1957 年伯克希尔完整年报

[PAGE 1]

CLEVELAND PUBLIC LIBRARY CORPORATION FILE BOSINESS INF. BUR. BERKSHIRE Bff HATHAWAY INC. Annual Report to the Stockholders > 1957 C

[PAGE 2]

BERKSHIRE ) HATHAWAY INC. Annual Report For the Year Ended September 30, 1957 TO THE STOCKHOLDERS OF BERKSHIRE HATHAWAY INC. There is presented herewith the consolidated annual report of Berkshire Hathaway Inc. and its subsidiaries for the year ended September 30, 1957. FINANCIAL The net loss for the year was $3,258,035 on sales of $66,098,223, com- pared with a net income of $922,548 on sales of $68,042,770 in 1956. The loss of $3,258,035 was after depreciation of $1,971,157 and tax carryback of $872,118. It included unabsorbed burden due to curtailed operations, inventory markdowns caused by the continuously falling market prices throughout the year, and additional costs resulting from the consolidation and modernization program. WORKING CAPITAL The financial position of the company continues to be strong at the AND NET WORTH end of the fiscal year with working capital of $26,401,396 and net worth of $44,903,306. The books of the company reflect working capital per share of $12.54 and networth per share of $21.32, both of which are very considerably in excess of the current market price of the stock. DIVIDENDS The company paid a dividend of 25¢ per share December 1, 1956, 15¢ per share March 1, 1957, and 10¢ per share June 1, 1957, making a total distri- bution for the year of 50¢ per share, aggregating $1,107,864. No dividend was paid Sep- tember First and none was declared for payment December 1, 1957. PLANTS AND We continued our policy of making improvements and additions to exist- EQUIPMENT ing plant facilities where the return on the investment seemed adequate. Expenditures which were capitalized in connection with such improvements amounted to $2,334,356 during the fiscal year. Early in January 1957 it became evident that this year would be a difficult one for textiles, and it was decided to curtail operations rather than to increase already substantial inventories.

[PAGE 3]

In March 1957 it was also decided to eliminate certain of our higher cost plants and con- solidate and modernize our operation in those remaining, taking advantage of this curtailment period to make machinery changes at a time when full production was not needed and a large part of the requirements of our customers could be supplied from inventory. Our Greylock plant in North Adams was in the process of liquidation, and it was decided to close permanently our plant in Holyoke, half of our big Berkshire plant in Adams, and the Swansea Print Works, owned by our subsidiary, Bourne Mills, and to distribute the best of the machinery among our other plants and liquidate the balance. Plant B in Fall River and our Fort Dummer plant in Brattleboro were also closed, but held on a stand-by basis. The remaining six plants of the former Berkshire Fine Spinning Associates group, and our King Philip finishing plant, were included in the consolidation and modernization pro- gram, which will be completed by the end of December 1957. During the present quarter we will be gradually increasing our production pending com- pletion of our modernization program at the end of December. We are now in the process of starting up Plants A and E in Fall River, and our plant in Coventry, which were closed during the modernization period, and expect to resume full operations in all of our modern- ized plants by January 1958. EMPLOYEE Our employees and their union representatives are cooperating with us in an RELATIONS effort to keep our plants in efficient operation, and we anticipate that our labor relations in the future will continue on the present satisfactory basis. GENERAL When the consolidation and modernization program is completed, your company will be composed of eight closely controlled modern mills manufacturing a well diversified line of cotton, synthetic, and blended yarn fabrics, together with a finishing plant and two other mills held on a stand-by basis. Overhead has been substantially reduced and a young hard-hitting executive group and sales organization is being developed. The unsatisfactory demand for textile products during the past twelve months has caused all branches of the industry beyond the primary producer to reduce inventories and purchase only on a hand-to-mouth basis. As a result, inventories between the mills and the ultimate consumer are at a minimum, and if the demand for cotton and synthetic textile fabrics broadens in 1958, as is anticipated by economists, shortages will be created which will result in substantially improved prices. With the operating economies resulting from our consolidation and modernization pro- gram, your company will be in a strong competitive position, and we expect that profitable operations will be resumed during 1958. MALCOLM G. CHACE, JR. Chairman of the Board November 16, 1957 SEABURY STANTON President

