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  • The Boston Globe OnlineBoston.com Boston Globe Online / Business / Globe 100
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    Net is hot, but bucks still stop at old-line firms

    Banks, retailers lead the pack in revenues

    By Chris Reidy, Globe Staff, 05/18/99

    Top 10 Companies
    Ranked by net revenue

    1. Raytheon Co.

    2. Gillette Co.

    3. TJX Cos.

    4. Staples Inc.

    5. Fleet Financial Inc.

    6. Harcourt General Inc.

    7. BankBoston Corp.

    8. EMC Corp.

    9. Thermo Electron Corp.

    10. BJ's Wholesale Club Inc.

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    The 1999 Sales 100

    orget about all those get-rich-quick stories you read about Internet companies in 1998. For one more year at least, The Boston Globe's Sales 100 is dominated mostly by old-fashioned businesses.

    Banks and retailers - topped by a defense company - make up the bulk of the top 10 firms. One notable absence: Digital Equipment Corp. For most of the last decade, Digital led all local companies in sales. But its recent acquisition by Compaq Computer Corp. has erased Digital's name from the Globe list.

    Acquisitions are expected to claim more names next year.

    BankBoston Corp., which ranks seventh in sales, should soon be absorbed by Fleet Financial Group, which sits in fifth place.

    And Wang Global, the 13th largest company in the Sales 100, agreed earlier this month to be acquired by a Dutch company.

    Only one company on the list, Affiliated Managers Group, saw bigger sales growth than Wang. Wang's sales growth was up 134 percent; Affiliated Managers, a Boston company that holds stakes in money management firms, grew by 150 percent.

    Of course, acquisitions work the other way, too. Purchases of other defense companies cemented the position of Raytheon Co. as the biggest publicly traded company in Massachusetts.

    Raytheon is perhaps best known for its Patriot and Tomahawk missiles and its Beech aircraft. Thanks to buying other companies, Raytheon saw revenues grow almost 42 percent to $19.4 billion. That was the largest percentage growth spurt reported by any company in the top 10 of the Sales 100.

    A distant second to Raytheon on the Sales 100 was Gillette Co., whose $10 billion in revenues was essentially flat.

    Boosted by the Mach3 razor, Gillette enjoyed strong sales in the United States, but troubles in Brazil, Russia, and Asia meant 1998 was one of the few times this decade that the Boston-based maker of razors, batteries, and consumer grooming products didn't have a banner year.

    Speaking of banner years, TJX Cos. should think about hiring a full-time color guard. Numbers for the Framingham-based retailer have been off the charts since it acquired the Marshalls chain in 1995.

    According to TJX, that acquisition resulted in all sorts of synergies and savings with T.J. Maxx and other TJX divisions. As those synergies hit the top line, revenues grew nearly 8 percent to $7.95 billion in 1998, on top of a 10 percent jump the previous year.

    Acquisitions are only part of the reason Staples Inc. saw sales grow to $7.1 billion. The well-managed retailer of office supplies continues to outperform rivals. Revenues were up 24 percent, after a gain of 31 percent the previous year.

    Harcourt General Inc. of Newton was another top 10 company that enjoyed double-digit gains. Its core business of book publishing has pushed Harcourt over the past three years from 10th place to sixth place on the Sales 100.

    In Hopkinton, EMC Corp. had another phenomenal year making computer storage products. As airlines and banks become immersed in e-commerce, they need to store more information, and EMC provides them with the computer equivalent of filing cabinets. EMC revenues were nearly $4 billion, and its revenue growth of about 35 percent was the largest of top 10 companies that didn't make a major acquisition.

    At first glance, Thermo Electron Corp., the Waltham-based maker of analytical and biomedical instruments, looked as if it had a good year. Revenues were up nearly 9 percent, but both earnings and its stock price have slipped. Looking to rebound, the company is reorganizing and bringing in Richard Syron, chairman of the American Stock Exchange, as its new chief executive next month.

    Now a stand-alone business, BJ's Wholesale Club Inc. had a chance to shine last year. Sales for the Natick-based retailer, spun off from Waban Inc. in 1997, were up just over 10 percent, to $3.6 billion.

    While 1998 was a strong year for the US economy, not all big local companies prospered.

    Reebok International Ltd. saw sales drop nearly 12 percent. A global player, the Stoughton-based maker of athletic footwear was hurt by slowing economies overseas. Meanwhile, US sales for many sneaker companies faltered as fashion styles shifted away from athletic shoes. Reebok hopes new fashion trends and its DMX shoe technology will boost sales in 1999.

    Polaroid Corp. is also looking for new products to give it a boost. It's betting on low-cost instant photography cameras aimed at teenagers and young adults. Polaroid could use a lift. Last year, sales dropped 14 percent to $1.85 billion.

    This story ran on page D14 of the Boston Globe on 05/18/99.
    © Copyright 1999 Globe Newspaper Company.

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