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| Title | Sheraton Corporation of America, 1957 Annual Report |
| Creator (LCNAF) |
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| Publisher | Starwood Hotels & Resorts |
| Date | 1957 |
| Description | Sheraton Corporation of America Annual Report for the year ending on April 30, 1957. |
| Subject.Topical (LCSH) |
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| Subject.Name (LCNAF) |
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| Genre (AAT) |
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| Language | English |
| Type (DCMI) |
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| Original Item Location | Conrad N. Hilton Papers |
| Digital Collection | Annual Reports from the Hospitality Industry Archives |
| Digital Collection URL | http://digital.lib.uh.edu/collection/hiltonar |
| Repository | Hospitality Industry Archives, Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston |
| Repository URL | http://www.uh.edu/hilton-college/About/hospitality-industry-archives |
| Use and Reproduction | No Copyright - United States |
| File Name | index.cpd |
| Title | Image 10 |
| Format (IMT) |
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| File Name | hiltonar_201609_021_010.jpg |
| Transcript | i> The magnificent Southland Center and Sheraton-Dallas Hotel, right, as they began to rise in early summer. Finished hotel will be more than 'Me the height of the steelwork pictured here, as only 12 of the 28 ies were up at the time. asset value applicable to the Company's common stock, plus any cash distributions to stockholders made during the year. The trend of "economic performance" on a per share basis is reported in the chart on page 6. We believe that these economic performance figures, rather than the relatively small reported earnings, account for the unusual growth of the Company in recent years. A "price-performance" ratio which relates the market value of the Company's shares to the "economic performance", is tabulated in the last column of the same chart. This is a somewhat unorthodox yardstick. It should not be confused with the more familiar price-earnings ratio which takes no account of any "unrealized" appreciation. In determining net asset values necessary for computing economic performance, Sheraton officers estimate every six months the market value of all Sheraton hotels and office buildings. They arrive at these values by multiplying "free and clear" earnings (before depreciation and interest charges) by a factor generally varying between 7 and 9; the factor depending principally on the age of the building, its location, probable future competition, available financing, and other conditions which affect the value. Experience indicates that such formulae (with occasional minor adjustments for certain nonrecurring items) provide a surprisingly accurate measure of the prices at which hotels can be sold, and therefore make possible an estimate of net asset values. Based, of course, on the accuracy of these yardsticks, Sheraton properties do not appear to have "depreciated" by the $ 11,919,7 5 9 of reserves which were set up in fiscal 1957. Instead they appear , to have increased in value by several million dollars over and above the cost of capitalized improvements made during the year. Perhaps, however, it would be more accurate to suggest, that the capitalized improvements were so effective that they added more than their cost to the indicated value of the properties, thereby more than offsetting any actual depreciation. BOARD OF DIRECTORS During the year nine new directors became members of the Sheraton board, adding materially to the fund of experience upon which the Company can draw in shaping its future policies. The president of one of New York's larger banks, the chief executives of four of the country's largest industrial companies and one of the country's largest fife insurance companies, one of the nation's principal authorities on modern management, one of Canada's leading industrialists, and one of the former heads of the nation's largest open-end investment trust, — these men can fur- nisH invaluable guidance to Sheraton in the years that he ahead. REPURCHASE OF SHARES The Company has repurchased relatively few of its common shares during the past year. Although an immediate increase in the net asset value of its shares could result from the purchase of its. own stock at a discount (currently approximately 50% from indicated asset value), an even greater advantage may be gained by other use of such funds. This would be true if the Company's asset value should more than double in the coming years. Historically the Company's indicated net asset value has doubled many times since 1941. (See chart on page 6.) During these sixteen years the book value of the Company's net assets has risen from less than $2,000,000 to $49,922,000. The latter figure, however, does not take into account $80,347,000 of unrealized appreciation (before capital gains taxes) which would be realized if the properties were sold at their indicated market value, as estimated by the officers. |