Document rp5rZpvekBZ0xOKMQO2k7YV5r

PLAINTIFF'S EXHIBIT Riley Stoker Corporation Annual Report For the Year 1949 Officers Fred H. Daniels................................Chairman and Vice-president Louis E. Griffith......................... President and General Manager David K. Beach...................................... Vice-president and Treasurer Ollison Craig.........................................................................Vice-president Max H. Kuhner......................................................... Vice-president David K. Beach..................................................................................Secretary Directors Fred H. Daniels, Chairman David K. Beach Philip R. Mather Louis E. Griffith George N. Jeppson Chapin Riley Frank C. Smith, Jr. RILEY STOKER CORPORATION, WORCESTER, MASS. Boston Now York Philadelphia Washington Buffalo Pittsburgh Cleveland Detroit Chicago Cincinnati Atlanta New Cleans Memphis St. Louts Kansas City St. Paul Tulsa Houston Denver Salt Lake City Lot Angeles Portland Seattle COMPLETE STEAM GENERATING UNITS BOILERS PULVERIZERS BURNERS STOKERS SUPERHEATERS AIR-HEATERS ECONOMIZERS WATER-COOLED FURNACES STEEL-CLAD INSULATED SETTINGS FLUE GAS SCRUBBERS RS-001786 1/17/02 NUECES TO THE STOCKHOLDERS OF RILEY STOKER CORPORATION: There is submitted herewith for your consideration the audited Consolidated Balance Sheet as at December 31, 1949, the audited Statements of Consolidated Retained Earnings, Income, and Application of Funds for the year ended December 31, 1949. The net income was 31,708,621.41 after provision for Federal taxes. After deducting the Preferred Stock dividend, this is equivalent to 34.87 per share on the Common Stock and compares with similar figures of 37.33 for 1948, 32.21 for 1947, 31.68 for 1946, 3-54 for 1945, and 3-95 for 1944. The net income for 1949 is exceeded only by that for 1948, which was fifty per cent higher. Production for 1949 was only four per cent lower than the best previous year, which was 1948. The reduction in net income is largely accounted for by the unsettled conditions in the coal industry, the steel strike, and a seventeen-week illegal strike at the Detroit plant of your Corporation where fuel-burning equipment is manufactured. During 1949 dividends of 31-50 per share, amounting to 33,858.00, were paid on the Preferred Stock as of March 30, 1949, and. at that time the entire remaining outstanding Pre ferred Stock was retired at a cost of 3401,232.00. The capital structure of the Corporation now consists only of 350,000 shares of Common Stock having a par value of 33.00 per share. Divi dends of 90 cents per share, 3315,000.00, were paid during 1949 on the Common Stock. After depreciation of 3114,734.35, the net investment in land, buildings, and equipment increased during 1949 by 3325,671.01, and the net current position improved by 3678,552.05. The details of the absorption of the increase in the net current position are shown on the Consolidated Statement of Application of Funds. Your Corporation has entered the year 1950 with a good volume of unfilled orders, and the new business taken during the first three months of this year is almost equal to that for the last six months of 1949. It is very pleasing to the Management to observe the large number of repeat orders received from old customers in the industrial and public utility fields. The outlook for good business in 1950 is very favorable, provided that labor conditions do not adversely affect our operations. We are glad to acknowledge the effective cooperation of our employees, customers and suppliers during the past year. Yours very truly, F. H. Daniels, Chairman Worcester, Massachusetts March 31,1950 L. E. Griffith, President r4_ RS-001787 1/17/02 NUECES Consolidated Statement of Application of Funds For the Year Ended December 31, 194.9 Funds Provided Net Income.................................................................................................................................. Add: Charges against income, requiring no expenditure of cash Depreciation............................................................................................... 3114,734.35 Less: Gain from sale of Fixed Assets ............................................... 326.66 31,708,621.41 114,407.69 Proceeds from sale of Fixed Assets......................................................................................... Adjustment of Taxes and Other Charges applicable to prior years.................................... 2,453.50 13,238.73 Total Funds Provided 31,838,721.33 Funds Applied Additions to Fixed Assets ........................ Redemption of Preferred Stock Outstanding Dividends on Preferred Stock Dividends on Common Stock 3440,079.28 401,232.00 3,858.00 315,000.00 Increase in Working Capital ....................................................................... 