STATE OF BUSINESS: Earnings: Best Ever?

As the stream of earnings reports reached flood stage last week, it appeared that 1955's first quarter was the best ever for many U.S. corporations. The combined first-quarter earnings of 484 corporations was 27.2% higher than for the same period a year ago, dividend payments to stockholders were up 6%, and only 17 companies failed to show a profit.

Even in corporations where profits were down because the upswing in business was not yet reflected in earnings, officials were optimistic. Westinghouse Electric's first-quarter earnings fell from $26,286,000 for the first quarter of 1954 to $12,782,000 this year; Pullman Inc. earned only $1,275,873 this year v. $4,197,701 in the first three months of 1954. But, with orders piling up, both companies think they will do better in the rest of this year.

Earlier Birds. Other corporations, in on the recovery from the start, reported big gains in first-quarter earnings. The steel industry set the pace ; combined first-quarter earnings of 33 steel companies were almost 70% higher than a year ago. U.S. Steel, by earning $72,652,402 in 1955's first three months, topped the record of $61,379,757 for that period, set in 1917. And, said Board Chairman Benjamin Fairless, earnings and production for the full year should be better than any previous year except 1953. Not to be outdone, Bethlehem Steel announced that its first-quarter earnings of $35,313,262 were also the best it had ever done in that period, declared a dividend of $1.50 a share. The outlook for the rest of the year was so good, said Board Chairman Eugene Grace, that Bethlehem will operate at 100% of capacity at least through July and capacity for the full year should average at least 90%.

The big automobile manufacturers were doing just as well. General Motors reported that it earned $309,406,862 in the first quarter, a 64.7% increase over last year. But the independent automakers were still having a tough time. Stude-baker-Packard has not yet announced its earnings for the quarter, but did report that only in March, the last month in the quarter, it had managed to operate in the black. Kaiser Motors, however, an almost chronically profitless independent automaker, earned $1,207,113 during 1955's first quarter, v. a loss of $7,509,340 in the same period a year ago.

Even Railroads. The railroads, deep in a slump a year ago, made a strong comeback. The first 35 railroads to report had combined earnings that were 77% ahead of last year's first quarter. The New York Central's Board Chairman Robert R. Young announced that in the first quarter, President Alfred Perlman turned in earnings of $11,813,010, compared with a deficit of $473,788 a year ago. Then Young announced a "regular" dividend of 50¢ a share, the same amount the road paid in January. Other less embattled railroads showed equally good profits. The Santa Fe earned $15,958,209 in the first quarter, v. $12,495,551 last year; in the same period the Pennsylvania earned $7,112,005 v. a deficit of $5,898,894 in 1954.