Trying Times

Like a fraternity pledge on initiation day, President Arthur M. Loew of Loew's Inc. (Metro-Goldwyn-Mayer) marched warily into his first annual meeting last week after barely two months in the job. He found his stockholders in no mood to spare the paddles. What made them mad was Loew's earnings, down $1,265,578 in fiscal 1955 from 1954's $6,577,311, and down again in 1956's first fiscal quarter to a mere $248,161, or 5-c- a share.

Filing into Manhattan's Loew's State Theater, some 800 stockholders booed and jeered, stamped their feet, shouted raucous questions. Cried one stockholder: "Come out punching. Let the best man win." At that stockhofders started to punch, wanted to know why Loew's was not doing more in TV, why M-G-M had turned out so few moneymaking pictures recently. Charged an ex-Loew's accounting clerk, brandishing a sheaf of papers: in the last 18 months M-G-M had produced 52 pictures, but only three made money, "and I got all the records here." Snapped another: "These directors are big-salaried old windbags." As usual, Management Baiter Lewis Gilbert, owner of 20 shares (value: $447.50), had plenty to say. He wanted to know how much stock President Loew owned, thought that a president should have a stake in his own company.

President Loew, who had spent 35 years working his way up through the company founded by his father, reported that he had an option to buy 40,000 shares of Loew's stock, "which in my opinion is sufficient incentive, if one is required. I resent the insinuation." Furthermore, said Loew, "I bought 1,000 shares last week just to keep you happy."

President Loew had news calculated to put stockholders in a happier frame of mind. To cut costs, President Loew had abolished all profit-sharing contracts for executives, eliminated retirement plan payments for everyone making more than $500 a week, cut in half the payments for other employees. Earnings in the second quarter this year would be up, he predicted--more than enough to cover the 25-c- quarterly dividend. Loew's hopes to put out better movies, he said, and is also studying TV possibilities. M-G-M has 1,000 sound features, plus another 1,100 sound shorts adaptable to TV; MGM's current TV show, M-G-M Parade, is al ready "a good income producer." When it came to a vote on Loew's 13-man slate of directors, the management candidates won easily, polling more than 4,300,000 shares of the total 5,142,615 shares outstanding. Said Loew: "These are trying times for motion pictures, but I feel certain that we shall move ahead."

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