FINANCE
W A L L STUEET ©F CHEft^iSTHY A i r Reduction earnings up 2 2 % over first half of '49; gain attributed to 13-cent dividend from Arcrods Corp. and increased operating efficiencies Co., Inc., reported earnA IRingsReduction of $4,080,133 for the six months ended June 30, 1950, equivalent to $1.49 per share of common stock. By comparison with 1949 when $1.22 was earned during the first six months, the latest statement indicates an improvement of 2 2 % . Sales have continued at about t h e same rate and amounted to $46,013,984 for the six months. Part of the earnings gain can be traced to a dividend from Arcrods Corp. ( jointly owned by Airco and General Electric) of 13 cents per share after income taxes. Also, operating efficiencies showed a gain. Semicommercial production of purified argon at Jersey City and operation of a liquid oxygen plant at Buffalo w e r e started this year, a n d broadened markets for an electric welding (Aircomatic) process include application to stainless steel and aluminum bronzes as well as to aluminum. T h e immediate future outlook is good as acetylene demand for rubber a n d plastics has necessitated capacity operation of calcium carbide furnaces at Louisville, Ky., Keokuk, Iowa, and Ivanhoe, Va. A fourth plant at Ashtabula, Ohio, is presently maintained in standby condition for t h e Government. Progress with a lowpurity tonnage oxygen for experiments in metallurgical blast furnaces has b e e n described as encouraging. T h e oxygen plant at Johnstown has been operating satisfactorily. Sales of dry ice for refrigeration, especially during transportation of perishable foods, normally reach a peak in July and August and have b e e n bolstered this year by addition of 50 tons per day to the capacity of t h e Chicago plant. Also, declaration by U. S. I n d u s trial Chemicals, Inc., of a 25-cent q u a r terly dividend, payable Sept. 1, will improve earnings by about $31,000, based on Airco's holdings of 122,907 shares of USI common stock. Air Reduction also holds 28,571 shares or 7Or of t h e outstanding common stock of Vanadium Corp. of America. Possibility of an extra or increased dividend this year depends on t h e exact amount of t h e liability arising from the government tax suit on revisions of income tax laws and on the size of capital expenditures. In this latter connection, John A. Hill, president, stated at the stockholders* meeting that a $10 million expansion of carbide a n d acetylene facilities, based on a plant a n d furnace design which will produce carbide at a substantially lower cost t h a n today, m i g h t be required. I n view of interest in t h e electric arc process for acetylene from natural gas this n e w carbide process must b e considered a significant development.
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The management has been aggressive in its attempt to improve t h e corporation's profitability. It is meeting the threatened challenge of acetylene from natural gas. It has reorganized research and engineering by combining the two functions in one department. The corporate structure of the company was simplified by liquidating 12 subsidiaries which are now operated as divisions. T h e income tax was thereby reduced from 40 to 387c. While profitability has not compared favorably with that of many chemical companies, Hill points out that Airco is not strictly a chemical company. However, t h e earnings for the latest six months are at a peak for the postwar period at 8.9r/r of sales and 14.6% of net worth—not bad even for a chemical company.
Sterling Shows Increases Net profit of Sterling Drug, Inc., a n d subsidiary companies for t h e six months ended June 30 was $7,829,004, after all charges a n d provision for income taxes. These earnings are equivalent to $1.99 per common share on 3,829,213 shares outstanding. For t h e corresponding period of 1949, net earnings w e r e $7,259,322, or $1.85 per common share. Sales for the first half of 1950 were $68,195,281, an increase of 1.3% over the $67,306,362 for the like period of 1949. Net earnings for the second quarter of 1950 were $3,611,964, or 92 cents per common share, as compared with $2,935,359, or 74 cents per common share, ior the corresponding period of 1949. The directors declared a regular quarterly dividend of 50 cents per share on the common stock, paid Sept. 1 to stockholders of record Aug. 18.
California Standard to Pay $1.00 Dividend Standard Oil Co. of California has d e clared a dividend of $1.00 a share payable Sept. 11 to stockholders of record Aug. 10. R. G. Follis, board chairman, said estimated net income for t h e second quarter of 1950 was $35,483,006, equivalent to $2.47 a share. Dividend income from associated companies operating in foreign countries amounted to $6,808,870, contributing 4 0 cents a share to net income after taxes. Income in t h e second quarter of 1949 was $38,398,382, or $2.68 a share on t h e present number of shares. In t h e first quarter of 1950 Standard reported an estimated net income of $24,924,457 or $1.74 a share, making a total for the first half of this year of $60,407,463, or $4.21 a share. Follis pointed out that gross domestic crude oil production of the company a n d
CHEMICAL
its subsidiaries in t h e U. S. was 266,000 bbl. daily in the second quarter, up 2,000 bbl. daily as against t h e first quarter. Increasing production of subsidiaries in Texas and Gulf Coast states accounted for the increases. In addition, Follis pointed out that in June a wholly owned Standard subsidiary produced 19,000 bbl. per day in Venezuela, this being a peak for operations in that area. The Venezuela production is a heavy specialty crude especially suited for asphalt use and is produced from a very large field west of Lake Maracaibo.
Dewey and Almy Sales Up 2 1 % in First H a l f Dewey and Almy Chemical Co. has reported net earnings for t h e first six months of t h e year of $679,770, equivalent to $2.12 per common share. This compares to earnings of $174,753 for the same period in 1949. Both figures exclude the profits of the 70"7< -owned Argentine subsidiary which were included in the 1949 semiannual report. Bradley Dewey, president, stated that sales for t h e first half of this year were $9,003,491 as compared to $7,446,076 for 1949, a gain of 2 1 % . Argentine sales are excluded from these figures. Twelve-months' figures for the period ended June 30 showed net earnings of $1,481,510 equal to $4.63 a share, on sales of $17,854,417, as compared to earnings of $976,493, or $3.05 a share on sales of $16,297,002 for the calendar year 1949.
Indiana Standard's Earnings Up 3 . 5 % in First H a l f Standard Oil Co. ( I n d i a n a ) has announced consolidated earnings of $52,498,494, or $3.43 per share, for t h e first half of 1950, but cautioned that the figures "are based on the assumption that present tax rates will b e applicable." T h e earnings represent a gain of 3.5% over the comparable 1949 figures of $50,713,608 and $3.32, but profit was smaller per unit of sales. Total income from sales for the first six months of 1950 was $609,208,330 as compared with $572,627,112 for the like period last year. I n announcing t h e earnings, Robert E. Wilson, chairman, a n d A. W. Peake, president, called for government economy in nonmilitary expenses and labeled as "especially dangerous" t h e suggestion that "heavy excess profits taxes b e leveled on earnings in excess of those in prewar years." Capital expenditures for the half, largely for oil a n d gas production and for improved marketing facilities, were $56 million, compared with $64 million in t h e first half of 1949 and $111 million in t h e first half of 1948. This lower level of capital requirements, Dr. Wilson and Mr. Peake said, together with slightly higher earnings and depreciation charges, m a d e possible a reduction of about $15 million in t h e company's indebtedness during the period.
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ENGINEERING
NEWS
