Document NGDeJMKBE5yKx0NO1QO3njE8g

Annual Report 1935 Illll . ?:T - Th e Sh e r w in -Wil l ia ms Co . N11793 i.w-T-Ti1f ** J ^ r-T;jel5 ... - -> . \ ' * r * . * i js` J- ' &*'??" ` - I (. J*: <* ,.. Z`` *'H*' " ....'..j^ST.|. iv .'w h ,j*ijg,;J v>w{*1w'' rmr ;w> a - . ?$ ( 4`it. ;*.-& *-liEfS ` { a ',f( &,l B' !a' , Ji /.' > -V f. -i. 91 f jii m$M Th e Sh e k w ih - Wil ia ms Co . GEORGE A, MARTIN PRESIDENT' To ike Stockholders'. The Annual Report of your Company for the fiscal year ended August 31, 1935 is submitted herewith. On the following, pages you .will find the Consolidated Balance Sheet of The Sherwin-Williams Company and Subsidiaries as at August 31, 1935 ancl related Consolidated Income and Surplus Statements as prepared by Ernst & Ernst, Certified Public Accountants, together with their certificate. The net earnings, after provision for taxes and deprecia tion, amount to $4,814,704.18. Deducting from this the amount paid in Preferred Dividends during the fiscal year, there remains a balance of $3,921,385.18 earned on the Common Stock or $6.19 per share on the 633,927 shares of Common Stock outstanding. The volume of sales of the Company including its wholly owned affiliates, was 18.5% in excess of last year. Referring to the Consolidated Balance Sheet showing the condition of the Company as at August 31, 1935, cash amounted to $7,869,834.43 and current assets $29,981,074.62, against a total indebtedness of $4,507,626.42. The Earned Surplus of the Company, as it appears on the Consolidated Balance Sheet as at August 31, 1935, was $16,146,510.55. Again it is a pleasure to report to the Stockholders that the Organization in all its branches and departments has been most loyal and faithful in giving its best in service to the Company .and the Management takes this opportunity to express to each and every employee appreciation and gratitude for the wholehearted support given during the year. " AUDITORS'. CERTIFICATE THE SHERW1N-WIL1IAMS COMPANY, CLEVELAND, OHIO- We have made an examination of the consolidated balance sheet of THE SHERWIN-WILLIAMS COMPANY and SUBSIDIARIES as at August 31, 1935, and of the statement of consolidated income and surplus for the year ended at that date. In connection therewith we examined or tested accounting records of the Companies and other sup porting evidence, and obtained information and explanations from officers and employees, of the Companies; we also made a general re view .of-.-the accounting methods and of the operating and income accounts for the year, but we did not make a detailed audit of the transactions. Inventories' have been test checked by us as to method of valuation and computations and, in our opinion, they are stated on the basis of the Lweroi" cost or market v alues. Reserves have been provided to elimi nate estimated inter-plant and inter-company profits in inventories at August 31, 1935. V Investments in 'Capital stock of affiliates not consolidated include investment of $3,695,825.00 in Canadian affiliate stated at cost which was loss than the proportionate share of the book value of the net assets as reported to us. Other investments included under securities of affiliated companies not consolidated, aggregating $134,786,23, are stated at: equity in net assets of such affiliates. Permanent assets are stated at carrying values reflected by the books of the respective companies. Such values with respect to the parent company, aggregating $11,152,254.17, represent depreciated cost and the values with respect to subsidiaries are based in part upon appraisals but no appreciation is reflected