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Show National Enterprise , March 31, 1976 Page Eleven Big Fish Finishes Record Year Inc., (OTC There are reasons for the 11.625, 12.125) seems to do regional approach, Cumming things the wrong way, to said. The company feels it can Curtice-Bum- s operate under an unusual provide better, cheaper and business attitude, but the quicker service and remain company has nevertheless fin- more sensitive to the customer ished a record year. markets. The concept of the regionSome 60 cercent of the al food processing firm accordproducts produced by subsiE. to ing Hugh Cumming, diaries if Curtice-Bum- s go out in an address under the labels of those president, before Denver financial ana- subsidiaries, he continued, lysts is, to be a big fish in a and the remainder are marlittle pond. keted under the brand names businesses believe Most of chain stores, such as Safein expansion, both internally way. and externally. So does CurticeThe company would like -Burns, in every way to see approximately 65 percent of its products go out except geographically. The holding company has under its own label, he said, to eight major divisions, and give the firm more control. each of these divisions occupThe Curtice-Bum- s goal, ies a large part of the market he added, is a 5 percent in the particular geographic internal growth rate and area in which it is found, expansion only by acquisition. s according to Cumming. But, the regional food Blue in Its Boy products policy isnt the only one that for are the east, instance, sets the company apart from Monte with Del for tied the average. nearly market share in the regions in The Corporate headwhich they are sold. Its Silver quarters staff for the $200 Floss sauerkraut, also in the million sales business is 16 east, occupies the majority of persons, including three secthe market in its selling areas. retaries, and some of those The Thank You and people have more than one Brooks brands are major job, Cumming said. names in the Midwest, he Under the companys said, and Nalleys chile pro- operating theory, each of the ducts in the northwest central subsidiaries operates auto37 percent of that market, nomously. Headquarters more than twice as much as supplies the financing, any other single brand. Cumming said, and it provides &T RID OF NUCLFAR a staff vice president marketing to help the sions. for divi- The reasoning behind the philosophy, he explained, is that the individual companies work better if they are allowed to operate the way they did before acquisition. The corporation also feels that smaller more independent companies also are more efficient. And, and Curtice-Bum- s its subsidiaries dont own any fixed assets. That brings up another way in which the company is unusual. Cummings is the general Coopmanager of Pro-Fa- c erative Inc., which is efficed in the same headquarters building. There are about 600 growers in the cooperative and more waiting to get in when there is room. They supply more than 70 percent of the raw products to Curtice-Bum- s companies under three year contracts. And, the cooperative owns all of the fixed assets and used by Curtice-Burn- s leases them to the company The farmers in the cooperative, on the other hand, are assured a market for their sensitive to the rights of other shareholders. He continued, Agway in products, and they share stays out of the food business of the the earnings and has no stock interest in company. Cumming said that Pre-Fa- c Pre-Fagets about 48 percent of Since the company the pre-ta- x earnings of Curtice Bums, and most of that money doesnt have three outside directors it can't be listed on is loaned to Curtice-BurnThe money is loaned for the American or the New York five years and, at the end of Stock Exchanges. With the acquisition of that time, the lenders get the Fine Foods, Cummoney back in the form of Nalleys anticipreferred stock, which pays ming said, the company dividends of six to eight pates sales of at least $200 million during fiscal 1976, percent. In almost all commodities which ends the last week in he said, farmers are waiting to September. get into the cooperative. There He declined to make a has never been a question of about net income, conflict of interest, he added prediction that the food business in response to a question, saying is too volatile. because there is a clear, legal In fiscal 1975, the comcontract between the two entipany reported a net income of ties. $2.77 million, or $3.26 a share, Still another unusual on revenues of $141.25 million aspect of the firm is that all of with net income of the directors are elected by a compared $1.43 million, or $2.01 a share, third organization. on revenues of $81.94 million Curtice-Burn- s has two the previous fiscal classes of stock. The class A is during and have the year. s. doesnt public right to vote for directors. The under favorable terms, Class B stock is 95 percent owned by Agway, the largest according to Cumming. Pre-Fa- c also provides food growers cooperative in of the the northeast, according to about Curtice-BurnCumming. financing for The firm has always had a he said, since an agricultural loan can good relationship with Agway, get better cooperative rates than most corporations. he said, and the directors are three-quarte- rs s, NO COM BURNING Windmills, . Reprinted by permission of The Oregonian c. and Art Bimrose, editorial cartoonist . For the quarter ended the last week in December, the firm reported net income of $1.59 million, or $1.80 a share, on revenues of $95.21 million, compared with net income of $1.4 million, or $1.65 a share, on revenues of $66 million for the same period a year earlier. |