1,160,169.28 3678,552.05 Changes in Working Capital for the Year Reduction in Bank Loans ..................................................................................................... Decrease in Accounts Payable............................................................................................... Decrease in Federal Income Tax ......................................................................................... Decrease in Other Current Liabilities................................................................................... Increase in Other Current Assets............................................................................................... Less: Decrease in Notes and Accounts Receivable Increase in Working Capital (As above) ................................................................. 3660,000.00 467,600.76 540,399.65 76,957.91 263,670.91 32,008,629.23 1,330,077.18 3678,552.05 To the Board of Directors Riley Stoker Corporation Worcester 6, Massachusetts We have examined the consolidated balance sheet of the Riley Stoker Corporation and its subsidiary companies as at December 31, 1949, and the related statements of consolidated income and retained invested earnings for the year ended at that date; and have had submitted to us a report of other public accountants on their examination of the subsidiary not examined by us. Our examination was made in accordance with generally accepted auditing standards, and accord ingly included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. In our opinion, the accompanying consolidated balance sheet and statements of consolidated income and retained invested earnings present fairly the financial position of Riley Stoker Corpora tion and its subsidiary companies at December 31, 1949 and the resuits of their operations for the year ended at that date, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. George A. Smith and Company, Worcester, Massachusetts Certified Public Accountants March 20, 1950 RS-001788 1/17/02 NUECES 7,052,785.22 IR etain ed nvested E arnings--Per attached . . .statement 4,722.95 .... Other A ssets Securities Acquired >e P cn o jn*r Pto3 C Hz T8nD Ps Sprt* OOx 8 zo Sto' o s' S* 2 w> 3 -- 00 h- 00 N> 04 n- VO On On o Oo s5-i >>w 3S 3r H PH P2 , Pi ' ^I Cfl O * Pi 73 n o oo 73 nd >25 cn Oir--< O 73 0> H H aW O. Z; CO > > ar > Z Z n w c` ffi W m CO ' cn > n o 2r >w 3s > Z PI cn ^ CO w pfi con oown b\0 owi- Consolidated Statement of Paid in Capital and Retained Invested Earnings For the Year Ended December 31, 1949 Acquired Paid in Capital Balance, December 31, 1948 .................................................................................................... Deduct: Portion of the excess of redemption value over par value of preferred stock redeemed; balance being charged to retained invested earnings..................................................... Balance, December 31, 1949 ............................................................................ Retained Invested Earnings Balance, December 31, 1948 .................................................................................................... Deduct: Portion of the excess of redemption value over par value of preferred stock redeemed, which exceeds the available balance of additional paid in capital .................................................................................. Less: Refund of state tax, adjustments of various tax reserves, bad debt reserve and expenses affecting prior years................................... $96,333.72 13,155.03 Add: Net Income for Year.................................................................................................... Deduct: Dividends on Preferred Stock Common Stock Balance, December 31, 1949 $3,858.00 315,000.00 $75,631.40 47,698.28 $27,933.12 $5,746,200.50 83,178.69 $5,663,021.81 1,708,621.41 $7,371,643.22 318,858.00 $7,052,785.22 Consolidated Statement of Income For the Year Ended December 31, 1949 Income from Operations after selling and administrative expenses, but before depreciation Depreciation.................................................................................................................................. Operating Income ...................................................................................................................... Other Income.................................................................................................................................. Other Deductions............................................................................................................................ Income before Federal Income Tax.............................................................................................. Provision for Federal Income Tax.............................................................................................. Net Income for Year...................................................................................................................... $2,837,094.14 114,734.35 $2,722,359.79 82,630.95 $2,804,990.74 51,659.48 $2,753,331.26 1,044,709.85 $1,708,621.41 RS-OOIZSf 1/17/02 Nueces