FINANCE AND COMMERCE

Press, Volume LXX, Issue 21296, 16 October 1934, Page 13

FINANCE AND COMMERCE

SYDNEY WOOL

SALES SLIGHTLY HIGHER PRICES KEEN COMPETITION FROM YORKSHIRE (CIITID PRJBS ASSOCUTIOJt— ST ILBCTMO TELJOBArH— COPTBIOHI.) (Received October 15, 10.40 p.m.) SYDNEY, OctcSer 15. The wool sales were resumed today and 8906 bales were offered, 7875 sold, and 1029 disposed of privately. There was keen competition from Yorkshire for suitable wools, and good support from Japan and the Continent. Compared with closing Sydney rates at the end of September, well-grown fleece wools and bulky skirtings ruled in sellers' favour and were occasionally 5 per cent, higher, while average descriptions remained firm. Good clearances were effected. Greasy merino sold to 15Jd for 33 bales from Narrandera.

WOOL DEMAND

SALES CANCELLED AUSTRALIAN POSITION (i-bom: otra ows cosBEsroNMKT.) SYDNEY, October 6. > There are several aspects of the present wool selling season in Australia that have extraordinary aspects, and the latest development has been the cancellation of the sales on two days in Melbourne this week. The reason for this unexpected move was the difficulty which the brokers experienced in making up catalogues, a large number of the growers having refused to submit their wool while prices regain at the present low levels. There are now more than 100,000 bales in the Melbourne stores awaiting sale, and the amount of wool available in Sydney is also accumulating at an alarming degree. The outlook is anything but promising, but in some circles it is considered that there is a ray of hope. It is felt that the lull in the market might be only temporary, but the reasons for optimism are hard to seek. In the circumstances it would seem that the selling season is going to be .«. unduly protracted, and it is feared tßat there will be a big carry over unless there is a distinct improvement in prices in the near future. The wool growers have always been against a controlled market, but this does not prevent them from limiting the amount of wool which they are prepared to place on offer. Many wool growers in Australia and New Zealand profited by the fact that they were able to hold on to their wool when prices were low, but the number who are able to do that has grown less, and this season there will be many cases of hardship. The official programme provided for the offering of 1,350,000 bales before Christmas, but it is obvious now that that figure will not be reached. At the moment there does not seem to be the slightest chance of successfully offering anything like that quantity. Thus, before the selling season is in full swing the trade is faced with grave problems, almost entirely the result of the German embargo, which has not only disorganised the wool-buy-ing business of that country, but has automatically put severe restrictions on the buying of England, France, and Belgium, which normally have a big wool business with Germany.

CONVERSION OF DEBENTURES

OPTION CLAUSE CONDEMNED (PRESS ASSOCIATION TELEOBAit.) DUNEDIN, October 15. The opinion that the stock exchanges should enter a strong protest was expressed by Mr Harman Reeves, chairman of the Dunedin exchange, in discussing some features of the conversion of local body debentures. Mr Reeves referred particularly to the option given local bodies, where a debenture became payable after 1940, to make the new debenture payable at any date thereafter by giving the holder six months' notice. He said this involved a distinct injustice to holders of long-dated debentures, for, if any local body availed itself of this option, devaluation as a stock exchange security would immediately follow, to the detriment of the holder. Mr Reeves said that the Dunedin Cl *y Council, when the injustice was pointed out, had immediately eliminated the optional clause, and fixed the maturity date for all loans, but there were other public bodies who were not meeting lenders in the same fair way. "Investors should take particular tare when paying premiums for Government and local body stock to see that the issuing authority has not an option to repay before the maturity •JBte," said Mr H. Kitson, chairman 01 the Christchurch Stock Exchange, When the above message from Dunedin was referred to him yesterday. "If stocks are bought and the investors understand that there is an option to *epay before the maturity date, then l" e y buy with their eyes open," said *«" Kitson. "Probably it would have oeen fairer not to have given the {-suing authority an option to repay °y giving six months' notice, but to wwl them state at the earlier date «i»« er the y wished to exercise the option or not. If the option was no£ \™ r ?A sed ' then the debenture holders ™°uid know that their securities were !°, carry the long maturity date. In «TOity, where the issuing authority {?? ?" option to repay on giving six «onths' notice, the debenture holder Dav ? ave the ri^ht to demand repayment on giving six months' notice." DAIRY PRODUCE BUTTER MARKET QUIET ■ .The South Island Dairy Association, **< 1.. has received the following market report from the New Zealand Pro'toce Association, Ltd., London:— gutter—Quiet; 63s to 655; Danish, IgCheese—Steady; white 48s; coloured —

