BRITISH INSULATED CALLENDER’S CABLES, LIMITED

Press, Volume XCIII, Issue 27986, 5 June 1956, Page 15

BRITISH INSULATED CALLENDER’S CABLES, LIMITED

Sales Increase Of 36 Per Cent. BENEFITS FROM CAPITAL EXPENDITURE PROGRAMME Mr W. H. McFadzean On Progress Overseas

The Eleventh Annual General Meeting of British Insulated Callender’s Cables, Limited, will be held on June 15 at the* Adelphi Hotel, Liverpool, England. The following is an extract from the circulated statement by the Chairman and Managing Director, Mr W. H. McFadzean, C.A., Companion I.E.E. Profit on Trading has increased by £4.473.647 or 61 per cent, to £11.852.852. A combination of several favourable factors has contributed to this record, but the two main reasons have been the increase of 36 per cent, in sales with its great benefit to our load factor and. of at least equal satisfaction to your Directors, the benefits now being received from our substantial capital expenditure over recent years at home and abroad. After adding other Income and deducting Depreciation and the other items detailed in the Profit and Loss Account, the Group Profit left available from 1955. subject only to Taxation, is £4,024 603 higher at £9.967.219. Out of this Taxation absorbs £4,839,058 or almost 50 per cent. In view of the necessity of strengthening certain reserves in the ordinary prudent conduct of the business, it is proposed to transfer £3.331,355 to strengthen Revenue Reserves and Carry Forward, in addition to adding to Special Capital Reserve the profit of £87,740 made on the Realisation of Investments.

• Following the Interim Dividend of 4 per cent, (less income tax) paid on the Ordinary Stock before our recent new issue, we propose a Final Divident of 81 per cent, (less income tax) on the new Ordinary Capital. The Balance Sheet is a strong one with disclosed Reserves of over £27,000,000 and manufacturing assets shown at very conservative figures. Sales of the Group were 36 per cent, higher at the record figure of £119.000,000.

A considerable proportion of the increase is accounted for by the higher prices ruling for many of our raw materials and copper in particular, but there has also been a substantial increase in the physical volume of our output due mainly to (a) the consistently high demand for practically all our products as distinct from the somewhat uneven load factor of the previous years; and (b) the benefits of the extensive modernisation and expansion of manufacturing facilities carried out in recent years enabling us not only to increase the volume of our production but also to comply with the frequent demands for quick delivery and the ever-increasing emphasis being rightly placed on price and quality. DIRECT EXPORTS TOTAL £lBm. Competition overseas during 1955 has been more intensive than ever and profit rates have suffered accordingly. Through the sustained efforts of our personnel at home and abroad, often . involving arduous and long journeys, we have nevertheless done business in 120 countries and achieved direct exports from this country of £18.000,000 including a substantial amount to the dollar area. To arrive at our full contribution to this vital national problem there must also be taken into account our indirect exports from this country (substantial but unfortunately impossible to assess accurately), represented by our products incorporated in plant manufactured and exported by other British Companies, and also the benefits of the further £23,000.000 turnover achieved by our Overseas Subsidiaries. In Australia, we have received orders for the installation of overhead traction equipment for two extensions to the electrification we are carrying out for the New South Wales Railways. Two important cable contracts in Canada employing 230,000-volt oilfilled cables, have been secured; one from the British Columbia Electric Company and the other from the Hydro-Electric Commission of Ontario in connexion with the St. Lawrence Seaway Project. , IMPORTANT SUBMARINE POWER CABLE DEVELOPMENT One of our most important developments which is attracting world-wide attention is in the submarine power cable field. Stockholders are already aware of the unique order we are executing for British Columbia Electric Company. I am glad to report that manufacture of the cables has been successfully completed ahead of schedule. The cables are now being loaded on to a special cable ship for transport to Vancouver and installation this summer. In this same sphere we are proud of the recent award to us by the New Zealand Government of a contract to investigate and report on the practicability of a submarine power cable across the Cook Strait. If this can be successfully accomplished it will bring to the New Zealand Government and State Hydro Department not only a fitting reward for their vision and courage, but also great financial economies. Our own Group Companies in Australia have all made further progress during 1955 and are steadily justifying our confidence in their future. As I advised you in my Statement last year, our new Canadian Company, Phillips Electrical Co., Ltd., had an extremely difficult time in 1954, mainly due to the major re-organisa-tion we were then carrying out. The first fruits of the latter were certainly gathered in 1955, for Phillips then made a profit of over £700,000 before taxation as compared with virtually breaking even the previous year. The Indian Cable Company, in which Indian Nationals have now a substantial shareholding, has also had a

successful year and is making its full contribution to the great industrial development of that country. Associated* British Cables. Ltd., in New Zealand, in which we have an important shareholding and act as technical advisers, has made further splendid progress. We have recently formed our own 8.1.C.C. New Zealand Company with a New Zealand Board : to deal with major contracts there and j to strengthen still further the coordination between the Parent Company and the valuable Agents of long standing we have in New Zealand. The new factory in Pakistan in which we and certain other Companies in this country together with Pakistan Nationals are interested, was recently opened by the Hon. Mr Habib I. Rahimtoola. Minister for Thdustries and Commerce. COPPER—SUPPLY AND DEMAND To many of us in 8.1.C.C. the outstanding memory of 1955 will be the problems we encountered relative to the supply, price and financing of copper. Copper is a metal which is and I believe always will be of great importance to the electrical industry, and I hope there will be an absence of the labour troubles which have bedevilled the position in recent years; that supply arid demand will soon be in balance; and that prices will stabilise at a much lower level than they are today. It will be of great benefit to all concerned if these three practical possibilities can be achieved. Although copper is a vital metal to us, we have over recent years spent considerable time and money on the development and use of other metals and in particular aluminium. Our efforts under this latter head were further intensified last year and today we can justly claim to be in the forefront technically in our particular sphere. I would sum up the outlook for 1956 by saying that whilst I view it with some caution and certainly cannot visualise the uniformly favourable conditions of 1955 being repeated. I feel we can look forward to satisfactory results. From the longer term aspect I have every confidence. The electrical field must be an expanding one, and the fact that it is becoming more and more technical is all in our favour. We have a wide base of products and. through our overseas policy, a world-wide snhere of activity. Above all. we have the personnel—the greatest single factor in assessing the future of any concern. Local agents:— BICC Construction <N.Z.), Ltd.. G.P.O. Box 1176. Kelvin Chambers, The Terrace, WELLINGTON, C.l. National Electrical and Engineering Co., Ltd.. P.O. Box 153, 334 Tuam street, CHRISTCHURCH. Richardson, McCabe and Co., Ltd., P.O. Box 476. 156 Hereford street, CHRISTCHURCH. —Advt.