INCOME RISES.

Auckland Star, Volume LXIX, Issue 254, 27 October 1938, Page 13

INCOME RISES.

SOUTH BRITISH, LTD.

WORLD-WIDE BUSINESS. PROFITS IN AUSTRALIA. "As you will gather from the further rise of over £1(1(1.000 in the premium income, business has been fairly active (lurinor the year ami. although we had to sustain some hard knocks in different parts of the world, we have with a reasonably ><>< 1 surplus in the underwriting account." -aid Mr. W. K. Wilson, <-h;i irmaii <>f directors of the South British Insurance Com puny. Limited, addressing shareholders at the annual meeting held in Auckland to-day. "It is in the accident section that the greatest expansion has Itccn taking place in recent years. Unfortunately, the profits of both workmen'* compensation and motor car policies are very slender, and this applies particularly to motor car business in New Zealand, where the rates for this class are lower than in most countries. However, the expansion is not confined to the accident side, and it is encouraging to find that, despite continually reducing rates, there is a steady growth in the lire premiums, the income from that source being higher than ever before. Fire insurance is still regarded by companies generally as the mainstay of the business. There has also been a marked recovery in marine, the net premiums producing the highest total since l!>"21. "Of the different fields in which we operate. Australia is tlie one that has made the largest contribution to this year's increase, and the business transacted there yielded a very fair percentage of profit. Rise in Expenses. at .dIIi.HJW are higher bv nearly £:?:!.imhi than for the previous year, continued the chairman. This is consistent with the greater volume of business handled, the bulk of the increase being on account of salaries and taxes.

The sum of £SO.OOO, half of the in- , creased income from premium®, has t>een added to the risks not yet expired, leaving £105.163 a* the surplus in the underwriting account. This is not quite as good as the previous year, but is eonsiderably better than seemed likely a few months ago. The amount returned from interest and rents lms advanced l>v £5500. Kents are responsible for pome of this, as our various buildings are all verv well let, and expenditure incurred a year or two ago in renovating some of the older premises is now hearing fruit. The larger return from other investments is a normal reflection of the growth in the company's assets. j The amount transferred to reserve fund bring* that fund to a level with the suliscribed capital. £23,300 lias been transferred to the investment fluctuation fund, and a further £70.000 has heen added to the contingencies reserve, which now stands at £420.000. The amount carried forward is about £3200 higher than the amount brought down from the previous rear. In the balance-sheet the amount standing against premises shows an increase of £33,752, almost wholly accounted for bv payments for the new building at Wellington. This was finally completed in May last, and the greatly improved accommodation provided for our own business is much appreciated both by our staff and by our clients. The five upper storeys are fully let to good tenants, also one of the shops. and we hope before long to have a suitable tenant for the remaining one. Mortgage Loans Increase. Loans on mortgage, which are widely I distributed, have risen by £50.391. Shares j in outside companies have increased bv . al)out £(13.000, represented by purchases ! in sound and well established concerns, : while there is the normal increase in Government stocks. Mn nicipal and Harbour Board debentures show a shrinkage of £57.000. due to the redemption of certain loans held in London and the United States. Heavy collections just before the close of the year have their reflection in the increase of over £30.000 in the bank balances and short dated deposits. The amount owing at branches and agencies | has also increased by £31.000. which I is in keeping with the growing business. The capital is unchanged, but i.s now ! represented by double the number of shares, the resolution t» reduce the ! individual value from £1 to 10/ having I been carried into effect as from January 1 last. The unusual increase in the number of holders during the past nine months would indicate that the change is achieving the desired object of getting the shares more widely spread. "After transferring £23.300 to the investment fluctuation fund, the latter stands at £304.180, which is an increase of only -£10.131. The discrepancy of approximately £13.000 i= explained bv the customary depreciation on our build - in"\s, sundry foreign exchange entries, and minor adjustments of book values. "We are recommending the payment of a final dividend of PJd per share, making a total of 1/5 for the year, said Mr. Wilson. This is slightly better than the amount distributed last year, which was 2/9 on the £1 share. Bonus For Staff. "The board would like on this occasion to recognise the staff's good work by the distribution of a bonus of five per cent on the salaries received by them during the year, and in anticipation of your endorsement an amount to meet this payment has been provided for in i the accounts before you. "Through the provident fund the staff has a stake in the company beyond that of mere employment. To this "fund they contribute five per cent of their ' salaries, the company usually contributi jug double this amount, which is liable i

to suffer reduction in an unsatisfactory year. In this way they have a direct and personal interest in the company's success, and the comfort of knowing that there is a steadily-increasing provision for them in the evening of their days." Mr. Wilson also thanked local directors and general agents throughout the world for their advice and assistance in the conduct and extension of the business. Guardian Trust Company. The business entrusted to the Guardian Trust Company continues to grow, he said, the assets under administration now reaching a total of nearly £14.000,000. On the chairman's motion the report and balance-sheet were adopted, and the dividend approved by the meeting. Directors Re-elected. The retiring directors, Messrs. P. H. l"|iti>n and S. Austin C'arr, were reelected. and Messrs. .T. A. Duncan and \. A. Duthie were reappointed auditors. In moving a vote of thanks to the directors and staff. Mr. Jas. Lowe referred to the wide scope of the company's business and said he thought the founder* were inspired when they clinie a~ the designation of the company "South British." a name which was in keeping with subsequent developments. He emphasised the fact that the company's receipts from overseas wore what was usually described in economic parlance as "invisible" exports, a verv important adjunct to New Zealand's output, which mainly consisted of primary product*! The motion was carried unanimously. .Mr. .lames Morton, general manager, responded on behalf of the staff.