These 39 Colorado Corps generated Total Pretax Earnings in 2011 of $19.6 bil, up a robust 21% over 2010. And such Total Pretax Income in 2010 of $16.1 bil was up an even much more robust 58% over 2009.
And to give a complete update, these 39 Colorado Largest Corps had their Total Pretax Income in the 1Q 2012 decrease by 7% from the 1Q 2011, going from $4,396 mil in the 1Q 2011 to $4,104 mil in the 1Q 2012.
And to give a complete update, these 39 Colorado Largest Corps had their Total Pretax Income in the 1Q 2012 decrease by 7% from the 1Q 2011, going from $4,396 mil in the 1Q 2011 to $4,104 mil in the 1Q 2012.
This is clearly a massive total earnings growth deceleration, and even an earnings reverse course.....up 58% in 2010, up 21% in 2011, and down 7% in the 1Q 2012. Something is clearly deteriorating here in Colorado, just as it is in Wisconsin, Ohio, Pennsylvania, Michigan and in other US States.
I use Pretax Income rather than After-tax Net Income, since so much of the change in effective income tax rates just happens due to financial engineering.
I excluded Corps in the Development Stage, and ones generating losses for many years.
This distinction between 2010 earnings growth and the earnings growth in both 2011 and the 1Q 2012 is particularly salient since there was a major move in Colorado political party control between 2010 and 2011, which was precisely what also happened in Wisconsin, Ohio, Pennsylvania and Michigan.
In 2010, Colorado's State Senates and State Houses were both in Democratic control.
On the other hand, in 2011 and in the 1Q 2012, Colorado's State Senates and State Houses both switched to Republican control.
Nationally in 2010, the US House was under Democratic control. But in 2011 and in the 1Q 2012, the US House was under Republican control.
Colorado's Democratic members of the US House numbered 5 of the total 7 in 2010, but only 3 of the total 7 in 2011 and in the 1Q 2012.....the same loss of Democratic majority that occurred in Wisconsin, Ohio, Pennsylvania, and Michigan with the 2010 election.
Let me first show below here the headquarters location and SEC Industry of each of these 39 Largest Colorado Corporations.
| Colorado Largest Corps | Colorado HQs | SEC Standard Industrial Classification |
| Newmont Mining | Greenwood Village | Gold & Silver Ores |
| DISH Network | Englewood | Cable & Other Pay TV |
| Discovery Communications | Englewood | Cable & Other Pay TV |
| Western Union | Englewood | Services: Business Services |
| Liberty Media | Englewood | Cable & Other Pay TV |
| DaVita | Denver | Services: Health & Allied Services |
| Liberty Interactive | Englewood | Cable & Other Pay TV |
| Cimarex Energy | Denver | Crude Petroleum & Natural Gas |
| Arrow Electronics | Englewood | Wholesale: Electronic Parts & Equipment |
| Whiting Petroleum | Denver | Crude Petroleum & Natural Gas |
| Molson Coors Brewing | Denver | Malt Beverages |
| Ball Corp | Broomfield | Metal Cans |
| QEP Resources | Denver | Crude Petroleum & Natural Gas |
| Antero Resources | Denver | Crude Petroleum & Natural Gas |
| Liberty Global | Englewood | Cable & Other Pay TV |
| Chipotle Mexican Grill | Denver | Retail: Eating Places |
| SM Energy | Denver | Crude Petroleum & Natural Gas |
| Berry Petroleum | Denver | Crude Petroleum & Natural Gas |
| Janus Capital | Denver | Investment Advice |
| MarkWest Energy Partners | Denver | Crude Petroleum & Natural Gas |
| Forest Oil | Denver | Crude Petroleum & Natural Gas |
| IHS Inc | Englewood | Services: Computer Programming & Data Processing |
| Intrepid Potash | Denver | Mining, Quarrying of Nonmetallic Minerals |
| Molycorp | Greenwood Village | Metal Mining |
| Croc's | Niwot | Footwear |
| Thompson Creek Metals | Littleton | Metal Mining |
| DCP Midstream Partners | Denver | Natural Gas Transmission |
| National CineMedia | Centennial | Services: Advertising |
| Royal Gold | Denver | Mineral Royalty Traders |
| tw telecom | Littleton | Telephone Communications |
| Teletech Holdings | Englewood | Services: Help Supply Services |
| Bill Barrett Corp | Denver | Crude Petroleum & Natural Gas |
| Echo Star | Englewood | Radio & TV Broadcasting & Communication Equipment |
| MDC Holdings | Denver | Operative Builders |
| UDR | Highlands Ranch | REITs |
| Woodward Inc | Fort Collins | Electrical Industrial Apparatus |
| CH2M Hill Companies | Englewood | Services: Engineering Services |
| Apartment Investment & Mgt | Denver | REITs |
| Pilgrims Pride | Greeley | Poultry Slaughtering & Processing |
And now let me show the Pretax Income (PTI) or Pretax Loss of each of these 39 Largest Colorado Corps in the most recent three years, along with their earnings growth in the two most recent years.
