Central States Manufacturing Enjoys Good Year Among State’s Top Private Companies

Central States Manufacturing CEO Rick Carpenter, left, and Presidents Donna Leger stand in the main lobby of their office in Lowell.

Revenue growth visited three of the four manufacturing firms in this year’s list of Arkansas’ largest private companies.

(Click here for a list of the manufacturers on the list of the largest private companies.)

Sales hit $262.2 million in 2011 at Central States Manufacturing Inc. of Lowell. The performance represented a one-year increase of nearly 25 percent for the metal components maker.

“We had a real good year last year,” said CEO Rick Carpenter. “We do quite a bit business with the agricultural sector, which was pretty good last year. We don’t do a lot of work with the new home construction, so we haven’t been affected by the downturn in that sector.”

The company is extending its production footprint into the upper Midwest, part of a planned build-out to provide national coverage.

“We will be putting a new plant in Hartford, S.D. I doubt we’ll be open by the end of the year,” Carpenter said.

The new facility is expected to operate with a staff of 25 people during 2013.

The CSM employee stock ownership plan purchased the remaining 61 percent of the company from the Carpenter family in December.

“That makes it 100 percent employee-owned,” Rick Carpenter said. “That was something we had contemplated for a long time since we initiated our ESOP in 1992.”

Favorable interest rates combined with the tax advantages of converting from a C corporation to a sub-chapter S corporation made the timing right to complete the ESOP buyout. 

“I’m a strong believer in sharing ownership with everyone, and it makes a difference in our performance,” Carpenter said. “We’re staying pretty busy.”

Hytrol Conveyor Co. of Jonesboro also reported strong double-digit growth during 2011, with a 22 percent increase in revenue to $98.3 million.

Central Moloney Inc. of Pine Bluff registered a one-year revenue gain of 9 percent, with $120 million in transformer-related sales.

“Sadly, top-line growth doesn’t always translate into a corresponding bottom-line growth,” said Chris Hart, vice president of personnel and community relations at Central Moloney. “We have seen a slight increase in profitability. But our traditional markets aren’t where they used to be.

“The primary basis for our business is and always has been new housing starts. As long as those starts are muddled, we won’t be able to return to business as usual.”

With the residential market languishing, the company has expanded its product lines to include larger transformers in the battle for revenue.

“You don’t hang around as long as we have without knowing how to get through good times and the bad,” Hart said.

Allens Inc. of Siloam Springs reported a 10.7 percent drop in annual revenue from its lines of canned and frozen vegetables.

Further declines in revenue are likely in 2012, since in March Allens sold four frozen vegetable plants – three in New York and one in Wisconsin – to the Bonduelle Group of Montreal.