Douglas Dynamics among Fortune’s five fastest-growing companies

Snowplow manufacturer grows with new products and acquisitions

snow plow
Douglas Dynamics makes vehicle attachments such as plows.

Last updated on July 2nd, 2019 at 09:19 am

Milwaukee-based Douglas Dynamics Inc. has been named one of Fortune magazine’s top five Fastest-Growing Companies in the world.

snow plow
Douglas Dynamics makes vehicle attachments, such as plows.

On a list that includes major name brand companies like Facebook and Netflix, and firms based as far away as Israel and China, Douglas Dynamics was ranked No. 5. The snowplow and commercial vehicle attachment manufacturer was the only Wisconsin company on the list.

Rolling Hills Estates, California-based Natural Health Trends came in first, followed by Guangzhou, China-based Vipshop Holdings, Menlo Park, California-based Facebook and Chandler, Arizona-based Insys Therapeutics.

Douglas Dynamics, which has never before appeared on the 100-company list, was ranked above powerhouses like Skechers U.S.A. (No. 7), Netflix (No. 20) and Under Armour (No. 42).

Companies qualify for the list if they trade on a major U.S. stock exchange; report data in U.S. dollars; file quarterly reports with the SEC; had a minimum market capitalization of $250 million and a stock price of at least $5 as of June 30, 2016; have been traded continuously since June 30, 2013; have revenue of at least $50 million and net income of at least $10 million for the four quarters ended on or before April 30; and have posted an annualized growth in revenue and earnings per share of at least 15 percent for each of the three years ending June 30, 2016.

The rankings take into consideration a company’s three-year annual growth rate in earnings per share and revenue; its past four quarters of net income and revenue; the company’s three-year annual rate of return; and its estimated price-earnings ratio for current fiscal year profits.

Douglas Dynamics produced a 141 percent three-year annual growth rate; $49 million in net income over the past four quarters; a 46 percent three-year annual growth rate in revenue; $395 million in revenue over the past four quarters; a 31 percent three-year annual rate of return; and an estimated P/E ratio of 23 for current fiscal year profits.

“It really comes down to just blocking and tackling and doing a particularly effective job of it,” said James Janik, chairman, president and chief executive officer of Douglas Dynamics.

Janik attributed the company’s growth to both internal growth with new products and distribution channels, as well as strategic growth through acquisitions.

“With new products, the last few years we’ve introduced a number of new products that I think extend the whole realm of productivity for our industry,” he said. “One of the things that our end users value, because most of our products are used by people to make a living, we’ve come out with a hugely productive portfolio of products.”

For example, a stainless steel sand and salt spreader used for ice control that was introduced last year has doubled sales in that product category for 2016. And new expandable snowplows have increased productivity significantly, which has been received well by consumers.

Douglas’ July acquisition of Kings Park, New York-based Dejana Truck & Utility Equipment Inc. for $206 million was not included in the ranking, but Janik said two other recent acquisitions helped fuel the company’s growth.

“What I like about this recognition is that the rankings are three-year growth of public companies, but it’s an index of growth as well as profitability,” Janik said. “It doesn’t just take organizations that have incredible growth but don’t do it profitably. It indicates a trajectory instead of a data point.”

Douglas has about has 1,900 full-time employees across North America, about 300 of whom are in Milwaukee. Douglas said the acquisition was advantageous because it diversifies the company’s offerings and reduces its weather-driven risk exposure.

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Molly Dill
Molly Dill, former BizTimes Milwaukee managing editor.