Hawaii’s Most Profitable Companies

An inside look at measuring success

August, 2011

For 28 years, Hawaii Business has been publishing a list of Hawaii’s Top 250 organizations based on gross revenues, because we think that’s the most effective way to measure a company’s size.

However, there have always been critics in the business community who believe we should use profits instead. “After all,” they point out, “many of those in the Top 250 actually lost money.” True.  Revenues might be a proxy for size, but they’re an imprecise measure of success.

But, profitability presents its own problems. To paraphrase Alvin Toffler, “Profits are like sausage; they’re esteemed most by those who know least about what goes into them.” 
Profit is affected by:

•  Nuances of the tax code;
•  Whether a company is publicly traded or privately held;
•  Whether the company is regulated and how;
•  How it applies the sometimes arbitrary rules of GAAP, or generally accepted accounting principles;
•  Whether it’s in a capital-intensive industry; and
•  Even the simple calculus of ownership: “Shall we take profits or shall we reinvest?”

In short, while profits are critical, they’re not always the only or even the most important measure of success. Also, privately held companies are more reluctant to provide their profit numbers to Hawaii Business than their revenue numbers; only 41 of the Top 250 provided their profit information for the list.

Yet, although our profitability list isn’t comprehensive, we were able to collect the financial statements of many of the Top 250 organizations. Some, like nonprofits and government agencies, post their financial reports online. Others are public record, gathered from places like the Securities Exchange Commission, the Federal Financial Institutions Examination Commission and the National Association of Insurance Commissioners.

Collectively, these 990s, 10-Ks and other disclosures provide a fascinating look at which businesses are making (and losing) the most money in Hawaii. We also look beyond the basic data, providing other metrics and analyses to help you make sense of all those numbers.

Hawaii’s Most Profitable

 

BANKS

First Hawaiian Is Hawaii’s Most Profitable Company

 

Bank of Hawaii Leads in Return on Equity

 

CREDIT UNIONS

Hawaii’s 5th Most Profitable Bank is a Credit Union

 

CONGLOMERATES

Biggest Divisions Don’t Always Create Largest Profits

 

HAWAIIAN AIRLINES

Airline’s Profit Dependent on Volatile Cash Flow

 

WATER BOARD AND UNIVERSITY OF HAWAII

“Profit” Worth Studying

 

HAWAIIAN TELCOM

After Bankruptcy, Profits Are Much Easier to Make

 

HEALTH CARE

Hospitals Hurt by Patients (and Governments) who Don’t Pay

 

INSURANCE COMPANIES

Investments Help Create Profits

 

HEALTH INSURANCE COMPANIES

Banking Profits in Case of Hard Times Ahead

 

NONPROFIT ORGANIZATIONS

No Margin, No Mission

 

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Author:

Dennis Hollier