Building Trade Now “More Competitive Than For Decade”

Press, Volume XCIV, Issue 28155, 19 December 1956, Page 19

Building Trade Now “More Competitive Than For Decade”

The building industry, though still quite active, is back to normal and business is becoming more competitive than it has been during the last 10 or 12 years. This comment was made by Mr A. E. Odlin. chairman of the C. and A. Odlin Timber and Hardv. are Company, Ltd., at the annual meeting in Wellington. Net profit, after tax, for the year ended September 30 was £44,553, compared with £59,759 the previous year. Last year’s profits included nonrecurring items, said Mr Odlin. The decrease this year was not surprising in view of the Reserve Bank credit restriction policy. Commenting favourably on the Government’s decision (announced last week) to remove building controls, Mr Odlin said that in his opinion the decision was overdue. “The present measure of credit control has had the effect of checking any tendency towards a boom in the building trade, and will continue to do so. In that respect I have no quarrel with the socalled credit squeeze.’’

The increase of £107,000 in paid capital in the current calendar year was needed for the replacement of plant, for new buildings and renovations to existing properties, and the reduction of immediate liabilities. A transfer of £30,000 to plant replacement reserve was approved at the annual meeting. “Sawmilling and timber merchandising plant and transport equipment is not only costly to maintain, but also the replacement price of plant today is much higher than the original cost,” said Mr Odlin. “On the timber side of our business in particular, some of our plant is becoming uneconomic, and it is intended to embark on a policy of progressive replacement with more modern equipment. Some of these costs will be met out of the fresh capital which has been raised, but nevertheless it is considered prudent that this year instead of transferring portion of our profits to general reserve as in former years, we should create a special plant replacement reserve,” said Mr Odlin.