#6. BEST PRODUCTS CO. INC.
P.O. Box 26303 Richmond, Va. 23260 REVENUE: $2.2 billion PROFITS: $2.2 million EARNINGS PER SHARE: 8 cents DIVIDEND: 24 cents ASSETS: $1.3 billion STOCKHOLDERS' EQUITY: $415.4 million RETURN ON EQUITY: 0.5 percent EXCHANGE: NYSE EMPLOYES: 18,000 TOP EXECUTIVES: Andrew M. Lewis, chairman; Robert E. R. Huntley, president; Bernard A. Cohen, executive vice president. FOUNDED: 1957
DESCRIPTION: Best Products, based in Richmond, is a discount retailer, operating 213 catalogue showrooms under the names of Best, LaBelle's, Jafco, Dolgin's, Rogers, Great Western and Miller Sales. It also owns and operates 44 specialty stores, including Best Jewelry Stores and Ashby's Ltd., a discount women's apparel chain.
DEVELOPMENTS: Best still is trying to climb out of the deep slump it has been in for more than two years, largely because of its failure to digest two major acquisitions of catalogue showrooms in 1982. Profits, at the lowest level in a decade in 1984, were even lower in 1985, dropping to $2.2 million (8 cents a share) from $13.6 million (50 cents). Sales also were down to $2.23 billion from $2.25 billion a year earlier.
Despite these gloomy financial figures, store officials remain confident that the chain will turn itself around, with results beginning to show at the end of this year. President Huntley recently said he expected earnings to show a "substantial improvement" by the fourth quarter of 1986.
Part of 1985's earnings decrease, Huntley said, was attributed to the increased costs incurred in restructuring the company -- consolidating its 10 divisions into four and remodeling the stores to make them more attractive, more self-service-oriented and more productive, especially in sales of jewelry and other high-profit items. Best also plans to change the names of all of its subsidiaries in the country to the Best name. #7. ETHYL CORP.
330 S. Fourth St. P.O. Box 2189 Richmond, Va. 23217 REVENUE: $1.6 billion PROFITS: $117.2 million EARNINGS PER SHARE: $1.81 DIVIDEND: 57 cents ASSETS: $1.6 billion STOCKHOLDERS' EQUITY: $789.6 million RETURN ON EQUITY: 15.2 percent EXCHANGE: NYSE EMPLOYES: 10,500 TOP EXECUTIVES: Floyd D. Gottwald Jr., chairman and chief executive officer; Bruce C. Gottwald, president. FOUNDED: 1887
DESCRIPTION: Ethyl Corp. produces chemicals for the petroleum industry and is a major supplier of fuel additives to U.S. refineries. The company has diversified in recent years in response to government regulations restricting lead additives in motor-vehicle fuels. The company derives revenue from high-technology chemicals, plastics, aluminum products, coal, oil, gas and life insurance. Income from the sale of leaded gasoline additives was reduced last year to 11 percent of net earnings, down from 16 percent in 1984.
DEVELOPMENTS: In February, Ethyl Corp. management announced a 2-for-1 split of the company's stock -- pending shareholder approval -- for shareholders of record on May 16. Company revenue for the fiscal year ended Dec. 31 dropped 8 percent, largely as a result of the sale of the company's plastics group. Net earnings declined 11 percent last year compared with 1984.
A major factor in the drop in earnings was the company's decision to take a $20 million after-tax write-down against the impact of new regulations further reducing the market for leaded gasoline additives. The company says that had the write-offs not been taken last year, net profits would have increased about 8 percent.
Late last year, the company announced plans to shut down production facilities in Thessaloniki, Greece, that produced lead antiknock compounds. The decision to close the plant was based on declining worldwide demand for such additives.
In January, Ethyl announced it is building a plant to manufacture semiconductor grade polycrystaline silicon at a chemicals complex near Houston. The new facility is expected to cost $45 million, with startup scheduled for late next year. The new plant is intended to increase the company's expanding role in electronics chemicals and semiconductor markets. #8. UNIVERSAL LEAF TOBACCO CO.
P.O. Box 25099 Richmond, Va. 23260 REVENUE: $1.1 billion PROFITS: $46.4 million EARNINGS PER SHARE: $2.69 DIVIDEND: 96 cents ASSETS: $488.3 million STOCKHOLDERS' EQUITY: $261 million RETURN ON EQUITY: 17.8 percent EXCHANGE: NYSE EMPLOYES: 3,500 TOP EXECUTIVES: Gordon L. Crenshaw, chairman and chief executive officer; Henry H. Harrell, president. FOUNDED: 1888
DESCRIPTION: Universal Leaf is the world's largest independent leaf-tobacco dealer. It also is involved in the manufacture and marketing of phosphate fertilizers for domestic and export markets, and recently diversified into the financial services market.
DEVELOPMENTS: Revenue for Universal Leaf Tobacco Co. rose nearly 40 percent in the year ended June 30. Net income for the year was up 17 percent over the previous year. For the first six months of the current fiscal year, ended Dec. 31, the company reported revenue of $628 million compared with $608 million in the same period last year. Net income for the first half was $29.5 million, about equal to net income for the same period a year earlier.
