1960 年伯克希尔完整年报

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CLEVELAND PUBLIC LIBRARY CORPORATION FILE BUSINESS INF. BUR. Bff BERKSHIRE HATHAWAY INC. Annual Report TO THE STOCKHOLDERS 1960

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BERKSHIRE HATHAWAY INC. The Company had 8,845 stockholders on October 1, 1960 DIRECTORS MALCOLM G. CHACE, JR., Chairman ABRAM BERKOWITZ W. R. L. McBEE JONATHAN CHACE EDMUND RIGBY LINSLEY V. DODGE OTIS C. STANTON BRADFORD R. FROST SEABURY STANTON ARTHUR INGRAHAM, JR. A. N. WINSLOW, JR. EXECUTIVE COMMITTEE SEABURY STANTON, Chairman MALCOLM G. CHACE, JR. W. R. L. McBEE BRADFORD R. FROST A. N. WINSLOW, JR. OFFICERS SEABURY STANTON, President EDMUND RIGBY, Executive Vice President, Treasurer & Clerk WILLIAM H. POTTEr, Vice President LINSLEY V. DoDGE, Vice President JOHN K. STANTON, Vice President BERTRAND D. MANLEy, Vice President STANLEY RUBIN, Vice President

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FINANCIAL HIGHLIGHTS For Fiscal Years 1960 and 1959 October 1, 1960 October 3, 1959 Sales $62,608,679 $69,511,792 Earnings and Special Items . 4,623,980 1,322,099 Earnings Per Share 2.84 .68 Depreciation 1,713,004 1,636,770 Purchases of Properties and Equipment 3,818,632 1,125,253 Cash $ 1,535,261 $ 1,986,623 U.S. Government Securities 3,248,184 4,464,204 Accounts Receivable (Net) 7,644,809 7,069,597 Inventories 14,919,764 15,655,025 Working Capital. 23,430,319 25,858,987 Working Capital Per Share 14.41 13.35 Stockholders' Equity 37,981,820 38,911,549 Stockholders' Equity Per Share 23.37 20.10 Payroll $21,063,195 $21,073,712

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BERKSHIRE HATHAWAY INC. ANNUAL REPORT For the Year Ended October 1, 1960 November 23, 1960 TO THE STOCKHOLDERS OF BERKSHIRE HATHAWAY INC.: Net earnings in the year ended October 1, 1960 were the highest in recent years, and total $4,623,980 compared with $1,322,099 for the fiscal year ended October 3, 1959. On the basis of the 1,625,519 shares currently outstanding, earnings were $2.84 per share, compared with $.68 per share on 1,936,321 shares in the previous fiscal year. As the result of the loss carry- forward, these earnings were not subject to Federal income tax. The substantial improvement in earnings resulted from an improvement in the market for our products which occurred during the year, coupled with the lower costs resulting from the economies obtained by the substantial improvements in our operating processes. During the past year we continued our established policy of improving our machinery and operating techniques and many technological changes were accomplished or are in the process of completion. Recently there has been a slowing down in the demand for deliveries of textile fabrics. This has been in part seasonal and in part the result of the necessary digestion of goods previously purchased by the retailers, chain stores, and other consumer outlets. Although prices have weakened somewhat during the past few months, inventories at the manufacturing level are low and this Company should be in a very strong position when the demand for goods reopens. This period of distribution appears now to be nearing its end, and as the industry begins to prepare for the new 1961 spring season the backlog of goods in the hands of all channels of the industry, from the manufacturer through to the consumer, is being substantially reduced. However, competition throughout the industry will remain keen. Your Company will meet this challenge by maintaining our policy of installing new and more efficient machinery as it is developed, both now and in the future. Our cloth inventories are low, our unfilled order position is substantial, and it is our expec- tation that the Company will continue to operate on a profitable basis during the coming year. MALCOLM G. CHACE, JR. SEABURY STANTON Chairman of the Board President

