The Los Angeles Times from Los Angeles, California • 14

TUESDAY MORNING: FINANCIAL FINANCIAL 00 Angela tme JULY 20, 1937. Net Income of Du Pont Higher Report on First Halt Year Shows Gain of 14 Cents on Common Stocks Record Fresh Upturn Gains of Fraction to 3 Points Led by Steel and Motor Favorites Sharp Setback on Wheat Mart Record Increase in Visible Supply Chief Factor in Reaction Business Hopes Raised by Farm Income Gains Outlook for Largest Return on Crop of 1937 Since 1929 Viewed as Highly Favorable Indicator BY THOMAS E. FLAVAGAX Oil Curtailment Rumor Heard on Wall Street Rapid Shrinkage in Supplies of Crude in Storage and Need for Conservation Viewed as Reasons BY FRANK J. WILLIAMS Copyright, 1937, by the North American Newipiper Alliance, Inc. NEW YORK, July 19.

Some talk is heard in Wall Street of a voluntary curtailment of oil production by the larger producers in fields east of the Rocky Mountains. The rapid deterioration of crude oil in storage as shown by recent tests has been something of a shock to the producers who for some time have declared that the best place to store oil is in Espee Profits Lower in June Decline in Net from Similar 1936 Month Given as $812,389 Southern Pacific Company net operating income for the month of June totaled $2,505,752.91, a decrease of $812,389.13 from June a year ago, according to the road's operating report released yesterday through the local office. While there was a gain of to $20,074,145.31 in railway operating revenues for the month, railway operating expenses advanced $2,550,472.64 to $14,814,982.66 nullifying the up CHICAGO, July 19. (ff) Large NEW YORK, July 19. Preliminary statement of E.

I. Du Pont de Nemours Company, ly because of a new all-time record Increase of the United States wheat visible supply, Chi NEW YORK, July 19. (P) Expanding farm income has bolstered hopes of business observers for consolidation of for the six months ended June 30, last, reported today shows trade and industrial gains. net income equal to $3.41 a common share against $3.27 per cago wheat prices today fell 2Vi cents a bushel. common share in the first half of The total increase for the last Analysts have recently been chary of predictions on business trends.

The outlook, they held, has been obscured by strikes, hostilities in the Far East, and political controversies at home. the ground. week was 21,861,000 bushels, against 18,600,000 bushels shown in August, 1929, the previous greatest increase. A year ago, the increase amounted to but 193G. June quarter indicated earnings were equal to $2.07 a common share against $1.34 a common share in the preceding quarter and $2.06 a common share in the second quarter of 1936.

Additional companies releasing reports today follow: Monetary Goal Still Remote Little Headway Made to Creation of Joint Gold-Silver Yardstick While strikes particularly in turn in gross business. The gain in expenses exceeded the gain in revenues by $43,278.07. the steel Industry could be 13,739,000 bushels. measured statistically, fighting Expenses for maintenance of way and structure gained Contributing to the downward trend of Chicago wheat values Warner Brothers Pictures, One of the evils of the oil fields, especially those worked by numerous small producers, is that the oil has to be taken out of the ground regardless of market conditions. When a producer strikes oil he has to drain the pool as soon as possible or near-by competitors will drain it for him.

In the larger fields, under the in the Far East, and domestic politics could not, yet they have been casting an undefinable shadow across the business scene. Coast Reserve Condition Told Twelfth Area Group Reports Further Drop in Working Capital were sharp setbacks of Winni peg prices, a development as cribed more or less to heavy BULLISH FACTOR In farm estimates just released, on the other hand, busl selling there against purchases here. Also, export demand for control of a few important inter ness men profess roe at least one important yardstick of the future. Statistics prepared by the De-partment of Agriculture show ests, it is easier for the producers to come to an agreement to restrict production. Oil consumption has held up surprisingly well and not a great deal is going into storage at this time, but the producers in favor thirty-nine weeks ended May 29 net profit $5,561,032 before surtax, equal after preferred dividend needs in arrears to SI.