About 25 percent of the increased revenue is related to the company's acquisition in October 1984 of Lawyers Title Insurance Co., a title insurance business in Richmond. Net income in the last full fiscal year also was helped by an unusually strong tobacco crop in 1985 compared with that of 1984.
In another diversification move, the company has entered negotiations to acquire a Dutch firm, Deli-Maatshappij, which deals in tobacco and other commodities in international trade. Company officials indicate that commodities trading aside from tobacco is a logical step toward broadening the business base of Universal Leaf. #9. FIGGIE INTERNATIONAL HOLDINGS INC.
1000 Virginia Center Pkwy. Richmond, Va. 23295 REVENUE: $806 million PROFITS: $29.2 million EARNINGS PER SHARE: $4.73 DIVIDEND: 76 cents (Class A); 68 cents (Class B) ASSETS: $561.5 million STOCKHOLDERS' EQUITY: $218.5 million RETURN ON EQUITY: 13.4 percent EXCHANGE: OTC EMPLOYES: 15,000 TOP EXECUTIVE: Harry E. Figgie Jr., chairman and chief executive officer. FOUNDED: 1964
DESCRIPTION: Figgie is one of the nation's most diversified companies, with more than 35 principal divisions and subsidiaries serving consumer, industrial, service and technical markets. The diversity of its operations reflects the founder's philosophy that poor performance in one sector will be balanced by strong performance in another. Two of its best-known consumer businesses are Fred Perry Sportswear and Rawlings Sporting Goods.
DEVELOPMENTS: Figgie had its best year ever in 1985, with net income soaring 68 percent and revenue up 11.5 percent over the prior year. In the second quarter, the company closed American LaFrance, the upstate New York maker of custom fire engines that consistently had hurt Figgie's earnings and cash flow. That was the business Wall Street analysts said Harry Figgie would never close, but he proved them wrong.
Figgie made four acquisitions during the year, which the chairman calls "tuck ins" because they can be neatly tucked into existing divisions. Figgie acquired Logan Co., a materials handling business; Chemetron, a fire protection business; and Gregg and Metro, two security-systems businesses.
The company made a major change in its financial structure on Jan. 23 by creating two classes of stock with unequal voting rights, in a move designed to insulate Figgie from unwanted takeovers and improve the company's access to capital markets. This was accomplished through a reverse stock split, in which 100 shares of the old Figgie common were exchanged for 50 shares of Figgie Class A stock and 50 shares of Figgie Class B stock. The Class B has a full vote, while the Class A has only one-twentieth of a vote. The Class A has a slightly higher dividend. Because New York Stock Exchange rules prohibit companies from having two classes of stock with unequal voting rights, Figgie moved from the Big Board to the over-the-counter market. #10. A. H. ROBINS CO.
1407 Cummings Dr. Richmond, Va. 23261 REVENUE: $706.1 million PROFITS: $75.8 million EARNINGS PER SHARE: $3.12 DIVIDEND: None ASSETS: $706.5 million STOCKHOLDERS' DEFICIT: $47.1 million RETURN ON EQUITY: NA EXCHANGE: NYSE EMPLOYES: 6,100 TOP EXECUTIVES: E. Claiborne Robins, chairman; E. Claiborne Robins Jr., president and chief executive officer. FOUNDED: 1866
DESCRIPTION: A. H. Robins is a diversified health-care company marketing so-called "ethical" pharmaceuticals such as Reglan, used to control vomiting and nausea in cancer patients undergoing chemotherapy, and ChapStick, the country's leading lip balm. The company also produces and sells Robitussin, a top-selling cough syrup line, and similar self-administered pharmaceuticals. Robins also markets animal care products and medical instruments and owns radio stations in Greensboro, N.C. The company operates overseas through approximately 30 foreign subsidiaries.
DEVELOPMENTS: Robins turned profitable again last year after reporting a record $461.6 million loss in the previous year when forced by litigation to set up a $615 million reserve fund to pay the cost claims related to the Dalkon Shield, a birth-control device about which serious medical questions have been raised.
In its annual report to stockholders, Robins called 1985 "the most difficult year in its history."
Under pressure of massive litigation brought against the company, Robins filed a voluntary petition for reorganization last August under Chapter 11 of the Bankruptcy Code. Since then, Robins' management has directed the company as a "debtor-in-possession" for the benefit of claimants, creditors and equity holders. The company contends in court documents filed in bankruptcy court in Richmond that operating results in recent years -- including fiscal 1985 -- "have outpaced industry averages."
Early this year, Robins asked the court to accept a company plan for fixing the cost of claims pending against the company as a step toward expediting the proceedings. That petition still is pending. The U.S. attorney in Richmond has sought sanctions against the company on grounds that certain "preferential payments" were made by Robins management prior to seeking protection under the bankruptcy law.
Beyond its court troubles, Robins informed stockholders that patent protection for Reglan, the company's largest revenue producer, has expired and several generic competitors have been brought to market. Management expects price and unit sales erosion in 1986.
The company also announced late last year that it had sold its manufacturing plant in Great Britain to an English firm, Glaxo Group, "for an amount approximating its cost" and expressed disappointment at circumstances that dictated its sale.