Category: Arkansas

by Arkansas Business Staff  on Monday, Feb. 25, 2019 12:00 am   1 min read

BNSF Logistics

by George Waldon  on Monday, Feb. 25, 2019 12:00 am   4 min read

Since 1988, Arkansas Business has honored the state’s top executives, small businesses and nonprofits with the annual Arkansas Business of the Year Awards.

Readers make nominations and an independent panel of judges selects the winners.

The winners will be announced at a special banquet March 6 at the Little Rock Marriott Ballroom inside the Statehouse Convention Center. The reception begins at 6 p.m. with dinner starting at 7 p.m. 

Profiles of each of this year’s finalists are listed below.

You can also go directly to the special section and find past finalists and winners.

LEGACY OF LEADERSHIP

Tommy May
Simmons First Foundation

CATEGORY I (1-30 EMPLOYEES)

Acorn Influence LLC
Carson Physical Therapy
iProv LLC
Jones & Co. Ltd.
We Are Few LLC

CATEGORY II (31-55 EMPLOYEES)

ImageWorks Commercial Interiors
Moix Recreational Vehicles
Movista LLC
OJ’s Commercial Cleaning

CATEGORY III (56-100 EMPLOYEES)

Cromwell Architects Engineers Inc.
Medic One LLC
Rainwater Holt & Sexton
Stone Bank
Team SI

CATEGORY IV (101-499 EMPLOYEES)

Oaklawn Jockey Club
Trinity Multifamily
Window Mart

NONPROFIT ORGANIZATION OF THE YEAR
Sponsored by AT&T

Arkansas Hunger Relief Alliance
Healthy Connections Inc.
Mainline Health Systems Inc.
SHARE Foundation

NONPROFIT EXECUTIVE OF THE YEAR
Sponsored by AT&T

Lynn Blankenship, Cooperative Christian Ministries & Clinic
Nicole Lashbrook, St. Joseph’s Helpers of Pulaski County
Micheal Sullivan, Habitat for Humanity of Greater Jonesboro

BUSINESS EXECUTIVE OF THE YEAR

Marty Casteel, Simmons Bank
Ryan Kibler, Medic One LLC
Alan Morse, Ritter Communications
Sharon Tallach Vogelpohl, Mangan Holcomb Partners/Team SI
Dan Williams, Garver

SMART GIVING AWARDS
Sponsored by Arkansas Community Foundation

Kinco Constructors
United Bank
Wright Lindsey Jennings

On Jan. 16, investors around the world mourned the death of John C. “Jack” Bogle, the legendary founder of the Vanguard Group and creator of the first retail index mutual fund.

Jack Bogle was a man of irreproachable integrity and boundless energy who profoundly improved the mutual fund industry and investing. His idea was to create an index fund that would try to replicate the index with lower costs than actively managed funds, which seek to beat the benchmark index and charge higher fees.

Bogle founded the Vanguard Group and in 1974 and in 1976 launched the First Index Investment Trust, the first index fund available to the public and the forerunner of today’s Vanguard 500 Index Fund.

The first response was less than enthusiastic, with the initial public offering raising a mere $11 million, well less than the $150 million desired. Bogle’s philosophy was attacked by competitors in the money management business, some going so far as to claim it was un-American to simply try to mimic the benchmark index as opposed to trying to beat it.

After a slow start, the Vanguard 500 Index Fund has steadily grown to what is now one of the largest mutual funds in the world with assets in excess of $400 billion. Today, the Vanguard Group oversees total assets of more than $5 trillion as investors have come to understand the many benefits of purchasing indexes.

Data on equity performance over the past 15 years reveals that well over 90 percent of large-cap, mid-cap and small-cap managers failed to outperform their respective benchmarks. Data such as this has been around for decades, but in recent years large numbers of investors have awakened to the futility of paying high fees and getting subpar performance.

According to Morningstar Inc., as of the end of 2017, index funds represented almost 45 percent of all equity assets, up from 20 percent in 2007.

Few investors are as familiar with the name Nathan Most, but his impact on the investment landscape approaches Bogle’s.

In 1993, at the age of 73, Nate Most, an employee of the American Stock Exchange, developed the first exchange-traded fund. An ETF is a marketable security that is designed to closely track a particular equity or fixed-income index, commodity or a basket of assets. Unlike a mutual fund, whose pricing is determined at the close of trading, ETFs trade throughout the day like any other stock.

By 2004, there were more than 250 ETFs that mirrored equity and fixed-income indexes trading on the stock exchange, compared with more than 4,500 ETFs today.

At that time, my father, Bill Tedford, and I saw an opportunity to combine the benefits of Bogle’s index approach with Most’s creation to build an all-ETF asset allocation program.

Because index portfolios contain thousands of stocks (or bonds) instead of dozens, the law of large numbers allows for more comprehensive analysis of probable portfolio behavior.

This data-based approach helps our clients define their risk tolerance and raises their comfort. They know they are unlikely to experience more market volatility than they had anticipated.

