Argus Sales Show Drop of $2,88,036

Argus Sales |
Show Drop Of

$609,381 Net Loss
For Year Listed In
Stockholders' Report -

Argus, Inc., reported net sales w-
$6,115,370 for the fiscal year end-
ing July 31, a drop of nearly three
million doll; ^95,406
in sales rep n-ipar-
able period or the previous year.

The figures, including a net op-
erating loss of $609,381, were list-
ed in the annual report to stock-
holders, mailed out last night.

The consolidated loss, according
to the report, would have totaled
$885,281 if it were not for a special
credit of $275,900. This represented
an estimated refund of prior years'
income taxes by reason of carry-
back provisions of the internal
revenue code. J
Gain In Working Capital ^

On the asset side of the picture
the report notes that during the
four-month period from April 1
to July 31, Argus net sales, in-
cluding other income, were $1,981,-
604 and net profit before special
charges was $211,250. During ap-
proximately the same period the
net working capital increased from
$30,961 to $139,938.

In a section of the report dis-
cussing management, the firm lists
a proposed slate of five new direc-
tors whose names will be pre-
sented to the stockholders at the
•Nov. 16 annual meeting.

They are John Airey, chairman
of the board of King-Seeley Corp.;

George J. Burke, attorney and
board member of the Detroit Edi-'
son Co.; James M. Delaney, present'
acting general manager of the
lirm; Robert E. Miller, president
and director of the Airlines Ter-
minal Corp. at Willow Run; and
Rudolph Reichert, president of th|i
Ann Arbor Bank and a director w
The federal Reserve Bank of
Chicago.

ana

f

Homer Hilton, Argus vice-presi-
dent in charge of sales, and a
member of the board since June,
is not, seeking re-election.
Inventories Studied

A point brought out by the re-
port is that a detailed study of:

the company's inventories was;

authorized to determine what por-j
tion of the inventory loss of $709,-'
000 recorded on March 31 was ap-
plicable +" ""'r^r periods.

An h 'nt accounting firm;

has rr that in its opinion
$1° the $709,000 provision
for i; vt'niury losses, at March 31,
was applicable to the period prior
to July 31.

As a result of the profits re-
ported to stockholders at the end
of July, 1948, which naturally did
not take into account the inventory
losses later discovered for that
fiscal year, bonus payments total-
ling $38.818 were made to four
Ar 'cers and employes. If
the ; ;>;ry losses mentioned can
be attributed to the prior year,
such bonus payments would amount
to only $22,380, the report stated.

Legal counsel for the firm is
studying the question of recovery
of the differences. The annual re-
port states that "appropriate steps
have been taken to protect the in-
terests of the company."
Bank Loan Retired

Between March 31 and July 31,
the company retired a $112,500
term bank loan and $179,000 of its I
three per cent negotiable notes,
which had matured May 1. Since)
July 31, the company has also re-
duced its demand bank loan
through payments aggregating
$650,000.

In discussing the terms of the I
$900,000 loan originally authorized [>
by the Reconstruction Finance ('
Corp., the annual rpnnrt notes that
the company :••' "e that it
will not, without ritten con-
sent of the RFC, pay any dividends
on its common or preferred stock.

Since the original loan was re-
quested the firm has asked that a
smaller loan be authorized, total-
ling $750,000, the difference be-
tween that sum and $900,000 hav^
•;g been received from the liquids?'
. ion of company assets. __