Warres E.Burrert | ise KiEtY Lata > Osata NeBRasia 6819) | February 3rd, 1976 To the Hilton Head Group oo | ear Ger Normally, when you get a letter from the wife, partner or secre- tary of Joe Glutz saying, Of course, Joe is too modest to tell you about this hinself, but I know you would want to hear thet,..7, it means that Joe is standing over the writer with @ gun at his ~ head, telling him not to look up from the xergx machine until the mailing has been completed, This one is for real. . - Today I received the 1975 annual letter of Walter J. Schloss As- + soetates, which included a twenty-year compilation of Walter's record since he left Graham-Newman. You may nemenber that I went to work for Grahan-Newnan in 1954." Walter left in 1955. And then Graham-Newnan closed up in 1956. I would prefer not to dwell on the implications of’ this sequence. | - ean * In any event, armed only with a monthly stock guide, a sophisti- “cated style acquired largely from association with me, a sub-leasé on @ portion of a closet et Tweedy, Browne and a group of partners whose names were straight from a roll call at Ellis Island, Walter strode forth to do battle with theS AP. | On the following page is‘a re-cap of his yearly performance and _ calculations I have. made regarding compounded results. The dif- ” ference-between the gross results and the limited partners’ results ig accounted for by the fact that, as General Partner, he takes ~ ~ 28% of the profits - a quaint and easy-to-calqulate method of tribute not entirely foreign to many of you. Walter-has had five down years compared to seven for the $ & P. His sugeriority in such down years would indidate that not only is he x man for all seasons, but that he has epecial strength when facing 2 heed wind. Maybe all of you had better watch Ben Grehem on Wall Street Week this. Friday. As for me, I'm going. vight.out and buy some Hudson Pulp & Peper.Warren £. Burgett April 15,. 1994 -To the Lantana Grow Eighteen years ago, I sent you the [attached meno that recounted the results Walter Schloss hed achieved sinca starting his partnership in 1955.- . The ether day I received Walter's 1953 [tabulation which is also attached. Accompanying these perforgance figures is a financial statement that should inspire sen Gahan Productions to film Citizen Schloss. Please note that Walter's total office expense is about $11,000 as compared to net income of $19 million. Fixed assets are carried at $2,605 (000's not pnitted), but Walter. would like me'to mention that the cost vas $6,569 new. . .. = think Walter's operational style shoul all (one Charlie has already mastered). 1 running his office for a year on what it cost: the engines on The Indefensible, be a lesson for us_. éffect; Walter is - Berkshire to start Meanwhile, Walter continues to outperform managers who work in temples filled with paintings, staff and ¢omputers. and he accomplishes this feat by rummaging anong the cigar butts én the floor of capitalism: It's quite a 38-year record, a tribute to 3en _ @s a@ teacher, Walter as a studerit,-and to the advantage.of a free puff. WEB/d> “yc ipsWaller & Edwin Schloss Associates, Li P.__. year (ara) s70:0¢4 Results of Walter & Edwin Schloss Associates Compared to } The Standard & Poors Industrial Average assocrarss ears 19960 INDUSTRIAL Avo. goer Re Ars Associates MERE Hie Re Distributed Overall Gain Over: Per Year Avg. inded Fa Annually Per Year Gain Incl, at ee Fhe Per Unit! in Percent in % Diyds. Yr. 1955 $5,082, 50 BB. be 1956 "51 034.85 $ 306.28 +6.84) 17.58 50.01 1952 41429'30 37-10 af a tee 43 i 958. : a. 1960 21398-33 es: 0 9.58 2961 1912.30 1,170:50 28.85 1962 §)185.9: Bn ag 196382 48.66 20.1%, 1984 gio" 56 32. 3965 6, 905,14 35.7%! 198% 198.95 8: 1967 6,695.30 : 3968 7,972.94 5.58 Be ae 4971 8,426.60 428.5% 1972 6,761.94 15% 1973 1228.52 - 8. 3m 197% 278-37 = 6: 2h 197 $,640:00 Sua! 49 we tote Bg 2094. 25. : ine E186 58: Be 1979 da, 29, 39.78 . 1980 10,200.00 2 3g 1% 1981 10,026.00 38. 2h sf | Th 1982 10,718.00 24, 32.38 Fo 138) 42s 2.22 38. Sheae | 4 19 13,880.00 6: 6. | 1% 1985 12, 336:00 19. 25.0% Of 1986 10,362.00 ais 1B * ao PES Se RR Be 1916. : , 15, 1989 10,548.60 2, eg Bik "990 9,332.00 42s 12. 3.08 BE. 1918.90 oe ie 79g 92” 10,850. 5 i 993 11,826.00 2: 26.9% 9:08 99h 12/434.00 it. 15.26 3.86 995 33,438.00 1,626.00 2a 28.3% Bm {| * In 1980, $1,500. of our distribution was @ return of capital. For the bo year period snded Deconber, 31,1995 th of return for the Limited Partners was 337.! pared to a gain for the Standard & Poors Industrial A\ ‘or a compound rate of return of 10.WK a yoar. It should be noted that most of our distributions of long term capital gains. OX” “or 35.) compound rate 7Xper year com- jerage of 52, 03% re in the form i i