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REVIEW OF EARNINGS AND SALES Earnings for the fiscal year ended October 1, 1960 were $4,623,980 after depreciation of $1,713,004. This compares with earnings of $1,322,099 after depreciation of $1,636,770 for year ended October 3, 1959. As we had a tax loss carry-forward in each year, no Federal income taxes were payable against these earnings. Sales volume for the year ended October 1, 1960 was $62,608,679 compared to $69,511,792 for year ended October 3, 1959. Substantially all of this difference of $6,903,113 in sales was due to the reduction of cloth inventories in 1959. 1960 billings were hased almost entirely on current production. DIVIDENDS A total of $1,715,323 was paid in dividends during the fiscal year just ended, as follows: December 1, 1959 20¢ per share March 1, 1960 25¢ per share June 1, 1960 25¢ per share September 1, 1960 25¢ per share The Directors, at the meeting held on November 10, 1960, declared a dividend of 25¢ per share payable on December 1, 1960, to stockholders of record on November 18, 1960. FINANCIAL DEVELOPMENTS The financial position of the Company continues strong. Net working capital on October 1, 1960 was $23,430,319, or $14.41 per share, compared with $25,858,987, or $13.35 per share, on October 3, 1959. Net worth was $37,981,820, or $23.37 per share, on October 1, 1960, compared with $38,911,549, or $20.10 per share, on October 3, 1959. During the year ended October 1, 1960, the Company purchased 310,802 shares of Berkshire Hathaway Inc. stock at a total cost of $3,838,386. These shares, together with shares purchased in prior years, make a total of 669,045 shares of treasury stock held by the Company. The outstanding shares as of October 1, 1960 were 1,625,519 shares, which compares with a total of 1,936,321 outstanding on October 3, 1959.

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OPERATIONS PLANTS AND EQUIPMENT During the fiscal year ended October 1, 1960, expenditures capitalized in connection with machinery and plant facilities amounted to $3,818,632. We received $579,343 from the sale of land, buildings, and machinery. All of the buildings, and most of the machinery remaining in our Adams plant, have now been sold, which completes the sale of all textile properties in which we have discontinued operations. The Company expects to spend approximately $3,000,000 on improvements to machinery and equipment during the coming fiscal year, and will continue to keep abreast of technological developments. EMPLOYEE RELATIONS Wage increases were granted throughout the textile industry in the early part of 1960, and went into effect in our plants on April 18, 1960. Under the terms of our contracts with the unions representing our employees, these contracts may be reopened for the purpose of wage negotiations upon the request of either party sixty days prior to April 15, 1961. We have continued to receive the cooperation of our workers during the current year, and look forward to the same mutually satisfactory relationship in the future. OPERATIONS The Company now has approximately 5700 workers and operates a total of seven plants, of which four are located in Rhode Island and three in Massachusetts. The total payroll for fiscal year ended October 1, 1960 was approximately $21,000,000, and all seven plants have operated on a full three-shift basis throughout the year. MERCHANDISING TRENDS In keeping with the policy established in the early part of 1959, our entire production is now sold in the grey or unfinished state, with the exception of curtain fabrics and cotton handker- chief fabrics. As a result of this policy, substantial savings have been accomplished in our selling costs and in working capital required. In addition, the risks entailed in carrying large inventories of highly styled goods have been eliminated. It is our intention to continue this present merchandising policy in the foreseeable future.

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BERKSHIRE CONSOLIDATED

• ASSETS -

October October 1, 1960 3, 1959 CURRENT ASSETS: Cash $ 1,535,261 $ 1,986,623 U. S. Government securities (at cost which approximates market) 3,248,184 4,464,204 Accounts receivable (less allowance for doubtful accounts — 1960 — $327,695) 7,644,809 7,069,597 Inventories (Note A) 14,919,764 15,655,025 Prepaid insurance, taxes and other expense 494,767 432,961 TOTAL CURRENT ASSETS 27,842,785 29,608,410 PROPERTIES, PLANTS AND EQUIPMENT (Note B): Properties comprising land, buildings, machinery and equipment 36,653,038 35,574,360 Less accumulated depreciation and amortization 22,263,561 22,378,762 14,389,477 13,195,598 Less estimated loss on properties to be sold . 353,609 14,389,477 12,841,989 MORTGAGE NOTES RECEIVABLE AND OTHER ASSETS 162,024 210,573 TOTAL ASSETS $42,394,286 $42,660,972 See accompanying note

