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Tampa Bay's most valuable companies

Tampa Bay's biggest companies touch 'em all, forming a diverse group that in most cases has increased revenue.

By HELEN HUNTLEY
Published May 15, 2006

Today we present this year's version of the Times 10: The Tampa Bay area's biggest public companies, all of them with $1-billion or more in annual revenue. At the top are our tech titans, Tech Data Corp. of Clearwater and Jabil Circuit Inc. of St. Petersburg.

And although they're the most visible players, we have our bases covered. The Times 10 is a diverse group, covering the territory from health care and financial services to water pipes and restaurants.

With $20.5-billion in revenue, Tech Data isn't just the Tampa Bay area's largest public company. Last year it nudged past AutoNation Inc. to take honors as the state's largest and it ranks No. 107 on the Fortune 500 list. Profits have been harder to come by. The computer products distributor is in a notoriously tough business with razor thin margins, and last year's $26.6-million profit was smaller than the return earned by seven companies on the Times 10 list.

That means Tech Data may be big, but it has to hustle to succeed. CEO Steve Raymund that's his face on the baseball card above hopes to bring more vitality to the business by building a distinctive corporate culture.

"As we've gotten bigger and a little more bureaucratic, we've lost some of that winning spirit," Raymund said in a recent speech. "We've lost the passion for being the best and having accountability."

Raymund sits on the board of one of the companies he thinks has created a corporate culture that works - Jabil Circuit.

As its name implies, Jabil started as a circuit board manufacturer, but the company has grown into a diversified electronics manufacturer, making medical, automotive, aerospace and telecommunications products as well as consumer electronics and computers at plants around the world.

And although it may be No. 2 in revenue, Jabil's market value is more than twice that of any other company on our list. This month the company said it would start paying a dividend, good news for shareholders.

Most of the Times 10 companies are doing well. Eight increased their revenues last year, seven by double digits. Half improved their profits, but one lost money (struggling Danka Business Systems). Eight have made money for shareholders over the past two years; two - Walter Industries and WellCare - by spectacular amounts.

If you have a good memory, you'll note this year's list looks a lot like last year's. The big difference is at No. 10. Gone is Certegy Inc., a credit and debit card and check processing company that moved from Atlanta to St. Petersburg in January 2005. Certegy had barely settled into its new headquarters when it said it was merging with Fidelity National Financial. The new company, Fidelity National Information Services, is headquartered in Jacksonville.

Rookie of the Year

Certegy's replacement is a 12-year-old upstart making a big impression in the business of office equipment sales and service. Global Imaging was founded in 1994 and became a $1-billion business through a combination of smart acquisitions and internal growth.

CEO Tom Johnson formerly worked at rival Danka Business Systems and apparently figured out what not to do when he started his company. Now Global is poised to surpass Danka in sales.

Johnson says there's nothing wrong with the office equipment business. "We are two or three times more profitable than the others because we've executed better. ... All the machines are such complex technology that they break regularly and they need high quality service to fix them. We get our customers and lock them in with love."

Most Improved Player

Any time you can go from a $552-million loss to a $275-million profit, you're on the right track. TECO Energy improved its financial position by getting out of the merchant power business, dumping expensive power plants in other states the company once thought could profitably produce power it could sell to other companies. The resulting writeoffs are behind it.

Last year TECO benefited from a big increase in coal prices and higher rates for the TECO barges used to transport it. Two subsidiaries, Tampa Electric and Peoples Gas, increased their customer base.

Utility Player

The rest of the Times 10 are easily classified, but Walter Industries dabbles in so many businesses, it's tough to know what it is. Walter might be a little easier to figure out in the future. On its agenda are plans to spin off the water products division as a separate public company with headquarters in Atlanta. The company will include U.S. Pipe, which makes pipe used in municipal water systems, and the recently acquired valve and hydrant maker Mueller Water Products.

Walter is under pressure from hedge fund investors to spin off its home building and mortgage finances businesses and to consider alternatives for its coal business. Once a drag on the company, the coal business is a profit center thanks to higher energy prices.

Shareholders have been big winners as the stock price has soared. Two years ago Walter stock was selling for about $12 a share. Now it goes for more than five times that amount. No other Times 10 company comes close to being as rewarding an investment.

Injured Reserve

Danka Business Systems has been on a downhill slide for a decade as numerous restructurings and a revolving door in the executive suite have failed to produce a lasting fix for the office equipment company's woes.

Danka took a shot at the big time in 1996 with the acquisition of Eastman Kodak's copier business. Overnight it became a $3-billion company with 20,000 employees around the world. But the big deal turned out to be a big mistake. The company has a third of the revenues and a fourth of the employees it had at its peak. It is smaller today than it was before the acquisition.

