Remington Typewriter Company

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Ilion, N. Y., March 29, 1915.
To THE Stockholders of the Company:

The Directors respectfully submit the following Report for the year ending December
31, 1914.

The European War, with the consequent universal depression in business, has made a
considerable reduction in our profits for the year. When it became impossible to foretell the
duration of the war and its effect upon both foreign and domestic business, the Board of
Directors decided to defer the payment of further dividends.

In view of changed conditions, the Directors deemed it wise to reconsider carefully the
basis of valuation of second-hand machines on hand. After a careful examination by a Com¬
mittee of the Board, a revised plan was adopted whereby machines were inventoried at figures
sufficiently below those at which they were taken in exchange to provide as liberal a margin of
profit on resale as is obtained on the sale of new machines. At the same time a more rigid
restriction of the items entering into the cost at which new machines were inventoried has been
estabhshed, so that all our stock has been taken at thoroughly conservative figures. The re¬
duction in inventory values resulting from this change, to which effect has been given as of
January 1, 1914, has been charged against surplus.

The Company, so far as we are at present informed, has suffered (except in earnings)
little or no actual loss in the war zone; but it has been thought best to set up a contingent
reserve against which to charge any possible losses due to the general conditions of business
abroad. In the summer of 1914, negotiations were pending for the purchase of some of the
foreign business which had been conducted by our dealers. This transaction, however, had
not been consummated when the war began, but, to meet any possible liability in this connec¬
tion, provision also has been made in the contingent reserve.

The expenses of the Company have been and are being reduced by increasing the efficiency
of all its departments.

A new Remington machine, embodying certain distinctive features which make it a
decided improvement over all other machines, is ready to market.

We are already securing large orders for typewriters which were formerly placed with
foreign manufacturers, and from such orders a continuing business should result after the close
of the war. It is believed that the business of the Company is on an improved basis, and better
results are anticipated during the coming year.

By order of the Board of Directors:

John Walter Earle,

President.