in the capital of surplus accounts of the parent company. A reserve lor revaluation of fixed assets, in the amount of $181,821.20, Is included under the caption of reserves. In crar opinion, based upon our examination, the accompanying.bal ance sheet and related statement of income and surplus fairly present the consolidated" position, .of the Company and its subsidiaries as at August 31, 1935, and the results of their operations for the yea r ended at that date., Further, ft is oir opinion that the consolidated statements! have been prepared in accordance with accepted accounting principles and on a b.isiis consistent with the preceding year. October 23, 1935. (Signed) ERNST & ERNST, Certified. Public Accountant# ---------- -------------- ------------ ---------- "r------------------------------------ ----------, -w " ,;/> : '!; , */ i;:; ;* '' -- " :6, CONSOLIDATED INCOME AND SURPLUS THE SHERWIN-WILLIAMS COMPANY ' ! AND SUBSIDIARIES For the year ended August 51, 1935. . ' SUMMARY OF INCOME.' Profit from operations for the year ; ended. August 31, 1935 after de- i ducting cost of sales, sailing, ad ministrative and general expenses, but before depreciation, other de I ductions--net .and federal income tax - - - - - - - - - - - - - $ 6,911,833.23 Less: Provision for depreciation - - i 860,094.68 Other deductions: Loss on permanent assets sold or scrapped, provision for doubtful t accounts, etc., less other income $ 330,167.14 Provision for estimated federal in- t come tax - - - - - - 906,867.23 $ 6,051,738.55 1,237,034.37 NET PROFIT FOR YEAR - $ 4,81L704.18 Surplus.balance September 1, 1934 ------- - 14,739,942.33 ' i-' ---------- -----!----' $19,554,646.51 DEDUCTIONS Dividends paid and provided for, less dividends on treasury shares: Preferred.................................$ 893,319.00 Common ($3.25 per share) * - 2,060,262.75 lililll i-v $2]953,581.75 Adjustment of booh value of invest ment in unconsolidated Canadian affiliate to cost - - - - - - - 378.700.00 Excess of cost over par value of treas ury common stock retired - - 51,104.21 Premium on preferred stock called for redemption ----- ... - 24,750.00 ---------------------- -.1 3,403,135.96 w.--. H BALANCE AUGUST 31, 1935 $16,145,510.55 (Note A) The Companies' proportionate! share of the operatii ig results of unconsolidate affiliates during the iyear has been reflected in the foregoing statement, -with the exception of the results of the 'Canadian affiliate. Final statement as to operating results of the Canadian affiliate for the year ended. August 31, ;1S35 v?as not available at date of issuance of this report. i ' H ii'! I TiTrr"V"^ A 'f Ji, V. -k. ii'. - ry--`c^rssajlBpE: CONSOLrpS^BALAJ THE S H ERWIN-WILET A H SCO M PAN % As of the'idlbse^of Ba&ness Angus' Assets CURRENT . Cash ~ - $ 7,869,834.45 Notes and acceptances receivable : : ::: 207,,825.72 ... Accounts receivable, less.':.reserve (includes accounts; amounting to .$6,620.07 due from unconsoli- . dated affiliates) ~ - - - - 7,102,670.71 "^Jpventoiy--raw material's and sup. plies, in process; and finished mer chandise.--- valued .on: basis cf lower of cost or market -. - - 14,800,743.76 .OTHER ASSETS; . Notes-receivable for properties sold . during 1934--secured.-' by' mort gage - - - - - -a- - - $ Miscellaneous notes -and accounts receivable, claims, advances, etc., less reserves .--- 152,241.18 393,526.45 INVESTMENTS Securities of affiliated, companies' i ot consolidated (note A) - - $ 3,850 ,611 -23 Other securities---at or below cost 121.6-1:3.51 p e r ma n e n t Larid, buildings, machinery and equipment at depreciated value y\ -.iwiii-i,.u-ifu/vv; ,fAx lt - ,981.,074.62 515,767.63 !