Democrat and Chronicle from Rochester, New York on January 31, 1985 · Page 35
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Democrat and Chronicle from Rochester, New York · Page 35

Rochester, New York
Issue Date:
Thursday, January 31, 1985
Page 35
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DEMOCRAT AND CHRONICLE, ROCHESTER, N.Y.. THURSDAY, JANUARY 31, 1985 FADE HONEY The airjne fare war is a bonus for newspapers because it generates extra advertising. Read tomorrow in Business. p . ; fl Market ends mixed Associated Press Stock prices closed mixed yesterday, bogging down in spots after the market's rise to a record Tuesday. Selling was concentrated mainly in blue-chip issues. Some broad measures of trends reached new highs. The Dow Jones average of 30 industrials, up 14.79 ,Tuesday, dropped back 4.74 points to 1,287.88. But gainers outpaced losers by about three to two on the New York Stock Exchange. Big Board volume totaled 170.02 million shares, the seventh largest total on record. The Big Board has had a run of 18 consecutive sessions in which gainers outnumbered losers a streak longer than any in modern market history. Analysts acknowledged that no market move continues indefinitely, and that prices were bound to reach the point sooner or later where a majority of traders would want to cash in some of their profits. But they also said the market's rise lately has created an appetite for stocks that might not yet be satisfied. Losers among the blue chips included GE, down 1 at 63; Eastman Kodak, down IV at 73 '2 ; International Paper, down 1 at 54'; and IBM, off 38 at 136 Vs. Bethlehem Steel fell 1 to 18. The company posted a loss for the last quarter of 1984, said it expected another loss in the first quarter of this year, and cut its quarterly dividend from 15 to 10 cents a share. LOCAL STOCKS 1984-85 High Low ' Sale in 100i High Low 55 40 Vi American Can - 1440 55 54 61 Vi 45 Vi Aiioc Dry Goods 1855 58 V, 57 28 Vi 17 V, BauichtLomb 1636 u28 28 63 44 Burroughs 5594 u65Vi 64 36 V. 25 7k Canandaigua Wins 7 33 33 17 Vi 12 Champion Prod. 3 14 14 44 27 Citicorp 5733 43 42 66 49 Coca-Cola 4176 61 60 58 39 Coll 786 58 57 19 Vi 7 Computer Consoles 1333 12 11 28 21 Curtics-Burns 82 25 25 61 42 DuPont 5677 u52 51 78 60 Eaitman Kodak 6841 75 73 12 8 Fay's '582 12 11 55 33 Gannslt 1191 u56 55 84 61 General Moton 8292 85 83 53 39 Gansral Signal 715 u53 52 17 11 Gleaion 116 13 13 13 8 Graham 36 13 13 42 22 Harris ' 3349 32 32 85 69 Minn. MiningMlg 5757 84 83 32 23 Mobil 9055 28 27 42 31 Pannwall 155 37 37 19 12 RG4E 544 19 " 19 35 27 Rochester Tel 244 34 34 38 29 Sears 8883 36 35 23 16 Sybron 97 20 - 20 12 8 Voplex " 3 10 10 50 33 Xerox 11967 43 41 u 52 week high; d 52 week low; x - ex-dividend Close Chg 54 - 58 1 28 64 33 14 43 60 -58 12 -25 -51 - 73 -12 55 83 -53 13 13 32 84 1 1 27 37 19 34 36 -20 -10 - 42 1 Building plans rise Democrat and Chronicle Business Plans for new construction increased in the Rochester area in December, according to a report from the F.W. Dodge Division of McGraw-Hill Information Systems Co. Non-residential building contracts increased 59 percent from a year before, to $17.4 million. The value of contracts for future residential building was up 11 percent at $14.9 million. Total building contracts rose 33 percent to $32.2 million. Contract figures include Monroe, Ontario, Wayne, Livingston and Orleans counties. The December totals are lower than a month earlier, when non-residential contracts totaled $27.2 million and residential were $17.8 million. ' For 1984 as a whole, non-residential construction had the biggest gain. The twelve-month non-residential total of $195.4 million showed an increase of 46 percent from 1983, while residenr tial plans increased 19 percent to $265 million. Total construction was valued at $460.4 million, 29 percent ahead of the year before. CUIIXI-3 CCrJTEACTS $60 50 In millions Non-residential Residential 40 20- i J Vv 0t i I I I I I I I I I I I DJFM AMJJASOND '83 '84 Monroe. Ontario. Wayne. Livingston and Orleans ' Counties Source ol data F W Dodqe Division Oemocrdl dnd Chronicle Dow Jones Industrials 1.287.88 4.74 Wilshire value of 5,000 stocks $1,843,562 billion $5,232 billion Prime interest rale 10.5 percent t unchanged Federal funds rate, near close 8.375 percent 0.125 point Gold price, New York $304.40 4B $2.90 RG&E electric bills to rise 0.9 percent A typical residential electric customer's bill from Rochester Gas and Electric Corp. will increase by 85 cents beginning tomorrow as a result or a state Public Service Commission ruling. The PSC yesterday