| Major | Complete | ||||
| Move to | Democratic | ||||
| Republican | State | ||||
| Control | Control | ||||
| PTI(L) | PTI(L) | ||||
| % | % | ||||
| Change | Change | ||||
| Total | Total | Total | 2011 | 2010 | |
| PTI(L) | PTI(L) | PTI(L) | vs | vs | |
| 2011 | 2010 | 2009 | 2010 | 2009 | |
| mils $s | mils $s | mils $s | |||
| Colorado Largest Corps | |||||
| Newmont Mining | 3,894 | 3,997 | 2,954 | -3% | 35% |
| DISH Networks | 2,094 | 1,767 | 1,374 | 19% | 29% |
| Discovery Comm | 1,430 | 1,071 | 787 | 34% | 36% |
| Western Union | 1,275 | 1,145 | 1,132 | 11% | 1% |
| Liberty Media | 1,059 | 116 | (38) | 813% | 405% |
| DaVita | 893 | 818 | 758 | 9% | 8% |
| Liberty Interactive | 855 | 547 | 465 | 56% | 18% |
| Cimarex Energy | 841 | 914 | 303 | -8% | 202% |
| Arrow Electronics | 810 | 679 | 189 | 19% | 259% |
| Whiting Petroleum | 780 | 541 | (163) | 44% | 432% |
| Molson Coors Brewing | 774 | 809 | 718 | -4% | 13% |
| Ball Corp | 660 | 606 | 537 | 9% | 13% |
| QEP Resources | 643 | 453 | 333 | 42% | 36% |
| Antero Resources Finance | 623 | 112 | (109) | 456% | 203% |
| Liberty Global | 430 | 140 | 141 | 207% | -1% |
| Chipotle Mexican Grill | 350 | 289 | 204 | 21% | 42% |
| SM Energy | 344 | 160 | 61 | 115% | 162% |
| Berry Petroleum | 256 | 136 | 68 | 88% | 100% |
| Janus Capital | 233 | 245 | 107 | -5% | 129% |
| MarkWest Energy | 199 | 80 | (155) | 149% | 152% |
| Woodward | 188 | 155 | 122 | 21% | 27% |
| Forest Oil | 187 | 299 | 117 | -37% | 156% |
| CH2M Hill | 181 | 172 | 111 | 5% | 55% |
| IHS | 162 | 173 | 159 | -6% | 9% |
| Intrepid Potash | 162 | 75 | 92 | 116% | -18% |
| Molycorp | 147 | (51) | (29) | 388% | -76% |
| Croc's | 137 | 81 | (23) | 69% | 452% |
| Thompson Creek Metals | 134 | 184 | 39 | -27% | 372% |
| DCP Midstream | 120 | 72 | (2) | 67% | 3700% |
| National CineMedia | 120 | 127 | 119 | -6% | 7% |
| Royal Gold | 116 | 44 | 63 | 164% | -30% |
| tw telecom | 99 | 67 | 30 | 48% | 123% |
| Teletech Holdings | 92 | 82 | 103 | 12% | -20% |
| Bill Barrett Corp | 48 | 128 | 88 | -63% | 45% |
| Echo Star | 29 | 145 | (7) | -80% | 2171% |
| MDC Holdings | (68) | (71) | (107) | 4% | 34% |
| UDR | (111) | (114) | (79) | 3% | -44% |
| Apartment Investment Mgt | (135) | (167) | (207) | 19% | 19% |
| Pilgrims Pride | (487) | 85 | (87) | -673% | 198% |
| Total all 39 | 19,564 | 16,111 | 10,168 | 21% | 58% |
Because there was such an incredible difference in total earnings growth of these 39 Colorado Largest Corps under Complete Democratic State Control (+58% in 2010) and after a major switch to Republican State Control (+21% in 2011 and even -7% in the 1Q 2012 ), I decided to check out smaller Colorado Corps, which file with the SEC, in order to see if this same pattern holds, as it also did in Wisconsin, Ohio, Pennsylvania and Michigan.
