STRONG REPORT FOR DALGETY

Press, Volume CIII, Issue 30481, 1 July 1964, Page 15

STRONG REPORT FOR DALGETY

(Special Correspondent N.Z.P.A.)

LONDON, June 30. The merger of Dalgety with the New Zealand Loan in 1961 is reported to be yielding gains of up to £lm a year, says the “Daily Mail” financial editor. He tips Dalgety as a share for British investors to hold over the General Election and through the life of a Labour Government

Colonel Christopher Dawnay, the chairman, says considerable economies, short and long term, are expected from the merger. “There will also be longerterm benefits which will show over the next five years,” said Colonel Dawnay. “We shall reorganise wool stores and offices and cut down handling expenses. However, these benefits may be partly offset by increased costs.” Coloney Dawnay was also reported as saying that he thought Dalgety was increasingly becoming a growth stock.

“I believe in continuing our efforts in the things we know about, that’s why we are steering clear of things like minerals, which we don’t know about, and limiting our activities associated with agri-

culture to the countries we know—Australia, New Zealand, England . and East Africa.” But there were, plenty of opportunities for growth. First, the company’s cattle and sheep station business would be expanded as soon as the management organisation had been built up. “The Government is doing a lot to persuade people to take up a block of virgin land and bring it into production, and we may well do this. It may take a lot of capital initially, but the returns eventually can be good,” said Colonel Dawnay.

The wool business should continue to grow at about 3 per cent a year—that would be the company’s bread and butter; But it was expected that the other departments, ranching and merchandising, would expand a great deal faster—they would be the jam. In Australia the opportunities for rapid growth were “very considerable”.

About a third of Dalgety’s profits came from wool. There had been a record clip, sold at prices 20 per cent higher than the year before. A lot depended on seasonal factors, and next year the clip might be a little less, said Colonel Dawnay.