The talking machine world (Jan-June 1927)

30 THE TALKING MACHINE WORLD February 15, 1927 Public Shows Faith in Talking Machine by Oversubscribing for Victor Stock Public Offering of $16,500,000 7 Per Cent Cumulative Prior Preferred, 95,000 Shares of 6 Per Cent Cumulative Convertible and 415,000 Shares of Common Is Oversubscribed No more positive indication of the return of the talking machine to public favor could be found than in the manner in which the new stock of the Victor Talking Machine Co., issued under the auspices of Speyer & Co. and J. & W. Seligman & Co., was literally grabbed by the investing public to an extent that resulted in a substantial oversubscription, making necessary an allotment of stock in proportion to the subscriptions sent in. The public offering consisted of an issue of $16,500,000 of 7 per cent cumulative prior preference stock, with a par value of $100 and offered at $98 per share; 95,000 shares of 6 per cent cumulative convertible preferred stock, of no par value, offered at $90 per share, and 415,000 shares of common stock, no par value, offered at $38 per share. The stock issue was authorized at a meeting of the stockholders of the company in Camden on January 17 and the books were opened to the public on January 19 for the sale of the 7 per cent preference stock, the other issues being made available to the public at later dates. It is explained that the new issues do not represent a refinancing of the company, but with the exception of the 244,230 shares of common held by the company for conversion of the cumulative, convertible preferred stock at the rate of two shares of common for each share of convertible preferred all the stock will be issued in exchange from the outstanding 350,000 shares of common stock of $100 par value. The prior preference stock of the company, the first to be offered, at $98 per share, will be redeemable in whole or in part at $115 per share and each share will carry voting rights. A sinking fund starting in 1928 will retire 3 per cent of the outstanding issue each year, if available, at $115 or less. When the stock was offered in the United States through a number of prominent banking houses, it was offered simultaneously for subscription in various European centers where it likewise proved in great demand. Just prior to the opening of the subscription books to the public the Victor Co. advised all its wholesalers and dealers of the new stock issues in order that those who desired might participate directly in the progress of the company by subscribing in advance to the public at large. Special arrangements were made whereby these Victor Co. representatives could receive particular consideration in the allotment of the security. The new stock has been placed on the New York Stock Exchange and each of the three classes immediately commanded a premium, not only significant of the standing of the stock in the eyes of the investing public, but of the effect of the statement regarding the Victor Co.'s business as offered by Edward E. Shumaker, president of the company, who in his letter to the bankers reported earnings in 1926, with the last quarter estimated, of $8,000,000 after Federal taxes and reserves for depreciation of about $1,140,000. "Since organization in 1901," Mr. Shumaker continues, "the company's business has been profitable in every year with the single exception of 1925. In that year net earnings were $931,358, before writing all depreciation, losses due to the abandonment of old models and extraordinary expenses incident to the development and introduction of new instruments and processes. The company has paid about $37,500,000 in cash dividends. A stock dividend of 416^3 per cent was paid in 1911 and of 600 per cent in 1922." The company entered 1927 with a production schedule for the first half year, based on orders on hand, that is one of the heaviest for any corresponding period in its history. Current assets on September 30, 1926, shown by the consolidated balance sheet, including $12,971,138 in cash and marketable securities, were $25,129,913, as against current liabilities of only $2,817,249. Such net current assets exceeded the par value of the prior preference stock. Total net assets were $51,093,812, equal to about $246 per share of prior preference stock. The valuable patents, rights and trade names are carried at $1; the master records and matrices for its entire collection of records are likewise carried at $1. No valuation is included for good-will. Old Type Phonographs Are Modernized by the Merola New Product of Crosley Radio Corp., Operated in Conjunction With Radio Set, Converts Mechanical Phonograph Into Electric Type Cincinnati, O., February 4. — Owners of the old type phonographs will be interested in the new product of the Crosley Radio Corp., the Merola, which, operating in conjunction with a radio set, converts a mechanical phonograph, playing a disc record, into an electric reproducing instrument. The Merola, it is claimed, eliminates needle scratch, increases volume and enables a more complete reproduction of the entire musical scale, without distortion. The Merola derives its name from the initial letters of "magnetic electric reproduction." In an interesting article by John R. Loofbourow, of the Department of Physics of the University of Cincinnati, the Merola is described as "a substitute tone arm for the phonograph. It is attached by a cord to the detector socket of a radio receiving set and the music from the record is thereby reproduced through the radio Solves Battery Eliminator Sales and Service Problems — THE dealer owes it to himself to handle only such devices as will perform satisfactorily. When you sell a Battery Eliminator show its performance by testing it with a Weston Model 489 Battery Eliminator Voltmeter — it will assure customer confidence. This double range battery eliminator voltmeter has a very high internal resistance (1,000 ohms per volt), which means that only a very slight amount of current (one milliampere for full scale deflection) is drawn from the eliminator for its operation. WESTON ELECTRICAL INSTRUMENT CORPORATION 190 Weston Avenue, Newark, N. J. STANbARb.THE.WARLb.AYER, WESTON Ttimeers since 1888 set and the loud speaker. The Merola also is equipped with a volume control device." Further, the writer states: "The two vital The Crosley Merola features of the electrically reproducing system which explain its superiority to mechanical systems of reproduction are, first, the replacing of the usual diaphragm by a light, sensitive armature, and second, the replacing of the horn by a distortionless, cone-type speaker. For adjusting the loudness of the reproduced music a volume control is provided. This consists of a rheostat which is connected across the armature coil in such a way that when all of the resistance of the rheostat is cut out the coil is short-circuited. To increase the volume more resistance is cut into the circuit." The installation of the Merola is a simple matter and consists merely of putting the plug in the detector socket of the radio set and connecting the extra lead wire to the detector "I! plus" terminal of the set. Interior of Unit RCA Receives Largest Radio Compass Order The largest single order ever received For direction finder or radii) compass installations has jusl lnen awarded to the Radio Corp. of America In I lie steamship interests allied with the United States Steel Corp., according to David Sarnoff, vice-president and general manager of RCA. Mr. Sarnoff states that the order provides fof 100 radio compass installations involving more than a quarter of a million dol lars. The radio compass has proved a boon to navigators, it is said.