42 a common share against $2,554,772, or 60 cents on the common for the like period. Thirteen weeks ended May 29 net profit $1,520,643, or 38 cents on the common against $578,527, or 12 cents on the common in the like thirteen weeks of last year. Klectric Bond and Share Company twelve months June 30 net income SIO.017,399 after surtax, equal after preferred dividend needs to 30 cents a common share against $9,090,863, or 12 cents a common share in the preceding twelve months. June quarter net income was $2,524,168 after charges and tax, equal to 8 cents a com WASHINGTON, July 19. (JP) Informed officials said today one of the administration's basic monetary aims creation of a joint gold-andsilver currency yardstick still appears far from realization.

They said the new monetary agreement with China, providing that this country will trade gold for Chinese silver, will not aid materially in establishing a gold and silver standard of value. TIED TO GOLD cash income of farmers for 1937 Canadian wheat appeared to be temporarily at a virtual standstill. SOFT AT CLOSE Closing prices of Chicago wheat futures were VA-1 cents under Saturday's finish, July September December with corn 2 off to up, July September December 77-, oats ls4-3 cents down, Septem will likely be around NEWYORK, July 19. (VP). Stock market leaders swung in to a substantial if not especially brisk cttrvance today as business news put a little more cheer into bjiyjng forces.

With old-line leaders stepping into the front ranks, gains of fractions to 3 points were widely distributed at the close. There were a few wider advances. United States Steel set the pace at the start with a rise of more than a point on an initial block of 4000 shares. It extended its improvement later and finished not far from the top at 118, up 2 points. Chrysler soon passed the steel bellwether and ended up 4 at 106.

Short covering here, as well as in "big steel," brokers said, was a lifting influence. AVERAGE JUMPS Resides steels and motors, rails, utilities, electrical equipments, farm implements, coppers, mail orders, oils and specialties were prominent on the upward trek. The Associated Press Average of sixty stocks enjoyed its best recovery in two weeks, getting up 1 point at 68.6. Transfers totaled 949,780 shares compared with 701,280 last Friday. Bright second-quarter earnings reports and prospects of mor favorable returns this fall, it was thought, contributed much to the market's performance.

TENSION EASES In addition Wall Street seemed more heartened over proceedings at Washington and tension over the Sino-Japanese war flare-up appeared to have lessened. A Turn to Page 16, Column 3 INDEMNITY UNIT EARNINGS UP IN HALF-YEAR Earnings of Pacific Indemnity Comnanv for the six months of curtailment say they are look 000. This would represent the largest crop of dollars in pocket since 1929 and would exceed 1936 ing ahead. Should this agreement materialize, an advance in the price of crude oil in the near future would not be surprising. ber 35-T4, and rye showing Total loans and investments of reporting member banks of the Twelfth Federal Reserve District declined further last week to $2,118,000,000 on July 15, against $2,119,000,000 on July 7 and $2,149,000,000 on July 15 a year ago.

Loans aggregated $1,001,000,000, against on July 7, and $926,000,000 on July 15 last year. Holdings of United States government direct obligations stood at $686.000 900, as compared with $685,000,000 a week earlier. Demand deposits rose to on July 11, as compared with $883,000,000 a week earlier, and time deposits totaled against $1,010,000,000 on July 7. Com na rati vp asspt and liahilitv by nearly $1,500,000,000. The significance of this, business observers sketch as follows: HEAVIER SPENDING Steel output has jumped sharply following the strikes.

But energy for this and other industries has been derived mostly from robust backlogs. At the same time new business has been dwindling. Those who have been privileged to peep into the workshops and laboratories of scientists find nothing amazing in the report on the Inventions' survey prepared by the National Resources Committee. Truly "there are more things in heaven and earth than dreamed of" by the ordinary citizen. But, while admitting that More money in the hands of The dollar now is hitched to gold at the ratio of $35 to one ounce of gold.

