Document w9d8jODkXQr8KE4jpYaJGExB

1945 r* Th e Sh e r w in -Wil l ia ms Co Th e Sh e r w in -Wil l ia ms Co . A. W. STEUDEL PRESIDENT To the Stockholders'. Herewith are presented the Consolidated Balance Sheet of the Company at the close of business August 31, 1945 and e Consoli dated Profit and Loss Statement for the year. ~ The earnings for the year, after allowing for all charge duding depreciation, but before providing for Federal Income au- cessProfits Taxes and Special Reserves, were $11,365,213.' ; The amount set up for Federal Income and Excess-Profits Taxes was $5,900,000 and $400,000 was added to the reserve for special plant obsolescence. The Final Consolidated Net Profit after all deductions was $5,065,213.14. This Final Consolidated Net Profit after deducting Preferred Dividends is equivalent to $7.17 per share on the outstanding common stock. In February of this year, an offer was made to the Company's Preferred Stockholders which gave them the right to exchange their holdings of the 5% Preferred Stock, share for share, for a new series of Preferred Stock identical in all its terms and conditions with the 5% Preferred series, except that the annual dividend rate was re duced to 4%. The holders of over 95% of the outstanding 5% Pre ferred Stock accepted this offer and, as you will see on the Balance Sheet, the Company now has outstanding $9,733,700 par value of Preferred Stock which is designated as "4% Series". This refinanc ing was accomplished without the help of underwriters so that the only expense incurred in the transaction was the small amount paid for legal and transfer agents' services. The sales volume for the year was 4.9% greater than the preceding year. War business, that is, sales of goods to the government or suppliers to the government for use on war products as reflected in sales subject to renegotiation, has been approximately 20% of the total volume of business during the war years. CURRENT ASSETS Cash____________ Assets U. S. Government securities (princi pally certificates of indebtedness) --at cost and accrued interest_____ Trade notes and accounts receivable, less reserves (includes accounts ag gregating $18,784.92 receivable from subsidiaries not consolidated)_ ' Inventories--raw materials and supplies, in process and finished merchandise ` stated on basis of lower of cost or market (estimated inter-plant and inter-company profits have been elim inated) less reserve of $500,000.00 for possible inventory shrinkage____ ____ Estimated postwar refund of excess profits tax________________ TOTAL CURRENT ASSETS........ $21,644,162.17 1,334,288.44 7,640,325.98 24,687,944.51 728,820.67 $56,035,541.77 INVESTMENTS AND OTHER ASSETS Securities of subsidiaries not consoli- J dated--Note A ________ _________ $4,112,090.30 Other securities--at or below cost 17,457.00 Miscellaneous receivables, insurance de posits and advances, less reserves.... 244,914.24 T>7?ApPDTV T3T A\TT A___"_v_r_r_>_ T..?.r\TTTT>A/T`E'TVTrr JT AWJ. AlfiV X X ; X X/XXX^i X, rxjLt j u t Xj W' Land, buildings, machinery ana equip ment--at cost to consolidated com panies, less reserve for depreciation. _ 4,374*,461.54 15,523,842.98 PATENTS AND TRADE-MARKS Nominal amount.....____________ 1.00 DEFERRED CHARGES Advertising stock, stationery, etc---- -- $ 486,715.04 Prenaid insurance, deferred taxes, etc... 507,410.94 994,125.98 $76,927,973.27 Note A--Investments in securities of subsidiaries not consolidated include (1) investment of $4,102,090.30 in Canadian subsidiary, stated at cost which was less than the proportionate share of the book value (including intangibles) of the net.assets of such affiliate as reported to the Company; net increase in equity in this subsidiary since date of acquisition, not taken up by the parent Company, amounted to approximately $676,800.00 as of August 31, 1944, (final statement as to operating results for the year ended August 31,1945, was not available at date of issuance of this report)--(2) invest ment of $10,000.00 in another subsidiary, stated at cost; the Company's proportionate share of net profits of such subsidiary not taken up, amounted to approximately $116,900.00. DATED3ALANCE SHEET IAMS CMPANY AND SUBSIDIARIES August II, 1945 Liabilities, Capital Stock, and Surplus 14,162.17 54,288.44 40,325.98 87,944.51 28,820.67 >35,541.77 CURRENT LIABILITIES Trade accounts payable, pay rolls, drum deposits, and miscellaneous items____ $10,680,207.88 Preferred dividend payable September 1, 1945............. ...................... ........... .... 97,337.00 Deposits--employees, employees benefit association ana officers._____________ 873,940.91 Accrued taxes (other than federal income taxes) and miscellaneous items 451,811.16 Federal taxes on income--estimated___ $7,040,343.49 Less United States Treasury Notes-- Tax Series (purchased and held for tax payments;___ __________________ 4,637,665.00 2,402,678.49 Notes payable to bank (in connection with advances to and loans by foreign subsidiary)______ __________________ TOTAL CURRENT LIABILITIES.. 696,748.69 $15,202,724.13 RESERVES ( For postwar adjustments, contingencies, maintenance of plants, employers' lia bility insurance, etc--_...____ 1,525,680.39 574,461.54 523,842.98 1.00 994,125.98 ,927,973.27 t include (1) was less than net assets of bsidiary since pproximately s for the year |---(2) investproportionate ipproximately CAPITAL STOCK AND SURPLUS Capital stock: Preferred--authorized 395,500 shares (par value $100.00 each--redeem able at $105.00 per share): Outstanding--cumulative pre ferred stock, 4% series-- 97,337 shares..___.$ 9,733,700.00 ' Common--authorized 800,000 shares ' (par value $25.00 each): Outstanding--638,927 shares___ 15,973,175.00 $25,706,875.00 Earned surplus._________ .... . 34,492,693.75 60,199,568.75 ` $76,927,973.27 Note B--Net current assets (not significant) of consolidated foreign subsidiaries have been translated into U. S. dollars at the applicable exchange rates in effect at August 31,1945. Such subsidiaries are located in Argentina, Brazil, Cuba and Mexico. Note C--The Company was contingently liable at August 31, 1945, as surety on a performance bond relative to performance by The Sherwin-Williams Defense Corpora tion (subsidiary not consolidated) as a party to a construction and operation contract with The United States of America.