AULSEBROOK’S ACCOUNTS

Press, Volume XCIII, Issue 28008, 30 June 1956, Page 12

AULSEBROOK’S ACCOUNTS

COMPANY NEU'S

NET LOSS REDUCED TO £11,725 A net loss of £ 11.725. compared with a net loss of £39.804 the previous year, is shown in the accounts of Aulsebrook and Company, Ltd., for the year ended March 31. Net profit before depreciation rose from £21,206 to £29.897. but depreciation is £37,301 higher at £98,311. The £56.689 which stood to the credit of the depreciation reserve last year has been used to offset this depreciation allowance. Referring to the depreciation allowance, the directors state “the acceptance of this heavy burden involves an unreasonably high charge against the current year’s trading, but Ihe directors are of the opinion that it is, in long term, sound policy to accept the method of making the provision as granted by the taxation authorities. In effect, a substantial amount u'ill be carriea forward to set off against subsequent profits, thus easing the ultimate tax burden. ... 'I he provision for depreciation is now at its maximum and will be substantially eased during each of the next three years.’’ Carry-forward from last year was £38.340. Interim and final dividends on lhe 5 per cent, preference capital each require £5OOO, leaving £28,340. After deducting the net loss for the year, £16,615 remains to be carried forward. Bank Debt and Debtors Increase Current liabilities are £59,296 higher at £483.386. mainly through a rise of £72,713 in bank debt. Current assets are £97.502 higher at £696.892. the main factors being increases of £50.665 (to £165.904) in debtors and £46.746 (to £530,530) in stocks. Commenting on these movements, the directors say that the greater part of the increase in bank debt “is located in sundry debtors, and a decrease in other liabilities of £15.200.’’ The increase in debtors Was evidence not only of increased sales but of the cumulative effect of the credit squeeze. “However, at the end of May. the company’s liability to its bankers was some £40.000 less than at the same date last year.” Reserves are unchanged, except for the disappearance of the depreciation reserve, and investments remain at £2549. Fixed assets are £41,620 lower at £894.761. Gross profit from the manufacturing of biscuits, chocolate, confectionery, and flour, before charging depreciation, rose £36.799 to £370.605. and income from investment and rents is £2373 lower at £4551. Selling, distribution and administration costs are £25,650 higher at £343.186. Directors' fees rose £B5 to £2073. During the second half of the financial year, the directors report, "considerable progress has been made towards reestablishing the profit-earning capacity of the company. The Auckland factory is now operating efficiently, producing goods of high quality at an increasing volume. Sales show a substantial increase for the year, and during the last few' months this increase has been particularly marked. However, there is no doubt that the removal of import controls has restricted the company’s potential output, particularly in the confectionery field, where overseas manufacturers enjoy a very substantial price advantage in their usage of sugar for exportable goods.” The directors say they are confident that both the company’s trading and financial position are under control, and that «atisfactory progress will be recorded during the coming year.