Farm Team

If trends continue, Danka will be replaced next year by fast-growing MarineMax Inc., a Clearwater boat dealer that's pushing its way into the major leagues. With the recent acquisition of Surfside-3 Marina, the company is extending its reach into New York and is on track to exceed $1-billion in revenues this fiscal year.

Two hot shot players on the move are Kforce Inc., a Tampa staffing services company, and Brown & Brown, an insurance agency with dual headquarters in Tampa and Daytona Beach. Both have the potential to be $1-billion players in the near future.

Kforce has been a big beneficiary of the low unemployment rate, which has employers seeking help finding skilled workers. Brown & Brown continues to expand and set records for sales and profits in spite of hurricanes and insurance industry upheaval.

Times staff writers Scott Barancik, Louis Hau and Kris Hundley contributed to this report. Helen Huntley can be reached at hhuntley@sptimes.com or (727) 893-8230.

About this story

- To be included on any of our lists, a company had to have its headquarters in Hillsborough, Pinellas, Pasco, Citrus or Hernando counties and have stock traded on the New York or American stock exchanges or the Nasdaq Stock Market.

- Financial results are for the most recently completed fiscal year except in the case of Danka Business Systems, which completed its year March 31, but has not released results. Results for Danka are for the four quarters ended Dec. 31.

- A percent change in net income is shown only for companies that were profitable for the last two fiscal years. Danka Business Systems lost money both years while TECO Energy lost money in 2004 and recorded a profit in 2005.

- Return on equity is net income divided by average equity.

- Two-year stock return is based on change in share price between April 30, 2004, and April 28, 2006. Return shown for WellCare is from initial offering through April 28.

- Market capitalization is the value of the company's outstanding shares based on the April 28 closing price.

THE TOP 10, by revenue for 2005

1. TECH DATA CORP.

5350 Tech Data Drive, Clearwater, FL 33760; (727) 539-7429; www.techdata.com

BUSINESS: Distributor of computer products

TICKER SYMBOL, MARKET: TECD, Nasdaq-NM

STOCK PRICE: $34.60

TOP OFFICERS: Steven A. Raymund, chairman/chief executive; Nestor Cano, president, worldwide operations; Jeffery P. Howells, executive vice president

EMPLOYEES: 8,500

FINANCIALS (Year ended Jan. 31)

REVENUE: $20.5-billlion, up 3.8 percent

NET INCOME: $26.6-million, down 83.6 percent

PER SHARE: 45 cents, down 83.6 percent

RETURN ON EQUITY: 1.4 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 7.8 percent

MARKET CAPITALIZATION: $2-billion

BIGGEST CHALLENGE: Improve disappointing results outside the Americas. While growth is strong in the Americas, Tech Data has faced declining sales and operational problems in its European and Middle Eastern operations. A technology upgrade and restructuring have diverted management attention. The company needs to find a CEO to succeed Raymund.

2. JABIL CIRCUIT INC.

10560 Dr. Martin Luther King Jr. St. N, St. Petersburg, FL 33716; (727) 577-9749; www.jabil.com

BUSINESS: Contract electronics manufacturer

TICKER SYMBOL, MARKET: JBL, NYSE

STOCK PRICE: $36.27

ANNUAL DIVIDEND: 28 cents

TOP OFFICERS: Timothy L. Main, president/chief executive; Mark T. Mondello, chief operating officer; Forbes I.J. Alexander, chief financial officer

EMPLOYEES: 60,000

FINANCIALS (Year ended Aug. 31)

REVENUE: $7.5-billion, up 20.3 percent

NET INCOME: $231.8-million, up 38.9 percent

PER SHARE: $1.12, up 38.9 percent

RETURN ON EQUITY: 11.7 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 47.8 percent

MARKET CAPITAL-IZATION: $8.2-billion

BIGGEST CHALLENGE: Managing explosive growth without diluting the distinctive Jabil culture that has produced a reputation for high-quality production. Finding the right employees, especially managers; training and supervising them is a particular challenge because of the company's far-flung operations, including 25,000 employees in Asia.