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HATHAWAY INC. BALANCE SHEET -LIABILITIES AND STOCKHOLDERS' EQUITY- October October 1, 1960 3, 1959 CURRENT LIABILITIES: Accounts payable $ 2,582,672 $ 2,424,171 Accrued wages and salaries 590,169 512,875 Accrued state and local taxes. 623,665 205,075 Social security and withholding taxes payable 615,960 607,302 TOTAL CURRENT LIABILITIES 4,412,466 3,749,423 STOCKHOLDERS' EQUITY: Common stock ($5 par value) authorized 3,000,000 shares — issued 2,294,564 shares 11,472,820 11,472,820 Excess of net assets received over common stock issued or cost of subsidiary acquisition (capital surplus) 2,738,106 2,738,106 Earnings retained in the business (earned surplus) 31,329,293 28,420,636 45,540,219 42,631,562 Less common stock in treasury at cost (1960 - 669,045 shares; 1959 - 358,243 shares) 7,558,399 3,720,013 37,981,820 38,911,549 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY . $42,394,286 $42,660,972 s to financial statements.

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BERKSHIRE HATHAWAY INC. Consolidated Statement of Income Years Ended October October 1, 1960 3, 1959 SALES • $62,608,679 $69,511,792 Cost of goods sold, administrative and selling expenses 56,273,523 66,352,908 Depreciation 1,713,004 1,636,770 57,986,527 67,989,678 OPERATING PROFIT 4,622,152 1,522,114 Other income 400,556 109,918 5,022,708 1,632,032 Other charges 292,698 121,456 NET INCOME BEFORE THE FOLLOWING 4,730,010 1,510,576 Special Items Gain from change in method of inventory valuation -0- 502,922 Gain or (loss) from sale of properties and equipment 25,083 (431,603) Idle plant expense (131,113) (259,796) (106,030) (188,477) NET INCOME AND SPECIAL ITEMS 4,623,980 $ 1,322,099 Consolidated Statement of Earnings Retained in the Business EARNINGS RETAINED IN THE BUSINESS AT BEGINNING OF YEAR. $28,420,636 $27,562,824 Net income and special items for the year. 4,623,980 1,322,099 Dividends paid. (1,715,323) (464,287) EARNINGS RETAINED IN THE BUSINESS AT END OF YEAR $31,329,293 $28,420,636 See accompanying notes to financial statements. CERTIFICATE OF AUDITORS the related statements of income and earnings retained in the business for the year then ended. We have examined the consolidated balance sheet of Berkshire Hathaway Inc. and its subsidiaries as of October 1, 1960 and accordance with generally accepted auditing standards, and accordingly included such tests of the accounting records and such Our examination was made in other auditing procedures as we considered necessary in the circumstances. present fairly the consolidated financial position of Berkshire Hathaway Inc. at October 1, 1960, and the consolidated results of In our opinion, the accompanying consolidated balance sheet and statements of income and earnings retained in the business with that of the preceding year. its operations for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent COMERY, DAVISON & JACOBSON Providence, R. I., November 1, 1960 Certified Public Accountants

