Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, March 29, 1994 TAG: 9403290171
SECTION: BUSINESS PAGE: C-7 EDITION: METRO
SOURCE: Associated Press
DATELINE: NEW YORK LENGTH: Medium
The profit figure in the magazine's annual ranking of the top 500 corporations would be enough to wipe out the 1993 U.S. trade deficit with Japan.
The magazine called the results a business-comeback version of Gen. Douglas MacArthur's World War II return to the Philippines, Richard Nixon's 1968 resurrection and ``the reheating of aging rock star Meat Loaf in time to win a 1994 Grammy Award.''
Extolling what it called the ingenuity of U.S. business, Fortune attributed the improvement largely to ``American industry's steady, relentless drive to raise productivity, improve quality and boost competitiveness.''
Also helping were a decline in long-term interest rates that reduced the cost of borrowing, a broad pickup in the U.S. economy and the expensive Japanese yen, which made U.S.-built products such as cars and computers more affordable than comparable Japanese goods.
The improvement didn't benefit the U.S. job picture, however. Total employment among the 500 fell for the ninth straight year, from 11.8 million to 11.5 million. The trend confirms a pattern of dwindling employment opportunities as businesses get more efficient with fewer workers.
Fortune's annual corporate ranking, which appears in the April 18 edition, said the earnings improvement was especially significant, because it was achieved despite stagnant growth in sales. In 1992, by comparison, the 500 lost $196.2 million, the first time the roster as a whole ever lost money.
Much of the 1992 loss was caused by a required accounting adjustment that changed the way companies report retiree health benefits. That adjustment also detracted from earnings in 1993. With the effects of the accounting adjustment excluded for both years, the 500 earned $81.7 billion in 1993 - 15 percent more than the comparably adjusted $71 billion in 1992.
General Motors Corp. easily retained its position as the biggest company. But Ford Motor Co. bumped Exxon Corp. for the No.2 spot, and Chrysler Corp. leaped from No.11 to No.8, bumping Chevron Corp., DuPont Co. and Texaco Inc.
Still, extensive cost-cutting kept the petroleum industry profitable: Exxon earned $5.3 billion, more than any other company.
The list also showed the fast expansion of the U.S. computer industry. The company with the biggest sales increase, No.222 Dell Computer Corp., first made the Fortune 500 list two years ago.
by CNB