FACTS FOR INVESTORS.

Auckland Star, Volume LXII, Issue 151, 29 June 1931, Page 4

FACTS FOR INVESTORS.

FARMERS' FERTILISER CO. PROFITS MUCH LESS. NO DIVIDEND THIS YEAR. The slump in the prices of primary products which has lessoned the value of the Dominion's exports by over £30,000,000 in two years has had a disastrous effect on the purchasing powers of the farming community. The man on the land is hard put to it to make both ends meet. In many cases he is eating into his capital and in these circumstances is compelled to find some means to curtail his expenses. Under such conditions what more natural than to cancel, or, at any rate, reduce for a season, his bill for fertilisers? From past results he knows such a policy is almost suicidal, but there appears to be no choice. The sale of manures has accordingly gone down tremendously and the fact is reflected in the accounts just issued by the New Zealand Farmers' Fertiliser Company. Last year, owing to a change of balancing time from March 31 to May 31, the accounts covered 14 months. Net profits for that period were £30,975; for the year just ended they have dropped to £4649, and the directors have been compelled to ask shareholders to forgo the usual dividend. The following table indicates the trend of business since 1922:—

♦Loss, i Deficit, fFourteen months. From the foregoing it will be seen that until last year the company had made steady progress and the returns for 192930 were the best in its history. The financial position may be gauged from the following tables showing the movement in the chief items of the balance-sheet:—

Attention has previously been drawn in these columns to the excessive dependence upon the bank for accommodation, and although the overdraft is slightly less in the latest accounts it is, when consideration is taken of decreased trade, relatively larger. On the other hand there is a very substantial drop in the amount of other liabilities which are less than half the totals of a year ago. The curtailment in trade is clearly indicated in the items, stocks and book debts. Stocks are less by £18,464. and sundry debtors by £17,299. After allowing depreciation on plant, total assets have dropped £42,380 in the year, while liabilities have decreased £22.577. There are nominal reserves, which include the carry-forward total £37,656, and these are invested in the business. The direc-. tors' report gives an assurance that administration and working costs have been cut down to a minimum, that both the Auckland and New Plymouth works are maintained in a high state of efficiency and shareholders will endorse, the hope expressed by the board that the "coming year will bring about a more confident tone and an improved demand for fertilisers." Meanwhile investors have been taking stock of the position and the shares which were selling at par a year ago are on offer to-day at 12/.

Gross Xet Div. Nominal Year profit, profit, p.c. reserves. £ £ £ 1922 _ 15,916* — — 1023 65,682 7,247 — 24,412t 1924 i 81,575 24.106 — 21,754 1925 84,812 25,724 7* 23,016 1926 93.36S 27,356 7 A 25,346 1927 88,740 25.1S7 74 30,883 1928 79.809 37,026 6 32,789 1929 97,231 27,055 8 32,98." 1930f 99,321 30,975 8 3,"),007 1931 54,575 4,649 — 37,656

LIABILITIES. Paid Other Date. capital. Overdraft, liabilities. £ £ £ 1022 .... 261,942 125,382 4.S04 1023 263,111 81,523 28,734 1024 261,745 22,780 46.00S 1925 261,005 SO.63O . 52.03o 1026 .... 261,09a 178,623 35,032 1027 2(51,005 181,221 45.788 1025 261,095 168,502 43,769 1020 261,005 149,875 42,880 1030 2C1.9D.J ] 97,000 41,334 1931 261,995 195,652 19,996 ASSETS. Land, buildings Book Date. and plant. Stocks. Debts. £ £ £ 1922 300.S10 10,06S 11,514 1923 .... 294,051 15,130 24,009 1924 .... 27S.684 1O.:?64 35,006 1923 3G8.339 L'S,57.". 29,7">2 1026 .... 434,307 37,686 36,1.77 1027 424,37S 64,824 37.265 1928 .... 411,511 42,681 03,383 1929 4J 5,495 - 51,373 35,265 1030 .... 421.408 07,812 38,302 1931 .... 414,879 79,348 21,003