Variety (Aug 1941)

Wednesday, Aogost 6, 1941 PICTUIIES WALL ST. AND AMDS. STOCKS Analysis of Par s Statement Shows Theatres Dipped But Distrib Upped Indication of th» severity of the slump in theatre grosses throughout the country during April, May and June was made clear in the earnings statement for the period issued by Paramount last week. It revealed a drop of virtually 30% In theatre in- come from the same three months of 1940. Par's theatre earnings are taken by the Industry as an excellent guide to general grosses, as It operates or Is partnered In the operation of houses in most of the states of the union and not only has first-runs but a variety of subsequents. Analysis of the figures shows the big slide taken by \h9 grosses was in the second quarter,'although the first three months were also off. VThile the Aprll-May-Juna spiU was approximately 29%, that for the first elx months was only 1S%. Theatre (Continued on page 2B) Correa Hints He May Ask Bioff-Browne's Bail Be Re?oked Trial of George E. Browne and 'William Biofl, president and west coast representative of the Inter- national Alliance of Theatrical Stage Employees, previously set for Aug. 18 in N. Y. federal court may be deferred. Yesterday (Tuesday) Judge Edward A. Conger told both the Government and defense counsel that no judge may be available before Aug. 25. Browne and BloiT are charged with violating the anti- racketeering act through threats of calling a strike of their union if major film companies failed to pay them off. Government charges $550,000 was extorted from Para' mount, LoeVs, 'Warner Bros, and loth Century-Pox. Mathias F. Correa, U. S. prosecu- tor, told the court that he was con' eidering asking for the revocation of bail for. the two defendants, each of whom has put up $50,000. Correa cited Judge John C. Knox's ruling last May in which the court declared that if any Government witness was Interfered with, he would revoke balL (Correa declared that Nick Circello, described as a 'Chicago Individual who has been on Browne's payroll from 1935 to 1940, although he Is not a member -of the union,' disappeared shortly after the indict, ment of Browne and Biofl on May 23, and P.B.I. men and U. S. marshalls In Chicago cannot locate him. He's better known as Nick Dean. Correa indicated that If Circello did not turn up by Aug. 18, he would ask the court to revoke ball. Attorneys for the defendants asked that the case be postponed to Sep tember, and while Correa admitted the Government would not be ready ' by Aug. 18, he opposed the delay and cited the disappearance of the wit ness as the reason for Government failure to be ready. Defense counsel denied any knowl- edge of the whereabouts of the wit- ness. Also yesterday (Tuesday), Federal Judge Simon Rifkind re- served decision on pleas by both Bioff and Browne to quash the In- dictments against them. Both men claim that the anti-racketeering act under which they are to bo tried Is unconstitutional and violates the fifth amendment to the Constitution. Bioff East for N. Y. Trial; Browne Later Hollywood, Aug. 6. Willie Biofl, personal representa' tive on the Coast for lATSE pres Ident George E. Browne, has started east, to be followed In a few days by his attorneys, George Bres- lin and Michael Luddy. They will prepare the defense for the Chicago hoodlum's trial there Aug. 18 with Browne on charges of extorting $550,000 from four major film com panies on asserted threats to call a strike of theatre projectionists. Both the accused are at liberty on $50,000 bonds. Lionel's Muse Hollywood, Aug. S. Lionel Barrymore gets screen credit as a musician as well as an actor in 'Dr. Kildare's Wed- ding Day' at Metro. He oomposed Tableaux Riisse,' an orchestral suite played in the picture. PAR'S NWB.O. MUCH BETTER Minneapolis, Aug. 8. '' Considerable theatre business im- provement throughout the Minne- sota Amus. Co. (Paramount) circuit, in evidence the past three weeks, is very encouraging to John J. Friedl, its president, and he feels that this bears out a trade contention that there's nothing wrong with the In- dustry that reasonably good eco- nomic conditions and first-rate pic- tures can't correct. Films have ~just as strong a hold as ever on the public and haven't lost any substantial amount of ground In the face of more and tougher entertainment opposition, In his opinion. - Moreover, the outlook for the Northwest is excellent because of fine crop prospects, comparatively high farm prices and much greater Industrial activity, Friedl points out It Is these factors, plus strong prod- uct, that have boosted grosses in re- cent weeks and which will result in increasingly satisfactory boxofllce returns the ensuing fall and winter, he feels. As for stage shows, Friedl says, as many big names as are available will be brought into the Orpheum here next fall and winter. While in New York last month he says he contacted agents and gave the latter carte blanche, but as yet nothing definite Is lined up. ROGERS