Earnings

Texas Rangers were still combing the coulees for cattle thieves and badmen when the Texas Pacific Land Trust was organized in 1888. Its assets were 3,450,000 acres of Texas land originally granted by the State of Texas to Texas Pacific Railway. Its liabilities were $10,370,000 of certificates issued in a reorganization of that railroad which segregated the land grants from the carrier properties. And its purpose was liquidation.

The trustees, however, were in no hurry. After 47 years 1,980,552 Texas Pacific acres are still unsold. Meantime the certificates have sometimes made exciting market history. After oil was discovered near some of the Trust's vast tracts in 1926, they touched a high of $3,650, were then split 100-for-1, and the new little certificates climbed as high as $40, equivalent to $4,000 for the old. Currently they are selling around $10.

Though the certificates are traded like a common stock, no investor has ever received one cent in dividends. The trustees have always applied the income from oil royalties, leases and the sale of land and lots to buying in and canceling outstanding certificates. Last week the trustees reported that income last year was up 48% to $458,000, of which only $41,000 was from land sales. More than half the income was used to buy in certificates.

That policy makes Texas Pacific Land Trust a unique investment among liquidating concerns: certificate holders' proportionate interest in the unsold land increases year after year. Behind each $100 par value of certificates in 1888 were 33 acres of Texas land. Today there are 114 acres behind the same certificates, and the land is much more valuable. Theoretically the time will come when the last solitary certificate holder will own all the land that remains unsold. But one thing will probably prevent that: The trust provides that if 75% of the certificate holders approve, all the property may be liquidated forthwith, the proceeds divided evenly.

Other earnings of the week:

Red into Black. Radio Corporation of America went into the red in 1932, was $16.25 in arrears on every share of Class B stock as late as last December. Last week, with a gross income increase of 26%, RCA reported 1934 net profits of $4,249,000 against a deficit of $582,000 the year before.

Profitless Prosperity. Anti-New Dealers had a perfect example of profitless prosperity when Chrysler Corp., reporting 1934 sales at a five-year high of $362,000,000, announced net profits of $9,534,000. In 1933, with $123,578,000 less sales, Chrysler earned $12,129,000.

From Surplus. For the third consecutive year the world's largest private corporation failed to earn its regular dividend ($9). American Telephone & Telegraph and affiliates announced 1934 net income of $5.96 a share ($111,000,000) against $5.38 the year before. The regular dividend had been paid by drawing upon surplus, now $21.50 a share. President Walter Gifford announced that during the year A. T. & T. had perfected a new telephone which has the bell and other equipment in the telephone itself instead of in a separate box.

Cash from Carrying. Firm and steady has been the growth of J. C. Penney Co. from one ''Golden Rule Store'' in Wyoming in 1902 to a chain of 1,474 cash-&-carry dry goods units in 48 States. Only once (in 1920) has the company ever lost money. Conservatively capitalized, unhampered by expensive leases, it is operated solely by merchandisers who allow no bankers to sit on their board. With 1934 sales at an all-time new high of $212,053,000, J. C. Penney last week announced net profits of $16,000,000, a record.

Electric Dividend. In 1933 General Electric Co. paid a common dividend of 40-c- a share, earned only 38-c- a share. Last week G. E. announced that, while sales had increased 21%, profits had jumped 58% last year to $17,151,000 or 59-c- a share. With January-February sales running ahead of the last quarter of 1934, the directors voted the regular 15-c- dividend for the first quarter of 1935. Prospects were that, with a saving of several millions in dividends through the retirement of its special stock (TIME, Jan. 7), G. E. would more than earn its common dividend this year, might even raise the dividend itself.

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