Eternal Verity

An eloquent prophet, a faithful practitioner of industrial virtue is Boardchairman George Matthew Verity of American Rolling Mill Co. Son of a circuit-riding Methodist minister, Steelman Verity was born 72 years ago in East Liberty, Ohio, married his boss's daughter, was Armco's president for 30 years, until he made way in 1930 for Charles R. Hook, Armco's present president./- George Verity's late years have been full of honors. Miami University in Oxford, Ohio gave him an LL.D. degree in 1925. Last year Middletown, Ohio, Armco's home town, declared a "Verity Day," with parades, public banquets, and a picnic for the city's entire 30,000 population. Last January Middletown's No. 1 citizen was again honored at home by having a new parkway named after him. Verity Parkway, as a publicity release related, was a tribute to the man who had operated the country's eighth largest steel company for a third of a century without the loss of a pound of production or an hour's work from labor trouble. Armco spirit, Mr. Verity once wrote, makes for "Pep, Pride, Production, Progress, Patriotism and Prosperity." To Middletowners George Verity seems in deed eternal.

Codified, numbered and formally adopted by the company's directors years ago were the 15 points of Armco policy, starting off with a declaration of high business ethics, winding up with a pru dent word about making good banking connections "in advance of their need" and liberally interlaced with such pur poses as the promotion of "Americanism and a real, live spirit of patriotism." Confused though its policies may seem, Armco is a money-making proposition, old Mr. Verity writing his 20,000 stockholders last week that 1936 earnings were $6,441,000, an improvement over 1929.

At the same time Mr. Verity asked his stockholders to approve a timely bit of financial thrift in the form of a $45,000,000 preferred stock issue. Part of the money will be used for expansion, including a rolling mill in Australia, the rest for retirement of outstanding bonds and old preferred stock. The refunding will probably save the company something in money costs and leave it in that rare position, a steel company virtually free of funded debt.

Mr. Verity's stockholders apparently received this news without enthusiasm, for Armco stock, after touching a high of $45 per share, promptly sold off to $38. Since the new preferred stock would be convertible into common shares, present stock-holders would either have to buy the new preferred when it is offered to them, or see their present equity diluted as more common is gradually issued under the conversion feature.

Famed in steel for another kind of conversion is American Rolling Mill--the continuous process for converting a white hot ingot into a long, thin sheet or strips.

Saving as much as 97% of the labor costs of previous methods, the continuous rolling process has reduced the price of automobile body steel from $83 per ton to $71 in the last ten years. Most other big steel companies have adopted the process, paying Armco a modest royalty.

/-President Hook also married the boss's daughter, Leah Verity.

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