Although currency is being issued against the Treasury's silver holdings, the $35-an-ounce gold price governs the dollar's value in relation to other currencies. As a step toward increasing the use of silver, Congress in 1934 provided fcrr acquisition of silver until it equals one-third of the Treasury's gold reserve or reaches the monetary price of $1.29 an ounce. Neither goal has been achieved. In recommending the measure, President Roosevelt said he had conferred with some countries "in regard to the use of both silver and gold, preferably on a Turn to Pngc 17, Column items for tne two weeks are as I follows: l-i-3 cents drop, September 88. Provisions results varied from 2 cents decline to 15 cents advance.

Special notice was taken of the fact that wheat prices at Liverpool, due 94-1V4 cents lower, closed today 1T4-2 cents down. On the other hand, weather conditions both sides of the Canadian border suggested likelihood of augmented black rust damage soon. DECEMBER DROPS December contracts led the wheat prices decline today in Chicago. From a high of $12994. December wheat here tumhled to but rallied to at the last.

Rye, corn and oats markets all gave way with wheat. Bright prospects for a big domestic corn crop continued. Oats and rye both felt the price effects Turn to Page 17, Column fi mon share against S2.125,:X)3, or less than 1 cent a common share in the June quarter of 19H6. National Cash Register Company and subsidiaries second quarter net profit $1,185,838 before surtax, equal to 73 cents a share against $817,262, or 50 cents a share in the June quarter of 1936. Six months June 30 net profit equal to $1.23 a share against $1,159,012, or 71 cents a share in the first half of 19ri6.

Howe Sound Company second quarter net profit $1,174,371 after normal Federal tax but before depletion, equal 'to $2.48 a share against or SI. IS a share in the June quarter of 19:16. Six months June 30 net profit was $3,056,471. equal to $6.45 a share against $1,090,423, or $2.30 a share in the first half of 1936. Nevada-California Klectrlc Corporation and subsidiaries May net income $72,089 after normal Federal tax against $130,706 in May, Turn to Page Column 4 farmers, it is argued, means heavier demand for farm equipment, automobiles, wire, tools and other materials and this in turn means fresh orders for the steel industry.

On the consumers' goods side of the ledger, every additional dollar means more liberal spending for clothes, household equipment and food. California Rail Loadings Show Gain Over 1936 SAN FRANCISCO. July 19. 566.30, maintenance of equipment and transportation $1,461,371.01 during June. Revenue gains included an increase of $1,728,795.79 in freight and $332,563.47 in passengers.

For the six months ended June 30, last, net operating income increased $2,176,842.61 to Railway operating revenues for the half year were up $22,240,910 to $112,477,974.72 and railway operating expenses gained $17,363,302 to $86,441,147.66. Net revenue from railway operations increased $43,278.07 to $5,259,162.65 in June and to $26,036,827.06 for the six months' period. May Operations of Company in Red NEW YORK, July 19. Southern Pacific Company today reported for May a net loss of $763,193 after all charges and taxes compared with a net loss of $212,292 in May of 1936. For the first five months of this year the company showed a net "loss of $916,088 against a net loss of $2,126,786 in the corresponding period of last year.

The railroads balance sheet as of May 31, last, showed current assets of $49,585,294 including cash of $11,928,705 against current liabilities of $30,392,693. As of May 31. 1936, current assets were $19,497,671, including cash of $18,548,023 against current liabilities of $39,122,006. Investments in stocks and bonds other than affiliated companies totaled $9,625,672 against $9,859,598 and funded debt due in six months was $8,958,500 against $1,499,728. Insurance Unit Adds Extra to Regular Dividend NEW YORK, July 19.

An extra dividend of 15 cents and a regular quarterly of 25 cents was declared today by Home Insurance Company, both payable August 2 to stockholders of record July 19. Similar dividends were paid in May. Standard Steel Spring Company declared a dividend of $1, payable August 5 to stock of record July 31. The latest previous payment was $1.75 on December, 1936. Simpsons, Ltd.

