Document 2jy6ZjQeqQxQjnqVojgQ1yv2a

PLAINTIFF'S EXHIBIT GP-928 Georgia --Pacific PLYWOOD & LUMBER CO. TWENTY-THIRD ANNUAL REPORT 1949 SGP 0032436 Twenty-third Annual Report 1949 Georgia --Pacific PLYWOOD $ LUMBEB CO. i& iO I; ;>* o 0) SGP 0032437 'i-r. ; -yj . .. (. . i TO THE STOCKHOLDERS HIS is the twenty-third Anmial Report of Tthe Company. During each year of its his- tory profits have been realized from operations, although they were meager in 1949. All things considered, however, we believe yota Company reasonable success. Sales Lowersaiesvolumeduringtheyearwas indus try-wide. Company het sales were $35,042,015 in 1949 compared with net sales of$45,340,826 in 1948. In unit volume, however, 1949 sales exceeded those of 1948, bnt because of sub stantially lower prices, the 1949 figure repre sents a 23% decrease in dollar return, Prices Early in the year a price war developed in the plywood industry. The index of price per thousand square feet was $110 in December 1948; it iiad fallen to $68 by June 1949. In August the downward trend was reversed by a minor price increase, followed by several up ward adjustments, so that at year-end the index price stood at $80. The decline in prices and volume during the first seven months of the year was a pattern felt throughout the national economy. The plywood and lumber industries were keenly affected by the confused markets that resulted from the general testing of price levels and by the rush to dispose of Inventories. Earnings and sales volume were both seri ously affected by an earthquake of record violence which occurred in April and severely damaged two ofourplywood plants atOlympia, Washington. Production wasresumed asrapidly as possible, but did not return to normal until late June, about the time plywood prices woe at the year's low. Earnings Earnings during the last quarter of 1949 showed improvement ova- the previous three Quarters of the year. Net earnings during the first quarter were $210,631, while the second and third quarters resulted in a combined loss oif $188,281. Fourth quarter earnings were $300,509, thus bringing net earnings, after taxes, fortheyear 1949 to$322,859, equivalent to 34c per share on the common stock, after de ducting dividends on the preferred stock. Com parable net earnings for 1948 were $3,457,528, or $4.48 per share. The Company's low rate of earnings could not be satisfactorily offset by year-end, despite improved conditions during the last quarter of the year. Orders bookedatthe higherprice levels i n r !Q i O' : I- O 0) 2 SGP 0032438 will not become folly effective until early in the current year, when all older lower priced orders are shipped. However, wc did begin to enjoy the benefits of improved prices to a considerable degree during the last period. Dividends Fifty centsper sharewas paid on the common stock daring 1949,25* of which was from 1948 fourth quarter earnings and 25* from 1949 first quarter earnings. This compares with $1.00 paid on the common stock in 1948. The previously stated conditions caused the Board of Directors to suspend dividend pay ments on the common stock last June. While die year-end trend of earnings was favorable, the Board did sot feel that there were sufficient accumulations of earnings at the time of its January 1950 meeting to justify the resumption of the common dividend at that time. Financial Condition Management has made a determined drive to keep our financial bouse in first-class order. At year-end the Company had net working capitalof$6,916,012,acurrentratioof3.11 tol and cash of $2,441,389. The surplus account totalled $6,416,991,comparedwith$6,391,519 the previous year. Long term debt at year-end was $1,354,167. satisfactory bhsis. The demand for plywood is again exceedihg the supply. In September 1949 the Company purchased for $300,000 cash, a large plywood plant at Savannah, Georgia. This plant, one of the most inodem in the industry, was completed only a year previously at a stated cost of $2,248,512, and was designed for the manufacture of hard woodplywood. Theproduction of the new plant, which will start operations during the current quarter, will supplement the Company's present production and assist in filling the accumulation of unfilled orders. Outlook The current earnings trend of the Company is encouraging and should improve during 1950 if present market conditions continue. Conclusion Sincere appreciation is extended to all em ployees for their splendid loyalty, high morale and excellent performance during a difficult year. Together we lookforward with confidence to the year ahead. Submitted onbehalf of theBoard of Directors Operating Conditions Company plants are operating at near capac ity rates. Demand and the backlog of orders, as well as prices, are currently on a reasonably February?, 1950 iO id : X. ."O, O) C3 C3 ,un on SGP 0032439 GEORGIA-PACIFIC PLYWOOD & LUMBER CO. PRODUCTS Dougias Fir Plywood Hardwood Plywoods and Veneers GPXPIastk-Faced Plywood Giant-Sized Scarfed Panda Doors-Fir and fyrdwood Douglas Fir Lumber and Timbers Western Pine Lumber Cypress and Redwood Lumber Mouldings-Western and Southern Southern and Appalachian Hardwood Lumber Long Leaf and Short Leaf Pine Lumber and Timbers Flooring-Residential and Factory Treated Lumber and Timbers Poles and Piling OFFICES Home Offkb......................Southern Finance Building, Augusta, Ga. Gbnbsal Sales Office . . Empire State Building, New York 1, N. Y. District Offices: Eastern................................ Empire State Building, New York 1, N. Y. Southern................................ Southern Finance Building, Augusta, Ga. Midwestern...................................... McCormick Building, Chicago 4, IlL Western.................................................Wilcox Building, Portland 4, Ore. WHOLESALE DISTRIBUTING WAREHOUSES Boston, Mm...................... Newark, N. I....................... . . Port Newark Independent Terminal Philadelphia, Fa. .... Chicago, Dl........................... at Allegheny Avenue MILLS Olympia, Washington Bellingham, Washington Springfield, Oregon Savannah, Georgia Dumas, Arkansas Jackson, Mississippi Steelwood, Alabama Cleveland, South Carolina Fairfax, South Carolina Walterboro, South Carolina Associated Mills throughout the Sonth and on the Pacific Coast rt r iQ ;CV ! X C3 C3 |cn Uj SGP 0032440