[PAGE 4]

BERKSHIRE Bff HATHAWAY INC. FISCAL YEARS - 1957 1956 1955 1954 Net Sales • $66,098,223 $68,042,770 $65,498,284 $66,929,036 Net Earnings Available for Dividends (Loss) (3,258,035) 922,548 300,722 660,335 Earnings per Share of Common Stock . (Loss) (1.55) .41 .13 .29 Cash Dividends Paid per Share of Common Stock .50 1.00 1.00 1.00 Net Expenditures for Plant Assets. 1,622,760 1,334,158 1,201,470 1,161,742 Working Capital 26,401,396 31,426,569 33,022,161 34,326,925 Total Stockholders' Equity • 44,903,306 50,369,720 51,399,756 53,354,318 Common Shares Outstanding 2,105,969 2,246,114 2,294,564 2,295,204 NOTE: "Common Shares Outstanding" represents the total shares outstanding at adjusted. "Cash Dividends Paid" also includes those of the Hathaway Manufac the close of each fiscal year, including the Hathaway Manufacturing Company as turing Company.

[PAGE 5]

[PAGE 6]

BERKSHIRE Consolidated — ASSETS — September 30, 1957 September 30, 1956 CURRENT ASSETS: Cash •• $ 2,002,657.32 $ 2,554,457.15 Accounts receivable (Less reserve $356,208.13-1957; $364,811.68-1956) 8,050,844.28 7,136,304.50 Recoverable federal taxes on income (Note A) 872,118.72 -0- Marketable securities (Estimated market value — $164,913.75 at September 30, 1957) 165,826.61 482,288.37 Inventories (Note B): Raw materials 3,185,294.62 3,337,399.61 Stock in process 4,057,854.56 4,273,243.22 Cloth 16,723,821.46 23,049,230.38 Waste 98,791.67 182,357.16 24,065,762.31 30,842,230.37 TOTAL CURRENT ASSETS. 35,157,209.24 41,015,280.39 INVESTMENTS AND OTHER RECEIVABLES: Investments. 518,793.00 518,793.00 Notes and other amounts receivable. 122,938.91 158,369.24 641,731.91 677,162.24 PROPERTIES, PLANTS AND EQUIPMENT (Note C): Properties comprising land, buildings, machinery, equipment and developed water power. 39,421,102.14 38,955,952.87 Less accumulated depreciation and amortization. 22,615,523.07 21,824,917.19 DEFERRED CHARGES AND OTHER ASSETS: 16,805,579.07 17,131,035.68 Prepaid insurance, taxes and other assets 621,165.91 732,404.60 Supplies inventory, including fuel and returnable containers. 433,433.50 402,548.88 1,054,599.41 1,134,953.48 TOTALS • $53,659,119.63 $59,958,431.79 See accompanying notes

[PAGE 7]

HATHAWAY INC. Balance Sheets — LIABILITIES AND STOCKHOLDERS' EQUITY - September 30, 1957 September 30, 1956 CURRENT LIABILITIES: Notes payable - bank $ 3,350,000.00 $ 4,300,000.00 Accounts payable . . . 3,836,392.42 2,184,993.38 Accrued wages and salaries . .. 469,881.10 786,925.23 Accrued state and local taxes. 664,056.53 640,261.47 Social security and withholding taxes payable 435,483.41 631,942.41 Provision for federal taxes on income . -0- 1,044,589.18 TOTAL CURRENT LIABILITIES. • 8,755,813.46 9,588,711.67 STOCKHOLDERS' EgurrY: Common stock ($5.00 par value) authorized 3,000,000 shares—issued 2,294,564 shares 11,472,820.00 11,472,820.00 Excess of net assets received over common stock issued or cost of subsidiary acquisition (capital surplus) 2,738,105.50 2,736,510.07 Earnings retained in the business (earned surplus) 32,538,284.15 36,739,562.28 Totals. 46,749,209.65 50,948,892.35 Less common stock in treasury at cost (188,595 shares — 1957; 48,450 shares - 1956) 1,845,903.48 579,172.23 44,903,306.17 50,369,720.12 TOTALS $53,659,119.63 $59,958,431.79 to financial statements