(department stores) declared a $1.25 dividend on the 6Vi per cent preferred in arrears, payable August 2 to stock of record July 26. A dividend of 20 cents on the new $3 par common stock was voted by Victor Chemical Works, payable July 31 to stock of record July 21 co-ordinated basis, as a standard of monetary value." TWO METHODS Officials said today such a standard could be created in two Home Service Plan Approved by Federal Court wavs: (Amounts in millioiu of dollars:) ASSETS July 14 July Loans and investments total 2118 2119 Loans total 1001 1008 Commercial. Industrial and auricultural loans: On necuriues 37 36 Otherwise secured and unsecured 30 304 Open market paper 33 33 Loans to brokers and dealers in securities 22 2J Other loans for purchasin or carrying securities 56 5(1 Real estate loans 3SB 31S Loans to bank 2 2 Other loans- On securities 68 71 Otherwise secured and unsecured 109 109 U. S. government direct obligations 68 685 Obligations fully auaranteed by U.

8. Bovernment 128 127 Other securities 303 200 Reserve with Federal Reserve Bank 320 300 Cash in vault 21 20 Balances with domestic banks 188 165 Other assets net 216 214 LIABILITIES Demand deposits adjusted. 925 883 Time deposits 1008 101O U. S. government deposits 38 41 Inter-bank deposits: Domestic banks 245 239 Foreign banks 15 14 Borrowing 1 Other liabilities 304 313 Capital account 328 327 July 7 flaures revised.

First, a bi-metallic policy could be followed providing for a con NEW AERO PARIS CALIFORNIA AUTO Federal Judge McCormick yes terday approved the reorganiza PLANT OPENED SALES HOLD UP tion plan of the Home Service Company dated April 15, last railing for creation of a new com ended June 30, last, totaled $336,. C79.03, equal to $2.24 a share on the outstanding capital stock, according to a preliminary report released by the company yesterday. Profit from the sale of securities and other profit and loss items totaled an additional $61, 855.73, or 43 cents a share, during the period. In the first six months of last year the company reported that total underwriting and invest, ment earnings, excluding profit or loss from the sale of securities, write-offs and appreciation of market value of securities, were equal to $2.21 a share. The company's present divi.

dend rate is 40 cents a share per quarter. In addition thereto durine each Quarter of 1937 an pany to take over the operating stant ratio between gold and silver values. Second, the dollar could be based on a certain amount of gold plus a certain amount of silver. In the latter case, the dollar's value would be subject to fluctuations either in the price of gold or silver, so that officials said some sort of international agreement to prevent sharp fluctuations would he desirable. Using preliminary figures for June, the Federal Reserve Bank today reported California car-loadings for the first six months of the current year totaled cars as compared with in the similar period of last year, an increase of approximately 12 per cent.

Pacific Northwest loadings during the half-year just ended were 493,585 cars, against 432.791 in the like period of last year, a gain of 14 per cent. California loadings maintained a fairly even rate of gain since the first of the year, the report states, whereas in the Northwest January loadings lagged considerably and February was only a shade higher. This was due to the maritime strike settled in February 5. A considerable rate of increase was reported from March to June. properties which will have a capi talization of $373,500 principal amount of bonds and 754,000 shares of $1 par value stock di vided into 600,000 shares of Class A and 154,000 shares of Class Interstate Operating Two Shifts Daily Harry Reynolds, president of Interstate Aircraft and Engineering Corporation, yesterday announced the company is occupying its new $350,000 plant ad-Joining the Los Angeles Municl-pail Airport and operating two eight-hour shifts.

The company, said to be the largest of its kind in the country, is engaged exclusively in the manufacture of aircraft precision parts for Douglas and other leading aircraft manufacturers. As Gold Fund Higher WASHINGTON, July 19. The Treasury's inactive gold fund stood at $1,100,080,271 on July 16, an increase of about $10,000 over the previous day. Operating Rate in Steel Dips extra dividend of 10 cents a share has been declared. common.