In addition to utilizing low-cost ETFs, we applied the logic Sam Walton stressed of keeping costs low and passing on the savings to the clients. As a result, we were able to charge a management fee that was far less than most investors were accustomed to paying.

We fully agree with Jack Bogle when he said, “In investing, you get what you don’t pay for. Costs matter.”

Witt Stephens Jr., who wholeheartedly embraced the logic of investing in ETFs, approached us in 2017 with the idea of starting a new registered investment advisory firm built around our strategy of low-cost index investing and ultralow management fees for clients.

After a combined 70 years at Stephens Inc., we left in October 2017 and launched Stephens Group Asset Management LLC in partnership with Witt and his sister Elizabeth Campbell.

We, like investors the world over, owe a large debt of gratitude to Bogle and the wonderful innovation he brought forward. He completely changed our professional and financial careers. As Warren Buffett said: “Jack did more for American investors as a whole than any individual I’ve known. … He converted in a 30-year period a lot of people to the right religion of investing. And it’s a good religion. It pays off.”

We couldn’t agree more.

Alan B. Tedford is managing partner at Stephens Group Asset Management LLC of Little Rock. Email him at Alan@SGAssetMgt.com.

by George Waldon  on Monday, Feb. 25, 2019 12:00 am   3 min read

Chenal Rehabilitation & Healthcare Center at 3115 S. Bowman Road. (Google Earth)

Home BancShares Inc. Chairman Johnny Allison received a $4.7 million compensation package in fiscal 2018, down from $4.8 million in the previous year, while all other named executive officers saw increases, according to the company’s preliminary proxy statement, filed Wednesday.

The publicly traded company (Nasdaq: HOMB) is the parent company of Centennial Bank. It’s scheduled to hold its annual meeting on April 18 in Conway.

Allison’s total compensation of $4.7 million included salary of $399,039, up from $373,280 in 2017, a bonus of $445,000 and stock awards worth $3.1 million.

Other executives and their compensation: 

C. Randall Sims, CEO and president, had had total compensation of $704,000, up from $339,000 in 2017. His 2018 package included salary of $309,000, up from $295,000 in 2017, and a $25,000 bonus.

Tracy M. French, CEO and president of Centennial Bank, had total compensation of $3.3 million, up from $747,100 in 2017. His 2018 package included salary of $448,000, up from $409,000 in 2017, a $205,000 bonus and stock awards of $1.7 million.

Kevin D. Hester, chief lending officer, had total compensation of $1.6 million, up from $596,000 in 2017. His 2018 package included salary of $374,000, up from $349,000 in 2017, and a $185,000 bonus.

Brian S. Davis, chief financial officer and treasurer, had total compensation of $837,000, up from $476,000 in 2017. His 2018 package included salary of $325,000, up from $324,000 in 2017, and a $135,000 bonus.

At the company’s annual meeting, shareholders will be asked to:

• To elect directors for a term of one year.
• To provide an advisory (non-binding) vote approving compensation of named executive officers.
• To approve an amendment to the company’s restated articles of incorporation, as amended, to increase the number of authorized shares of common stock from 200 million to 300 million.
• To ratify the appointment of BKD LLP as the company’s independent registered public accounting firm for the next fiscal year.

by Associated Press  on Friday, Feb. 22, 2019 10:10 am   1 min read

The Federal Reserve Bank Building in Washington D.C.

by Arkansas Business Staff  on Wednesday, Feb. 20, 2019 11:27 am   1 min read

Witt Stephens Jr. (Nancy Nolan)

An investment firm has acquired Kodiak Gas Services LLC of Houston from The Stephens Group LLC of Little Rock, a private investment firm led by Witt Stephens Jr. and Elizabeth Campbell. 

Financial terms of the sale to the EQT Infrastructure III fund were not disclosed. Founded in 2011, Kodiak provides contract compression and related services for the oil and gas industry in North America.

“The Kodiak team grew an idea in 2011 into the 3rd largest contract compression company in the United States,” Witt Stephens said in a news release. “We have been fortunate to partner with these talented industry executives and feel confident that they will continue their record of growth and success with their new partners.”

The EQT Infrastructure III fund is part of EQT Partners, an international investment firm founded in 1994.

In a news release, EQT said Kodiak will keep its corporate headquarters in Houston and operate under the continued leadership of President Mickey McKee, CEO David Marrs and other members of the Kodiak management team.

EQT said it will support Kodiak in the next phase of development, focusing on continued expansion with existing and new customers, strengthening its technology platform and enhancing services.

“We are excited to help build and shape the next phase of development for Kodiak and look forward to working with such a talented group of people and outstanding executive management team who share the same culture, values and drive as EQT,” Alex Darden, partner at EQT, said.

Kodiak has 285 employees and provides services in the Permian, Eagle Ford, Scoop/Stack and other basins of the U.S.

by Lance Turner  on Wednesday, Feb. 20, 2019 11:00 am   1 min read

Uniti Group Inc. of Little Rock announced Tuesday that it will sell its business in Latin America to a company controlled by Phoenix Tower International of Boca Raton, Florida, for cash consideration of $100 million, subject to adjustments.

