Independent Exhibitors Film Bulletin (1961)

I I FINANCIAL ROUND-UP Trading Unusually heavy trading in the stocks of several film and theatre companies during the past fortnight underscored the surge of investor interest in the movie industry. While most of the recent activity has been centered on film shares, two theatre companies came in for considerable attention in the two weeks span from Feb. 17 to March 2. Loew's Theatres was the most heavily traded industry stock with a turn-over of over 136,000 shares, and showing a rise of $3.50. National Theatres also experienced a sharp increase in activity. In the film division, Metro-Goldwyn-Mayer responded to the roseate profit picture painted by president Joseph R. Vogel at the recent stockholders' meeting, the price up over 4 and sales running over 125,000 shares. A similar bullish tone was evident in Columbia Pictures trading, the key here apparently being the snappy response to the new Screen Gems issue. Disney was another lively item. AB-PT 1st Q. Trails American Broadcasting-Paramount Theatres' profit for the first quarter of this year "will likely be a little behind" the $3,336,000 ($.80 per share) earned in the similar I960 period, but "outlook for the year is better ". In making that prediction, president Leonard H. Goldenson attributed the looked-for drop to "a little softness in spot TV commercial sales" at this time. Overall yearly picture should be brighter than expected I960 net, which was near $10.5 million ($2.50 per share). For the fourth quarter of '60, noted Goldenson, AB-PT's earnings were "about 70 cents a share", compared to 65 cents a share in the corresponding 1959 span. Goldenson's overall prediction would seem to substantiate the following strong recommendation of AB-PT by A. M. Kidder & Co. However, it's the network, not the movie houses, that attracts the investment firm: "This issue, despite a 12i/2-point rise since our Special Report of June 6, I960, appears to have further upside possibilities because of expectations of continuing good earnings performance. Even in comparison with record I960, which saw pershare net climb to an estimated $2.50 from 1959's $1.87, and allowing for the current slackness in general business, results for full 1961 should reach new highs. Thus, as the gradual transfer of company's large capital resources out of the stagnant movie theatre business into the dynamic TV broadcasting and allied fields continues to pay off, the issue offers additional appreciation potential . . . "The expansion of ABP's television business has been the most significant single factor behind the company's success . . . Movie theatres represented 68% of company's business at its inception. Today they account for a much healthier 32%. Gradual disposition of less profitable properties provides a source of new funds which are reinvested in TV and other areas. At present, even though the remaining theatres operate at a profit, further selective dispositions are indicated for the future as more profitable uses for the capital develop." Executive Transactions Securities transactions by the officers and directors of film and theatre companies, as reported by the SEC for the period Dec. 11, i960 to Jan. 10, 1961, were as follows: Columbia president A. Schneider, exercising an option, purchased 43,720 shares to bring his total holdings to 60,722 . . . Vice president Rube Jackter acquired 2,000 Columbia shares; he now has 2,050 . . . Options for M-G-M shares were exercised by vice president-treasurer Robert H. O'Brien and vice president-general counsel Benjamin Melniker. O'Brien purchased 3,000, giving him a total of 4,185, while Melniker acquired 1,600 to raise his holdings to 2,785 . . . Spyros P. Skouras exercised an option to buy 62,200 shares of 20th Century-Fox; his holdings now 85,000 . . . Albert Zugsmith continued to buy heavily into Allied Artists, another 3,000 shares purchased in December lifting his total of A A common to 174,500 . . . Vice president E. Cardon Walker acquired 300 shares of Walt Disney Productions; total 948. Film Profits Up Based on a Wall Street Journal earnings survey and compilation of corporate reports, profits of motion picture firms in I960 rose .1 per cent above 1959 earnings. The increase shines even more brightly amid an average drop of 2 per cent for 601 corporations listed in the survey. In I960, the movie concerns earned $29,491,000, compared to $29,474,000 for '59. UA Places Notes, Warrants United Artists revealed the private placement with a small group of institutional investors of $10,000,000 of six per cent subordinated notes, due Feb. 1, 1976, and ten-year warrants to purchase 200,000 shares of UA common stock at prices in excess of the present market. In making the announcement, president Arthur B. Krim said that the funds will be used for the repayment of certain shorter term debt and for the continued expansion of the firm's business. Placement was arranged by F. Eberstadt & Co., and Lazard Freres & Co. Jan. Dividends Above '60 Cash dividends paid by film companies in January, 1961, were up from last year's first-month total. Motion picture firms issuing public reports paid $1,353,000, compared to $1,067,000 in January, I960, it was reported by the Commerce Department. In December, I960, they paid $3,858,000. FILM & THEATRE STOCKS Close Close Film Companies 2/16/61 112/61 Change ALLIED ARTISTS 5 6 + 1 ALLIED ARTISTS (Pfd.) 11% 13% +2 COLUMBIA 243/8 293/4 +5% COLUMBIA (Pfd.) 72i/2 72 Vi DECCA 33i/8 34% +iy4 DISNEY 34 38% +4% M-G-M 471/2 52% +4% PARAMOUNT 653/4 69% +33/4 20TH-F0X 473/g 47 % UNITED ARTISTS 35% 371/4 +1% UNIVERSAL 45 48 +3 UNIVERSAL (Pfd.) 84% 841/2 + % WARNER BROS. 60 59 -1 (Allied Artists on Ann rican Exchange, all others on N.Y.S.E.) Theatre Companies AB-PT 483/4 503/4 +2 AB-PT (Pfd.) 193/4 191/2 ~ 1/4 LOEW'S 18 211/2 +3% NATIONAL THEATRES 6 6% + % STANLEY WARNER 29% 303/4 + 1% Film BULLETIN March b. 1961 Page 7