Document zQoKMJ3xNLbGeakK3Vy3wJxpz

3^7e: < ' review of the year < \ ia shipments and earnings Shipments of 516-.586.507 in were below 1959 '960 were down slightly from shipments of $168,028,632 in 1959. Net earnings fell from $7,681,383, or $4.72 per share, in 1959 to $5,666,874, or $3.48 per share, in 1960. All subsidiaries are consolidated in the Company's financial statements. orders declined in second half Incoming orders for the first half of 1960 were slightly above those for the last half of 1959, but during the second half of 1960 incoming orders fell sharply below last year's level. Orders received curing the first half of I960 were S87,200,000, but in the second half orders declined to $73,300,000 as the level of business among our major customer industries fell off. Total orders received in 1960 were $160,500,000, compared with 8185,600,000 in 1959 and $137,350,000 in 1958. The Company's backlog of unfilled orders was S40,500,000 at the beginning of 1960, and S30,300,000 at the end of the year. The latter represents approxi mately two months' shipments at the present rate. dividends paid were Dividends totaling$2.40per share $2.40 per share of common stock outstandingwere paid during 1960. This equals $3,902,972, or 69 per cent of net earnings. The Company's policy on dividend payments is to give shareholders reasonable income stability by relating the dividend rate to long-term trends in earnings, rather than allowing it to fluctuate annually. Within this con text our policy is to pay out an average of 50 per cent of long-term net earnings as dividends. In years of relatively poor earnings the amount paid out may be greater than 50 per cent, as it was in 1958 and 1960. 6 no bonuses paid Under an incentive compensation plan approved by shareholders, a bonus may be paid when earnings before taxes exceed S6.00 per share of common stock outstanding. Although earn ings for 1960 exceeded that figure by a small amount, Brake Shoe's management and directors felt that results for the year did not justify the payment of incentive compensation. sales by industry, 1960 Railroads............................................... 38.3% Mining and construction............................ 19.7 Automotive and farm equipment . 14.3 Machinery .......................................... 11.7 Steel and other primary metals . . 4.8 Aerospace ........................ 4.6 Petroleum and chemicals....................... 1.2 Other........................................................ 5.4 Total................................................... 100.0% inventories increased by Total inventories at the begin- $2.7 million ning of 1960 were S23.224.- 714. Purchasing and inventory controls kept year-end domestic stocks of raw material and supplies at a level near that at the beginning of the year, but the starting up of international manufacturing operations resulted in a slight additional increase. Inventories of finished products and work in process increased by slightly more than $2,300,000 during 19o0 This rise illustrates a trend which is current in the American economy. Most businesses are keeping neir inventories of raw materials and supplies at the low cm SCI 01791