DATA PROCESSING RESOURCES: CALLING ALL PROGRAMMERS
When Mary Ellen Weaver, chief executive of Data Processing Resources Corp., was interviewing a New York underwriter she hoped would co-lead its initial public offering, she added an item to the normal IPO agenda. ''I said we'd better move this along because I'm pregnant,'' she recalls. ''They freaked, so we just dropped them.''
Weaver, 45, soon found a new underwriter and did the investor road show--56 meetings in three weeks--while she was seven months pregnant. By the time the Newport Beach (Calif.)-based DPRC went public on Mar. 5 last year, the IPO was nearly 20 times oversubscribed--and CEO Weaver had given birth to a new public company. Her son was born two months later.
Weaver hasn't slowed down since. DPRC, a staffing agency that places computer professionals, remains on a tear. In the past year, it has acquired computer staffing companies in four states and opened offices in four more. For the fiscal year ended last July, earnings were $3.3 million on sales of $58.1 million, and growth has sped up since. For fiscal 1997, analysts expect DPRC, No.16 on BUSINESS WEEK's Hot Growth list, to earn $6.6 million on sales of $113 million.
''VERY RESPONSIVE.'' In 1985, Weaver was working at XXCAL Inc., an Orange County information-technology staffing firm, when a colleague, Tom Ballantyne, approached her about starting a business together. Although the onetime schoolteacher had to be talked into the deal, she never looked back. DPRC grew steadily, thanks to soaring demand
for mainframe computer programmers and other information specialists. Weaver's insistence on strong customer services made the firm a standout. Says Gerald L. Abbott, manager of auto sales and distribution systems at American Honda Motor Co., DPRC's first customer: ''Mary Ellen is very responsive, and she takes a lot of personal interest in our business.''
In the early 1990s, the highly fragmented, $12 billion info-tech staffing industry began to consolidate, with large agencies snapping up tiny mom-and-pop shops. Broad-based temp companies such as Accustaff Inc. and Interim Services Inc. also bought in, attracted by fast growth and fat margins. Weaver knew she faced a choice: Either bulk up or bail out. In early 1994, Weaver bought Ballantyne's stake for $5 million.
But Weaver knew she couldn't go it alone. So, like many others on the 1997 Hot Growth list, she brought in professional management. Weaver hired David M. Connell from New York City-based investment fund Welsh, Carson, Anderson & Stowe as a consultant, naming him president in 1994. Connell, who had assisted in the buyout of Ballantyne, helped Weaver refinance the company and take it public. Weaver now spends most of her time on sales and marketing.
Today, DPRC's goal is to buy one company and open a branch each quarter. It is looking at targets in the eastern U.S. and is trying to build on its strength in mainframe programmers, increasingly in demand as companies scramble to reconfigure their computers for the year 2000. ''If we wait,'' Connell says, ''it will be too late to acquire the top-quality companies.''
Besides diversification, DPRC also hopes to boost its higher-margin offerings. In acquiring Dallas-based Leardata Info-Services Inc. in January, DPRC gained programmers familiar with fault-tolerant systems, used in airline reservations and other systems that must always function. Investors seem plenty impressed. With DPRC's stock now trading at around 21 1/2, up from the $14 IPO price, it's no wonder that a secondary offering to raise $40 million this year was oversubscribed again. Weaver's corporate baby is growing up fast.
By Larry Armstrong in Newport Beach, Calif.
Updated June 15, 1997 by bwwebmaster
Copyright 1997, Bloomberg L.P.