Trans-Lux Corporation

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Trans-Lux Corporation

110 Richards Avenue
Norwalk, Connecticut 06856
U.S.A.
Telephone: (203) 853-4321
Fax: (203) 854-6891
Web site: http://www.trans-lux.com

Public Company
Founded: 1920
Employees: 660
Sales: $70 million (2001)
Stock Exchanges: American
Ticker Symbol: TLX
NA1C: 334290 Other Communications Equipment Manufacturing

Trans-Lux Corporation manufactures, distributes, and markets large-scale, real-time electronic information displays for both indoor and outdoor use. The company’s displays provide up-to-the-minute information and promotional messages in graphic, animation, video, and text formats. Listed on the American Stock Exchange since 1925, the company has a history of innovation and financial strength. It is the world leader in displays for financial applications, serving more than 50 stock and financial exchanges and thousands of banks. It also serves the retail, gaming, corporate, transportation, entertainment, and sports markets.

Company Origins

After mining quicksilver and drilling for oil in Mexico, Englishman Percy Norman Furber arrived in the United States in October 1918 and soon delved into another difficult but completely unrelated endeavor. Furber wanted to develop a projection system that could be used in a lighted room. He enlisted the aid of a friend, Arthur Payne, who had worked with Thomas Edison. Payne hit upon the idea of rear projection. But projecting images through a screen would require the invention of a finely wrought translucent material of much higher quality than any in existence.

In 1920, Furber formed American Lux (Latin for“light”) Products, and three years later the company used natural silk to create its first successful screen. Initial sales of the screens and the rear projector went mostly to schools and churches. Furber thought about developing a similar system for the stock market after a visit to the New York Stock Exchange. At the time, the brokers crowded around a dome-topped ticker tape. Those who were closest gained an advantage. Furber created a system that projected and enlarged the stock quotations from the ticker tape onto a rear projection screen.

Financing this new operation required more capital. Furber took his company public on August 26, 1925. It was listed on the New York Curb Exchange, which later became the American Stock Exchange. That year, the company had 41 installations throughout the country on stock exchange floors and in brokerage house boardrooms.

Within a few years, the company broke into the entertainment business by creating a much larger screen for movie viewing. By 1927, it began marketing its commercial-sized theater screen, rear projector, and a new wide-angle lens to the motion picture industry. To further penetrate this market, the company created the Trans-Lux Movies Corporation in partnership with a major Hollywood production and theater company, Radio-Keith-Orpheum (RKO). Together the two companies began a theater-building program using Trans-Lux as the trade name.

4,000 Stockholders, $2 Million Value by 1931

In 1931, Percy Furber turned over the company reins to his son, also named Percy. By this time, Trans-Lux had 4,000 stockholders, 100 plus employees, and was valued at $2 million. The first Trans-Lux theater at 58th Street and Madison Avenue in New York City offered newsreels in a setting featuring larger seats, more leg room, and wider aisles than the average theater of the day. Rear projection allowed patrons to read their programs and easily locate their seats. It also eliminated the distraction of a beam of light slicing down through the crowd from an overhead projection booth.

In 1934, the company opened two newsreel theaters in Brooklyn and one in Philadelphia. Three years later, it added three more theaters and shortened its name to Trans-Lux Corporation. With newsreels no longer the draw they once were, the company began offering short films and feature movies.

Trans-Lux Enters the Outdoor Sign Business: 1940s

In 1940, Trans-Lux purchased Louis Casper’s patent on a remote-control signaling system that enabled small rounded pellets to form letters and numbers and travel around outdoor message signs. The best-known figure in this new moving message sign industry was Jacob Starr. Starr’s company, Artkraft Strauss Sign Corporation, first illuminated the“Great White Way”of Broadway. Trans-Lux joined forces with Artkraft Strauss and by 1948 was supplying electrical traveling message signs to advertisers, radio stations, and publishers throughout the country. At the same time, Trans-Lux had 1,400 stock-ticker projectors and 80 news projectors in the United States, plus another 200 in Canada.

When the television industry burst on the scene in the late 1940s, Trans-Lux began developing specialized rear-projection equipment for television studios. The company greatly expanded its engineering capacity and started supplying the studios with“Teleprocess”screens and projectors. When closed-circuit television (CCTV) emerged, Trans-Lux adapted that technology for viewing stock market information. In 1959, the company formed an electronics division to develop and sell CCTV systems. The expanded business required Trans-Lux to move from its Brooklyn headquarters to a larger, five-story building in Long Island City.

Declining Movie Audiences: 1950s

Closely tied to the fate of the movie theater industry, Trans-Lux suffered when theater attendance dropped dramatically from 78.2 million weekly in 1946 to 58 million by 1950. Sitting at home in front of the television began replacing going out to the movies.

