Peoples Drug Stores Inc. yesterday reported a 21 percent increase in earnings for its third quarter ended July 1. Earnings were $1.1 million (30 cents a share) on sales of $81.9 million in the year-ago quarter.

peoples Chairman A.C. Israel said the improved performance "reflects the growing benefits of our long-range revitalization program, aimed primarily profitability."

Earnings for the first three quarters of Peoples' fiscal year, which begins Oct.1 increased similarily, to $4.2 million ($1.15) on sales of $307.8 million from $3.5 million (95 cents) on sales of $285.3 million in the same period a year ago.

Chairman Israel expressed optimism that Peoples sales would grow as the company opens new optical departments and mini-combo units which combine a convenience food center with traditional drug store.

Peoples based in Alexandria, has 375 retail drug store in nine states and the District under the names Peoples, Lane , Reed, Lee, Schuman, Dynamic Discount and Health Mart.

Financial Security Group Inc. the property and casualty insurance holding company subsdiary of International Bank, said first half earnings were up 54 percent to a record $4.5 million ($1.51 a share) from $3 million (99 cents) a year earlier.

The second quarter ended June 30 was the best ever for Financial Security, producing earnings of $2.7 million (89 cents), a 42 percent increase over the $1.9 million (64 cents) of the previous year.

The company said written premiums for the six months were up 9 percent from $49.5 million to $54 million. and investment income increased 16 percent from $3.2 million to $3.7 million.

Doughties'S Foods. the portsmouth food processor, reported first-half earnings jumped to $322,000 (45 cents a share) from $269,000 (39 cents) a year ago, while sales increased from $13.2 million to $14.8 million.

Earnings for the second quarter ended July 1 were $196,000 (29 cents), up from $174,000 (25 cents), on an increase in sales from $6.5 million to $8 million. Earnings per-share changes reflects a 10 percent stock dividend paid June 1.

Doughtie's said it completed in July the acquistion of Parks Seafood Inc., enabling the company to expand into seafood.

American Ralty Trust of Arlington reported a turnabout in third-quarter results, showing a profit of $59,000 (3 cents a share) against a loss a year ago of $203,000.

The trust also moved from the red into the black for the first nine months of the year, earning $1 million (46 cents) compared with a loss of $407,000 a year ago.

Revenues for the quarter increased from $1.5 million a year ago to $1.6 million, but nine-month revenues were down from $4.17 million to $4.14 million.

Chairman Thomas Broyhill said that, as a result of the turnabout, American Realty would seek permission from its debenture trustee to pay $56,800 in interest on its 7 percent debentures which was originally due May 1.

General Kinetics Inc. of Rockville reported earnings for the year ended May 31 fell to $257,000 (34 cents a share) from $590,000 (80 cents) a year earlier.

The decrease was due mostly to a $280.000 (38 cents) extraordinary item resulting fromm loss carryforwards the prior year. This year's earnings included a $17,000 (2 cents) loss carryforward.

Sales increased from $2.7 million to $3 million for the company, which provides magnetic tape maintenance services, and produces tape equipment, automated sorting machines and food testing gear.

Kapok Tree Inns Corp., owner of Perter Pan Inn in Urbana Md., yesterday reported a drop in earnings for the 12 weeks ended July 2. Profits were $180,000 (6 cents a share) on sales of $3.7 million comparedwith profits of $254,000 (8 cents) on sales of $3.5 million in the 12 week period a year ago.

Earnings for the 40 weeks ended July 2 were $1.25 million (42 cents) on sales of $13.8 million compared with year-ago profits of $1.29 million (43 cents) on sales of $13.3 million. The company said the 40-week earnings reflect the effect of its donation of land to the City of Clearwater, Fla., where Kapok

Richmond Fredericksburg & Potomac Railroad Co. reported second quarter earnings of $2.34 million ($6.54 a share) down slightly from $2.4 million ($6.60) a year ago.

Forthe first half, earnings were $4.56 million ($12.70) compared with $4.2 million ($11.69) in the first half of 1977

RF&P President Stuart Shumate noted that carload traffic handled during the second quarter was almost level withthe second quarter of 1977.

Union Trust Bancorp, holdingcompany for Union Trust Co. of Maryland, reported yesterday a 14 percent increase in second-quarter profits to $2.1 million (88 cents a share) compared with $1.9 million (77 cents) a year earlier. Six-month net income rose 13 percent to $4.2 million ($1.73)compared with $3.8 million ($1.53).

Total assets were $1.14 billion on June 30, an increase of 7.8 percent from the same period in 1977, while deposits jumped about 11 percent to $850 million. Chairman Stevenson Peck cited increased consumer loan volume as a major factor in earnings growth.

Stanwick Corp., a management systems firm in Arlington, reported lower profits for the fourth quarter and fiscal year ended April 10 . Stanwick earned $375,702 (37 cents a share) in the recent quarter compared with $457,851 (44 cents) in the same period last year.

Earnings for the year ended April 30, were also down, to $1.6 million (1.50 a share) from $2.5 million ($2.34) the previous year. the company said the decrease in net income reflected a delay in finalizing a contract with a primary customer.

Bankers Security Life Insurance Society reported second-quarter earnings of $829,199 (60 cents a share) compared with $864,715 (63 cents) a year ago.

Six-months earnings were up, to $1.6 million ($1.15 a share) from $1.3 million (96 cents) a year ago. Bankers Security is affliated with International Bank here.

TransTechnology Corp. of Alexandria reported a decrease in net income for the year ended March 31 despite a 35 percent increase in sales. Net income for the year ended March 31, 1978, was $604,804 (34 cents a share) compared with $946,761 (55 cents) for the previous year. Sales increased to $29.9 million from $22.1 million.

The company attributted the decrease in income to unanticipated losses at its Italian subsidiary, Muzzi-Gessner, a loss at a manufacturing subsidiary and reduced profit margins for its ordnance operations.

Scope Inc., a Reston manufacturer of electronic products, reported record six-onth profits of $1.7 million ($1.38 a share) compared with $1.2 million ($1.00) in the same period last year. The 39 percent increase in earnings came on a 32 percent increase in sales to $26 million.

Chairman William Schaub said Scope's backlog of orders at mid-year was 68 percent above the level of last Jan. 1, indicating "sustained growth through 1978," In the second quarter, Scope sold a printer product line which added $85,000 (7 cents a share) to net income for the 1978 period.