Corporations

Last week the following newsworthy corporations made the following news:

Chocolate Earnings. He abhors signing his name, writes no personal checks, no letters. He never gives an interview. lives in two rooms over a country club. At 19 he cooked caramels in an alley, peddled them around in Philadelphia, was ruined when a street car smashed his wagon. At 46 he built a $1,000,000 chocolate factory in a Pennsylvania cornfield. As there was no town for miles around, he built one. Today every child knows the name of ruddy, thickset Milton Snavely Hershey of Hershey Chocolate Corp. who, at 77, still walks through his 50 acres of factory floor space, observing, suggesting, nibbling.

Though it has not advertised since 1909, Hershey is the world's biggest chocolate company. It uses 240,000 qt. of milk and three carloads of sugar a day. It produces about 45% of all the cocoa and chocolate products consumed in the U. S. Over half of its total sales are accounted for by the Hershey bar (almond and plain, 5-c- and 10-c-). The rest comes from breakfast cocoa, chocolate syrup, chocolate covering for "enrobing" the candy of other manufacturers. On windless summer days the town of Hershey, Pa. (pop. 2,500) is permeated by a sweet sickish odor which Pennsylvania Dutch farmers round about call "da chockle shtink." But the Hershey earnings have not always been as steady as the Hershey "chockle shtink." Net profit dropped from $7,635,000 in 1931 to $4,246,000 in 1933, largely on account of competition from Peters and Nestle's bars. Baker's cocoa and Rockwood's candy coating. Last year, however. Hershey did better. Last week its directors announced earnings for the year of $5,148,000.

Biggest share of the earnings will go not to Milton Hershey, who does not own the company, but to Hershey Industrial School which does. In the school's account is a trust fund containing 500.000 Hershey common shares (70% of the total outstanding) which Founder Hershey turned over to it in 1909 when he lost interest in making money. The school teaches useful trades to 800 orphan boys who live in houses scattered so widely over the school grounds that to visit them all would mean a 40-mi. automobile drive. The school and other Hershey companies own nearly everything in the town, including the golf course, the trolley line, the water and electric companies, the department store, the laundry, the roller coaster. With an annual income from its trust fund of $1,675,000, Hershey Industrial School is continually under pressure to expand, has lately piled up embarrassingly large surpluses.

Rubber Year. A sprawling giant is U. S. Rubber Co. which makes rubber in Sumatra, tires in Detroit, footwear in Naugatuck. machine belts in Passaic, hot water bottles in Providence. Tires are the principal product, but its salesmen will accept orders for engravers' gum and fruit jar rubbers. It has so many subsidiaries that most statistical services do not bother to list them all. Last week there was hardly a stir when U. S. Rubber announced that it had dropped 16 subsidiaries last year, was preparing to drop 15 more, bringing the total down to 31. Simultaneously President Francis Breese Davis Jr. announced earnings for the year of $888,000 against $77,000 in 1933. Its deficit account now $28,000,000, U. S. Rubber passed the preferred dividend in 1928, has paid nothing on the common since 1921.

Columbia Suit. One of Columbia Gas & Electric Corp.'s biggest Depression deals was to connect its 29,000-mi. Midwest natural gas system with the Texas Panhandle through Panhandle Eastern Pipe Line Co. in which it has a 50% interest. Last week the Federal Government filed suit against Columbia Gas & Electric for conspiracy in restraint of trade, charging that it had prevented Panhandle Eastern from selling natural gas to cities and corporations in five Midwest States.

"Marvelous Step." Perhaps the most impressive figures ever released by the Federal Securities & Exchange Commission were the page and poundage statistics on Republic Steel's registration statement, filed in connection with its proposed merger with Corrigan, McKinney and Truscon. That document contained 20,000 pages, weighed 50 lb., was bound in dozens of volumes. Soon after the statement was filed, SEChairman Joseph Patrick Kennedy devised a simplified registration form making it unnecessary for old-line companies to compile such colossal corporate autobiographies (TIME, Jan. 21).

Not until last week, however, did any corporation take advantage of the new form. Then Swift & Co. registered $43,000,000 of bonds to refund outstanding securities at lower interest rates. The new Swift bonds will carry a 3 1/4% coupon, probably the lowest rate for an industrial bond issue since before the War when General Electric sold an issue of 3 1/2s. When Swift officials reported that the 50-page registration was no more troublesome than an oldtime prospectus, Chairman Kennedy, happy as only a Boston Irishman can be, exulted: "This issue is very good evidence that at least the breaking of the jam is starting. It is a marvelous step in the right direction."

Next day Pacific Gas & Electric Co. of California registered the biggest single issue since the Securities Act was passed --$45,000,000 of 4% bonds to retire $44,636,000 in securities due in 1952. P. G. & E. was in a great hurry to get its registration to Washington. Carrying duplicate copies, P. G. & E. officers climbed into two airplanes in San Francisco, headed across the Sierras. One plane was grounded in Sacramento, the other was forced down at Cheyenne. Its passengers chartered a third plane, reached Washington just before midnight to find that SEC had obligingly kept its offices open.

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