The company’s movie exhibition business recovered by the late fifties, however, when its theaters became first-run houses for some important domestic and foreign feature films. As the U.S. middle-class began moving from the city to the suburbs, theaters followed. Shopping complexes outside the cities proliferated, and in 1964 Trans-Lux built its first shopping center theater, an 850-seat in Reisterstown Plaza Mall in Baltimore. By 1969, the company had brought large, modern theaters to five more suburban shopping centers, nearly doubling the size of its theater holdings. The next year, Eugene Picker joined Trans-Lux to head up its entertainment division and added 16 theaters to the chain, bringing the total to 37 theaters in ten states.

New Electronics Development: 1960s

Trans-Lux began to see a need for greater investment in electronics. Stock exchanges and brokerage houses were inundated with new, advanced techniques for gathering and projecting information. An anchor on Trans-Lux’s fortunes was its system’s two-step process. The information Trans-Lux relied on began with prices printed on ticker tape from Western Union. Then, a delay was required as the ticker tape shifted away from the print head to a viewing position for projecting or televising. With an electronic ticker display, Trans-Lux could bypass the printing stage, creating a real-time, immediate information system. Electronics would also eliminate the need for telegraphic data through Western Union.

In 1965, Charles Holloman was brought on board to help the company make the transition to electronics. That year Trans-Lux was shocked by the introduction of a new 45-foot-long electronic display installed on the trading floor of the New York Stock Exchange by a competitor. Even though the Ultronic’s Letrascan electronic wall device had been steadily replacing Trans-Lux tickers for several years, the New York Stock Exchange installation created great concern. Trans-Lux had enjoyed a long-standing business relationship with the exchange.

Percy Furber, Richard Brandt, Charles Holloman, and others visited the display’s developer, Recognition Equipment Company of Texas, and made a deal. Recognition needed Trans-Lux’s knowledge of how to market stock-ticker equipment. Trans-Lux needed Recognition’s technology. In a joint effort, Holloman set out to create a much smaller version of the Recognition system.

Two years later, Trans-Lux announced the Trans-Lux Jet, named for the jets of air that controlled character formation in the sign. It was the highest quality, real-time, continuous flow wall display yet produced and a new method of viewing up-to-the-minute stock market sales information. Its ten-foot size made it appropriate for brokerage offices. Perhaps the best news for Trans-Lux was that it no longer needed to rely on the Western Union ticker.

U.S. and Canadian brokerage houses ordered more than 1,000 Trans-Lux Jets in the first six months. To handle overseas orders, Trans-Lux opened an international office in Zurich, Switzerland. By mid-1969, about 3,000 Jets were in use. Shortly after introducing the Jet, Trans-Lux applied the same innovations to a closed-circuit television system.

Relocating to Connecticut: 1970s

The Jet’s popularity required Trans-Lux to find a larger production facility. In 1970, the company moved to Norwalk, Connecticut. Demand for Jets continued to grow. Longer versions of 15, 25, and 43 feet were produced. In 1969, Holloman succeeded in reducing the size of the Jet to one-fifth of the original. Ten years later, by developing a powerful miniature microprocessor chip, the company reduced the Jet to a twenty-fifth of its original size.

Company Perspectives:

We take great pride in the cutting-edge display solutions we design for clients around the world and the high standard of client service we maintain. And we look forward, moving to take advantage of dynamic new technologies, to our continued leadership in the expanding communication environments of the future.

The other side of Trans-Lux’s business, the entertainment industry, began rapidly evolving again in the early 1970s, producing new challenges. The theater building boom of the 1960s ended. The boom had aggravated the traditional industry problem of a shortage of quality movies. Bidding on films became fierce. Many companies split their single theaters into twins. Three screen and four screen theaters began appearing.

Trans-Lux lost money on its theaters in 1973 for the first time in many years. Bud Levy took over the theater department. In 1974, the year Richard Brandt replaced Percy Furber as chairman of the board, the multiplex trend (with as many as 12 screens) was in full force. Levy split some of the company’s theaters into two and three screen houses and sold off others. By 1981, Trans-Lux’s theater holdings were concentrated in the Northeast, particularly Connecticut, and the company was down to 28 screens.

Selective Stock Read-out Device

As successful as the Jet was, it left out one important segment of the stock market. Large portfolio holders and active traders had no device that would automatically zero in on their individual stock holdings or market objectives. When a Chicago-based company, Quotemaster (later called Extel) developed an experimental prototype for a selective tape read-out device, Trans-Lux expressed interest. The companies reached an agreement and Trans-Lux began further development and manufacturing of the device, naming it the Personal Ticker. Personal Tickers could be programmed to monitor up to 40 stocks on one stock exchange. By 1969, Trans-Lux began installing the product for private investors, portfolio managers, pension fund administrators, investment advisors, and individual brokers. That same year, a strong bull market ended abruptly, sending installations of all types of Trans-Lux equipment on a plunge.

