Nickels Make Millions
Lance off Charlotte lias to sell a lot
of snacks to roll up its gross.
(Investor's Reader >
The snack pack of crackers and
cookies has never enjoyed a belter
market, according lo financial vice
president George McCormick of
Lance Inc. From Charlotte headquar¬
ters he reports demand has been
spurred by "more people with more
money and more leisure time." They
have thus had more occasion to pass
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CHIPS
Thai fuc* to i any kind of vimlulcb — an>
lime, .invulicic.
flut if ><m -uni a wbL delirhiful cm-
phaM» on pickle- in your 4.ind»i<h, here'-
j neu one «ith the Mount Olive Pickle-
built riuht in i be ftllinit:
DOUBLE CHEESE-PICKLE
SANDWICHES
the pickle-chee-e blend
»
beany
undwkli Havor that you'll call for again
and again, once you've tried It. Make It
tin- way: I (3-ounccl pack cream cheeve
tOftCMtf: Vj cup grated Cheddar cheece;
'• c»P Mount Olive SWEfcl SALAD
CUBES; 2 ublc-poon- of milk: -alt and
pepper:
К
-lice- buttered wltoJewhcal or
nut bread.
Combine cream cliee-e. Cheddar cbtevc.
pickle- and milk Sea-on. Spread on bread.
lor a Perfect Sandwich Partner:
the snack stand or machines in service
stations, offices, factories or stores.
The Lance variety includes Toast-
chce. Nekot and Lanchee peanut-but¬
ter filled crackers, Choc-O-Lunch
cookies, Nip-Chee cheese-filled crack¬
ers. peanuts, cheese bits and fig bars.
The 1965 acquisition of Bullock Manu¬
facturing expanded the menu with po¬
tato chips and corn curls and chips.
Lance distributes its goodies in 26 Mid¬
dle Atlantic. Southern and Midwest
States.
But though the nickel pack ( Lance’s
predominant package) continues in
strong demand, George McCormick
laments, in recent months “rising costs
of wheat, oil and sugar plus increased
wages have caused a profit squeeze.
You can't raise the price of a nickel
snack to offset such rising costs."
However, for the full year 1966 the
financial executive expects Lance will
turn in another record, its tenth in a
row. He guesses sales will reach S42-
1 0-4 3,000, 000 compared to $37.700,-
000 in 1965. George McCormick hesi¬
tates to predict profits, saying only that
the gain will be less than in previous
years.
Wall Streeters expect net income
around SI. 47 or $1.48 n share. In
1965 net income was $3,800.000 or
$1.40 a share. In these figures the
operations of Bullock arc not included
for either year. George McCormick ex¬
plains Bullock was considerably in the
REAL ESTATE
LOANS
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INVESTMENT LOANS, INC.
Bo« 74 Night Tel. ME 9-4430
ANGIER, N. C.
red when it was acquired and although
it has turned the corner its 1966 profit
on $2,000,000 sales is not "significant."
To add to the confusion, in the report
for the 36 weeks ended September 3,
which showed earnings of 97c a share
vs 88c for the 1965 period, the Bul¬
lock losses were included in arriving at
the 1965 figures.
The 2,700,000 Lance common
shares trade over-the-counter around
17, up from 13 last September. Since
the stock went public in 1962 the price
has ranged within the limits of 23 and
1 1 which were established the first
year. The company pays 14c quarterly
dividends, supplemented by a 6c extra
paid last month (but a year ago the
extra was 8c).
In the decade ended 1965 Lance
sales rose 80 per cent and net income
was up 275 per cent while the operating
profit margin widened in nine of the
ten years. But now, following the nar¬
rower margin of 1966, the financial
vp believes Lance has effected the ma¬
jority of production and other efficien¬
cies it can to cut costs.
"In the future we will get more profit
by making more sales.” To get more
sales, "the first thing wo are trying to
do is push the 10c pack on all our
merchandise.”
Since the larger pack goes over bet¬
ter in vending machines. Lance plans
to greatly multiply its machine distri¬
bution. It currently owns 3.000 dime
machines and plans to add 8.000 more
this year alone. The machines are
rented out to companies and institu¬
tions which also buy the snack pack¬
ages and gel reimbursed by collecting
the coins.
To make more production possible,
Lance is in the midst of a $2,500,000
expansion of its ultramodern $7,000,-
000 office building and plant which
was completed in early 1963. The ad¬
dition is to be completed by the end
of this year and will produce
20-Ю-25
per cent more capacity.
Acquisition is another possible route
to increased sales. In 1966 Lance be¬
gan and then terminated negotiations
with two small companies, Tandy
Snacks and T-K Foods, both of Or¬
lando. George McCormick notes "we
will continue looking for acquisition
possibilities." As for Lance being a
candidate for merger by some other
diversification-hungry corporation, the
vp says: "Wc get inquiries all the time
but as a matter of fact I just finished
telling one big national concern that wc
were not interested — period."
io
THE STATE. APRIL 1, 1967