3. OSI RESTAURANT PARTNERS INC.

(formerly Outback Steakhouse Inc.) 2202 N West Shore Blvd., Suite 500, Tampa, FL 33607; (813) 282-1225; www.outback.com

BUSINESS: Restaurant chains

TICKER SYMBOL, MARKET: OSI, NYSE

STOCK PRICE: $40.37

ANNUAL DIVIDEND: 52 cents

TOP OFFICERS: William Allen III, chief executive; Paul Avery, chief operating officer

EMPLOYEES: 95,000

FINANCIALS (Year ended Dec. 31)

REVENUE: $3.6-billion, up 12.5 percent

NET INCOME: $149.6-million, down 4.1 percent

PER SHARE: $1.95, down 3 percent

RETURN ON EQUITY: 13.1 percent

TWO-YEAR RETURN TO SHAREHOLDERS: -0.4 percent

MARKET CAPITALIZATION: $3.2-billion

BIGGEST CHALLENGE: Rejuvenating the tired Outback Steakhouse brand. Lower sales at OSI's flagship concept are dragging down the seven-chain company, but a turnaround won't be easy. Outback's menu is stale, its decor dark and dated and its competition tougher than ever. If its leaders can figure out how to bring back female and young customers, a higher stock price should follow.

4. TECO ENERGY INC.

702 N Franklin St., Tampa, FL 33602; www.tecoenergy.com

BUSINESS: Electric and gas utility holding company

TICKER SYMBOL, MARKET: TE, NYSE

STOCK PRICE: $15.27

ANNUAL DIVIDEND: 76 cents

TOP OFFICERS: Sherrill W. Hudson, chairman/chief executive; John B. Ramil, president/chief operating officer; Gordon L. Gillette, executive vice president/chief financial officer

EMPLOYEES: 4,998

FINANCIALS (Year ended Dec. 31)

REVENUE: $3-billion, up 14 percent

NET INCOME: $274.5-million

PER SHARE: $1.31

RETURN ON EQUITY: 19 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 38.7 percent

MARKET CAPITALIZATION: $3.3-billion

BIGGEST CHALLENGE: Reducing about $1.5-billion in parent company debt, of which $357-million is due in 2007. The faster TECO cuts debt, the sooner it is likely to begin growing its dividend. The company faces the 2007 expiration of federal tax credits for the production of coal-based synthetic fuel, a major source of income.

5. WALTER INDUSTRIES INC.

4211 W Boy Scout Blvd., Tampa, FL 33607; (813) 871-4811; www.walterind.com

BUSINESS: Water infrastruc-ture products, coal and natural gas, home building and finance

TICKER SYMBOL, MARKET: WLT, NYSE

STOCK PRICE: $68.90

ANNUAL DIVIDEND: 16 cents

TOP OFFICERS: Gregory E. Hyland, chief executive; William F. Ohrt, chief financial and accounting officer

EMPLOYEES: 10,100

FINANCIALS (Year ended Dec. 31)

REVENUE: $2.1-billion, up 32.6 percent

NET INCOME: $7-million, down 85.9 percent

PER SHARE: 18 cents, down 84.2 percent

RETURN ON EQUITY: 2.6 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 437.6 percent

MARKET CAPITALIZATION: $2.8-billion

BIGGEST CHALLENGE: Fixing its long-struggling home building unit and figuring out a possible exit strategy. Walter made good on its 2005 pledge to boost shareholders' return on investment. Its coal division is soaring, and the company plans to spin off its water-infrastructure unit. Now on the table: A spinoff of the home building and associated mortgage units.

6. RAYMOND JAMES FINANCIAL INC.

880 Carillon Parkway, St. Petersburg, FL 33716; (727) 567-1000; www.raymondjames.com

BUSINESS: Stock brokerage and money management

TICKER SYMBOL, MARKET: RJF, NYSE

STOCK PRICE: $30.27

ANNUAL DIVIDEND: 32 cents

TOP OFFICERS: Thomas A. James, chairman/chief execu-tive; Chester B. Helck, presi-dent/chief operating officer

EMPLOYEES: 5,987, along with 3,533 independent contractors

FINANCIALS (Year ended Sept. 30)

REVENUE: $2-billion, up 14.5 percent

NET INCOME: $151-million, up 18.4 percent

PER SHARE: $1.33, up 15.7 percent

RETURN ON EQUITY: 13.1 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 85.3 percent

MARKET CAPITALIZATION: $3.3-billion

BIGGEST CHALLENGE: Recruiting enough high-performing brokers to keep revenue growing at double-digit rates - without running into regulatory issues. The company has been pushing out low performers and putting on the full-court press to lure top brokers away from the competition. Enticements include a choice of compen-sation options and giving brokers ownership of their book of clients.

