FINANCE >
Early Returns f r o m a Record Breaking Y e a r Net Sales (in Millions) 1955 1954 Air Reduction Allied Chemical American Potash Atlas Powder Cook Paint & Varnish D e v o e & Raynolds Diamond Alkali Freeport Sulphur Johns-Man ville Hercules Powder Heyden Koppers Monsanto Nopco Norwich Pharmacai Pennsalt Rayonier St. R e g i s Paper G. D . Searle Smith, Minje & French : Staufïer * Union Carbide
%
Increase
ί 149.2 Harvest of Prosperity. But t h e major reason for last year's success stories w a s set b y t h e continuing busi ness b o o m . T y p i c a l l y , U n i o n Carbide says, "Increased p h y s i c a l v o l u m e of sales from n e w p r o d u c t i o n capacity a d d e d in 1 9 5 4 and 1 9 5 5 , t o g e t h e r w i t h i m p r o v e d business conditions, m a d e possible substantial i m p r o v e m e n t s in operating results." C a r b i d e adds that i n c o m e before depreciation, amortiza tion, a n d taxes a m o u n t e d t o 3 3 % of sales in 1 9 5 5 , c o m p a r e d w i t h 2 9 % in 1954. N o r are c h e m i c a l firms a l o n e in reap i n g the harvests of prosperity. Across t h e b o a r d t h e story w a s m o s t l y t h e same. G e n e r a l Motors' profits soared 4 8 % to nearly $ 1 . 2 billion, first time ever that a corporation h a d netted m o r e than $1 billion in a s i n g l e year. U . S. Steel's i n c o m e c l i m b e d to a record
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Midland,
Michigan, Department OC 840A.
on DOW
DOW
CHEMICALS FEB.
13,
1956
C&EN
731
FINANCE §370.2 million for a return of 9% on sales (highest margin since 1940) against 6 % return t h e previous year. Standard Oil (N. J . ) earned $717 million ($10.96 a share) for the best year in its history; Jersey Standard h a d netted $585 million ($9.56 a share) a year earlier. And Kennecott Copper reports record income of $125.6 million last year, up from $77.9 million earned in the previous year. O n e notable exception: Strike-plàguëd Westinghouse Electric saw income dip to $42.8 million i n 1955 from $79.9 million in 1954. > Wall Street T a k e s Note. T h e wealth of good financial news did not pass unnoticed by the stock market. Wall Street h a s b e e n beset b y crosscurrents of indecision a n d d o u b t fostered b y fears that the business boom may jpass its peak before t h e end of the year as well a s about President Eisenhower's decision regarding t h e upcoming election—which h a d sent stock prices slipping since t h e first of the year. Now t h e downtrend has been r e versed, a t least temporarily. Led b y blue chip issues the market has moved cautiously upward. C&EN's index of 2 1 smaller chemical companies, for instance, touched a n e w high a t the e n d of February's first week, bolstered b y strength i n Hercules Powder and highpriced Robm & Haas. Reports of record earnings, of course, came as n o surprise to investors; t h e picture h a d been developing all year. While it has a d d e d substance to investor confidence, Wall Street can b e
expected to keep one eye, at least, cocked warily on t h e future.
Stock Splits Stock splits among chemical process firms continue to m a k e financial news. Recent actions: • American Potash will split its Class A a n d Class Β shares 2 1 / 2 for o n e if share owners approve a t their annual ineeting April 24. At t h e same time the company proposes t o change the n a m e of t h e Class Β to common stock. If the split i s approved, the company expects t o place t h e n e w shares o n a quarterly dividend r a t e of 2 5 cents, equivalent to the latest dividend of 6 2 1 / 2 cents paid on the present shares. • Allied Laboratories plans to split its common stock t w o for one and has boosted t h e annual dividend rate on the present shares to $1.60 from $1.20. • Standard Oil (N. J.) stocldiolders h a v e approved the proposed three-forone split of their stock. Jersey Stand ard will have nearly 196.4 million com mon shares outstanding after the split is effected. A dividend of 5 0 cents, payable March. 10, h a s been declared on t h e n e w stock, equivalent to the $1.50 dividend paid on t h e old stock last December.
• Koppers h a s registered 300,000 shares of its common stock with SEC
for public sale. Proceeds from t h e stock sale, together with u p t o $30 million the company has arranged t o borrow from a group of commercial banks, will b e a d d e d to general cor porate funds. Koppers believes that funds from t h e stock sale, bank credit, and retained earnings and reserves will be in excess of its requirements f o r t h e year ahead, so the bank credit will b e used only i n part; estimated capital expenditures for 1956 total a b o u t $33 million. At recent prices, sale of com mon should n e t t h e company about $15 million. • N u c l e a r D e v e l o p m e n t C a r p · of America has obtained n e w capital t o finance expansion b y private sale of stock a n d t h e creation of a long-term loan commitment. N e w capital will be u s e d for development of nuclear reactor testing a n d manufacturing fa cilities, including development o f a n experimental station a t Pawling, Ν . Υ., and additions t o facilities a t W h i t e Plains, Ν . Υ. • Schering has declared a n extra divi dend of 25 cents as well as a regular 25-cent dividend, payable Feb. 1 7 . • Du Pont was owned by 159.000 stock holders a t t h e end of 1955, a n increase of 6.4%>, or almost 10,000 over t h e number recorded a year earlier. D u Pont common stock was distributed among 143,941 holders.
INDEX OF STOCK MARKET RRICES Jan. ' 5 4 Opening Prices = 1 0 0
CHEMICALS
PHARMACEUTICALS
3O0Φ
250-
2 1 Others
2Ο0 -
>
Λ
^
150«
5v/189.1 I **Ti85.8
%££
200
S E C Composite Index
171.8
^171.8 150,^"
S E C Com posîte Index
Ί32.3
1Ο0. 2 n d Qtr. ( 1 9 5 5 )
732
C&EN
3 r d Qtr.
FEB. I 3 f
I956
lOO 4 t h Qtr.
1st Qtr. ( 1 9 5 6 )
2 n d Qtr. ( 1 9 5 5 ) - 3 r d Qtr.
4 t h Qtr.
1st Qtr. ( 1 9 5 6 )
