The News and Observer from Raleigh, North Carolina • 137

The News and Observer Raleigh NC Sun March 17 MS 190 1 -POdg Investors fincling ways to cash in on videocassette phenomenon By ANISE WALLACE New York times News Service NEW YORIC As he entertainment revolution has spread one of the most conspicuous phenomena of the past year has been the explosion in sales of videocassette recorders Americans alone are expected to buy 10 million to 12 million of these machines in 1985 up from 73 million last year At this stage investors wanting to capitalize on the VCR craze are limited to a few companies that specialize in the production or distribution of the movies what the industry calls the "software" The machines themselves the "hardware" are manufactured by such major electronics companies as the RCA Corp and the Sony Corp Because VCRs contribute only a small portion of those companies' revenues and profits they have a relatively small impact on stocks Motion-picture producers are earning millions of dollars on sales and rentals of new and old movies to the home-video market David Londoner an entertainment industry analyst at Wertheim Co the New York investment concern says this revenue represents the "most rapidly growing portion of their earnings" 1 Because of the timeless nature of Walt Disney movies Londoner estimates that Disney movies enjoy more home-video sales as opposed to less-profitable rentals than other movie producers Home video represented $37 million or 40 percent of Walt Disney Production's 1984 fourth-quarter earnings up from $20 million in the 1983 quarter Londoner says he thinks Disney of all the major motion-picture producers stands to gain the most from home video in the coming years Retailers are another way for investors to pate in the VCR boom Most outlets are small mom-and-pop stores that analysts predict will suffer in any industry shakeout Managers of these stores must pay constant attention to turnover and that requires capital and computerized record-keeping Furthermore as more entrepreneurs enter the business it becomes more and more competitive "There are too many stores opening up" warns Harold Vogel leisure-time analyst at Merrill Lynch Capital Markets A handful of publicly traded retailers are positioned to benefit from the growth in video sales and rentals One of the most widely known companies in the field is Wherehouse Entertainment an American Stock Exchange company that runs 135 stores scattered through California Oregon Washington Nevada and Arizona The stores sell records and computer software as well as videocassettes However Skip Stem a research assistant at Paine Webber Inc estimates that 45 percent of Wherehouse's revenues are from video sales and rentals Paine Webber also estimates that the company's sales will grow at 20 percent to 25 percent annually In addition to Wherehouse's expected growth rate Paine Webber analysts like the company for another reason: Louis Kwiker the company's president and chief executive officer Since joining the company in 1982 says Paine Webber's Stern Kwiker has closed marginal or unprofitable stores broadened Where-house's product line to include videocassettes and computer software and overseen an increase in revenues per store Management will use the proceeds to open 20 new stores this year and more in 1986 In the past three months Wherehouse's stock has climbed to as high as $28 from around $15 and for that reason Paine Webber last month lowered its recommendation on the stock to "attractive" from a "buy" Inventor fights suspicion about tnergy machine By JOYCE GEMPERLEIN 1 Knieht-Ridder News Service WASHINGTON When Joseph Westley Newman invented the plastic-coated barbell he got a patent When he came up with a rain deflector that does away with automobile windshield wipers the US Patent and Trademark Of lice said "OK" and gave him another patent But when Newman of Luce dale Miss cooked up the idea for his Revolutionary Energy Ma: chine the patent office said "whoa" Newman 48 came to Washing: ton again last week to continue a war He has waged it for five years on paper and in wood-paneled hearing rooms for himself for the world and he says for all of the world's creative people Newman wants a patent for a machine that he and several investors swear does something that runs counter to scientific principles accepted for centuries: the machine produces more energy than it consumes Before Newman built his machine he developed revolutionary theories concerning magnetic fields and sub-atomic particles which he says explain how his invention can work At least 30 once-skeptical engineers and physicists including one who worked on the Saturn 5 moon rocket have visited him in Lucedale tested the machine and pronounced it amazingly contrary to all conventional wisdom about thermodynamics And most important they have sworn in affidavits that it works They believe as Newman does that his non-polluting generator will rewrite the laws of physics free the world from utility companies end the use of oil as a fuel and render the internal combustion engine obsolete But the patent office has not seen it that way It has refused to grant Newman a patent so that he can produce his invention commercially without fear that the idea will be stolen So Newman has sued the patent office On Thursday 4 small collection of assorted dreamers and disgruntled inventors gathered in the rear of US District Judge Thomas Jackson's courtroom to cheer on Newman But Jackson continued the case telling Newman and his attorney John Flannery that they would have to bring the 5000-pound invention to Washington to be tested For a variety of reasons Newman refuses to do so So Newman went home once again to his wife Ellen defeated The Associated Press Joseph West ley Newman left and attorney John Flannery arrive at US District Court inWashington Thursday one that can continuously produce work with no energy input Most scientists and engineers and generally accepted laws of physics say there can be no such thing Newman contends that his invention is not a perpetual motion machine and that the labeling of it as such by the examiner who in a later case was ruled incompetent to evaluate patent applications has acted as a curse 111 1 but not beaten and convinced more than ever that he's willing to suffer scorn in the interest of helping the world "I am right" he said outside the courtroom "I know I am right I have explained with this machine many things that have not been explained before" Newman's non-polluting machine uses the properties of magnetism and electricity to generate power It is based on Newman's theories of electromagnetism which he says no one has ever thought to consider The 5000-pound prototype he has built in his backyard uses dry cell batteries to trigger a reaction in a "common" material that he declines to name In tests conducted by scientists the machine has reached efficiency levels of IAA percent meaning it has produced 10 times more energy than it drew from the batteries say affidavits signed by the scientists Newman first applied for a patent in March 1979 In 1980 an examiner who admitted later that he had not read the application wrote across it that it "smacked of a perpetual motion machine" A perpetual motion machine is I 151ME I A MOG 4ATITE3 I I irli 1:41 Elt 1111 1JD litukJt9)Q i i rl i l') 110)rt 1 Vm5 LL LI 1 1 1 -1 1 1 1 1 1 1 1 1 I 1 1 I May be used only 1 in game No 4' I The News and Observer' I and I The Raleigh Times I Expires March 17 1985 I el The Nems and Observer and ''Ihe RaleighTimes Expires March 17 1985 We're placing a 295000 sq ft facility on the market for just $695000 That's a very attractive $236 per sq: ft Excellot for warehousing or industrial applications it's located in Chester SC just 12 miles from I-77 And with 110000 sq ftof ground floor spacerail connects and truck access This could be the expansion opportunity you've been looking for Principals only 'contact Bob LehmannSprings Industries Fort Mill SC Telephone 803 547-2901 SPRINGS INDUSTRIES INC I 1111111111 MI NI IN Financier convicted MILAN Italy (AP) Former financier Michele Sindona was convicted of bank fraud Friday and sentenced to 12 years in prison court officials said The case involved the collapse of Banca Privata Finanziara which Sindona controlled The collapse was one of Italy's biggest financial scandals of the 1970s Prosecutors said Sindona looted the bank and another he controlled of 274 billion lire about 6137 million at current exchange rates but worth much more in dollars at that time The trial began Dec 3 Sindona 64 was extradited in September from the United States where he was serving 25 years for fraud in the collapse of the Franklin National Bank in New York When various Italian judicial proceedings against him are over Sindona will be returned to the United States to finish that term Mr Fanner Old you know that HAYNES Is the source for CHEMICAL VALVES Our polypropylene Ball Valves are TOUGH with Teflon Seats 0-Ring Seals 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