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Show Page two IML The National Enterprise, August 10, 1977 names president Seven months after his family purchased the corporation, S. Whitfield Lee, 33, has assumed the duties of presi- dent of IML, in addition to those of chairman of the board and chief executive officer. He plans to move to Salt Lake soon from San Francisco. The recent management change marks another phase of growth IML is experiencing right now, explained Glenn Goodrich, vice president. Six weeks ago, Norman Jordan left his position as president of Auerbachs to rejoin IML as chief financial officer. Jordan held that position for 15 years at IML about ten years ago. A.T. Bozich, former IML president, has left the firm to pursue ests. personal inter- Controversy bodes ill for MSF The current Public Service said the Salt Lake based freight company posted a leap in revenues from $103 million in 1975 to $124 in 1976. He projected sales of $140 million this year. July, typically the worst month of the year for a trucking firm, since many factories in the East close down for the month, was a profitable period for us this year, Goodrich said. It is the first time in six years we made a Commission hearings sur- profit in July." IML is making large investments in "rolling stock sider Goodrich (large trucks and trailers), Goodrich said, to replace and expand its existing fleet. IML employs 3200 people. Mountain rounding arguments 2302 Parleys Way 484-090- 1 about stockholders whether are benefitting, at the expense of ratepayers, from profits of MFS the utilitys oil wholly-owne- d production firm, Company. In 1974, flaprika Fuel Supplys request for a rate increase may have a substantial impact on more than your Mountain Fuels gas bill stock could also be hit hard if the PSC decides to combine the companys oil and gas revenues for ratemaking purposes. After hearing similar evidence three years ago, the PSC has agreed to again con- the Wexpro PSC found that in order to adequately protect consumers, the interrelated oil and gas operations had to be combined for ratemaking purposes. As a result of that decision, sell orders for MFS stock flooded the market, and trading was suspended on the New York Stock Exchange. A week later the PSC reversed its decision, reportedly to protect the financial integrity of the utility. Nowr, with essentially the same issue before the com- - mission, a survey of local brokers by the Enterprise has revealed many investors fear the company's stock price will sag if the PSC decides to combine the Wexpro and Mountain against adverse PSC decision could affect the stock by five or six points at first, since the market "usually overreacts. But he believes the PE ratio is "about right for that Fuel accounts, Mountain Fuels kind of a stock. People who buy Mountain Fuel stock want to be in- wishes. in that drilling d supply, opined Jess of Thomson McKinnon, adding he hadn't closely followed MFS recently. The excitement of discoveries gave the stock its appeal, Harward continued. He called the utility the exotic one around the country as a result of its oil findings. Harward said his company is now touting Intermountain Gas, which serves southern Idaho, because it is starting to develop an combination similar to MFS', with oil discoveries in Nevada and Wyoming. volved think that decision would dramatically affect the stock and harm Mountain Fuel's ability to raise capital in the future, said one I Har-war- broker familiar with the company, who asked not to be identified. The broker recommended Mountain Fuel spin off its nonutility operations (which include brick, chemical and land companies) as a stock dividend to shareholders. That way, he said, the shareholders would get the benefit of those operations, which they considered when buying the stock, and ratepayers would no longer feel they were subsidizing other activities. Creating spinoffs would also prevent the issue from being reopened time after time, he added. oil-g- Complex Issues issues being considered in the current rate case are complex. The utility has asked for a $28.6 million rate increase, in large part because it wants to change its accounting procedure. The Wexpro issue arose only when it was pressed by consumer and state representatives. The Unfair to stockholders Jack Sweeney of Dean Witter also advised a spinoff, commenting it was unfair to stockholders who must contend with a continuing controversy over Wexpro. An adverse decision on the question would injure the utility, Sweeney continued. A lot of the Eastern money likes the idea this utility has tremendous oil reserves, he In 1976, million of Mountain Fuel's $23.8 million earnings. But that doesnt necessarily reflect the true proportions of oil versus gas earnings because oil revenue is often reflected in gas accounts and, $12.4 Without a resolution, many investors may read the conversely, gas revenue in oil accounts. The two accounts merge because all wells drilled arc originally classified as cither oil or gas, depending on which generates more revenue. Gas from gas wells is sold to consumers at a price based on cost of production. Gas from situation as unpredictable and want out, Sweeney said. He pointed out other oil ex- ploration companies have LICENSEE price-earnin- ratios gs (MFS trading in the low 40s last week, had a PE ratio of 10), but Mountain Fuel's was kept low because it was a hybrid utility and also be- 0 nonutility oil accounted for operations said. higher is sold at higher oil wells cause of the continuing pro arguments. Lanny McLean, manager of A.G. Edwards, said an Wex- market prices. According to Assistant Utah Attornev General James L. 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