Changes at Trans-Lux

Following the 1969 stock market decline, Trans-Lux management learned that their electronic display sales should not be overly dependent on a single industry. The company therefore decided to diversify and formed an industrial sales department in 1970 under the leadership of Louis Credidio. Credidio went after the commodities market and in 1971 sold an adaptation of the Personal Ticker, the T-900, to the Chicago Board of Trade. Soon Trans-Lux completed sales to many other commodity exchanges, capturing a small but significant new market.

When Extel’s teleprinter terminal sales boomed, it contracted Trans-Lux to manufacture keyboards and way-station selectors. This led to Trans-Lux’s entry into the teleprinter market. Credidio studied the telex terminal field and by 1974 Trans-Lux began marketing a telex terminal, the Trans-Lux Teleprinter (TLT), to several industries. More than 700 terminals were installed by 1975.

Entrance into Multimedia Show Business

One of Brandt’s dreams was to lead Trans-Lux into the business of multimedia shows. In 1970, the premiere of the“San Francisco Experience,”a 29-projector, seven-screen spectacular with 30 special effects wowed Brandt. He hired the creators of that show to develop a nearly $1 million budget multimedia entertainment film on New York City. The September 28, 1973 opening of the 45-projector, 16-screen film was called“bedazzling and breathtaking”by The New York Times.“The New York Experience”became the longest-running commercial multimedia show in history, an attraction in New York City, and the source of inspiration for shows in other cities. In 1986, Trans-Lux operated two multimedia attractions in New York City,“The New York Experience”and“The Seaport Experience.”That year, the company’s net income hit a record high of $4.1 million.

Further Growth and Expansion: 1990s and Beyond

In 1992, Victor Liss took over as CEO. That year annual revenues reached $24.1 million. By the time Liss retired in 2001, the company had experienced a nearly three-fold increase in annual revenues.

Early in 1995, Trans-Lux acquired Integrated Systems Engineering, Inc., a full service electronic sign manufacturing company, to broaden Trans-Lux’s outdoor signage capabilities. On November 10 of that year, Trans-Lux and Metropolitan Theatres opened a sophisticated, high-tech, 12-screen cinema complex in Loveland, Colorado. Advanced projection systems, digital sound technologies, and an architecturally elaborate 38,000-square-foot setting helped the complex draw impressive reviews.

Trans-Lux in the mid-1990s had a communications division that designed, produced, leased, sold, and serviced the company’s electronic information displays. Another division, the entertainment and real estate division, ran an expanding chain of motion picture theaters and some real estate in both the United States and Canada for corporate and income-producing purposes. From about 1998 to 2001, that division invested in building new theaters in the western states, bringing the company’s total to 65 theater screens. In 2000, the company opened a Los Angeles-based film booking office that allowed it to book films for other theater companies.

Key Dates:

1920:: American Lux Products is founded by Percy Furber.
1923:: The company installs the first ticker tape projection system at the New York Stock Exchange.
1931:: The company opens its first newsreel theater; founder Percy Furber turns the company leadership over to his son.
1959:: An electronics division is added to the company.
1964:: The company builds its first shopping center movie theater.
1967:: Trans-Lux Jet wall display is introduced.
1970:: Sixteen new theaters are opened for a total of 37 theaters in ten states.
1974:: Richard Brandt becomes chairman of the board and president.
1992:: Victor Liss became President and CEO.
2001:: The company surpasses $70 million in revenue.

The company’s capacity to produce electronic displays increased in 2000 when it opened a modern outdoor display manufacturing facility in Utah. The facility helped boost the division’s bookings by 50 percent the next year. The indoor display division remained a major supplier of communications tools for the financial community, including banks, brokerage houses, and stock exchanges. Theaters, museums, hotels, corporations, and military hospitals were also customers. The division experienced a growth spurt in 2000 when the Australian gaming authorities approved Trans-Lux’s serial slot controller for sale in that country. That decision also boosted sales of the LED (light-emitting diode) jackpot meter displays that work hand in hand with the slot controllers.

Trans-Lux also entered the healthcare industry with products designed to help hospitals, pharmacies, and outpatient clinics operate more effectively by delivering critical information displays. By 2002, Trans-Lux products and services were used worldwide. That year the company also operated about a dozen movie theaters with 65 screens in the western mountain states that produced about 20 percent of company sales. Company annual revenues had reached $70.1 million in three divisions: outdoor displays, indoor displays, and entertainment/real estate.