[PAGE 8]

BERKSHIRE D: HATHAWAY INC. Condensed Consolidated Statement of Income YEARS ENDED September 30, 1957 September 30, 1956 SALES (NET) • $66,098,223.42 $68,042,769.73 Cost of Goods Sold, Administrative and Selling Expenses (Depreciation - 1957 - $1,971,157.43) 70,211,943.90 66,413,220.92 OPERATING PROFIT OR (Loss) • • (4,113,720.48) 1,629,548.81 Other Income . 199,136.14 337,964.46 (3,914,584.34) 1,967,513.27 Other Charges 213,169.50 177,965.26 NET INCOME OR (Loss) BEFORE PROVISION FOR TAXES ON INCOME (4,127,753.84) 1,789,548.01 *Provision for Taxes on Income (869,718.72) 867,000.00 NET INCOME OR (Loss) ($3,258,035.12) 922,548.01 *In the current year this amount represents recoverable federal taxes on income less the provision for taxes on income - subsidiary companies. Statement of Earnings Retained in the Business EARNINGS RETAINED IN THE BUSINESS AT BEGINNING OF YEAR $36,739,562.28 $38,077,325.50 Net Income or (Loss) for the Year . (3,258,035.12) 922,548.01 Revenue Agent's Net Asset Adjustments for Fiscal Years 1951, 1952 and 1953 -0- 15,327.77 Prior Years' Provision for Federal Taxes on Income Not Required 164,620.49 -0- 33,646,147.65 39,015,201.28 Dividends Paid .. 1,107,863.50 2,275,639.00 EARNINGS RETAINED IN THE BUSINESS AT END OF YEAR. $32,538,284.15 $36,739,562.28 We have examined the consolidated balance sheet of Berkshire Hathaway Inc. and its subsidiaries as of September 30, CERTIFICATE OF AUDITORS was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting 1957 and the related statements of income and earnings retained in the business for the year then ended. Our examination records and such other auditing procedures as we considered necessary in the circumstances. in the business, with the notations thereto, present fairly the company's consolidated financial position at September 30, 1957 In our opinion, the accompanying consolidated balance sheet and related statements of income and earnings retained principles applied on a basis consistent with that of the preceding year. and the consolidated results of its operations for the year then ended, in conformity with generally accepted accounting Providence, R. I., October 24, 1957 COMERY, DAVISON & JACOBSON Certified Public Accountants

[PAGE 9]