Thus, I found 16 Colorado Smaller Corps filing with the SEC, which had Pretax Income or Pretax Loss of roughly at least $40 mil in any of the most recent three years, and which weren't included in the 39 Largest Colorado Corps. Thus, these 16 Smaller Colorado Corps also did not have Pretax Income or Pretax Loss of more than $100 mil in any of the most recent three years.
Now to the results of these 16 Smaller Colorado Corps.
The Total Pretax Income of these 16 Smaller Colorado Corps increased by 15% in 2011 as compared with 2010. But that was nothing compared to what happened in 2010, where the Total Pretax Income in 2010 increased by a totally off-the-charts 766% over 2009.
This earnings growth pattern divergence of these 16 Smaller Colorado Corps was consistent with the earnings growth pattern divergence of the 39 Largest Colorado Corps. And Colorado's earnings growth pattern divergence was precisely what also happened in Wisconsin, Ohio, Pennsylvania and Michigan.
Thus clearly, Colorado Corps of all sizes performed substantially better in 2010 under Complete Democratic State Control than in 2011 after a major switch to Republican State Control......just precisely what happened in Wisconsin, Ohio, Pennsylvania and Michigan.
It is pretty clear to me that in 2010, a Democratic President, coupled with a US House and a US Senate both in Democratic hands, and also coupled with a US State Governor and US State Legislature both in Democratic hands, did wonders for corporate earnings growth in that year. With this political structure, economic stimulus, both much needed business income tax stimulus and wise, carefully-vetted investment spending, can occur on a robust scale. And this very strong economic stimulus was in full throttle starting in the 4Q 2009, and did Corporations ever reap the benefit of this by generating exceptionally strong profits.
The worse thing that can happen after a financial meltdown, and near depression, is a US government that just waits for the free markets to correct themselves.....a laissez-faire approach, so favored by Republicans. Fortunately for the country, the exact opposite to that wisely happened in 2009 and 2010.
But then in 2011 and the first half of 2012, the US government was unfortunately forced into a laissez-faire economic approach, due to the US Congress stopping nearly every economic initiative of the Obama Administration. The focus of the US Congress was almost singularly on austerity, when the improving, but still clearly struggling, US economy was shouting out for more economic stimulus, wisely designed.
Thus, things stopped to a walk on the US economic front when the US House switched to Republican control with the 2010 election, coupled with certain US States like Colorado, Michigan, Pennsylvania, Ohio and Wisconsin, also switching from Solid Democratic Control to Solid Republican Control.
Case in point is Business Income Tax Reform, which the Obama Administration strongly supports, and which nearly all Republicans say they are behind. If the President's Framework for Business Income Tax Reform, presented more than three months ago, is strengthened by the US Congress and passed, I am pretty certain that all of the US economic problems, including US real GDP growth, US unemployment, US underemployment, and the US Deficit....would all be substantially improved, and on an ongoing sustainable basis over the long run.
However, the US House Ways and Means Committee must initiate the legislation on this critically needed Business Income Tax Reform. And what have they done so far? Absolutely nothing. I'm not kidding. On the other hand, if the US House was under Democratic control, I am pretty certain that this Business Income Tax Reform would have gotten out of the US House Ways and Means Committee by now and been placed on the US House Floor.
Instead, the Republicans in the US House are focused on attempting to pass an extension of the much lower Bush income tax rates on the wealthy, which increases the US Deficit by more than a trillion dollars over the next decade, and creates almost no US jobs. This continual off-focus approach to governing by the Republicans in the US House shows that they are clearly unfit to be reelected, due to either their gross incompetence on US economic issues, or to their only be interested in governing for the top 1% of the country.
On the other hand, when the President is a Democrat and the US House is in Democratic control, economic initiatives move forward, and they clearly did very robustly in 2009 and 2010.
Given the magnitude of the above Colorado corporate earnings growth numbers in 2010 vs. those subsequent to 2010, it is clearly in the economic interests of Colorado Corporations of all sizes and all Colorado citizens for a return to the 2010 days, when corporate earnings were on a complete upward tear. And the same goes for Wisconsin Corporations of all sizes and for all Wisconsin citizens. And the same also goes for Ohio Corporations of all sizes and for all Ohio citizens. And the same goes for Pennsylvania Corporations of all sizes and for all Pennsylvania citizens. And the same goes for Michigan Corporations of all sizes and for all Michigan citizens.
