Document M4rRaqn3bkV6KMBQOG9QMvMXx

February 8,1966 The world-wide performance of the Abex organization in 1965 resulted in the highest shipments and earnings in our company's 63-year history. Several factors contributed to the year's favorable operations. The robust health of the economies of the United States, Canada and western Europe accelerated demand for our products and services, pushing shipments to new heights. Increased earnings for 1965 were attributable primarily to expanded ship ments and to the continued effectiveness of cost controls by all divisions of the company. 1965 was a particularly gratifying year because it brought to fruition some of the efforts of management to reshape the company in recent years. The strength and capacity for growth and progress inherent in a highly diversified industrial organization were reflected in the year's results. SHIPMENTS AND EARNINGS REACH NEW RECORDS Consolidated shipments increased for the fifth consecutive year. In 1965 they amounted to $260,168,235, an eight per cent gain over shipments of $241,478,130 in 1964. The gains extended broadly through the four major product groups of the company: friction products, hydraulic equipment, products for the rail roads and the castings and forgings group. Activities in each of the groups are discussed more fully in later sections of this report. Net earnings from operations increased 14 per cent to $11,104,486, equal to $6.02 per share, compared with $9,762,039 or $5.27 per share in 1964. Shipments and net earnings from operations per share were: 1965 Shipments Earnings per share 1964 Earnings Shipments per share First Quarter Second Quarter Third Quarter Fourth Quarter Total $ 64,738,000 69,400,000 59,583,000 66,447,235 $260,168,235 $1.53 1.70 .99 1.80 $6.02 $ 58,089,000 61,980,000 57,452,000 63,957,130 S241,478,130 $1.21 1.51 .92 1.63 $5.27 page five