7. WELLCARE HEALTH PLANS INC.

8725 Henderson Road, Renaissance One, Tampa, FL 33634; (813) 290-6200; www.wellcare.com

BUSINESS: Managed health care

TICKER SYMBOL, MARKET: WCG, NYSE

STOCK PRICE: $47.31

TOP OFFICERS: Todd Farha, president/chief executive; Paul Behrens, senior vice president/chief financial officer; Thaddeus Bereday, senior vice president/general counsel

EMPLOYEES: 2,200

FINANCIALS (Year ended Dec. 31)

REVENUE: $1.9-billion, up 34.7 percent

NET INCOME: $51.9-million, up 5.4 percent

PER SHARE: $1.32, down 15.4 percent

RETURN ON EQUITY: 15.3 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 146.4 percent

MARKET CAPITALIZATION: $1.7-billion

BIGGEST CHALLENGE: Retaining members and margin if Medicare or Medicaid funding declines. The company, which has 855,000 Medicaid and Medicare members in seven states, intends to expand its service territories and make selective acquisitions. This year, WellCare has added 626,000 Medicare drug plan members nationwide, giving it a base for continued growth. However, competition is increasing.

8. LINCARE HOLDINGS INC.

19387 U.S. 19 N, Clearwater, FL 33764; (727) 530-7700; www.lincare.com

BUSINESS: Oxygen and respiratory therapy services

TICKER SYMBOL, MARKET: LNCR, Nasdaq-NM

STOCK PRICE: $38.18

TOP OFFICERS: John P. Byrnes, chief executive; Shawn Schabel, president/chief operating officer; Paul Gabos, chief financial officer

EMPLOYEES: 8,258

FINANCIALS (Year ended Dec. 31)

REVENUE: $1.3-billion, down 0.2 percent

NET INCOME: $213.7-million, down 21.9 percent

PER SHARE: $2.06, down 20.8 percent

RETURN ON EQUITY: 18.6 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 14.2 percent

MARKET CAPITALIZATION: $3.7-billion

BIGGEST CHALLENGE: Dealing with government-imposed caps on equipment rental fees and cutbacks in reimbursements for medications, dispensing fees and equipment. As one of the biggest home oxygen providers in the nation with more than 400,000 patients, Lincare is likely to absorb cuts better than most of its competitors and take market share from smaller providers under cost pressure.

9. DANKA BUSINESS SYSTEMS PLC

11101 Roosevelt Blvd., St. Petersburg, FL 33716; (727) 622-2100; www.danka.com

BUSINESS: Office equipment distributor

TICKER SYMBOL, MARKET: DANKY, Nasdaq-SC

STOCK PRICE: $1.26

TOP OFFICERS: A.D. Frazier, chairman and chief executive; Edward K. Quibell, chief financial officer

EMPLOYEES: 4,928

FINANCIALS (For four quarters ended Dec. 31; results not available for fiscal year ended March 31)

REVENUE: $1.1-billion, down 8.3 percent

NET LOSS: $176.9-million

PER SHARE: -$3.36

TWO-YEAR RETURN TO SHAREHOLDERS: -69.8 percent

MARKET CAPITALIZATION: $76.3-million

BIGGEST CHALLENGE: Turning a profit, something Danka, a British company with U.S. headquarters in St. Petersburg, hasn't done since fiscal 2003. The red ink helps explain Danka's frequent leadership changes and its anemic stock price. In March, the company replaced chairman W. Andrew McKenna and CEO Todd Mavis with Frazier, a former CEO of the Chicago Stock Exchange.

10. GLOBAL IMAGING SYSTEMS INC.

3820 Northdale Blvd., Suite 200A, Tampa, FL 33624; (813) 960-5508; www.global-imaging.com

BUSINESS: Office equipment distributor

TICKER SYMBOL, MARKET: GISX, Nasdaq-NM

STOCK PRICE: $39.90

TOP OFFICERS: Thomas S. Johnson, chairman/chief executive; Michael Shea, president/chief operating officer; Raymond Schilling, executive vice president/ chief financial officer

EMPLOYEES: 4,200

FINANCIALS (Year ended March 31)

REVENUE: $1.03-billion, up 11.2 perccent

NET INCOME: $61.9-million, up 8.7 percent

PER SHARE: $2.45, up 8.4 percent

RETURN ON EQUITY: 14.9 percent

TWO-YEAR RETURN TO SHAREHOLDERS: 7.9 percent

MARKET CAPITALIZATION: $879.6-million

BIGGEST CHALLENGE: Finding and training enough qualified employees to cash in on the opportunities presented by a changing marketplace for office equipment. Increasingly complex equipment and office networks strain the resources of smaller competitors, while office superstores and consumer electronics chains compete on price. High-quality service is essential for Global to maintain its competitive advantage.

[Last modified May 15, 2006, 07:20:30]