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BERKSHIRE HATHAWAY INC. Notes to Consolidated Financial Statements for the Year Ended October 1, 1960 Basis of Consolidation The consolidated financial statements include the accounts of all subsidiary companies, including a Canadian subsidiary. Corporate Changes During the fiscal year Shellmound Warehouse Company was liquidated into the parent company. Note A - Inventories stock in process of Berkshire Divisions which is priced at a standard established in 1933, which is substantially less than the Raw materials, including materials in process, are priced at the lower of cost or market, except for the cotton content of priced at the lower of cost or market. All costs were determined generally on an average basis. Current standard costs are used in valuing labor and manufacturing burden in stock in process. Cloth is The inventories of subsidiaries are priced at the lower of cost or market on a first-in, first-out basis. Note B - Properties, Plants and Equipment The properties, plants and equipment at October 1, 1960 and October 3, 1959 are stated at net book values of $14,389,477 and $12,841,989, respectively. respectively. Consistent with the prior year, depreciation has been charged to operations on the book basis. The net values used for federal income tax purposes were $16,112,462 and $15,040,212, Note C - Taxes on Income Inc. federal income tax returns for fiscal years 1954 through 1957. A net refund of federal taxes on income of approximately After the close of the fiscal year, agreement was reached with the Treasury Department on review of Berkshire Hathaway $72,000 resulting from this review has not been recorded in the accounts. Since the company has a large operating loss carry-forward, no federal income tax provision against the current year's earnings is necessary, and a loss carry-forward of approximately $1,400,000 is available for future years. Note D - Pension Plans and Retirement Separation Benefits The company made contributions to the trustees for the pension plans based upon payment of normal costs plus amortizing the deficiency for past services. with a minimum service of fifteen years and who retire voluntarily. Under the terms of the union contract such liability The company is contingently liable for retirement separation pay of certain employees who have reached the retirement age does not become fixed until the actual retirement of eligible employees. As of October 1, 1960 the estimated liability under the contract was $116,000. Note E - Purchase Commitments At the close of the fiscal year the company had outstanding raw material commitments at prices not in excess of market. Plant improvement commitments were approximately $1,900,000.

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BERKSHIRE HATHAWAY INC. comparatIve FINANCIAL DATA FISCAL YEARS - 1960 1959 1958 1957 1956 Sales $62,608,679 $69,511,792 $61,956,405 $66,098,223 $68,042,770 Net earnings (loss) 4,623,980 1,322,099 (4,975,460) (3,258,035) 922,548 Earnings (loss) per share of common stock 2.84 .68 (2.36) (1.55) 41 Cash dividends paid 1,715,323 464,287 None 1,107,864 2,275,639 Cash dividends paid per share .95 .22½ None .50 1.00 Purchases of properties, plant and equipment 3,818,632 1,125,253 1,279,848 1,622,760 1,334,158 Working capital 23,430,319 25,858,987 24,647,555 27,429,021 32,536,230 Working capital per share 14.41 13.35 11.70 13.02 14.49 Stockholders equity. 37,981,820 38,911,549 39,927,846 44,903,306 50,369,720 Stockholders' equity per share 23.37 20.10 18.96 21.32 22.43 Common shares outstanding . 1,625,519 1,936,321 2,105,969 2,105,969 2,246,114 NOTE: "Common shares outstanding" represents the total shares outstanding at the close of each fiscal year.

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BERKSHIRE HATHAWAY INC. EXECUTIVE OFFICES 97 Cove Street, New Bedford, Mass. SALES OFFICES 1430 Broadway, New York, N. Y. 3028 East 11th Street, Los Angeles, Calif 363 Adelaide St., West, Toronto, Canada PLANT LOCATIONS Hathaway Div., New Bedford, Mass. King Philip Div. D, Warren, R. I. King Philip Div. A, Fall River, Mass. Valley Falls Div., Albion, R. I. King Philip Div. E, Fall River, Mass. Coventry Div., Anthony, R. I. Warehouse, Fall River, Mass. Bourne Mills Div., Tiverton, R. I. LABORATORY New Bedford, Mass. TRANSFER AGENT REGISTRAR OLD COLONY TRUST CO. THE FIRST NATIONAL BANK OF BOSTON 45 Milk Street 45 Milk Street Boston, Mass. Boston, Mass. AUDITORS COUNSEL COMERY, DAVISON & JACOBSON ROPES, GRAY, BEST, COOLIDGE & RUGG Providence, R. I. Boston, Mass.

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BERKSHIRE HATHAWAY INC.