authorized the util ity to increase its electric rates by 0.9 percent to reflect increased wage expenses and other costs, but it deferred the company's proposed 0.4 percent increase in gas rates. The typical residential bill for 500 kilo watt-hours will increase from $43.75 to $44.60. RG&E has about 295,000 electric and 231,000 gas customers in Rochester and nearby counties. Detection Systems loses Detection Systems Inc. of Fairport reported a loss of $190,422 on sales of just over $2 million for its third quarter, which ended Dec. 31, compared with a loss of $172,352 on sales of $2.2 million a year earlier. The company, which has 156 employees, attributed the loss to heavy investments in integrated security systems. While sales dipped slightly in the quarter, the company reported that sales of security sensor products had increased and it is focusing on certain security products. For the nine months that ended Dec. 31, losses totaled $584,079 on sales of $6.7 million. In the same period in 1983, losses were $445,751 on sales of $7 million. Briefly The board of directors of The Des Moines Register and Tribune Co. plans to announce today whether it will sell Iowa's only newspaper with statewide circulation and its other news media holdings. The Des Moines Register, with a circulation of 240,000, said in today's editions that the, Gannett Co. Inc. and Washington Post Co. were the leading contenders. Also among bidders are the Tribune Co. of Chicago, New York Times Co., Hearst Enterprises, Cox Enterprises and Morris Communications. Full-time employees received median weekly earnings of $337 in the fourth quarter of 1984, a 5.4 percent increase from a year ago that kept workers ahead of inflation, the Labor Department reported yesterday. The department's Bureau of Labor Statistics said the fourth-quarter figure was up $17 a week from the year-earlier level of $320. The survey also showed that median earnings of about 41 million families with one or more wage-earners in the household were $513 between Oct. 1 and Dec. 31, up 5.9 percent from the year-earlier level of $485. Sears has begun converting its Long Ridge Mall store in Greece into a "Store of the Future" that will include computer-aided customer service and new sales floor layouts. The store will remain open during the construction, which will take about six months. Techtran Industries Inc. of Rochester has introduced the 421 Profitmaker comDuter for retailers that, ran hp nnorat. ed independently by manual data entry or linked to electronic cash registers. The computer can provide sales and profit reports, inventory status, invoices, pricing labels and automatic stock reorders. Ablest Temporary and Technical Services Corp. has opened a second Rochester area office at the Alliance Building, 183 Main St. The company's other office is in Henrietta. Systems Associates Inc. of Caledonia, Livingston County, will assist International Business Machines Corp. in selling and installing locally the IBM System36-38 and MAPICS manufacturing software application. Rochester Coca-Cola Bottling Corp. announced it has acquired Sarkis Management Services Corp. Inc. Terms of the sale were not disclosed. Sarkis is a local vending and food service management firm. Bond prices fell. Silver price: Handy & Harman, $6,210 per troy ounce; New York Commodity Exchange, $6,287 per" troy ounce. Compiled from reports by Democrat and Chronicle. Associated Press and United Press International Subsidiaries' losses cut Xerox profit by 38 Stock drops VA; Kearns predicts better times in '85 By Ed Lopez Democrat and Chronicle Business Massive losses from its insurance subsidiary, coupled with a computer-related venture that soured, caused 1984 profits at Xerox Corp. to plummet by 38 percent, down $175 million from the previous year. Profits fell overall from $466 million in 1983 to $291 million last year, although the company's reprographics and infor mation systems showed increases in both revenues and profits in 1984, the compa ny announced yesterday. In the wake of the earnings report, Xerox stock dropped 1 ' points to close at 42. : Despite the setbacks, President and Chief Executive David T. Kearns predicted 1985 "will be a good year for Xerox" and "we have every reason to believe we will build on our recent successes." Among the successes he cited were strong sales of Memorywriter electronic typewriters, higher-than-expected profits from electronic printers and good market reception for the "10 series" of copiers and duplicators. However, losses from business segments outside the company's traditional revenue