Company News GEAR MEAT

Press, Volume CII, Issue 30042, 29 January 1963, Page 17

Company News GEAR MEAT

Profit Up 87 p.c. On Year Before

(N.Z. Press Association) ,

WELLINGTON, Jan. 28. The net profit of the Gear Meat Comp-ny, Ltd., Wellington, for the year to October 31 last was £57.336 This M 86.8 per cent, higher than the £30,694 earned in 1961 and 11 per cent tower than the £64,426 in 1960. The latest result is reached after provision of £50,048 (£47,341) tor depreciation and an undtsctosed amount tor tax.

The steady dividend of 10 per cent. takes ■ £38,640 (£34,420). In the previous year shares from a one-for-five par issue did not participate in the interim payment of 5 per cent. The latest profit covers the dividend 1.4 times.

The profit included investment income of £7178 (£8368). Paid capital is unchr.nged ait £386,400. Reserves amount to £716,064 (£697,388), including £456,303 (£456,303) in capital reserves. Shareholders'

funds are £1,102,484 (£1,083,7887. There are provisions amounting to £35,000 (£35,000) for building and plant renewals. Freehold and leasehold properties appear at £69,945. Freeholds have been valued at 75 per cent of Government value on October 31, 1960, plus improvements, and leasehold improvements have been valued at root.

Balance sheet' figures include current assets £827,217 (£760,824), current liabilities £721,870 (£643,067), fixed assets £914,880 (£887,274), and investments £117,257 (£113,757). Current assets include debtors £134,246 (£199.450) and str k £689,342 (£558,075). Current liabilities include creditors and tax provision £284,915 (£290,921), a.d overdraft £413,910 (£332,524). Decision Justified

The chairman (Mr G. M. Pottinger) says the sales factory earnings fully justify ttie directors* decision last year to make cash and bonus share issues.

Average tax paid profits for the last three years have b-en £50,818, against £29,369 for the previous three years. “After what is termed a ‘good’ year in the meat industry it is recognised that an ‘adverse’ one may follow,” he says. “Nevertheless, the directors look forward with confidence to the future, particularly as the company’s continued efforts to diversify its activities ensure a higher and more stable rate of earning.” During the year revenue reserves increased by £ 18,706 of which £ 10,000 is shown as an addition to market fluctuation reserve, which now stands at £75,000 The board considers that this reserve should be built up to ait least £lOO,OOO as profits become available. "This is necessary, having regard to the general atmosphere of uncertainty in international markets,” Mr Pottinger sa. s. “The company s retail trade has continued to expand ait a most satisfactory rate. Once the deadening effect of price control was shaken off our turnover fig ures improved. “The good intentions of price contr J are no substitute for the spirit of competition and a careful and prudent buyer’s freedom of choice. Retail meat costs have compared more than favourably with those tor the similar period under price control. The latter neither . reflected the true variations in the cost of livestock nor achieved stability in retail prices," he adds.