ENDING INDIE PROD. DEAL WITH COL Hollywood, Aug. B. Independent producer deal be tween Charles R. Rogers and Colum bia terminates Aug. 10, with the stu- dio buying Rogers' rights to the story, 'The Gentleman Misbehaves,' production of which was delayed by casting problems. Moving put with Rogers are his chief aide. Bill Pierce, and his en- tire stafl. Negotiations are going on for the release of two other Rogers story properties, 'Jane Addams of Hull House' and 'Mermaids on Parade.' Sylvan Simon Nearly Had His Vacation Pittsburgh, Aug. B. S. Sylvan Simon, Metro director who had planned to spend several days here with his mother, Mrs. Eva Simon, got to see her Saturday (2) for only a few hours, having been summoned back to Coast three weeks ahead of his scheduled re turn to pilot new Wallace Beery pic ture, 'Steel Cavalry,' formeHy 'Com- bat Car.' Studio paged him at Schroon Lake, N. Y„ where he had been vacationing with his wife, just a short time after he had left Hollywood. ■ Shooting on Beery film was scheduled to get under way this afternoon (5), just a few hours after Simon's arrival Studio had script waiting for him in Chicago upon his arrival there Sunday (3) so he could go over it on train trip to Coast SPOTLIGHT ANEW Paramount and Warners' Ac- tivity of Late Inspired By Strong Earnings' State- ments — Reduction oi Funded Debts Makes Is- sues Even More Attractive INVESTMENT TRUSTS With Paramount and Warner Bros, common shares hitting new 1941 highs and becoming two of the 12 most-active stocks on tiie N. Y. Stock Exchange last week, fresh in- terest la being evidenced in film shares by the trading fraternity. An. other stock to hit a new peak for the year is Universal common certifl' cates (on the N. Y. Curb), shares gaining a full point In a week to reach $7.87^, by far the highest mark recorded by the shares In more than a year. Excellent earnings statements by 1>oth Par and Warners last week were held responsible for the spurts, while Universal recently showed fine profits with chance that the third quarter of the current fiscal year will even better the record breaker of 1940. Stock traders In the financial dis- tract are not so optimistic about all film company shares but where profits of picture corporations are running far ahead of last year fiu'- ther Interest is bound to show, they say. Executives with different com- panies In which there has been ex- tensive buying lately claim the miniature bull move is traceable both to better earnings and the im- proved all-around financial picture. Fact that investment trusts this year bought more in Paramount common than probably any other is reflected in the steady climb of these shares. There is no disposition to sell at these levels, according to opinion in Wall Street The amount of first preferred outstanding also is linked to this heightened interest in Par common. Reported this week that there is less than $12,500,000 worth of the first preferred currently outstanding as ' compared with $25,000,000 originally outstanding. While Par has Indicated no decision to call in the first preferred, the public's gradual shift from this con. (Continued on page 20) SEE $800,000 THIRD QUARTER NET FOR U Although the third quarter of Universal's fiscal year just ended last week, expectation 'in Wall Street Is that the company will show a net profit of around $600,000 for the quarter. This would be slightly above the $780,803 shown in the third quarter of the last fiscal year, which ended Oct. 30, last. While such earnings would in- dicate that the company is merely holding the pace set in 1940, the third quarter last year was one of the heftiest in U history. Also the quarter took in the dull boxoffice pe- riod of June and July, unusually dismal this year. if Nick Schenck Doesn't Okay It BIO Rodgers Win Forget U A Mer Atlas' RKO Stake Activity of Atlas Corp. in RKO and its subsidiaries is revealed in the six-month report issued last week, with the company listing 6,882 shares of Kelth-Albee-Or- pheum 7% preferred, sold to RKO, ai one of the major sales in this period. Corporation also showed that It increased Its com- mon stock portfolio through the purchase'of about 79,000. addi- tional shares of RKO common, making 1,076,197 ehares now held. Atlas also listed the sale of 7,000 shares of general Theatres Equipment WBNETPROHT UP mB Showing an Improvement of near- ly $2,000,000 ovu the first nine months 'in the previous fiscal year, Warner Bros, last' week reported net operating profit of $4,483,449 for the first 30 weeks in the present fiscal year ending last May 81. This com- pares with $2,450,713 In correspond- ing period of the previous fiscal year. Warner earnings are equal to $1.12 on the common stock, best per share earnings this company has shown in some time for this portion of a year's business. They are figured as being equivalent of $44.60 per preferred share. Company reported a little more than $33.68 as being dividend arrears on these shares. Company listed gross