SOUTH BRITISH INSURANCE OPERATIONS FOR YEAR INCREASED PREMIUM INCOME [THE PEESS Special Service.] AUCKLAND, October 15. The accounts of the South British Insurance Company, Ltd., for the year ended August 31 show a substantial increase in the underwriting surplus, which, at £115,339, is £50,877 higher than in the previous year. This is the highest yet recorded and is accounted for by the increased premium income. 38 well as by the reductions in losses and expenses. The ratio of losses to premium income, at 52 per cent., is the lowest since 1920.

o T A e y ear ' s dividend is unchanged at is 8d a share.

The transfer of £IOO,OOO to the genor,aL„reserve brings this fund to £1,000,000.

The net premium income for the year amounted to £813,472, which with interest and rents received and accrued (£124,690) after the payment ° f income tax, makes a total of & "38,162.

After making full provision for losses outstanding and for taxation, there is a surplus m the underwriting account of £115,339, making, with the £124,690 received from interest and rents, a total amount available of £240,029 This amount has been dealt with as follows:

To reserve fund ' .. .. 100,000 Interim dividend of Is 4d a share, paid in April .. 68,776 Final dividend now recom-

mended of Is 4d a share, making 2s 8d a share for the year .. .. 68j776

..Thjs leaves £2477, to which is added the balance from August, 1933, less dividend paid in October, 1933 £213,267, making, to be carried into the new accounts, £215,744. paid ca P ital is unchanged at £1,031,640. The reserves, which include new item—contingencies reserve ■7i°ifi„„ £l^47 ' 388 - compared with £1,662,437 in the previous year. Total assets at £3,322,494 compare with £3,189,578 last year.

N.Z. GUARANTEE CORPORATION ANNUAL MEETING [THE PBESS Special Service.] WELLINGTON, October 15. The annual general meeting of shareholders in the New Zealand Guarantee Corporation. Ltd., was held today. In moving the adoption of the report and balance-sheet the chairman (Mr W. Thorpe) explained fully the operations of the corporation during the last year, and emphasised the fact that the corporation's assets were in a liquid state. He also pointed out to shareholders that if the recommendations of the board were carried the general reserve account would be increased to £30,000, which, together with £3256 carried forward, would make the total reserve equal to slightlv more than 46 per cent, of the capital of the corporation. Mr W. Appleton, vice-chairman, in seconding the motion, endorsed the remarks of the chairman and made special mention of the conservative policy adopted by the board. Several shareholders spoke in congratulatory terms of the results of the year's working and in support of the policy adopted by the board. All of the recommendations of the board were passed unanimously. Messrs S. Kirkcaldie and G. W. Magnus, the retiring directors, were re-elected unopposed, and Messrs Watkins, Hull. Wheeler, and Johnston were reappointed as auditors. Generous references were made of the work of the directors, manager, and staff, and the meeting terminated with a vote of thanks to the chairman. A final dividend of 2d a share was paid to-day, making a total of 4d for the year.

[BROWN, EWING AND CO., LTD TRADING PROFIT INCREASED Brown, Ewing and Company, Ltd., drapers, Dunedin, will submit the following report to the annual meeting of shareholders for the year ended August 15:— The results of the year's trading show a net profit of £1024 19s lid, as compared with £742 12s 8d last year—an increase of £282 7s 3d. While this upward trend is satisfactory, there is still room for improvement. The chief difficulty is the obtaining of an increased volume of business, and this will depend on the restoration of increased spending power in the hands of the public and the co-operation of shareholders and their friends. The dividend on the preference shares will be paid at the rate of 5 per cent, per annum, but the directors regret that no dividend on the ordinary shares can be recommended. During the year the company suffered the loss by death of Mr George Ritchie, who for some years occupied the position of director. The vacancy in the directorate has not been filled, and a resolution will be brought before the annual meeting authorising the directors to fill the vacancy when they deem it advisable to do so. Mr P. O. Smellie retires, and, being, eligible, offers himself for re-election.