BERKSHIRE BH HATHAWAY INC. Notes to Consolidated Financial Statements For the Year Ended September 30, 1957 Basis a anadin stardiary. For the lisat an ended september 30, 19s the a operati of relits oi Bourne Mins are indudied only for the last quarter of that year. Corporate Changes — During the current fiscal year Berkshire Fine Spinning Corporation, rose shames Priat 1 Berkshire Hathaway Inc., was liquidated into the parent company. In April 1957, operations were discontinued at an inactive subsidiary of the Swansea Print Works Division of Bourne Mills and the division was liquidated. During this year Berkshire Hathaway Inc. acquired the remaining outstanding stock of Bourne Mills thus eliminating the small minority interest. Note A - Recoverable Federal Taxes on Income Hathaway Inc. federal income tax returns for the fiscal years 1954, 1955 and 1956, which is presently being conducted year 1955. by the Internal Revenue Service. Federal income tax returns of Bourne Mills have been examined through the fiscal Note B - Inventories Berkshire Hathaway Inc. — Raw materials are priced at the "lower of cost or market". The cotton content of stock in process of Berkshire Divisions is priced at a standard established in 1933, which is substantially less than the current Current standard costs are used in valuing labor and manufacturing burden in stock in process. Cloth is priced at the market. The material content of stock in process of the Hathaway Division is priced at the "lower of cost or market". Bourne Mills — The cotton content of the inventory at Bourne Mills is priced on the basis of "last-in-first-out" except Labor and manufacturing burden are valued at adjusted standard costs and the total inventory value is less than market. for goods purchased from Berkshire Hathaway Inc. and miscellaneous cloth which are stated at "lower of cost or market". Note C - Properties, Plants and Equipment The properties, plants and equipment at September 30, 1957 and September 30, 1956 are stated at net book values of $16,805,579.07 and $17,131,035.68, respectively. The net values used for federal income tax purposes were $18,760,789.25 and $19,086,730.43, respectively. Depreciation has been charged to operations on the tax basis. Note D - Pension Plans and Retirement Separation Benefits $239,647.38, this being the estimated minimum payment permissible under the plans. For the current fiscal year the company made contributions to the trustees for the pension plans amounting to under the contract was $220,000.00. Note E - Purchase Commitments are at prices approximating market. The company has outstanding plant improvements and material commitments amounting to $4,556,000.00. The materials

[PAGE 10]

BERKSHIRE Bff HATHAWAY INC. The Company had 11,832 stockholders on September 30, 1957 DIRECTORS MALCOLM G. CHACE, Jr., Chairman JONATHAN CHACE IRWIN L. MOORE LINSLEY V. DODGE HENRY S. NEWCOMBE BRADFORD R. FROST WILLIAM A. O'HEARN ARTHUR INGRAHAM, JR. EDMUND RIGBY W. R. L. McBEE OTIS C. STANTON JOHN H. McMAHON SEABURY STANTON A. N. WINSLOW, JR. EXECUTIVE COMMITTEE SEABURY STANTON, Chairman MALCOLM G. CHACE, JR. IRWIN L. MoORE W. R. L. McBEE A. N. WINSLOW, JR. OFFICERS SEABURY STANTON, President EDMUND RIGBY, Vice President, Treasurer & Clerk Administrative Sales WILLIAM H. POTTER Vice President LINSLEY V. DODGE Vice President JOHN J. McMAHON Vice President OTIS C. STANTON Vice President HENRY S. NEWCOMBE Vice President BERTRAND D. MANLEY Vice President JoHN K. STANTON, Assistant Treasurer

[PAGE 11]

BERKSHIRE Bff HATHAWAY INC. EXECUTIVE OFFICES 704 Hospital Trust Building, Providence, R. I. SALES OFFICES 1430 Broadway, New York, N. Y. 746 South Los Angeles St., Los Angeles, Calif 261 Fifth Avenue, New York, N. Y. 363 Adelaide St., West, Toronto, Canada PLANT LOCATIONS Berkshire Div., Adams, Mass. King Philip Div. D, Warren, R. I. Hathaway Div., New Bedford, Mass. Valley Falls Div., Albion, R. I. King Philip Div. A, Fall River, Mass. Coventry Div., Anthony, R. I. King Philip Div. B, Fall River, Mass. Bourne Mills, Tiverton, R. I. King Philip Div. E, Fall River, Mass. Curtain Factory, Warren, R. I. Fort Dummer Div., Brattleboro, Vt. Finishing Plant, Lonsdale, R. I. LABORATORIES New Bedford, Mass. Lonsdale, R. I. TRANSFER AGENTS OLD COLONY TRUST CO. THE CHASE MANHATTAN BANK 45 Milk Street 18 Pine Street Boston, Mass. New York, New York AUDITORS COMERY, DAVISON & JACOBSON Providence, R. I.

[PAGE 12]

BERKSHIRE ( Bff HATHAWAY INC.