MANAGEMENT
V-C Still Waits for an Upturn in Profits Virginia-Carolina Chemical gets a new board chairman but sees no change in its long range expansion plans Virginia-Carolina Chemical got a new board chairman last week. Meeting in Richmond, Va., company directors elected David K. Wilson, president of Cherokee Insurance Co., Nashville, Tenn., to the post. Justin K. Potter, who has served as chairman, president, and chief executive officer of V-C since 1958, remains president and chief executive. The move, says Mr. Potter, will remit in no change in V-C's long range plans. Mr. Wilson, a major V-C stockholder, has been a director since 1958. Like Mr. Potter, he lives in Nashville rather than in Richmond, Va., location of V-C's headquarters. Last week, too, V-C reported results of its fiscal year ended last June 30. As expected, they were not exceptional. Net sales were $83,816,353, down 3.5Si from record 1960 sales. Earnings after taxes, but before special charges, were $2,525,627, compared with net earnings of $2,105,719 the previous year. The management is encouraged by the better profits. But it is disappointed that the figures do not show the uptrend that V-C expects as a result of the $22 million it poured into new plant and equipment during the past two years. This was more capital than the company had invested in the previous five years put together. V-C is still largely a fertilizer company, and fertilizer sales were down somewhat this year. This also affected the volume of business done by the bag division. But the decline in sales of these two divisions was partly offset by gains in the mining and chemicals divisions. The past two years' capital spending went chiefly into the phosphate mining and chemicals divisions. The mining operations are mostly at Nichols, Fla., although an old operation is still running at Mount Pleasant, Tenn. The mining operations form the raw material base for the company. V-C's fertilizer division has 35 plants, chiefly scattered throughout the southeastern states, but with a few in
the Midwest. All of them make complete fertilizers. Some make their own superphosphate, and some even make their own sulfuric acid for the superphosphate process. The chemicals division makes inorganic and organic phosphorus compounds at Fernald, Ohio, outside Cincinnati, Nichols, Fla., and Charleston, S.C. Company headquarters and research laboratories are at Richmond. The new investment at Nichols includes an expansion of wet process phosphoric acid capacity large enough to raise triple superphosphate capacity to 300,000 tons per year; a new phosphate rock flotation plant; a calcining kiln; a 100,000 ton-per-year diammonium phosphate plant; and rebuilding of a phosphorus furnace, which had been on standby for three years. The chemicals division built a new tetrapotassium pyrophosphate plant at Fernald and added a new unit for
making trimethyl phosphite and Folex defoliant at its Charleston, S.C, plant in the past year or so. At Charleston, V-C concentrates its production of organic phosphorus compounds, makes some inorganic phosphates, and runs its other phosphorus furnace. The TMP goes into insecticides. Before the new plant was built, TMP was made in the same facilities used for V-C's series of organic phosphites, phosphonates, phosphorothioates, and alkyl and aryl acid phosphates. Some of these are used in the company's other agricultural chemicals—Folex, a cotton defoliant, and Phosfon-D, a chemical that retards the height of chrysanthemums and other plants without decreasing the size of the blooms. Other organic phosphorus compounds are used as additives for extreme pressure lubricants, plasticizers, stabilizers, antioxidants, resin curing agents, and a wide
MR. CHAIRMAN CHATS WITH MR. PRESIDENT. David K. Wilson (left), newly elected chairman of Virginia-Carolina, confers with president Justin K. Potter, with whom he now shares job of strengthening V-C's product line, building profits AUG.
21, 1961
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BASIC RAW MATERIALS. These piles of wet phosphate rock at Virginia-Carolina's Nichols, Fla., mine are the company's basic raw material, not only for its fertilizer operation but for a wide range of chemical products into which it is diversifying
range of other applications. The inorganic phosphates, made at Charleston as well as at Fernakl, go into detergents and many other products. Financing. Finding money for this expansion hasn't been easy. \ irginiaCarolinas capital structure doesn't lend itself to financing through issuing more common stock. How it got that way takes a bit of history to explain. The firm has had some terrific ups and downs since it was first put together from eight small fertilizer companies back in 1891. In 1926 V-C found itself in court lacing bank ruptcy. The upshot of this was that, by court order, the company was saddled with a big slug of both !'.< and 6''