Holders of the $747,000 principal amount of bonds of the old company will receive $500 principal amount of the new bonds and 792 V4 shares of the Class A stock for each $1000 bond. The Class will be distributed to unsecured creditors, common and first and second preferred stockholders, i A subsidiary, Home Service Properties Corporation, has been formed to hold the non-operative properties of the old company, and permission received from the Corporation Department to issue 200,000 shares of an authorized MHTOTIUBfl, TOLLY CO. investment NEW YORK. July 19. (ZD-Operations in the steel industry for the current week declined .2 of a point to 82.5 per cent of capacity, comjvired with 82.7 per cent last week, the American Iron and Steel Institute estimated today.

A month ago operations averaged 75.9 per cent of capacity Slight Gain Shown in June Over May SAN FRANCISCO, July 19. (JP) Automobiles sold better in California in June than in the preceding month, but not quite as fast as in June last year. Sales compiled from State registrations of new cars totaled 29,107. passenger cars and commercial vehicles. This compared with 27,628 in May and 30,196 in June last year.

Records of F. Walter Crinnion, publisher of Motor Registration News, show that only in one other month has the June mark of last year been beaten. That was in December, 1936, when the record was pushed up to 32.711. The half-year sales set a new record, totaling 155.372, which compared with 118.025 last year and 150,643 in the 1929 first half, fjn erly the rec rd half-year. Sales have above 27.500 cars a month for the last four months.

June being the second best month this year so far, failing by around 100 cars of equaling the March figure. Last year sales tapcrel ofl from the June record to October, then came up to the new peak in December. The five leading counties from volume standpoint all showed losses from June last year, rang ing from 1 to 11 per cent. TELEPHONE MADISON MM IS SO SMIN LOS ANGEL El INVESTMENT lECDNtTirt MEMIEI ANGELES STOCK EXCHANGE fii fi 1 NEWS FLASH a result of rapid expansion and development of business the company outgrew its former plant (while a year ago the rate was during the first eight months of operation. capitalization of 250.000 shares.

70.9 per cent. The new location includes two lular Declared Reg Water Utility by Survey of State Banks Shows Sharp Upturn in Resources buildings with a combined floor space of more than 10.000 square feet and six acres of ground, providing adequate space for future expansion plans. Both buildings have been completely modernized and a new structure is being added. The new unit, now nearing completion, will be the administration building and is to house the executive offices and engineering department. TO HOLDERS OF MOTION PICTURE COMPANY SECURITIES: IT IS ESTIMATED THAT MOTION PICTURE PRODUCTION COSTS HAVE INCREASED MORE THAN 30 IN THE PAST TWO YEARS.

THEATRE OPERATING COSTS ARE ALSO UP. TO DATE THESE INCREASES HAVE BEEN OFFSET BY RISING ATTENDANCE TO NEW PEAK LEVELS, REOPENING OF OLD AND BUILDING OF NEW THEATRES. AND MODERATELY HIGHER BOX OFFICE PRICES. AS THESE INFLUENCES ARE SLACKENING ADVANCE IN FILM RENTALS AND BOX OFFICE PRICES IS PROBABLE THIS FALL. FURTHER INFORMATION REGARDING THIS INDUSTRY OR INDIVIDUAL COM-PANIES IS AVAILABLE ON REQUEST.

MITCHUM, TULLY CO. NCW ITIM ONLY. NOT IN CONNtCTION WITH ANY OFMH ON SOLICITATION. ACCURACY OM COMPLtTINtl NOT OUARANTII NEW YORK, July continued Improvement in the condition of State chartered banking institutions, with an increase of about three billion dollars In a year in total resources, is shown in the annual survey of LOS ANGELES TRADE POINTS UP resources and liabilities and earn ings and expenses of State banks, Just issued by the Committee on State Bank Research of the State Bank Division, Amer SAN FRANCISCO, July 111. California Water Service Company today declared a regular quarterly dividend of $1.50 a share on the preferred, payable August 15 to stockholders of record July 31.

