20101122-NEWS--1-NAT-CCI-CL_--
11/19/2010
4:18 PM
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$1.50/NOVEMBER 22 - 28, 2010
Vol. 31, No. 46
With costs down, cash stacks up Despite sales growth, companies cling to big balances amid economic concerns By JAY MILLER jmiller@crain.com
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anton’s Timken Co., admits spokeswoman Lorrie Paul Crum, “has a lot of cash.” That’s an understatement. As of Sept. 30, Timken held nearly $900 million in cash or what accountants call “cash equivalents,” such as Treasury bills that are quickly convertible to cash. That’s almost 30 times the $30.1 million in cash the maker of steel and bearings held at the end of 2007, before the recession began.
Timken is among an expanding roster of companies in Northeast Ohio that have seen their cash stack up by keeping costs in check even as their sales rebounded after the worst of the economic slump. Just what they’ll do with all that cash remains to be seen. The accumulation eventually may benefit stockholders and employees, because it suggests cash-rich companies may be poised to accelerate their growth. But some economists call this strategy “cash hoarding” and argue that corporate decisions to cling to cash rather than spend it
on hiring or capital investments are holding back the economic recovery. A look at the levels of cash and cash equivalents held by various Northeast Ohio companies at the end of their 2007 fiscal years and as of their most recent quarters shows huge increases in their stashes of cash. Consider these striking numbers: ■ Specialty chemical maker OM Group Inc. saw its cash over this period soar 346%, to $446.8 million from $100.2 million. ■ Iron ore producer Cliffs Natural
For small retailers, it’s Black Six Weeks Friday’s fun, but they focus on whole season By MICHELLE PARK mpark@crain.com
For small, independent retailers in Northeast Ohio, there are shades of gray when it comes to rallying for Black Friday, the kickoff of the holiday selling season that begins the day after Thanksgiving. Few engage in the door-buster sales and 4 a.m. openings that have become the hallmark of big-box retailers. Some even ignore Black Friday altogether, figuring they can’t beat the promotion-crazed giants at that game. But others try in their own modest ways to capitalize from the get-go on a six-week period that can make or break their year. Steve Presser, owner of Big Fun Toy Store, which sells gifts and vintage collectible toys in Cleveland and Cleveland Heights, estimates his store does 30% to 35% of its annual sales from now until year-end. “If you came in my store yesterday, you would have seen probably 50 boxes on the floor,” Mr. Presser said last week. “Every Black Friday, we kind of one-up ourselves from the previous year. We have to.” This year, Mr. Presser said he has widened his spectrum of offerings to include more than 100 unusual book titles and 30 or 40 new items, including turn-of-the-century Cleveland greeting cards. This is the fourth year Akron
See CASH Page 6
See FRIDAY Page 30
Construction slump claims another casualty Concrete supplier Collinwood Shale latest to succumb By STAN BULLARD sbullard@crain.com
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Collinwood Shale, Brick & Supply Co., a Cleveland-based concrete supplier dating from the late 19th century, is the latest casualty claimed by the now 5-year-old
construction downturn. The company originally made bricks; its “Collinwood Brick” pavers form the base of many Cleveland streets. Collinwood Shale left brick-making behind decades ago to focus on producing ready-mix concrete and related materials. Over the
years, it gained locations throughout the region under a variety of names, including Horning Builders Supply Co. in Kent and Smith & Cowan Supply in Akron. The end came Nov. 10 when multiple assets of Collinwood Shale were bought by an affiliate of Osborne Inc., the concrete supply company led by Jerome T.
INSIDE Clinic spinoff sees wild growth Growth at Cleveland HeartLab, which through blood tests allows physicians to see if patients are at risk of a heart attack or other cardiac problems, has reached new heights: The 200 tests it ran in January are mild when compared with the 18,000 it ran in October. Read Chuck Soder’s story on Page 3.
See CONCRETE Page 7
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SPECIAL SECTION
Crain’s again honors 40 of Northeast Ohio’s brightest leaders ■ Page F-1