private companies headquartered in the Washington metro area.

Several of Maryland's largest companies faced unique challenges last year. Consumer unhappiness over a rate increase helped scuttle plans by Baltimore's Constellation Energy to merge with Florida's largest utility. Black & Decker's profit took a hit from the difficult housing market and rising commodities prices. Legg Mason's star fund manager, Bill Miller, failed to extend his 15-year winning streak against the Standard & Poor's 500-stock index. Sales were up at McCormick, but the Sparks spices and seasonings firm spent much of the year restructuring operations and closing two plants. The outlook was better at Baltimore investment firm T. Rowe Price, which exceeded last year's record of assets under management and became one of a handful of foreign firms to win a coveted role as manager of part of China's social security fund.

Click here to view the largest public companies in Maryland with headquarters outside the Washington metro area.

Virginia's biggest companies represent a diversified lot. Smithfield Foods, already the world's largest pork producer, gobbled up three new meat businesses. A price war over flat-screen, high-definition televisions left Circuit City in a bind last year, forcing the Richmond electronics retailer to close stores and cut thousands of jobs. Dominion Resources of Richmond asked the legislature to re-regulate its electric utility in hopes of producing more predictable returns. Norfolk Southern teamed with Union Pacific to bolster freight service between Los Angeles and the Southeast. And Genworth Financial, the big financial services holding company in Richmond, spent a busy year tinkering with its portfolio, buying a life insurance company and selling off an employee benefits business.

Click here to view the largest public companies in Virginia with headquarters outside the Washington metro area.

Many of the region's largest employers are not based in the Washington area, but they include some well-known names in an array of industries. Fast-food giant McDonald's is the biggest, followed by weapons maker Northrop Grumman, which bought intelligence technology firm Essex of Columbia last year. The U.S. affiliate of Dutch conglomerate Royal Ahold continued working to turn around its ailing Giant Food chain and recently reached a deal to sell off its U.S. Foodservice subsidiary, also based in Columbia. Wal-Mart struggled to define itself as more than just a low-cost leader, only to see some of its tactics backfire and hurt its bottom line. Federated Department Stores spent much of the year converting the various regional chains it had bought, such as Hecht's, into Macy's or Bloomingdale's locations. The retailer now has 29 stores in the area. Verizon moved aggressively to expand a high-speed fiber-optic network in the region to compete against cable companies for phone, Internet and television service. It won approval to begin marketing the service in several counties and cities.

Click here to view major employers headquartered outside of the Washington metro area.

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