In Focus

Cox Rocks

NOTE: During the month of July, we are featuring companies who are headquartered in some of the states we Chicks call home. This week, Georgia kicks off the fun. More than just the state famous for peanuts, peaches and Jimmy Carter, Georgia has 15 public companies featured on Forbes 500 list. Here's how they rate: Home Depot (23), UPS (52), Bellsouth (66), Southern Company (76) Georgia-Pacific (84), Coca-Cola (93), Delta Air Lines (123), Coca-Cola Enterprises (128), Aflac (193), Suntrust Banks (221), GenuineParts (229), First Data (313), Flowers Industries (387), Cox Communications (466) and Mohawk Industries (491). This week we will review Delta Air Lines, Cox Communications, UPS and Flowers Industries.

I can remember way back (don't ask) when cable television first came to my hometown. Most of my friends already had it for a while before Ole Lee (that's my dad) finally caved in and got it for us. It was a huge deal. I don't think we left the television for weeks. I watched several movies over and over again and giggled every single time we went past the Playboy Channel. Yep, that's right... you remember, don't you? Before parental control and the ability to actually select what you wanted access to, you simply got everything. HBO, Cinemax, Spotlight (remember Spotlight?), and Playboy, among others. Thank goodness times have changed! Anyway, the introduction of cable was such a big deal that I have never forgotten the little name on the black box that sat atop our large, wooden, incredibly ugly television set. Cox. Today, Cox Communications is the 5th largest cable company in the US. And as narrow as that specialty sounds these days, there is a lot more to this company than meets the eye.

Featured on the New York Stock Exchange, Cox Communications (NYSE:COX) has come leaps and bounds since its inception back in 1962. It began as Cox Enterprises around 100 years ago under the leadership of James M. Cox, a one time Democratic nominee for President. It is now actually more of a conglomerate, doing more than just dabbling in various media outlets, from newspapers, radio and television, to the Internet and automobile auctions.

Cox has been fortunate to evolve the way that it has. With the rapidity of growth within the industry, you can see how many smaller companies might fall by the wayside. Cox has managed to stay above the fray and with great vehemence has researched and developed the sort of capabilities this industry demands. One of the nation's leading broadband communications companies, Cox provides several residential services:

Cox Cable

Cox Digital Telephone (local and long distance services)

Cox@Home (high speed Internet access)

Cox Digital Cable (advanced digital video programming services)

Cox Business Services (commercial voice, video and data services)

Cox also has a vested interest in other telecommunications companies including Excite@Home and Sprint PCS, along with some popular programming networks such as Outdoor Life, Speedvision, The Learning Channel and The Discovery Channel. In the last few weeks Cox also announced its new deal with AOL/Time Warner (the number two cable operator). This arrangement will allow AOL to deliver their high-speed Internet service over Cox's high-speed network. This has become the trend with many Internet Service Providers trying to keep up with the speed cable can provide as opposed to the traditional phone line transmissions. The trial, called "AOL PLUS" will be available later this year. This relationship is equally as beneficial for Cox, who will reap the rewards of the highly visible AOL.

The man behind the company, Jim Robbins, has been President since 1985. When the company finally went public in 1995, he threw CEO into his title as well. Which was very much deserved considering the huge successes this company has seen under his direction, and the obvious expertise he has gained in the number of years working in the cable industry. With a B.A. from the University of PA and an M.B.A. from Harvard, Robbins went on to be a managing editor at a television station in Boston, a manager at both Continental Cablevision and Montachusett Cable Television, Senior Vice President of Operations for Viacom Communications, Inc. and Vice President and General Manager of Viacom Cable. Ultimately he ended up with Cox back in 1983 and this rest is, well, history.

Some other interesting notes about this company are their strong financials. Although I haven't run them through the Chicks' Dozen, a quick glimpse of their Company Snapshot over at Marketguide.com shows their Gross Margins at a whopping 75.57% (remember, the Chicks only ask for 50%) and their Net Margins at 24.28% (way above our request for 8%). About as Chicky as a company can get! As of 03/31/01, the previous three months showed an increase of revenues to $947.9 Million, up 22%! Not too shabby!

The biggest obstacle for many of these telecommunications companies is having the savvy to keep up with the frenetic pace of the ever-changing telecommunications industry. It is truly about keeping up, because what is the best, biggest, and fastest today, will either need to be upgraded or replaced tomorrow. How does a company develop innovative, extremely expensive products, have them available at all times, and not lose their shirts every time one of them becomes outdated?

Well, I'm not there, I'm not familiar with what it takes, and therefore, I haven't a clue. BUT, I can read a financial statement (most of the time; some of them do give me fits), I can read the latest news releases, and I can research a company's history. In doing so, I could see that the old company that helped bring the outside world into my very own living room (which, in hindsight, maybe wasn't always a good thing) was still around and continuing to do the same for families everywhere in even better ways. In fact, they'd been around long before my wide belts were draped around my waist, before the emergence of my big, hard hair, or my loud broaches that graced the neckline of my button-down shirts.