base were a big fly in the ointment. Losses at Crum and Forster, Inc., a , property and casualty insurer, and writeoffs totaling $85 million from the phase-out of Shugart Corp., a manufacturer of . disk drives, sent earnings per share downward from $4.42 in. 1983 to $2.53. last yeara 43 percent drop. In 1983, Crum and Forster posted prof its of $145 million but lost $10 million last year as it got battered along with the rest of the property and casualty industry by a string of natural disasters and costly price wars. Kearns told security analysts in New York City yesterday that price increases had been implemented at Crum and Forster since July, along with cost-cutting measures and tighter underwriting guidelines. But he cautioned that a turnaround would take time. "It is important to remember that price inceases only become effective as policies are renewed or new business is written," he said. In the fourth quarter, Crum and Forster lost $23 million compared with a $26 million profit for. the same period in 1983. As a whole, Xerox lost $12 million in the fourth quarter due to a $73 million write-off from the Shugart operations. A year earlier, Xerox made a profit of $73 million in the fourth quarter. While Shugart and insurance losses weighed heavily on the company, Kearns had upbeat news about the rest of Xerox operations, for 1984. Revenues from reprographics and information systems went from $8.3 billion in 1983 to $8.8 billion last year. Profits were up from $328 to $354 million. Kearns said the world population of Xerox copiers and duplicators rose to more than two million, a 12 percent increase over 1983. The "10 series" products accounted for about 25 percent of that total just two years after they were introduced, he added. "We have significantly increased our market share of copierduplicator products in the mid-volume area and stabi- lized our share at both ends of the market," he said. TURN TO PAGE 60 Delco to begin building steam generating facility By John Campbell Democrat and Chronicle Business Delco Products Division of General Motors Corp., the largest customer re maining on Rochester Gas and Electric Corp.'s westside steam heat system, has broken ground for its own $5.2 million steam generating facility. I he new building will be located next to Delco's plant at 1555 Lyell Ave. and will supply steam heat, run metal plating and washing equipment, and house com pressed air equipment. Local contractors will do much of the construction, which should be completed by next tall, said b rank Eisele, Delco s manager of plant engineering. Delco makes electrical motors and com ponents for cars. The firm does not plan to add staff for the new facility, said per- sonnel director B.B. Murphy. . KG&E plans to abandon the steam sys tem by Oct. 5, saying a spiral of problems has made it uneconomical to continue. Higher oil and natural gas costs have been SDread amone fewer customers as more industrial and commercial landlords install their own boilers. RG&E started selling steam, a byproduct of electric generation, in 1889. Only about 100 customers still use the downtown section of the steam grid. Fewer than 10 customers remain on the westside section, fueled by Station 9 at ' Mt. Read Boulevard and Buffalo Road, according to David K. Laniak, RG&E vice president of corporate planning. In anticipation of RG&E's abandonment, two groups have asked the state Public Service Commission for permission to take over the steam system: Rochester District Heating Cooperative, a nonprofit group of downtown building . owners, and David E. Thurston, a Stationary engineer with the backing of Time Energy Systems Inc. of Houston. Yesterday the PSC approved a proposal by RG&E to offer interest-free loans to certain steam customers who convert to their own heating facilities, according to PSC spokesman Francis Rivett. Bausch & Lomb profit rises 15 and revenue is up 12 for 1984 Democrat and Chronicle Business Despite fighting a price war in the con tact lens market last year, Bausch & Lomb Inc. reported record earnings and revenues for the fourth Quarter and vear ended Dec. 30, 1984. Fourth-quarter earnings of the Roches ter-based firm rose 23 percent to a record $18.2 million, or 61 cents a share, from $14.8 million, or 50 cents a share in the same period a year ago. Revenues were up 4 percent, from $134.1 million to $139.1 million. For the year, net income increased 15 percent to a record $58.8 million, or $1.98 a share, from $51 million, or $1.72 a share in 1983. Sales were $533.5 million, up 12 percent from $477.3 million the year before. With