Top performers based on revenue

Mergers and acquisitions affect growth among area's leaders


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Mergers and acquisitions are coming back into fashion, now that companies are starting to stand up from the recessionary crouch that helped them get through the financial meltdown. And the effects seem to be evident in the revenue changes seen in the most recent fiscal year.

PG graphic: Ranking the PG Top 50 by revenue
(Click image for larger version)

The leader on this year's list ranking firms by revenue change was RTI International Metals, a titanium products company in Moon that credited a significant acquisition with helping push the company into the fast-growing market of making medical device components. Increased demand from energy market customers also helped push RTI to a 39.4 percent revenue increase.

Other businesses that have used acquisitions to grow recently include third place finisher Buffalo-based financial institution First Niagara, which posted a 22.7 percent revenue increase, and fourth place contender, Wilmerding-based rail and transit industries supplier Wabtec, which posted a 21.5 percent gain.

The company that landed in second place with a 28.5 percent revenue increase, Milwaukee mining equipment maker Joy Global Inc., has both done its own acquisitions and is the subject of speculation that it could be acquired. It's the circle of business life.

In fifth place with a 18.6 percent gain, Cranberry teen clothing retailer rue21 gave hope to those who used other methods to produce growth, in this case by opening new stores and expanding product lines.

PG graphic: Ranking the PG Top 50 by biggest improvement in revenue
(Click image for larger version)

Ranking the same group of companies just by overall revenue seemed to shake out some of the impact of acquisitions. That's because, while companies of all sizes do such deals to get expertise or a foothold in a new market, a deal that could transform a smaller firm's revenues can turn into a "bolt-on" move for a big one.

The H.J. Heinz Co. is a frequent buyer and seller of food operations around the globe, yet it only rose one spot between 2011 and 2012 in the total revenue rankings of public companies that are either based in Pittsburgh or have significant operations in the region.

Heinz, with $11.6 billion in revenue, ended up in the 22nd slot on the most recent revenue list. It tied for 17th on the revenue change list, with an 8.8 percent gain. The Pittsburgh ketchup company is unlikely to be on next year's lists of public companies since it has agreed to be acquired by Berkshire Hathaway and 3G Capital.

Health services company McKesson held onto its ranking at the top of the revenue list with $122.7 billion, up from $112 billion a year earlier. Telecommunications business Verizon also produced a nice gain in revenue, growing from $110.9 billion to $115.8 billion, as it stayed in second place.

The highest ranking Pittsburgh-based company on the total revenue list was 13th ranked U.S. Steel, which had $19.3 billion down from $19.9 billion last year.

intheleadcompanies

-- Teresa F. Lindeman: tlindeman@post-gazette.com or at 412-263-2018 First Published May 3, 2013 4:00 AM


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