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Friday, Jun 9, 2023

List Story

By JOE BEL BRUNO Staff Reporter There is one thing that drives many of the San Fernando Valley’s fastest growing public companies: technology. The Valley is proving itself not just to be a center for entertainment, but a growing region for high-tech firms. Ten of the 25 fastest growers are in that arena, producing everything from digital cameras to high-bandwidth switch systems. Leading the pack is Xylan Corp., No. 1 on the List, which latched onto the demand for computer networking to become one of 1996’s hottest initial public offerings. The Calabasas-based company, which opened for business in 1993, makes switches that move data over computer networks. Among its competitors are heavy hitters like Cisco Systems Inc. and 3Com Corp. “There is a lot of competition in what we do,” said Kevin Walsh, Xylan’s vice president of marketing. “But our growth comes from the fact that we are packing more and more technology into one single device. For being new, and a smaller company, we’ve been able to move quicker and stay just ahead of the competition.” Xylan’s sales grew 333 percent to $128 million in 1996. Besides being the Valley’s fastest growing public company, it ranks No. 12 on the Business Journal’s List of 100 fastest growing public companies in L.A. County. Earlier this year, Xylan was caught in an industrywide glut of data networking stocks and at one point dropped to as low as $12.38. The stock recently recovered to about $20 on Nasdaq but still is far from the $76 upon first going public in 1996. Despite its stock tumble, Xylan revenues for the six months ended June 30 were $93.1 million, compared with $51.6 million for the like period a year ago. Xylan has kept up its revenues in part through a strategy of signing a relatively small number of very large deals, instead of multiple smaller deals, Walsh said. For example, it recently signed a three-year, $2 million agreement with First National Bank of Maryland to upgrade bank teller machines. Another company booming last year was Chatsworth-based MRV Communications, which secured the No. 2 spot on the List. It posted a 126.6 percent increase in revenues last year, coming in at $88.8 million. However, the best of the 5-year-old company lost $9.6 million. MRV designs high-speed network switching systems, similar to Xylan. Most of its growth has come from sales agreements with several leading computer companies, including Intel Corp., Fujitsu Corp. and Digital Equipment Corp. MRV wasn’t the only company on the List to experience strong revenue growth, yet lose money. Others include Cinema Ride Inc. at No. 13, Film Roman Inc. at No. 14, Jerry’s Famous Deli Inc. at No. 15, Dycam Inc. at No. 16 and Children’s Wonderland at No. 25. But by far the biggest difference between revenues and profits was at Trikon Technologies Inc. The Chatsworth-based company, No. 3 on the List, saw revenues grow by 98.3 percent over 1995 to $42.2 million. However, the company lost $94.5 million. The company was previously called Plasma & Material Technologies, but changed its name in March after making the $150 million acquisition of United Kingdom-based ElectroTech Group. “It was a big one-time purchase that’s why our profits are so low,” said Trikon spokesman Frederick Reynolds. “Our customers want fewer vendors with more solutions. So, to be a player, we made the acquisition and changed our name to expand our products and broaden our markets.”

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