PTI will acquire about 500 towers located across Mexico, Colombia and Nicaragua, Uniti said.

“This transaction realizes substantial value for our stockholders and allows us to focus on the vast communications infrastructure growth opportunities in the U.S.,” Uniti CEO Kenny Gunderman said in a news release. “Uniti Towers will continue to be a significant component of our ongoing strategy to provide a full suite of solutions to wireless carriers and other customers.”

Dagan Kasavana, CEO and founder of Phoenix Tower International, said the purchase will expand its tower holdings in Colombia, Mexico and Central America.

The deal is subject to closing conditions and is expected to close by March 31.

Founded in 2013, Phoenix owns and manages more than 6,000 towers and other wireless infrastructure throughout the United States, including Puerto Rico and the U.S. Virgin Islands, Costa Rica, Panama, El Salvador, Guatemala, Colombia, Peru, Mexico, the Dominican Republic, French West Indies, Jamaica, Argentina, Ecuador and Bolivia.

Uniti Group (Nasdaq: UNIT) is a spinoff of Windstream Holdings Inc. of Little Rock that was formerly known as Communications Sales & Leasing.

Arkansas can become a leader in the knowledge-based economy if its state government, industries and educators work together to develop a workforce attractive to innovators and to diversify its portfolio by bringing in a big company to complement homegrown successes.

That’s what attendees of the first Arkansas Innovation Council Summit were told Tuesday at the Robinson Center ballroom in Little Rock.

The first speaker was Ross DeVol, a Walton fellow with the Walton Family Foundation.

The state ranks in the bottom 10 for human capital investment, risk capital and entrepreneurial infrastructure, research and development inputs, technology concentration and dynamism, and technology and science workforce, according to the Milken Institute’s 2018 State Technology & Science Index. DeVol is former chief research officer at the Milken Institute.

On Tuesday, he said, “To be frank, Arkansas needs to get on the map.”

That’s not to say the state hasn’t improved. He said its overall score on the index has improved by six points since he joined the foundation in 2017.

He spoke a lot about Utah’s success climbing to the top of the index over several years and said Arkansas could do the same thing by taking a number of steps.

DeVol suggested the state develop a strategic vision, award incentives based on economic impact, recruit anchor tech firms (large and established tech companies, like Apple), take advantage of public-private partnerships, promote commercialization of research and development efforts and increase access to early-stage risk capital.

In response to a question from the audience, DeVol said Arkansas needs both an anchor firm and homegrown startups for a diverse portfolio.

The panel discussion following DeVol’s presentation served to reinforce many of his points.

It was comprised of:

• moderator Stan Green;
• Richard Brown, dean of the University of Utah College of Engineering;
• Mark Mason, principal and founder of full-service technology consulting firm Affirma Consulting, which is headquartered in Seattle and recently expanded to Fayetteville;
• Elliott Parker, managing director of corporate innovation for High Alpha Venture Studio of Indianapolis;
• Dr. Cam Patterson, chancellor of the University of Arkansas for Medical Sciences; and
• April Seggebruch, co-founder of Bentonville software company Movista.

Brown said higher education institutions and industry leaders working together have made a huge difference in Utah, where the number of engineering graduates from his university has increased from about 40 to more than 1,000 over the past few years.

For the past five years, Brown said more than 80 percent of those students have stayed in Utah after graduating. Since 2006, the UU’s College of Engineering has spun out 74 startup companies.

Mason said he choose to expand to Fayetteville because recruitment and retainment of talent is a priority for Affirma Consulting. He said he felt he could hire University of Arkansas graduates. He noted that a lower cost of living and good quality of life are key to retaining workers.

Parker said the relationship between the startup community and established companies is also important. “We believe that, over the next couple of decades, the success that large established companies achieve will be determined in large part by the quality of the engagement that they have with startups,” he said.

Brown said being a leader in the knowledge-based economy is all about engaging in a necessary cycle, “involving the government allocating the funds, the universities growing the workforce, more industry coming to the state because we’ve got a growing, young, well-educated population. And the new companies require even more employees, so we go round and round.”

Utah has also implemented incentives for venture capital investments, he said, and that has made a difference.

Everyone on the panel seemed to agreed that there is a need for Arkansas to develop an engaged investment community and for universities to encourage commercialization efforts by students and faculty.

The summit ended with a keynote presentation by Gov. Asa Hutchinson, who touted the state bringing coding classes to every high school in Arkansas, spending $2.5 million to certify computer science teachers, holding a blockchain summit, helping fund the cybersecurity range at the University of Central Arkansas in Conway and many other initiatives.

About the new Arkansas Innovation Council, he said, “I see this as an opportunity to make sure Arkansas not only enhances our workforce and our education but that it’s guided by industry and those people who are dependent upon” the knowledge-based economy.