REDUCED GRAMOPHONE PROFITS

Evening Post, Volume CXIII, Issue 9, 12 January 1932, Page 12

REDUCED GRAMOPHONE PROFITS

The selling of gramophones and records falls naturally into the category of the luxury trades, and therefore companies engaged therein must expect to bear the full brunt of trade depression and reduced spending power (states ''The Times"). Particularly is this the case with those companies selling the better class of instrument and record. How true this is is indicated; by the progress report pubr lished by Electric-and Musical Industries for the 12; months, ended 30th June last. This company is" a merger of the two most important concerns in the British gramophone industry, the Gramophone Company and the .Columbia Graphophpne Company. Both companies have a remarkable record of progress behind them, and it may be imagined that the directors are fully aware of the need of extraordinary meafcires to combat trade depression. The amalgamation of itself should achieve much towards this end, for duplication on a large scale can-be avoided, while the reductiou in prices announced -fairly'recently is a step in the right direction. Of course, these influences were not in operation in the period under review, which explains the sharp fall in profits. The combined earnings of the two companies after meeting debenture interest-were only £160,893, whereas for the preceding year the earnings of the Gramophone Company were £841,931, and those of the Columbia Graphophone £580,159.- Full provision, however, has been made for depreciation, and over ; ££00,000 has' been set aside for rebates oh.stocks o£;-dealers in view of price reductions and;to Cover the fall in the value'of the raw materials bold by the companies. A combined balance-sheet is also published, whicl) shows ,a strong liquid' position; cash, and investments in gilt-edged stocks amounting to nearly £2,750,000.