And frankly, the same goes for all US Corporations of all sizes and for all US citizens in all US States.
While substantial US job creation doesn't necessarily result from substantially higher corporate earnings, I can clearly tell you one thing.....lower corporate earnings will undoubtedly result in a significant loss of US jobs. When corporate earnings absolutely tanked in late 2008 and in 2009, corporations were very quick to dramatically cut US full-time employees. And to give a recent illustration, when Hewlett Packard recently announced down earnings, it also announced it will be cutting 27,000 jobs, or 8% of its workforce. And Ohio-based Procter & Gamble, just recently taking a $452 mil Restructuring Charge, has to mean a significant loss of US jobs. And I have seen so many large Restructuring Charges made by Corporations, such as Michigan's Dow Chemical, in their 1Q 2012 Earnings Statements, made in the same quarter where their earnings growth has fallen off the cliff.
In deriving Pretax Income for these 16 Smaller Colorado Corps, I start with Audited Pretax Income under Generally Accepted Accounting Principles (GAAP), and then exclude several clearly unusual very large items relative to Pretax Income, such as Asset Impairments, and Gains and Losses on both Debt Retirements and Asset Dispositions.
First, here is the HQs and SEC Industry for each of these 16 Smaller Colorado Corps:
| Colorado Smaller Corps | Colorado HQs | SEC Standard Industrial Classification |
| Advanced Energy Industries | Ft Collins | Electronic Components |
| Air Methods | Englewood | Air Transportation Nonscheduled |
| Allos Therapeutics | Westminister | Pharmaceutical Preparations |
| Altegris Winton Futures Fund, LP | Evergreen | Commodity Trading |
| Cobiz Financial | Denver | National Commercial Banks |
| CSG Systems | Englewood | Services: Computer Processing & Data Preparation |
| Digital Globe | Longmont | Communication Services |
| Guaranty Bancorp | Denver | State Commercial Banks |
| Hallador Energy | Denver | Coal Mining |
| Hughes Satellite Systems | Englewood | Communication Services |
| Innospec | Littleton | Chemicals & Allied Products |
| Resolute Energy | Denver | Crude Petroleum & Natural Gas |
| TransMontaigne Partners LP | Denver | PipeLines |
| Vail Resorts | Broomfield | Services: Amusement & Recreation |
| Venoco | Denver | Crude Petroleum & Natural Gas |
| Westmoreland Coal | Englewood | Coal Mining |
And below here is the Pretax Income (PTI) or Pretax Loss of each of these 16 Smaller Colorado Corps in the most recent three years, along with their earnings growth in the two most recent years.
| Major | Complete | ||||
| Move to | Democratic | ||||
| Republican | State | ||||
| Control | Control | ||||
| PTI(L) | PTI(L) | ||||
| % | % | ||||
| Change | Change | ||||
| Total | Total | Total | 2011 | 2010 | |
| PTI(L) | PTI(L) | PTI(L) | vs | vs | |
| 2011 | 2010 | 2009 | 2010 | 2009 | |
| mils $s | mils $s | mils $s | |||
| Colorado Smaller Corps | |||||
| Air Methods | 77 | 68 | 44 | 13% | 55% |
| CSG Systems | 76 | 61 | 63 | 25% | -3% |
| Vail Resorts | 63 | 48 | 81 | 31% | -41% |
| Venoco | 62 | 66 | (54) | -6% | 222% |
| Innospec | 53 | 71 | 18 | -25% | 294% |
| Advanced Energy Industries | 50 | 67 | (32) | -25% | 309% |
| Resolute Energy | 48 | 9 | (65) | 433% | 114% |
| Hallador Energy | 46 | 37 | 36 | 24% | 3% |
| TransMontaigne Partners LP | 37 | 35 | 27 | 6% | 30% |
| Cobiz Financial | 28 | (12) | (70) | 333% | 83% |
| Altegris Winton Futures Fund, LP | 20 | 60 | (33) | -67% | 282% |
| Hughes Satellite Systems | 17 | 67 | (3) | -75% | 2333% |
| Digital Globe | 6 | 7 | 86 | -14% | -92% |
| Guaranty Bancorp | 6 | (38) | (48) | 116% | 21% |
| Westmoreland Coal | (20) | (3) | (46) | -567% | 93% |
| Allos Therapeutics | (31) | (77) | (74) | 60% | -4% |
| Total all 16 | 538 | 466 | (70) | 15% | 766% |
