Word: lusteveco
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Navy ships, branched into commercial cargo handling as Philippine exports began to rise. When World War II came, the Navy commandeered all the company's facilities. After the Japanese conquest of the island nation, all seemed lost for Lusteveco-until it received a handsome postwar windfall. In 1945, with the approval of General Douglas MacArthur, the company was given a treasure in surplus LSTs, cranes and trucks to replace its lost equipment...
...Lusteveco's U.S. owners, including Edward M. Grimm and Charles ("Chick") Parsons, who was a Navy guerrilla in World War II (and later told about it in Rendezvous by Submarine), promptly set about rebuilding. By 1963, Grimm, Parsons and colleagues were able to sell their 50% interest for $6.6 million to a group of Filipino businessmen and investors headed by Jose B. Fernandez, now 43 and the company's chairman. U.S.-educated (Fordham, Harvard Business School) and a member of a wealthy Manila family, Fernandez tapped as president a young American: Donald I. Marshall...
Missionary Zeal. Under Fernandez and Marshall, Lusteveco has barged ahead with a sort of missionary zeal. Sales have almost doubled since 1963, but the company is chary with dividends. It plows nearly all its earnings back into expansion. "Until we are sure we can meet the needs of the country," explains Fernandez, "we will continue to give that first priority and dividends second...
...meet those needs, Lusteveco has been spending some $4,000,000 a year on new equipment, which is a lot by Philippine standards. Its own yards at II-oilo turn out a new tug every six weeks, two new barges a month-most of them prestressed concrete creatures that carry 2,000 tons of cargo, are cheaper and easier to maintain than standard steel barges...
Standard as such hardware and experience may be in other parts of the world, it is in short supply in Southeast Asia, as U.S. military logistics experts have discovered to their chagrin. Lusteveco tugs and barges helped break the Saigon shipping bottleneck, and the company is bidding for similar work at Thailand's choked port of Bangkok. Still, happy as he is to have the U.S. military business (which now accounts for 12% of sales), Fernandez finds that he is hard-pressed to "accommodate that Viet Nam effort," looks for the day when he can "bring back...