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Stock of your Corporation. During the year
1949 the Corporation purchased 18,198 shares
of Convertible Preference Stock, having an
aggregate par value of $909,900, at a cost of
$727,920. This is an average cost of $40 per
share. Capital surplus was increased by $181,-
980 as a result of these transactions.
In the 1948 Annual Report you were advised of the offer made on January 31, 1949,
to the holders of the Convertible Preference
Stock to purchase such stock at $40 per share
on the following terms: 20% in cash and an
option on 20% for each of the four following
years; the shareholders to agree to waive dividends on said stock under option to the Corporation. A total of 71,002 shares were
submitted to the Corporation on this basis, of
which 14,206 shares were purchased and paid
for and 56,796 shares were subjected to the
Corporation's option.
On July 25, 1949, a further offer was made
to the holders of the Convertible Preference
Stock to purchase said stock on substantially
the same basis. As a result of this offer 19,948
shares were submitted to the Corporation, of
which 3,992 were purchased and the balance
of 15,956 were subjected to the Corporation's
option.
Accordingly, as of December 31, 1949, the
amount of shares of outstanding Convertible
Preference Stock had been reduced from 134,-
463 shares outstanding at the beginning of the
year to 116,265 shares, of which 72,752 shares
were under option to the Corporation.
On January 31, 1950, the Corporation exercised its option to purchase 18,188 shares, thus
reducing the amount of outstanding Convertible Preference Stock to 98,077 shares of which
54,564 shares are under option to the Corporation.
Your Corporation also purchased in the open
market 83,128 shares of its own Common capital stock at a cost of $778,201.91, an average of
$9.36 per share. These shares are held in the
Corporation treasury for future corporate use.
A comparison of the outstanding capitalization at December 31, 1949 and December 31,
1948 is shown herewith:
December December
31, 1949 31, 1948
Funded Long Term Indebtedness $23,758,030.40 $23,187,174.60
4% Convertible Preference
Stock ($50 par) 5,813,250.00 6,723,150.00
Common Stock ($5.00 par). 8,065,400.00 8,073,225.00
Capital & Earned Surplus, . 16,499,281.14 14,044,744.80
$30,377,931.14 $28,841,119.80
Deduct Cost of Treasury
Common Stock $ 1,109,118.94 $ 330,917.03
Net Worth $29,268,812.20 $28,510,202.77
4% CONVERTIBLE PREFERENCE STOCK —
Shares Outstanding 116,265 134,463
COMMON STOCK —
Shares Outstanding 1,498,852 1,583,545
Book Value Per Share of
Common Stock After Deducting Par Value of 4%
Convertible Preference
Stock $ 15.65 $ 13.76
Net working capital on December 31, 1949
was $3,747,734, an increase of $1,205,152 over
net working capital on December 31, 1948.
Current assets totaled $9,091,469.73 of which
$6,345,291.24 was in cash or equivalent, as
compared with current assets of $7,552,253.63
at the end of 1948. Current liabilities were
$5,343,735.40 as compared with current liabilities of $5,009,671.56 on December 31, 1948.
The ratio of total current assets to current
liabilities on December 31, 1949 was 1.70 to 1
as compared to 1.51 to 1 the prior year.
Rooms Department
During the last year room occupancy continued to decline slightly. In the widely diversified properties of your Corporation, which
include both luxury and commercial hotels,
large and small, room occupancy was 79.8%
in 1949 as compared to 85.6% in 1948, a
decrease of 6.7%.
Wage rates under the new union contracts
in force during 1949 were higher than for the
previous year.
By the exercise of careful management, however, the operating results in the rooms department were maintained at a satisfactory profit
level. As disclosed in the accompanying table,
net room sales decreased slightly, being $17,-
565,405 in 1949 as compared to $17,677,417
in 1948. Rooms department profit, however,
increased to $12,351,635 or 70% of revenue as
compared to $12,279,041 or 69% in 1948.
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