a $9 million one-time charge for future costs of divesting the industrial instruments business, however, actual net income for 1984 rose only 3.7 percent, to $50.2 million from $48.4 million in 1983. Contact lens sales for the year rose 21 percent over 1983. The professional eye care products division as a whole posted an 18 percent sales gain over 1983. TURN TO PAGE 6D : wssmsm pAMiiftpiii jfc'v'ETER i''" ' 'H& rfT -' -" : r - "hzi 3 u spfijj - v.. IXtl.l.!"' dfefeL j Associated Press Giant-killer Owner Costas Papadopoulos says his 1,700-square-foot building in Exeter, R.I.,' dwarfed by its sign, is the smallest shopping mall in the country. Tax rules on employee education could change your study plans Many companies are now involved in helpine emolov ees pay for education either for themselves or for their children. Some of these education benefits are threatened, but others are coming on strong. There are two stories here: One for the mass, one for the class. For the mass, the issue is Company-paid education and trainingeourses. Congress let the tax exclusion for certain tuition payments die last January, then decided to extend it through 1985. What's threatened are the courses you take to qualify yourself for a better job. You might want to sign up for such a course this year, lest Congress let the benefit lapse again. Right now, the rules are these: . Your company can finance almost any type of education, even if it's not job-related. All it needs is a written ' plan, applied even-handedly to all groups of employees. You can be reimbursed, tax free, for tuition, books, supplies and fees (although not for food, transportation and lodging). A newly imposed ceiling of $5,000 a year applies to non-job-related courses, according to Peter Elinsky of the accounting firm Peat Marwick. "(There is some argument in the accounting profession as to whether that ceiling might also apply to courses that are job related a controversy that awaits resolution by the IRS.) inriE onvflHT ouinn Excluded are courses on sports, games and hobbies, unless they involve the company's business. Benefits are limited to employees, not their children. Most large and medium-size companies offer these perks to their employees. A new survey by Hewitt Associates finds that, among 619 companies, 99 percent pay for courses related to an employee's current job (like a word-processing course for a secretary), while 89 percent also pay, or help pay, for certain non-job-related courses (such as an accounting course taken by a secretary who . wants to advance). It's the tax break for the non-job-re-. lated courses that may be allowed to die at yearend. For the top echelon of executives, the issue isn't their own education it's their children's. Joe Walsh of Coo-. pers & Lybrand in Washington, D.C., says that companies are always looking for ways to use tax-free company money to finance college education for execs' children. A company can -start an Educational Benefit Trust setting money aside for an employee's child and using those funds to pay the education bills. But the 1984 tax law made a drastic change in these trusts. The company can no longer take a tax deduction when money is paid in; it gets the deduction only when monev is taken out and paid to the school or employee at which point, the employee has to report it as taxable income. Companies are now more apt to promise certain top executives that their children's education will be taken care of when the time comes. At that point, the company pavs (and deducts the payment), while the employee picks up the same amount as taxable income. . . Many colleges and universities offer free tuition, or cash education grants, to the children of faculty members and administrative personnel, but not to lower-level employees. This perk used to be income-tax free. But Congress doesn't think it's fair to give tax breaks for education grants to a favored elite. So it wrote a new rule last year. The college employee whose child gets this kind of undergraduate tuition aid will now have to report the amount to the IRS as taxable income, unless the school revamps the program so it won't discriminate in favor of the more highly paid. For graduate students, the tax break was eliminated entirely. The non-discrimination provisions take effect on July 1. The schools are waiting for IRS regulations, to find out exactly how their programs should be run. Write to consumer columnist Jane Bryant Quinn care of the Washington Post Writers Group, 1150 15th St N.W., Washington, DC. 20071.

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