Kelly Springfield Shows Loss for '21
Kelly Springfield Shows Loss for '21
Extraordinary Charges And Drop In Tire Prices Helped To Wipe Out Profit,
OUTLOOK BELIEVED BETTER
Year Closed Without Any Current Bank Indebtedness, President Says In Report.
New YORK, Feb. 20.—The Kelly Springfield Tire Company's report for 1921 shows a net loss of $506,959, against net profits of $1,959,294 in 1920. Gross profits on sales amounted to $6,004,521, against $7,721,902; operating and administration expenses aggregated $4,507,427, against $4,290,907.
The company closed the year without current bank indebtedness, says Alfred B. Jones, president of the company, in his remarks to stockholders. Inventory showed a substantial reduction, values of materials on hand and forward commitments at the close of the year having been based on cost or market values.
In common with the entire rubber industry, Mr. Jones said, the company, in severe depression in sales. Production was reduced, but as the year advanced demand increased. The value of sales, in view of the drastic decline in tire prices, dropped below that of 1920, but there was an increase of 20 percent in the number of tires sold. Extraordinary charges resulted from the further decline in the market value of materials and finished goods in the early part of the year, and the expenses incident to the operation of the plant at Cumberland, Md. all of which extraordinary expense has been charged directly against the year's operations.
Commenting on the operations at the Cumberland plant, the report says production was begun in May and that at the close of the year the output had reached a substantial total. The board has been advised that production had reached a quantity sufficient to warrant the belief that no further provision for extraordinary operating charges would be necessary.
The detailed income account for 1921 and 1920 is as follows:
Gross profits on sales $6,004,521 $7,721,902
Oper. and admin. Exp 4,567,427 4,290,987
Operating Income $1,437,094 $3,430,915
Other income, 446,915 604,531
Total income $1,883,009 $4,035,440
Interest 8% notes 477,777 1,492,774
Other int. and chg 1,912,191
Extra compensation 83,373
Provisions for invest 500,000
Total deductions $2,389,969 $2,076,152
Net loss for year 506 959 *1,959,294
Prof and loss surp. after dividends $6,116,777 $7,203,915
* Net income before Federal taxes.
The general balance sheet on Dec. 31 showed net current assets of $10,775,715 and net current liabilities of $2,357,977 cash, $2,891,999 accounts and notes receivable, less reserves for doubtful accounts, and $5,525,739, the value of inventory figured at cost or market, which ever is lower. The company, early last year refunded its short term obligations by issues of $10,000,000 ten-year 8 per cent sinking fund gold notes.
Kelly Springfield came to Cumberland with the Chamber's help. Herman Miller wrote:
Ground was broken for the Kelly-Springfield Tire Company on Wednesday, April 11, 1917, when George C. Young, Secretary of the Chamber of Commerce and former mayor of Cumberland, turned the first shovelful of dirt. Through arrangement of considerations to the Kelly-Springfield Tire Company, such as a bonus of $750,000.00, the land of the Bopp, Miltenberger and Johnson farms was given to the Kelly Company as part of the bonus to build a tire plant here. The work of raising the money was handled by the Cumberland Development Company and the Chamber of Commerce. The cash was raised by selling stock in the Development Company to the public. ( Industry in Cumberland)
Allegany College of Maryland
Cumberland (Md.) press coverage; Cumberland (Md.) Chamber of Commerce
Cumberland (Md.), 1920-1930