The largest Alaskan-owned, Alaska-based companies.
Unexpected. Unpredictable. Last year served up unanticipated demand for supplies and services that boosted business for many lucky and many wise Alaskan enterprises. Not surprisingly, the good news about economic expansion in 1989 is reflected in the performances of major business players. Our 1990 and sixth New Forty-Niners report identifying the 49 largest revenue producers among Alaskan-owned, Alaska-based firms continues the tale of a more encouraging business climate. Last year was the first in which Alaska Business Monthly could report an overall increase in gross revenues of the firms incluede since the New Forty-Niners feature was first published in 1985.
The 49th state's own most successful businesses, the New Forty-Nener companies, are risk-takers akin to the original Forty-Niners who sought their fortunes in the 1849 California gold rush. They represent the most successful prospectors, those who've staked and worked claims to seize a niche in Alaskan commerce.
Driving increased demand in the 49th state's economy last year was the labor-intensive cleanup operation mobilized to reclaim oil-soiled beaches. Almost 11 million gallons of North slope crude poured from the Exxon Valdez supertanker when it grounded on Bligh Reef in Prince William Sound on March 24, 1989.
The cleanup work poured well over a billion dollars worth of business into the state. The impact was felt not only by companies providing supplies and services for the cleanup operations, but also by businesses that met the needs of support centers, such as lodging, communications and transportation companies. Restaurants and other retailers also benefited from the surge in wage-earner spending power.
Cleanup activities clearly gave momentum to Alaska's economy last year. The Alaska Department of Labor reports that employment in alaska grew in 1989, rising 6.4 percent from 1988. the agency also notes that the 6.7 percent statewide unemployment rate dislodged the previous comparable low of 8 percent set in 1976.
Even without the impact of cleanup revenues, though, the state's business community continued to recover from two prior years of drastic company downsizing in 1986 and 1987. In a review of the economy's performance in 1989 published by the labor department in the April issue of its Alaska Economic Trends publication, the agency's economist wrote, "The oil spill cleanup made a significant contribution to Alaska's economy in 1989, but to brand it as the only tonic that cured an ailing Alaskan economy would be an overstatement."
Among the factors the economists cite as bossting the state's economy were expansions in the mining industry, in new air cargo infrastructure and in the bottomfish sector of the fishing industry, as well as improvements in the construction, retail and service trades.
The 1989 overall gross revenues of the New Forty-Niners surged 42 percent for 1988. The sensational increase primarily reflects Veco International Inc.'s role as Exxon's major contractor for cleanup work in Prince William Sound and other parts of southcentral Alaska. Veco itself amassed $960 million in revenues, up 773 percent from the company's 1988 receipts.
Another cleanup-related business and contributor to the New Forty-Niners' overall revenues is a firm founded to provide catering and housekeeping services to worker camps. That company, Chugach-NANA/Marriott, represents a joint venture of Chugach Alaska Corp. and NANA-Marriott and is likely to become inactive in 1991. The business reported $29 million in revenues for 1989.
Oil-spill cleanup activity also benefited banks, car dealerships, hardware distributors and airlines among the New Forty-Niners. And, as seen last year, expansion in Southwest Alaska fueled by the area's bottomfish industry helped to boost revenues for firms supplying fuel and transportation, as well as for seafood processors.
Methodology. To Qualify as a New Forty-Niner, a business must be operated for profit, headquartered in Alaska and owned - at least 51 percent - by Alaska residents. Although most companies listed are privately held, publicly traded firms are eligible; state-owned businesses, such as the Alaska Railroad Corp., are not.
Gross sales revenues generally are the total value of goods and services sold. For financial institutions, the figure used includes total interest income, fees and other income. In evaluating travel agencies, real estate firms and insurance companies, we consider revenue to consist of commissions or fees and other income.
In most cases, the source of the data is the firm itself. Although data are available for financial institutions, some air carriers and many Native corporations, most New Forty-Niners are private corporations that must be relied on to provide information. We do consult public documents, industry expertsand other sources for available information
Firms we believe would have qualified for inclusion this year if we had been able to obtain adequate financial information are Anchorage Chrysler, Dragnet Fisheries and Fairbanks Enterprise/Kinn Enterprises (holder of nine Alaskan Mcdonalds franchises). Petro Star Inc. of North Pole no longer appears as a New Forty-Niner because it was acquired by Arctic Slope Regional Corp., and although Northland Hub of Fairbanks is in a Chapter 11 bankruptcy reorganization and court data are publicly accessible, we were unable to clearly define the revenues of previously listed Market Basket and Northland Hub and chose not to include them.
One firm that regrettably will drop far down in the New Forty-Niners ranking next year is Carr-Gottstein Co. In a sale expected to be finalized in October, the business is selling its food wholesale operations and grocerry stores to a group led by Carrs managers. Because the acquisition is being funded by a Los angeles-based bank that technically will own the enterprise, the food and grocey operation will not qualify for inclusion as a New Forty-Niner next year. Expected to be retained among the Carr-Gottstein holdings are shopping centers, office buildings, undeveloped land and an Anchorage housing development.
Alaskan companies use a variety of fiscal years. The 12-month periods reported here as 1989 revenues vary widely: some ending in June or August of 1989 and others in March 1990. We use the 12-month period that reflects the highest number of months in calendar year 1989.
The staff of Alaska Business Monthly has taken every effort to compile as complete and accurate a list as possible. We have to attempted to verify discrepancies in reporting 1988 revenues this year and are satisfied that any differences are due to revenues being recast to reflect accounting changes.
Thanks to all who helped by providing or clarifying information about Alaska's largest business. We're pleased to present the New Forty-Niners of 1990 and to recognize the Alaskan owners, managers and workers who are responsible for the accomplishments of these outstanding 49th state prospectors.
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|Title Annotation:||The New Forty-Niners|
|Author:||Griffin, Judith Fuerst|
|Publication:||Alaska Business Monthly|
|Date:||Oct 1, 1990|
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