Evening journal., 1922-03-07
Today's News Today
int Company Feels Effect Depression Earnings FALL Surplus Maintained

ht annual report OF the r. l. du-
Pont de Nemours & Company. and
subsidiaries, issued today, shows
that the company, in common with
other industries, suffered through
the general business depression. the
marking down OF inventories and
other unfavorable economic condi-
tions, but its strong financial posi-
tion enabled Il TO continue dividend
payments (S per cent. debenture
and per cent. on common stock)
amounting to S9.341.5OS. by draw
ing on its surplus. This leaves
surplus Of S66.OSO. .659.71 or more
than 800 a share OF the common
stock. as against a surplus OF $69,-
659.74S. at the end Of 1920.
The companys volume Of business
for 1921 was S55,2S5,1S1, about half
OF the 1920 volume and it's net in
come, including receipts from per
manent investments. was S7.25S.-
O72.11, a little less than half OF the
net for 1920
The report shows securities held
for permanent investment worth
S9S.099,2S5. a tthe present marked
down values. This is approximately
S24. 800. 900 in excess Of their cost.
The company's bank Indebtedness
has been wiped out.
The report discusses economic
conditions and predicts that a
change for the better will come
when the surplus stocks throughout
the country are exhausted. Irenee
dupont. president OF the company, In
his annual report says:
This report covers the affairs OF
r. /. dupont de Nemours & Com
pany Delaware Corporation) and
also consolidated therewith f. /.
dupont de Nemours & Co.. Of Pa.
+. 1. DUPONT de Nemours Export
Co. Rokeby Realty Company. all the
stock Of which is owned by the first
mentioned company.
THE continued reduction In prices
in 1921 has adversely affected the
operations of your company. both
through the reduction in inventory
values which resulted and the re-
striction of buying which usually
accompanies a falling market
I'm so far as materials have been
used In manufacture. the loss from
reduction in values has been alb
sorhed In operations The inventories
were re-valued December 81. 1921
ON the basis Of cost. or market,
whichever was lower. resulting IN a
total write-down of s9.O7O.543. all
OF which. excepting S3S9OsS was
charged against Contingent Reserves
created out Of Earnings during the
period Of war imitation. Your COM
pany has no onerous purchase OF
sales contracts outstanding.
The attached financial statement
shows that the volume Of business IT
1921 was s55,2s5.1S1. which is ONLY
SIS per cent OF the volume OF bus
mess shown for 1920. This compar
sion, however. is too favorable. IT
the year 1920. the sales OF the Fab
rikoid business were handled by q
separate corporation not consolidat
de with the parent company. where
as in 1921 Fabrikoid sales are in
ciuded with your other business.
true comparison indicates that tn
volume of business in 1921 wa.
about one-half ike business in 1920
1.-THE stockholders Of this com
pany, like all others interested II
the economic welfare OF the country
are anxious TO know whether thi
represents a new era OF reduced bus
mess or whether the depression vii
quickly pass No attempt can b
made to answer this question whicl
does not start with an endeavor q
determine the reasons leading up q
the low volume OF business. Tn
writer believes that the immediate
cause Of the low volume OF bushes
was the endeavor. IN the latter par
of 1920 and during the year 1921. oi
the part Of those engaged in lndustr
and commerce TO liquidate their IN
ventories Your company Is prob
ably a fair example OF average condi
tions. OF raw materials used 81
products sold during the first eigh
months OF 1921. approximately one
half came out OF the storehouse an
.one-half was purchased. This mean
that those who sold to the duPon
Company suffered a reduction OF s
per cent. IN the volume Of material
needed by this company for its al
ready reduced operations. This con
diflon must cease when inventorie
are exhausted.
1T seems reasonable TO suppos
that the marked reduction in buyin
has resulted in intense competition {
soil and that this has been larg
factor In the reduction OF prices.
The most lamentable result OF IN
liquidation OF inventories has bee
discontlnuance OF employment Will
inventories were being consumed
Your company has been obliged {
dIannnfInmn The sarVIces OF tWl