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Table I
Five Year Summary of Sales, Earnings and Dividends 
Years Ended November 30

[[6 column table]]
|  | 1957 | 1956 | 1955 | 1954 | 1953 |

| Net Shipments* | $55,668 | $51,765 | $30,181 | $25,197 | $26,156|

| Profit before Income Taxes* | 4,167 | 5,431 | 3,141 | 1,311 | 2,539 |
| % to Net Shipments | 7.49% | 10.49% |10.41% | 5.20% | 9.71% |

| Net Profit* | 1,927 | 2,548 | 1,468 | 785 | 1,197 |
| % to Net Shipments | 3.48% | 4.92% | 4.86% | 3.12% | 4.58% |

| Earned Per Common Share | 1.16 | 2.00 | 1.37 | .74 | .72 |
| Dividends Per Common Share+ | 1.00 | .72 | .72 | .72 | .72 |

* In Thousands
+ Adjusted for Stock Splits in 1956 and stock dividends in 1956.

ing for tax savings of about $500,000. The change to the LIFO was made in order to state profits more realistically and to conserve cash through consequent tax savings. Finally, the number of common shares outstanding increased by 23 per cent, due primarily to the 200,000 shares sold publicly in January, 1957. 


The reduction in demand for construction and industrial machinery which began in 1957 has continued to date in 1958. In the three months ended February 28—the first quarter of KOEHRING's fiscal year ending November 30—shipments and other income declined 34 per cent to $9,295,000 from $14,157,000 in the same period of 1957. Profits declined mush more sharply with net income of $1,000 being reported, compared with $568,000 in the first quarter of 1957. After provision for preferred dividends there was a loss for the common stock equal to 4 cents per share on the 1,484,764 shares outstanding, compared with earnings in the 1957 period equal to 35 cents per share on the same number of shares outstanding.

At the present time, the immediate outlook for KOEHRING's business is affected by the following factors: construction equipment apparently is being ordered on a basis which is lower than replacement requirements would indicate; plastic injection molding machinery is in very strong demand; industrial machinery new orders have stopped declining but it still is too early to know if the upturn in February and March is a real turn-around point; and residential housing, after flattening out the two-year downtrend in mid-1957, dipped sharply to an annual level of 890,000 starts in February of the current year. 

On the positive side, it seems clear that both the Administration and the Congress intend to make funds available for accelerating roadbuilding and military construction. Just when this will have a beneficial effect on construction equipment buying is difficult to predict, but it is quite certain that the Federal Highway and other construction projects will require significantly greater amounts of equipment than now are in the hands of contractors. Timing the expected upturn is impossible, but KOEHRING's management feels it may develop either in the latter part of 1958 or the first half of 1959. The Company's production has been curtailed to the extend that inventories, which normally are increasing in the early months of the year, were trimmed $1,200,000 in the first quarter of 1958 and employment is down about 35 percent from the peak level of March, 1957. Manufacturing operations still are below the level of shipments so a further reduction in inventories is indicated in the next few months. 

Koehring Company and Subsidiaries
Summary of Net Earnings
Quarter Ended February 28

[[3column table]]
|Total Shipments, Royalties and Other Income|$9,294,971|$14,157,014|
|Cost of products sold, selling and administrative expenses|8,744,107|12,362,759*|
|Depreciation of plant and equipment|400,321|408,426|
|Contributions to Employees' Profit Sharing and Retirement Trust|—|69,195|
|Interest expense|177,166|151,441|
|Federal and State income taxes|(27,738)|596,707*|
|Net Earnings|$1,133|$568,486*|
|Net Earnings per Common Share after provision for Preferred Stock Dividends (computed on 1,484,764 shares of Common Stock outstanding on February 28, 1958.)|$(.04)|$.35*|

*After giving pro rata effect to the LIFO charge against earnings made at the end of 1957. 


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