Two large Washington area corporations - Financial General Bankshares Inc. and Martin Marietta Corp. - yesteday reported record profits during the third quarter and first nine months of 1978.
Financial General, a large bank holding company, said third-quarter earnings jumped more than 39 percent as interest income soared at the 13 banks it owns or controls, including Union First of D.C., American Bank in Silver Spring and First American in Northern Virginia.
For Martin Marietta, a diversified aluminum, construction materials, chemicals and aerospace company based in Bethesda, third quarter operations resulted in a 62 percent increase in earnings.The gain reflected economic strength in many domestic markets to which the company sells its product.
Financial General, a Washington company that currently is the target for the takeover by Middle Eastern investors, posted third-quarter operating profits of $3.7 million (56 cents a share) compared with $2.7 million (41 cents) in the same period last year. Counting securities transactions, FGB earned $3.68 million (55 cents) in the recent period compared with $2.7 million (41 cents).
That brought nine-month profits from operations to $9.6 million ($1.45) vs. $7.6 million ($1.16), also a record.
President J. William Middendorf II said the recent jump in profitability reflects interest earnings on a substantial 14 percent gain in total loan volume to $1 billion compared with the same period a year ago. The third-quarter earnings were the highest ever for FGB in any quarter, and the loan volume figure represented the first time the holding company's banks topped the billion-dollar level.
He also said that the "healthy economic climate" here and a successful merger of three Northern Virginia banks into First American were factors in the recent gains. Total deposits were up 6.5 percent to $1.6 billion.
Martin Marietta earned $44.7 million ($1.81 a share) in the recent quarter compared with $27.4 million ($1.15) in the same period last year as sales rose $89 million to $457 million. Nine-month earnings also were a record at $99 million ($4.10) vs. $80.6 million ($3.39) as sales were up to $1.25 billion from $1.05 billion.
Chairman J. Donald Rauth said the third-quarter results - the highest profits during a three-month period in company history - "reflect good to heavy levels of demand in most of our commercial markets."
He said Martin's shipments of aluminum, construction aggregates and cement are well above 1977 levels.
Bankers Security Life Insurance Society of Washington also reported record nine-month earnings. Net income rose 33 percent to $2.67 million ($1.93 a share) from $2 million ($1.46) in the same period last year.
During the third quarter alone, Bankers Security earned $1.17 million (85 cents), more than double last year's third-quarter profits of $578,132 (42 cents). The recent period included $180,165 of capital gains compared with a loss of $1,127 in the 1977 quarter.
Chairman Leslie Schultz said net premium income of $40 million was double the level for the first nine months of 1977, influenced largely by a $20 million increase in variable annuity premiums marketed nationally by Oppenheimer Management Co.Death claim expenses were down 14 percent, and investment income rose 9 percent, he added.
Sales of new life, accident and health policies rose 11 percent in the nine months to $3.9 million, and the company's life insurance in force totaled $3.19 billion on Sept. 30 compared with $2.89 billion a year ago.
MCI Communications Corp., a Washington common carrier that provides intercity services for large-volume users, reported profits of $1.4 million (7 cents a share) in the second quarter ended Sept. 30, up 40 percent from $1 million (5 cents) in the 1977 period. Sales rose 26 percent to $23 million.
During the quarter, MCI added 16 cities to its "Execunet" voice communications service, bringing the total to 34. For the first six months of MCI's fiscal year, earnings were $2.26 million (10 cents) vs. $1.9 million (8 cents) as revenues jumped to $43 million from $36 million.
The firm has applied to offer "Execunet" in six additional cities, including Atlanta, by year's end.
Smithfield Foods Inc., the Virginia meat processing firm, said third-quarter profits jumped substantially to $543,000 (22 cents a share) from $310,000 (12 cents) in the same period last year. The 1977 quarter had included only $32,000 of profits from continuing operations, Chairman Joseph Luter III said.
Nine-months earnings totaled $5.4 million ($2.15) vs. $1.3 millio (52 cents). The 1978 figure includes $2.7 million ($1.06) from continuing operations, reflecting a tax credit of $1.2 million (47 cents) from the reversal of taxes in prior years following a tax settlement with the Internal Revenue Service last April.
Sales in the recent quarter were $38.7 million compared with $32 million a year earlier, while nine-month sales rose to $117 million from $97 million. Luter said the gains reflected "strong consumer demand" for Smithfield's meat products and higher profit margins.
Atlantic Research Corp. of Alexandria reported a 45 percent increase in nine-month profits to $1 million ($1.92 a share) from $689,000 ($1.44 in the same period last year. Sales rose 27 percent to $31 million, and new business bookings in the recent nine months totaled $35 million. The firm's diverse operations include production of data communications test instruments and solid rocket propulsion systems.
Scope Inc., a Reston electronics firm, reported record nine-month earnings of $2.55 million ($2.11 a share), up 39 percent from $1.84 million ($1.53) last year. Sales rose 37 percent to $41 million, and Chairman William Schaub said incoming orders "have shown a substantial increase in recent months."