Television digest with electronic reports (Jan-Dec 1959)

15 Ti:*a«de Ilepoi:*t • • • • august i?, 1959 TUBE SALES HERALD SPURT IN TV OUTPUT: Manufacturers' optimism about fall TV sales is more than just press-release talk. One of best indicators that it's backed by firm plans is the boom now being enjoyed by the picture-tube industry. Although first-half factory sales of all picture tubes (including replacements) showed a 17% increase over last year — 4,370,535 vs. 3,689,587 — production rate is being stepped up even more by all picture-tube manufacturers. And they all say increase is more than seasonal. TV-set inventories are in excellent shape this year, so there's plenty of pipeline-filling following introduction of new models. But since production schedules have considerable lead time, it's obvious that manufacturers are already counting on good consumer acceptance of 1960 lines. While tube production capacity may be strained in some instances this fall, most picture-tube manufacturers don't predict any shortages — even if 1959 should turn out to be a 6-million-set year, which now appears more of a possibility than ever. "The set makers' anticipated schedules are heavier than I've ever seen at any time," one large independent tube manufacturer told us. "Every one of our customers, large & small, is increasing his orders. Some are ordering twice as much as earlier this year. The pipelines seem to be completely dry. The industry is operating at a rate of 6 to 6V2 million sets." Said one of the largest picture-tube makers: "Business is up appreciably this year. The whole tenor of business is very strong — especially since June. But we still can turn out more product if we have to." Another big manufacturer agreed that business was well up over last year, and said that the confused size-<&-shape picture (Vol. 15:32) is his biggest worry. Still another said that orders are very high, but "there's adequate capacity in the industry to handle even more of an increase." ELECTRONICS 2ND-QUARTER PROFITS UP 29%: Sharing in biggest over-all nationwide profit surge since end of World War II, representative electronics firms enjoyed aggregate 2ndquarter profits 29% higher than the same 1958 period. This is indicated by our quarterly comparison of financial statements of 23 firms in various electronics fields. The 29% increment is considerably below the 75.6% rise for 428 U.S. corporations in all fields reported recently by the Wall Street Journal. But on other hand, aggregate electronics profits fell far less during the first-half-1958 recession than did corporate earnings generally (Vol. 15:12), so there's a relatively higher base for 1958 comparison. Diversified electronics firms, with their heavy concentration of military business, suffered least during 1958 recession — and in our tally their large relative size obscures dimensions of dramatic comebacks made by firms heavily in consumer electronics & components — the consumer group reporting an aggregate 317% increase in profits, components group increasing by 101% in the period. Here are vital statistics for the 23 "weathervane" electronics firms in 2nd-quarter and first-half 1959 as compared with same 1958 periods: All electronics groups — aggregate 2nd-quarter sales up 11%, profits up 29%. Total first-half sales up 10%, profits up 27%. Seven large diversified electronics companies aggregated 8.6% increase in sales for 2nd quarter, accompanied by 21% profit increase. For first half, sales were up 8%, profits up 20%. All 7 showed profit increases for both periods, 6 of the 7 reporting increases in sales in both 2nd quarter & first half. Seven companies known primarily as TV-radio manufacturers (although some are widely diversified) reported these sales & profit trends for 2nd quarter: Sales up 28%, profits up 317%. For first half, as compared with same 1958 period, sales were up 31%, profits up 326%. One reason for huge profit increases is j fact that 3 of the 7 reported losses in first-half 1958, two in 2nd-quarter 1958, and in arriving at 1958 aggregate profits, these loss figures were subtracted from totals. All 7 companies were profitable in both 1959 periods, and every company bested 1958 figures in both sales & profits during the 1959 periods.