Broadcasting Telecasting (Jul-Sep 1958)

NETWORKS CBS PROFITS RUN AHEAD OF RCA • Midyear report shows CBS net of $27.3 million • RCA leads, however, after allowing for federal taxes For the first time, CBS Inc. in the first half of 1958 surpassed RCA in net profits (before federal income tax). The CBS midyear report (see below) shows a pre-income-tax net of $27,287,556 on total sales and revenues (after discounts) of $201,433,378. RCA's report, issued in July, showed a net of $27,088,000 (before federal income taxes) on a total of $542,554,000 [Manufacturing, July 28]. After provision for federal income taxes, RCA's net profits are still ahead of CBS Inc. by a little more than $1 million. RCA allocated half its pre-tax net to federal income tax ($13,544,000), so its net profit also came out to that figure. CBS allocated $14,766,000, leaving $12,521,556 as net profit. Both companies pointed out in their statements that the figures are subject to year-end adjustments and audit. In addition, RCA noted specifically that its net profits figures "are necessarily based in part on approximations." It also noted that starting last Jan. 1 it figured depreciation of "certain standard manufacturing facilities" on the straight-line rather than an accelerated basis and that this "results in a reduction of depreciation charges by $500,000 per quarter after income tax in 1958." The consolidated net income of CBS Inc. for the first half of 1958 totaled $12,521,556, up $2.3 million from the $10,199,193 recorded in the same period of 1957, board chairman William S. Paley announced at a board meeting last Wednesday. The total was described as a record sixmonths figure. Net revenues and sales, also said to represent a six-month record, were pegged at $201,433,378 as compared to $186,798,814 in the first half of 1958. First-half earnings were equivalent to $1.59 per share, as against $1.33 per share for the same period of 1957. Per share earnings, it was explained, were calculated on the average number of shares outstanding during the respective six-month periods (7,881,400 in 1958 and 7,651,461 in 1957). The board declared a cash dividend of 25 cents a share on Class A and B stock, payable Sept. 12 to stockholders of record at the close of business Aug. 29. 'Rawhide' Bites Dust at CBS-TV When Sponsor Fails to Turn Up There'll be one less western on tv next season — at least for the first 13 weeks. Scratched at CBS-TV: Charles Marquis Warren's Rawhide, originally scheduled for Mondays, 7:30-8:30 p.m. effective Sept. 29. The hour-long "adult western" reportedly had been close to finding a buyer — Reynolds Metals Co. — but at the last minute, Reynolds bought full sponsorship of ABC-TV's Walt Disney Presents on an alternate-week basis [Advertisers & Agencies, Aug. 4]. Finding no new takers, CBS-TV last week confirmed it would be dropping Rawhide, but indicated it would once again make it available to advertisers after the first of the year. In its place, CBS-TV will schedule two half-hour programs, Name That Tune, a perennial musical quiz that has had no difficulty in past seasons finding interested bankrollers; the 8-8:30 p.m. slot as of Thursday (Aug. 14) was still unfilled. While reasoning that on Mondays two half-hour programs should have less trouble finding advertisers than an hour series, CBSTV is adopting a different philosophy towards Wednesdays. There, it has withdrawn two half-hour film entries — Official Films' The Invisible Man (8-8:30 p.m.) and Ziv's World of Giants (8:30-9 p.m.)— and will instead attempt to lure sponsors with a live, hour-long series titled Pursuit. ABC-TV Regional Meets Open; Affiliates Learn of Promotion The first of a series of two-day regional meetings is being held by ABC-TV in New York's Hotel Warwick beginning today (Aug. 18). The schedule continues with meetings at Chicago's Hotel Sheraton-Blackstone (Aug. 21, 22); Statler-Hilton, Dallas (Aug. 25, 26); Sheraton Palace, San Francisco (Aug. 28, 29). It is expected that representatives of more than 70 ABC-TV affiliates will attend the sessions on exploitationpublicity-promotion advertising. "During the past season, ABC-TV affiliates staged some of the most successful promotion, publicity and exploitation campaigns in the history of the industry," Michael J. Foster, vice president in charge of press information for the network, said, adding, "we believe that these sessions will help provide an exchange of ideas as well as fresh ideas for the stations and the network, which can be translated into even more successful promotion for the 1958-59 season" Mr. Foster will attend the New York and Chicago meetings; Ernest Stern, director of press information for the network's western division, will take part in the Dallas and San Francisco meetings. Sid Mesibov, network director of exploitation, and Dean Linger, director of advertising and promotion, will attend all four sessions. BREAKDOWN ON CBS' RECORD HALF Six Months Ended June 28, 1958(26 Weeks) June 29, 1957 (26 Weeks) net revenues and sales . . . $201,433,378 $186,798,814 Deduct: operating expenses and cost of goods sold $138,385,713 $130,440,592 selling, general and administrative expenses .... 34,051,811 30,605,181 provision for depreciation and amortization of fixed assets .... 2,642,776 2,966,225 175,080,300 164,011,998 26,353,078 22,786,816 MISCELLANEOUS INCOME, LESS MISCELLANEOUS deductions 934,478 837,623 INCOME BEFORE FEDERAL TAXES ON income 27,287,556 21,949,193 provision for federal taxes on income 14,766,000 1 1,750,000 NET INCOME FOR PERIOD .... $ 12,521.556 $ 10,199.193 EARNINGS PER SHARE (NOTE 1) . . $1.59 $1.33 Italics denote red figure NOTES: 1. Earnings per share are calculated on the average number of shares, 7,881,400 in 1958 and 7,651,461 in 1957, outstanding during the respective six month periods. 2. The 1958 results are subject to year end adjustments and to audit by Lybrand, Ross Bros. & Montgomery. August 13, 1958 Page 62 • August 18, 1958 Broadcasting