Broadcasting Telecasting (Oct-Dec 1957)

MANUFACTURING continued half of radios used by Ford and Chrysler and all used by American Motors. Though tied to the fortunes of the auto industry, Motorola's radio sales also depend on whether the percentage of new automobiles sold are radio-equipped. Thus far, this percentage has been on the rise. It has strengthened position in tv set making, its production deadlines have not been as great as the average for the tv industry. Philco — According to a company spokesman: sales of 1958 tv models already introduced and of radios and hi-fi are "quite satisfactory"; air conditioning and color tv, however, "disappointing." Philco is not producing a color set at present. Its thirdquarter net income was more than six times greater than the similar period of a year previous; profits in the first nine months almost tripled the level of before, but earnings totals are "still very low relative to the pre1956 experience." RCA — Broadcasting activities account for about 25% of over-all volume and provide a steady source of income "year in and year out." NBC-TV apparently has gained in "competition for prestige shows . . . expanded its share of tv audience during the current season," but "expenses of color shows are substantial." Though RCA has been promoting color almost single-handed, "mass acceptance still seems at least a year removed." Manufacturing provides 72% of total sales, shipments to the government about 30%. Introductory color expenses seem to be largely at fault for a drop in RCA"s profit margin even though sales have increased. Prediction: tv set sales in 1958 may dip below the 1957 level in sympathy with the estimated slippage in consumer expenditures on durables. But records and hi-fi are "hot" items at present. RCA's dollar sales, aided by selective price advances already made, will rise slightly next year, and, despite a probable lower profit margin, net income will hold within 10% of the 1957 level. "RCA is expected to give a better-thanaverage market performance during the coming year." Raytheon Mfg. — Despite recent improvement in management, "Raytheon stock has little to recommend it at present." Company plows back much of its earnings because of rapidly expanding sales in past years, but the importance of government orders to the firm means the expected business recession probably will not curtail Raytheon's sales next year. Prediction: estimated 6% profit margin for 1958, slightly higher than the depressed 1956 margin. Sylvania Electric Products — Tv industry's inventory of tv picture tubes at the end of September was 32% below the figure of a year ago. Reasons: production schedules were cut early in year and output geared closely to retail sales, and new 110-degree picture tubes caused old style tubes to be cleared out. Sylvania has benefited from this thin picture tube acceptance. Factory unit sales were up. Sylvania stock "appears to be an excellent vehicle for longer-term" buys. Westinghouse Electric — Combined with GE, Westinghouse accounts for about onethird of the entire electrical equipment industry's production. Consumer durables are the problem area of the industry and "consumer lines threaten to remain troublesome in the year ahead." Its stock (at about the same price level as competitor GE) "appears to offer somewhat better current value . . . [but]relative to all stocks, Westinghouse has no more than average investment appeal at this time." Zenith Radio — It shipped 11% more tv set units in the first nine months of the year than the period of a year ago (but industry was down 14% ). "Feather in management's cap": winning an out-of-court settlement from RCA in anti-trust suit ($10 million in damages, payable $1 million a year). Prediction: "Because the long post-war rise in disposable income is expected to level off in 1958 for the first time since 1954, we tentatively estimate lower volume and a slightly narrower profit margin next year." McDonald Reveals Zenith Plan To Reincorporate, Split Stock Zenith Radio Corp. plans a corporate reorganization, moving its legal site from Illinois to Delaware and calling for a twofor-one stock split, Comdr. E. F. McDonald Jr.. president, has announced following action by the board of directors. The plan, to be considered by stockholders early next year, is intended to broaden Zenith's ownership base, boosting the number of authorized shares of stock. Zenith stock, which consistently has been selling at over $100 per share, closed on the New York Exchange at the time of Comdr. McDonald's announcement Nov. 27 at $126 (up $9 after a $6 drop the day before). With Delaware reincorporation, Illinois capital stock tax is non-applicable and the firm could issue non-voting preferred stock. Quarterly dividends on new stock are expected to be 50 cents per share (equivalent to $1 on present stock). Zenith directors also approved extra and special dividends out of 1957 earnings. RCA Working on New Designs For Fm, Multiplex Equipment Development of new-type fm broadcast transmitters and complementary multiplexing equipment was announced last week by E. C. Tracy, manager, RCA broadcast and tv equipment department. The fm multiplexing equipment is currently undergoing experimental testing in conjunction with WCAUFM Philadelphia, according to Mr. Tracy. "Test results obtained to date," he said, "indicate that equipment designs are in a near-final stage and that RCA, by late 1958, will have on the market complete fm transmitters designed for multiplex operation." Planned for RCA's new fm broadcast transmitter line, according to Mr. Tracy, are: a 10 w exciter-transmitter (Type BTE10B); a 250 w fm transmitter (Type BTF250B); a 5 kw fm transmitter (Type BTF5B), and multiplex sub-carrier generator equipment for use with RCA multiplex exciters. The equipment reportedly will be RETIRE tonight calm and peaceful in the knowledge that you bought time on the consistently proven #1 TV station (KJEO-TV) in the fabulously rich Fresno and San Joaquin Valley market. Consult your Branham man now for further fascinating details. We GUARANTEE you'll save your energies . . . get more for your monies . . . on KJEO-TV Fresno. ACT TODAY! Page 94 • December 9, 1957 Broadcasting