Steady Rise in Earnings

Corporate profits are on a steady rise almost across the board, so the first earnings reports for the quarter ending in December showed last week.

International Business Machines' quarterly earnings of $2.40 a share (v. last year's $1.91) hiked the company's 1959 total to a record $7.97 a share. General Foods Corp., the nation's largest food processor, rose 17.3% to set a new quarterly record of $1.12 a share v. 95-c- a share last year. Bulova Watch Co. ticked its way to an impressive 69% hike for the first nine months, largely on the strength of higher earnings in its third quarter (64-c- v. 34-c-).

American Steel Foundries hit a $1.05-a-share pace, nearly triple its 1958 performance. Beech Aircraft profits soared 63% ($1.41 a share v. 88-c-) on a 49% rise in sales, and Diamond Alkali Co. chalked up earnings of $1.03 v. 88-c- for last year. In Manhattan, Chairman George Romney led off the auto parade by announcing that American Motors pre-tax quarterly earnings were "considerably higher" than the $21 million earned a year ago, although the net may be less, because last year American Motors still had a loss carryover to offset taxes.

Even companies whose quarterly earnings dropped because of the steel strike were generally able to clear the year in good shape; e.g., Allied Chemical raised its 1959 earnings 46% (to $2.51 a share) despite a quarterly drop of 4% in profits. But nothing could save Douglas Aircraft Co. from a hefty 1959 loss as a result of heavy charge-offs against its new DC-8 jet transport program. The firm reported a loss of $33.8 million, compared with a $16.8 million profit in 1958. However, it expects peak deliveries of DC-8s in 1960 to boost overall sales to more than $1 billion--and profits with it.

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