>. 952,254.74 ]r,046,993=90 , - PATENTS AM) TRADE MARKS Nominal value DEFERRED Advertising stock, stationery, etc. $ Prepaid insurance, ta ces, etc. 542,554:22 249)964.061 1.00 792,518.28 $f7,518,610.17. CU3-A< - Pf D' M- RES ' Ft. CAT Se' Lt k; -Co k .; '. Ra (Not:; A) See corn saints in accompanying certificate orvis of vtlue of Ln- aestmenls in securities of affiliated rompanies riot Ooiisolidatea aac" cifpermanent assets. (Note^B) Net decrease in equity,in.unconsolidated Canadian affiliate' since date uF acquisition not takes, up by parent company ainoren,ted to approximately $640,000.00 h '3 of '.August 31, 1:?34 (final statement as fo: operating- results-, .-for"'year 'ended. August 51,1 share ofnet j (Note c; of 567I.5CI:f . ;;r SOL ID' AT Dd | BALANCE SHEET.- IN-WILLIAMS.' cjoMPAN Y AND SUBSIDIARIES I As of the close of business August 31, 1935 ,5 /: 12 l IS ' : ' l- ..;$29;,9Bi;.b74.e2- 545,767.63 : l - i 5 "I. :. v:;:;: .d.d I: 3,962,254.74 ' 17,C46,993.90 LOO 7 [>2,518.28 {152,318,610.17 LLiabilities CURRENT ...... Accounts payable, etc. (includes , account amounting to $21,719.76 payable to unconsolidated affili ate)- $ 1,822,072.56 Preferred dividend--^payable Sep tember 1,. 1935 - - - - 217,761.00'' Accrued federal, state and county taxes, etc. - L" * -LA -"'T I,473,649.34 Depcs its---officers .and employees' 605,143:52 Mor tgages. payable (existing when 1 .'.subsidiaries were fully; acquired .. Art 1934) - - - - - - .. "389,-000.00; ^r e s e r v e s .;:;:, :;. - $ 4,507,626.42 For-.contingencies, revaluation of and 'maintenance of plants, em' i-.' -plcyers1 liability insurance, etc. 1,298,89$.20 CAPITAL STOCK OUTSTANDING . Series "A-A" 6% cm nulative pre ferred (145,204 -shares---par- . value . $100.01 . i \ each) - .- - $14,520,400.00 Less:: In treasury - --.30..shares.: - 5,000..00 Common (633,927- $14,517; 400:00. (v shares--- par value $25.00 each) - - - 15 ,48,175.00 CONSOLIDATED EM USfED'SURPLUS - Ll 'f;A. Balance August 31, 1935 - : 16., 146,510.55 ...... . - ......... .---- 46,512,08;: 55 $52,318,610 17 igardi'ag basis of value of inlied ana o"permanent assets, .tinr-diari affiliate since date .o a^proKu[lately $64 j,000.00 'ig psult.1 for year ended August 51, 1936 vj-as not f-railable -i date oi fsi uanco of this report).' Proportionate share of net profits or loss'*;, on .all ether unionsoliduted. affiliates have been taken u .d . of $(N67o1t,e50Cff)orTnhoet.e.sp.arerecnetivacbcxlenpdri.sncoo' uwnat,esdt 3 AsTtpoAihrutegdrn'o3n*.1nti,: 1935, dab!; in the amount Th e Sh e r w in -Wil l ia ms Co . 1.01 Prospect Ave., N. W. Founded 1866. Cleveland* Ohio , Manufacturers'of Faints, Varnishes, Colors, Stains, Enamels, Lacquers, Lead Products, Dyes. Oteinipalsi Lithopone, Litharge, linseed Ofl, Dry 'Oo Io es , Insecticides, Coal Tar Products,- Disinfectants,- Cleaners, Polishes. " Main -Plants . Cleveland - Chicago - Dayton. Detroit -.Newark - Brooklyn. Pittsburgh Oakland, Cal.. - Bound Brook, N. - Gibbshoro* N. J. Lincoln - Dallas - Los Angeles - Cofleyville, Eian. GEO. T. BISHOP C. G. b u j .. :, W. S. COT TINGHAM HARRIS CREECH "Ptreciors fcgaBgfrwr iV; i; iv-i: ;'.V fficers GEO. A. MARTIN, President H. D. WHITTLESEY, FM Vice-Pruidtnt A. W. STEUDEL, Vice-PnJtdeni C. G. BUI,]:, Fix- Pniident L. H. SCHROEE Elfc Trauurier H. J. HAIK, Vivc-Prstident T. G. MURPHEY. Secntay Transfu 4gents CLEVELAND TRUST COMPANY' Cievel-aH'd, Ohio uv . . BANKERS TRUST COMPANY .-. New. Vorlc, H, Y. Registrars--y CENTRAL UNETEE1 NATIONAL BANK GUARANTY TRUST COMPANY Ctanelaad, Ohio New Yuris, N. Y,,