The producers news. [volume] (Plentywood, Mont.) 1918-1937, 1927-02-25
SUPER PROFITS IN STOCKINGS,
RAGS, VAUDEVILLE AND HASH
By Leland Olds, Federated Press

Excessive profits flowing to New York bankers
from exploitation in Milwaukee knitting mills are
revealed in the report of the Phoenix Hosiery Co.
for 1926. The report shows profit of 81, 646,424
after deductions for interest, depreciation and
federal taxes. 1t means return of S7.79 on
each IS share of common stock
This profit of 1860 in a single year follows
one OF 1870 in 1925, giving the owners of COM
mon stock return of at least 31O%6 on the par
value of their stock in years. AS a matter of
fact the owners of the common stock are getting
a profit of $1,364,042 securities for which
they probably never paid cent.
Phoenix Hosiery reorganized in 1922 by
Lehman Brothers and Goldman, Sachs & Co., two
New York banking firms. Before the reorganiza-
ton the entire capital consister of $3,OOO,OOO in
common stock The preferred stock issued by the
reorganizers more than covered the value of the
original capital so that the common stock of SIS
par probably distributed to the New York
bankers and their friends. It has the sole voting
power.
The former S3,OOO,OOO of common stock has
been puffed up from $4,000 in 1919 by stock
dividends capitalizing the accumulated profits of
previous years. Meanwhile according to the re-
port of the Wisconsin industrial commission.
workers In the hosiery mills were averaging only
SIC to $40 week
The owners of B. Kuppenheimer & Co., big
clothing manufacturers, are also getting a gener-
Gus return their investment. The 1926 report
shows a net profit of $700,784, equivalent after
preferred dividends to $3.50 on each SIS share OF
common stock. In the past years Kuppenheim-
er has reported total profits amounting to ST.
957675, equivalent after preferred dividends to
S19S6 on each So share of common. This is a
5-year profit of nearly 4OO@6. The owners have
received back in profits about times what they
originally invested in the stock.
Catering to peoples desire for amusement ap
pears as another source of rich return, to Judge
by the 1926 report of the Orpheum circuit Or
pheum's 1926 profit amounted to $2,086, 49, equiv
aent after preferred dividends to $2.88 profit Oh
each 81 share of common stock. In the years
1923-1926, the profits of this vaudeville amuse,
ment trust have totaled s7,62961S, giving tn,
owners return of $1O07 on each 81 share OF
10O7ao their investment.
Profits of restaurant chains such as the Wal
dorf system, Childs and Thompson's show thai
the wholesale providing of cheap meals with cheal
labor affords still another field in which capital
lists can be sure of generous returns on thei
surplus funds
Waldorf profits in 1926 amounted to 81 066 1863
equal to 1922 each no-par share of common
As each share represents an investment of no
more than SIS the years return is about 44e6
Childs 1926 profit of $1,6SS,S29 meant return
Of 1892 a share on the no-par common stock
Taking into account stock dividends and splitup
this represents a return of about 2615 % on tn,
investment John R. Thompson, serving about 81,
100000 meals, made profit of s., sos, 1857 or S62
on each no-par share. This means return O.
25%O on the book value of the stock