Television digest with electronics reports (Jan-Dec 1955)

18 Financial & Trade Holes: Hallicrafters Inc., as fore cast in this column 4 weeks ago (Vol. 11:47), becomes a subsidiary of big Penn-Texas Corp., operating as a coordinate division much along the lines of Stromberg-Carlson in General Dynamics, as result of merger agreement concluded Dec. 14 and subject to ratification by stockholders of both corporations sometime before Feb. 27. Deal in effect amounted to $6,300,000 sale of Hallicrafters, inasmuch as it calls for issuance by Penn-Texas of 332,000 shares of its stock to Hallicrafters stockholders, or 2 for 5. Penn-Texas closed on N. Y. Stock Exchange Dec. 16 at 18% and Hallicrafters on Midwest at 7. Deal followed shortly upon retirement of Raymond W. Durst as Hallicrafters’ president, due to personal matters ; he remains as consultant and a director, Penn-Texas policy being to have separate board for each of its subsidiaries. Chairman Wm. J. Halligan Sr. has assumed his duties, with Wm. J. Halligan Jr. promoted to sales v.p. ; Robert F. Halligan, another son, to v.p. ; Charles T. Marshall to communications sales mgr. Merger also follows close upon release of Hallicrafters’ report showing earnings of $140,500 (17«f per share) on sales of $4,707,221 in quarter ended Nov. 30 compared to $104,292 (13^) on $6,420,537 in same 1954 period. During fiscal year ended last Aug. 31, Hallicrafters earned $406,146 (49^;) on sales of $29,063,463 as against loss of $940,946 on sales of $31,054,363 in preceding year (Vol. 11:47). There will be no changes in the Hallicrafters setup, it was stated. Its 2 Chicago plants, employing more than 1000, are outgrowth of “ham” equipment business founded in 1933 by the then 34-year-old Halligan, who chose upon graduation from West Point in 1922 to become a Boston newspaper reporter rather than an Army man and who turned to manufacturing while writing one of the early radio, columns for the old Boston Telegram. There is no intention to quit any phases of the TV-radio or communications equipment businesses “as long as they’re profitable,” and the advantages of the new tieup were said to include Indiana Steel Products Co., with quarterly dividend of 25(* distributed Dec. 10 to stockholders of record Nov. 23, reported operations for 10 months ended Oct. 31 resulted in net income after taxes of $614,542 ($2.16 per share) compared to $1.69 per share for same 1954 period. Last board meeting decided to retire $100,000 more of outstanding debentures as of Dec. 1, reducing funded debt to about $200,000, National Telefilm Associates Inc. (Eli Landau, pres.), which recently marketed 312,500 shares of its stock at $5 (Vol. 11:22), reports net profit of $60,531, equal to 9^ per share on 650,000 shares of common outstanding, during quarter ended Oct. 31. Film rentals totaled $660,995 during period. Comparable figures are unavailable. IT&T’s earnings for 9 months ended Sept. 30 were highest for any similar period in its history — consolidated net income amounting to $16,036,240 ($2.23 a share) as against $12,838,789 ($1.79) in 1954 period. Net sales were $313,496,377 vs. $260,014,244. American Electronics Co. reports sales of $4,318,619 and net , profit of $117,377, or 34(* per share on 517,860 shares outstanding, during first 9 months of 1955 vs. $3,441,745 sales and $190,186 profit (40^* on 476,000 shares) in same 1954 period. Edward Lamb Enterprises, headed by the Ohio-Pa. broadcaster-publisher and investor in various appliance firms, has acquired, along with group of fi'iends of Mr. Lamb, “in excess of 100,000 shares” of the 392,000 outstanding shares of Seiberling Rubber Co., Akron. George Link, v.p. of Link Aviat’on Inc., elected a director of General Precision Equipment Corp. availability to Hallicrafters of the engineering & scientific divisions of Penn-Texas — notably in the aircraft parts and machine tool fields. Working capital of Hallicrafters last Aug. 31 was $4,793,531, and last week Halligan reported that his company had further improved its financial position by paying off $891,387 in bank loans and notes, reducing accounts payable by $767,409, reducing inventories more than $1,000,000, increasing earned surplus (reported as $3,088,219 on Aug. 31) by $442,352. It has 825,000 shares of common stock outstanding, of which Halligan and his family own 201,600 (24.4 </, ) and Durst, 32,900. There were no banking intermediaries in the deal. Penn-Texas is headed by 50-year-old L. D. Silberstein, about whom there has been very little publicity but who is described by acquaintances as a wizard with a genius for putting companies together. Originally known as Pennsylvania Coal & Coke Corp., Penn-Texas assets climbed to $85,000,000 this year from only $4,600,000 in 1950. Its total sales have gone up to an estimated $80,000,000 from $6,000,000 in same period. Its net earnings this year are expected to total $4,500,000, or about $1.20 per common share after reflecting 10-month loss of about $500,000 by Colt’s, according to study by McLaughlin, Cryan & Co., 1 Wall St., N. Y. Its most recent acquisitions were Pratt & Whitney and Liberty Products Corp. (aircraft parts) and Colt’s Mfg. Co. (arms & instruments). Only Penn-Texas subsidiary previously in electronics field is Crescent Co., Pawtucket, R. I., making wire & cable. Other subsidiaries are Chandler-Evans (aircraft components) ; Potter & Johnston Co. (automatic turret lathes) ; Industrial Brownhoist Co. (heavy materials-hauling equipment) ; “Quick-Way” Truck Shovel Co. (power shovels) ; Bay way Terminal Corp. (industrial service) ; Tex-Penn Oil & Gas Corp., Penneo Oil Corp. & P-T Corp. (oil & gas producers) ; Pennsylvania Coal & Coke Corp. (mining) ; Saxon Steamship Co., Seaborne Steamship Co. & Seasplendor Steamship Corp. (ships). Clevite Corp. will set new sales and earnings record this year, according to pres. William G. Laffer, addressing Cleveland Society of Security Analysts this week. He estimated earnings at $4,750,000 (about $2.50 a share) on sales of $72,000,000, which would compare with $2,668,648 ($1.33) on $59,204,627 last year and with previous high of $3,914,228 on $70,528,107 in 1953. Advent into electronics fields has proved excellent move, said Laffer, though “greatest growth in this part of the company’s business is still to come.” Magnavox stockholders Dec. 14 approved issuance of 120,000 shares of new $50 preferred stock, for which SEC registration has been filed, and pres. Frank Freimann announces that it will be offered by underwriting group headed by Reynolds & Co., N. Y., shortly after Jan. 1. George J. DeMartini, partner of Cohen, Simonson & Co., New York brokers, has been elected a director of Guild Films Inc. :}*:)«** Dividends: Emerson Radio, 10^* quarterly plus 5^ extra payable Jan. 16 to stockholders of record Jan. 6; Motorola, 37%<^ Jan. 13 to holders Dec. 30; Packard-Bell, 12%^ Jan. 25 to holders Jan. 1; IT&T, 35() Jan. 15 to holders Dec. 22; Gabriel Co., 12Vz(t Feb. 1 to holders Jan. 16; Lear Inc., 15<‘ Jan. 13 to holder's Dec. 21; Electrical & Musical Industries Ltd., 12(f Jan. 4 to holders Dec. 20; Electronic Associates, 25^‘ Dec. 31 to holders Dec. 21; Howard W. Sams & Co., 10<‘ regular, plus lOc* extra Jan. 25 to holders Jan. 16; National Co., 10(1* Dec. 30 to holders Dec. 25; Canadian Westinghou.se, 25(} Jan. 3 to holders Dec. 15 (down from previous 50(* quarterly).