The motion picture almanac (1931)

54 The MOTION PICTURE ALMANAC 1931 Inventories: Completed pictures, not released, at cost $ 642,623.37 Released pictures, at cost, less amortization 4,124,873.16 Productions in progress 3,239,832.86 Accessories and supplies 250,364.71 8,257,694.10 Scenarios and continuities, at cost, less reserve 584,420.59 Capital Assets: At sound values as appraised, together with subsequent additions at cost, less reserves for depreciation and amortization: Land owned $26,046,112.58 Buildings and equipment on land owned and partly leased.... 33,942,704.13 Leasehold improvements and equipment 22,576,392.62 Leaseholds, goodwill and contracts 7,242,655.29 Investments In and Advances to Affiliated and Other Companies: Equities in capital stocks of affiliated and other companies, based on appraisal $ 1,323,375.95 Capital stocks, not appraised, as valued on books 1,394,700.00 Advances to and bonds of affiliated companies 1,245,221.09 Other Investments and Deposits and Other Assets: Bond sinking fund deposits $ 1,290,086.12 Deposits under leases and sundry advances 2,684,162.85 Mortgages receivable 648,886.62 Class A stock and Orpheum Circuit, Inc., preferred stock held for resale (at cost) 626,951.56 Sundry investments and deposits , 3,494.42 Deferred Charges: Unamortized bond discount and expense $ 701,229.24 Property maintenance and improvement expenses deferred 515,905.53 Prepaid insurance and expenses 1,142,653.77 Development expenses deferred 404,898.27 Film production charges and unahsorbed studio overhead 475,184.13 Organization expenses deferred 330,847.46 $ 15,200,614.81 89,807,864.62 3,963,297.04 5,253,581.57 3,570,718.40 $117,796,076.44 $ 5, 702, 481. C LIABILITIES Current Liabilities: Notes payable and debentures $ 919,956.79 Accounts payable 2,396,914.57 Deposits on sales of investments, etc 50,000.00 Accrued taxes, interest and expenses 2,335,609.72 Deposits: Deposits to be liquidated by film service $ 314,128.01 Rent and other deposits 176,082.13 490,210.14 Deferred Accounts and Debentures Payable 407,640.26 Funded Debt: B. F. Keith Corporation, first and general refunding, twenty-year, 6% gold bonds (less in treasury) $ 6,907,500.00 Other mortgage bonds of subsidiary companies 17,722,150.00 Mortgages payable 15,721,950.00 (Funded debt maturing within one year — $2,517,650.00) Reserves: For uncollected billings $ 28,223.94 For taxes and contingencies 1,866,054.13 For abandonment of unnecessary properties and rehabilitation of theatres (charges during year 1930 amounted to $1,020,204.87 for rehabilitation expenditures and net loss on sales of capital assets and investments in affiliated companies) 2,007,034.13 Preferred Stocks of Subsidiary Companies: Keith-Albee-Orpheum Corporation, 7% cumulative convertible preferred stock — 43.089 shares of $100 each $ 4,308,900.00 Orpheum Circuit, Inc., 8% cumulative convertible preferred stock — 60,103 shares of $100 each 6,010,300.00 Capital Stock and Surplus: Class A capital stock, without par value (less 53,148 shares held in treasury) — 2,328,250 shares outstanding, including shares reserved for stocks of subsidiary companies not yet exchanged $46,934,768.84 Class B capital stock, without par value — 500,000 shares 1.00 Initial surplus 4,633,670.26 Operating surplus, per statement attached 5,055,192.66 Contingent Liability: Radio-Keith-Orpheum Corporation is a party to a jc'nt and several guaranty to insure the repayment of a loan of $400,000.00 by an affiliated company. Commitment for repurchase of £50,500 Australian exchange for $202,000.00. Class A stock options are outstanding for $155,000 shares at $30 or more per share. 40,351,600.00 3,901,312.20 10,319,200.00 56,623,632.76 $117,796,076.44 Consolidated Detailed Statement of Profit and Loss For the Year Ending December 31, 1930 Income : Theatre admissions $50,646,182.46 Film rentals and sales 16,466,344.56 Rents, concessions and other income 4,245,304.00 Expenses: Artists' salaries, other salaries and film service $30,500,450.78 Cost of film sales and service 10,083,634.03 Film selling and general expenses 3,141,490.67 Other operating and general expenses 18,749,028.37 $ 71,357,831.02 $ 62,474,603.85 $ 8,883,227.17 Equipment showed a decline of $3,259,204 from 1929 to 1930. Universal's Profit Universal and subsidiaries report a profit after all charges for the quarter ending January 31, of $1,045,326. This profit is described as abnormal clue to the adoption by the company from November 1, 1930, of the standard method of write-off of picture costs by amortizing such costs over the income-producing life of the pictures. This change was started with the pictures of the present season's releases. There was, therefore, included in the income for the quarter ending January 31, revenue on pictures of prior season's releases, the costs of which already had been completely written off. If the company had also revalued the prior season's release at November 1, 1930, it is stated, profit for the quarter ending January 31, would have b;en $90,432, and the surplus at the beginning of that quarter would have been increased by $1,165,342. FOX Fox Film's 1930 gross of $102.004 009, and a net operating profit of $10,251,827 broke all previous records, the increase being attributed in part by "acquisition of additional properties, but much more to the fundamental stability and steady growth of the industry." "Hardly another industry of this magnitude could be mentioned in which growth has been so nearly uniform, or in which the ratio or gross income to costs has been so nearly constant," the report said. "The explanation of this experience undoubtedly lies in the fact that the industry satisfies universal human needs scarcely less essential than food and clothing. In fact, reports appear to indicate that the present depression has affected more seriously the demand for food and c'othing than it has the demand for amusement, recreation and instruction." The $102,004,009 gross for 52 weeks ended Dec. 27, 1930, compared with $83,184,112 for 1929, a net of $10,251,827 compares with $9,469,051, but an item of non-recurring expenses brought the net profit carried to surplus down to $9,205,434. This was equal to $3.64 a share on 2,525,660 shares of stock outstanding, compared with $10.78 a share on 920.660 shares at the end of 1929. Net 1930 operating profit before non-recurring expenses amounted to $4.06 per share. The much discussed differences in methods of writing off of production cocts between the method used by Touche, Niven, the corporation's accountants and that employed by Price, Waterhouse, who represented the bankers in the April refinancing program are discussed by Harley L. Clarke, president of the corporation. He says: "If the proposed new write-off table of Price Waterhouse were used, the difference between amortization obtained and that set up by the company, as determined and certified by Touche, Niven, would be $894,261 for 1930, and the net would be reduced by this amount. It is to be noted, however, that the effect of the change would be simply to add to the write-off against the income during the past year and to decrease by the same amount the write-off to be deducted from the income of subsequent years."