VALUE OF FRENCH FRANC SINKS TO LOW OF 1926 BY THI ASSOCIATED PRESS A sharp drop in the French franc, it to the lowest level since 1926, failed to disturb other leading foreign currencies yesterday, and most ended higher in terms of the dollar. The franc dropped .01 i of a cent to 3.75 cents. The currency for ninety-day delivery, however, remained at a discount of .17 of a cent, Continued financial difficulties of the Chautemps government was the main factor behind the drop in spot francs, bankers said. The British pound sterling advanced 3-16 of a cent to 4.97 9-16, Attractive Suggestions for July Rc-Invcslmcnt $50,000 Par Value Seasoned short term 6 bonds due in 1939 Helling to yield 5.75 to maturity. Bond interest requirements earned in avenge of 4.4 times for past 7 yean and 7.9 times in 19)6.

Net current assets $3400 per $1000 bond. BUSINESS IN LOS ANGELES A 1 1 pracar, by VOUNO NT KOCNKI.INC I I I 1 1 1 recent years rose bv 9.7 per cent in 1936, 12.6 per cent in 1935 and 14.5 per cent In 1931. Total deposits In 1936 aggregated representing a growth of 8.7 per cent, in comparison with an increase of 11.8 per cept in the preceding year, an increase of 8.9 per cent in 1934, and a decrease of 7.4 per cent in 1933." The survey of earnings and expenses revealed that in State banks which do a commercial business gross earnings from current operations showed an increase of 13.4 per cent in 1936 over 1935 and that more than 15 per cent of gross earnings was turned into profits after current operating expenses in 1936, compared with 2.3 per cent in 1935. "The chief source of earnings In State banks doing a commercial banking business in 1936," according to the report, "was from loans and discounts from which 00.1 per cent of gross earnings was derived. From investments, 26.3 per cent of gross Income in 1936 was earned.

A "Current operating expenses, amounting to 71.2 per cent of gross earnings In 1936, compared with 74.5 per cent in 1935, decreased. Net profits before dividends in 1936 ranged between $1.65 and 37 cents, per $100 of deposits. After dividends average net profits for 1336 amounted to 57 cents for each. $100 of deposits, compared with 38 cents for 1933." ican Bankers' Association, under the chairmanship of W. S.

Elliott, vice-president and cashier Bank of Canton, Canton, Ga. "Resources of 10,299 State supervised banks in the nation amounted to $38,652,720,000 at the end of 1936, a gain of 8.2 pet-cent over 1933, and total deposits were $33,184,292,000, a gain of 8.7 per cent," the report says. "Comparison of the figures of condition for total State supervised banks for the period from December 31, 1932, to 1936," the report adds, "reveals that total resources of these banks reached their lowest figure on December 31, 1933, standing at and that since the end of 1933, they have continued to rise during each consecutive year, showing a gain of 26.2 per cent on December 31, 1930, over the low year l33- "Loans and discounts for the first time in five years increased during 1936, showing a gain of 3.5 per cent over 1935. Invest menu, steadily Increasing during German marks were .01 of a cent ol 820,000 Par Value Xon-Callahle Iref erred Stock selling to yield 6.67. Preferred dividend requirements earned an average of 2.) times for put 8 yean and 3.78 times in 1936.

Preferred dividends paid quarterly without interruption sine 1921. Additional information rvlativ to th abovt ururitirt availabU in our jilt. Van Denburgh Bruce, inc. .523 WEST SIXTH STRUT LOS ANOIIIS TRINITY 3241 TIllTYPli ATT IA 5S0 higher, and Swiss francs Improved .01 of a cent. The guilder lost .01 of a cent.

In London dollar ended at 4.97, off 5-16 of a cent from the New York week-end rate and in Tarls the American currency was quoted at the equivalent of 3.781 cents to the franc against Business activity in Los Angeles for the week ended July 1 7 advanced to 91 .4 per cent of the 1 929 level from 90.9 per cent from the previous week. On the seasonally adjusted basis losses in building permits) volume of telegraph business, postal receipts, number of telephones in service and electric power production were, more than offset by heavy gains in bank and bank Saturday's New York rate of 3.770 cents. i.