income at $76,609,471 and net Inoome of $11,- 653,358 before deductions for amorti- zation and depreciatioi> of properties, interest expense, $1,058,000 provision for normal Federal income taxes and other deductions. Gross Income last year in same period was only about $225,000 below 1941. Warner Bros, wrote ofl $914,000 al provisions for contingencies, believed prlncipal- (Continued on page 20) CAPRA-SELZNICK-UA WAITING FOR LAWYER Completion of United Artists' deal with Fvank Cm>rt and David O. Selznlck will now wait on the end of the Toriy Sudekum (Crescent) anti-trust trial in Na^ville, ex. pected to take about two weelcs more. Necessity of the presence in court of Ed Raftery, UA attorney, is causing the delay. Originally Raftery intended to leave Nashville and proceed to Coast without awaiting finish of the trial, but he has since changed his plans. In the meantime, he has been con- fabbin by phone and mall with UA's Coast rep, Loyd Wright and pact Is nearing final form, so that a minimum of time will be needed be- fore It is signed. Huddles between Nicholas M. Schenck, Metro prez, and William F. Rodgers this week will determine whether the Metro salesmanager will be released from his contract to take the presidency of United Artists which has been offered him. Schenck's repeated denials to news- papermen, however, that he would not release Rodgers made It appear unlikely that he will change his at- titude. In that oase, it is understood, Rodgers will make a public state- ment and withdraw entirely as a candidate for the UA job. His atti- tude is that if his departure from Metro cannot be arranged com- pletely and amicably to everyone concerned, he will make no further effori.to obtain his release. He's ex- tremely anxious, it is said, not to disturb the friendly relations that exist between him and other execs at Metro,-which he has served since 1924. Despite Schenck's denial to news- papers that Rodgers had asked for his release, It Is known definitely that the Metro sales chief had made such proposals and that Schenck was cognizant of theiii. Schenck arrived in New York from the Coast over the weekend and Rodgers, it is learned, will sit down with him this week on the matter. ' Hurley Sets Up Own Outfit to Produce A's Sacramento, Aug. 6. Articles of Incorporation were filed here by Theatre Attractions, Inc., headed by Harold Hurley, former assistant managing director at Paramount. Hurley plans a series of 'A' pro- ductions in Technicolor and is ne- gotiating for a United Artists re- lease. Par Moves Up Garyey Hollywood, Aug. 9. Stanley Garvey, member of the stafl for seven years, was upped to associate story editorship at Para- mount to succeed Julian Blaiistein, who reported for Army duty. John Hanagan, head of the read- ing department became assistant to Bill Dozier, chief of the scenario and story stafl. SCHWABTZ'S COL. SALE Hollywood, Aug. 9. Arthur Schwartz, songwriter, sold to Columbia for $20,000 'Young Girl's Fancy' which he and Everett Freeman authored. It's for .Tpnn Arthur. WuL Fox's 2 Attacks WJiile Testifying In Bribery Trial Philadelphia, Aug. B, ' William Fox suffered two diabetle attacks while testifying this week as star Government witness in the sec- ond trial of U. S. Circuit Judge J. Warren Davis and Morgan S: Kauf- man, former Federal bankruptcy referee, charged with accepting bribes from the onetime millionalr* film magnate. Fox's first attack came while he was on the stand Fridiy, and he was stricken again yesterday (Mon.). Despite bitter cross-examination by defense counsel William A. Gray, Fox stuck to the story he told in the previous trial—which ended la a jury deadlock—that he had given Judge Davis $27,500 so that he might obtain a favorable ruling in the Cir- cuit Court on bankruptcy litigation. Kaufman is accused of being the go- t>etween In the deal. Fox testified that Davis had asked him to 'concoct' a story that would clear the jurist when the F.B.I. ques- tioned him regarding the possession of $1,000 bills which the Government claimed they traced from Fox to Judge Davis' daughter's bank ac- count. Gray declared that Fox had changed his story in order to get leniency from the Ck}vernment when he comes up for sentence. The for- mer film mogul has pleaded guilty. Gray alleged that Fox owes the Gov- ernment about $5,000,000 In de- linquent Income taxes. Hakims Sue Gabin On Old Picture Conunibnent Los Angeles, Aug. B, Germany's invasion of _,France echoed in Superior court Here in a suit against Jean Gabin, French ac- tor, currently under contract at 20th-Fox. 'Action was filed by Rol>- ert and Raymond Hakim, owners of the Paris Film Production Co. Hakims assert they had Gabin under contract for the picture, 'Tht Golden Helmet,' In Paris but wers prevented from producing It when the actor was called to the French colors. After his discharge from ths army, they declare, he refused to go through with the contract. Plain- tiffs charge the story was bought with the stipulation that Gabin