Review Of Week’s Stock Exchange Transactions

Press, Volume CIII, Issue 30497, 20 July 1964, Page 15

Review Of Week’s Stock Exchange Transactions

The mid-week steadying on New Zealand stock exchanges last week stopped trading from following the runaway dash of the week before, but over the week the market was again firm, with just a hint of steadying at the close. Turn-over was down sharply on the week, but trading again covered a wide range of issues. Daily average turn-over on Christchurch stock exchange was 19,513 against 24,018.

There was a rather subdued start to the week, but the tone was firm on both Monday and Tuesday. This trend was checked on Wednesday as rises and falls came into balance.

However, the setback was temporary and the market rose again on Thursday, boosted by New Zealand second-rank issue gains and a stronger overseas list. Rises outnumbered falls by more than two to one over the whole list as the market closed for the week.

Recent strengthening of the market pushed the New Zealand index even higher. The index of New Zealand shares again climbed to a new peak—the fifth rise running—in figures released last week. The new figure was 1652 38 up on the week before: q rise of 2.35 per cent in a week. Australian shares traded in New Zealand moved up further to a new high level of 1649. Good Showing Australian stocks made a good showing on the week, closing on an exceptionally strong note, while New Zealand issues showed rises outnumbering falls more than two to one.

Overseas leaders were also strong, while key New Zealand stocks followed a firm trend.

Companion shares gave the New Zealand section a lift as they came into line, while in some cases profit-taking caused the older shares to edge back. Second-rank New Zealand Issues also gave strength to the market as buyers sought further scrip. This caused trading to range over a wide number of

issues in almost every section of the New Zealand list. Only breweries and insurances were easier. Miscellaneous Miscellaneous stocks in both the New Zealand and overseas lists were the strongest section of the market. Australian shares showed rises well ahead of falls, while New Zealand issues showed twice as many rises as falls. Office equipment suppliers —currently seen as the market’s glamour stocks—were irregular on the week. Armstrong and Springhall gained Is 6d to 67s 6d, Beechey and Underwood was steady at 40s, while British Office Supplies eased Is at 40s. Television stocks also were treated with some reserve. Pye Electronics closed 3s up at 88s, while Bell Radio slipped 3d to 37s 9d. Charles Begg rose Is 6d to 28s, and the B shares 9d to 27s 9d.

Good company reports from two motor distributors, Seabrook Fowl ds and Tappenden Motors, came late in the week. This section of the market was steady. Newspapers attracted some interest with Otago Daily, in first business for some weeks, up 6s to 365, Wilson and Horton up Is to 355, and New Zealand Newspapers B up 2s 6d to 735, while the old shares edged back 6d to 735. Other good gains by New Zealand shares were made by Arnold and Wright, Coulls,

•Somerville Wilkie, Leyland Investments, and Ross and Glendining. Overseas banks were firmer, with rises by A.N.Z., Bank of N.S.W., Commercial Bank and National Bank of N.Z. There has been good buying interest in gas shares recently and gains were made last week by Auckland, Christchurch and Wellington. Frozen meats were quiet but firm, while loan and agency and woollens and textiles again advanced. Unlisted stocks were strong, too, while mining showed three rises to one fall. Plastics Rise Consolidated Plastics directors said last week that trading conditions for the last two years had been “most favourable.”

This, according to the accounts released last week, was no understatement. The company made its third profit rise in a row with a 36.7 per cent increase to £167,573. Listed only last year, Consolidated Plastics has shown a steady advance. Currently it is bidding for J. Yock, Auckland merchants. However, in their report, Consolidated Plastics’ directors warn that it would be unrealistic to expect the same rate of increase to continue. Nevertheless, new developments were being planned to offset the increasd competition in the plastics industry. Truth Year Revenue of Truth N.Z. rose during the latest year, but profit was cut back by £16,931 to £33,los—the lowest since 1958. This profit set-back was caused by high special and ordinary depreciation on new plant and several non-recur-ring expenses brought about by the modernisation of accounting procedures. Unchanged 12 per cent ordinary and B dividend takes £22,813 and this is covered nearly one and a half times by the profit. Earning rate on shareholders’ funds fell from 12.2 per cent to 7.9 per cent. The accounts showed that “Truth” owns 85 per cent of the capital in English Elec-tric-Leo Computers. N.Z.F.P. Plans N.Z. Forest Products which announced plans during the week to divide its existing £1 preference and ordinary shares into two 10s shares, is one of the first companies outside those trading in office supplies, to prepare for decimal currency in this country. When decimal currency is introduced in this country in 1967 the present 10s—to be known as the dollar—will be the major unit. Proposals to increase capital from £lsm to £2sm by the creation of 20m 10s shares and a one-for-eight premium issue of 7s 6d a share, were also announced.

Further capital is needed for more mills and services before there can be full utilisation of forests in the early 1980’s.

Directors believe, from long-term forecasts, that the company can expand profitably. They say that the ordinary dividend rate of 8 per cent should be regarded as a minimum, in the immediate future. P.T.Y. Profit A reduction in the rate of home construction was one reason for a £18,410 or 29.5 per cent fall in profit to £43,711 by P.T.Y., Putaruru, in its latest year. Dividend is a steady 8 per cent Directors say, however, that a scheme which involved the purchase of land for development and re-sale as building lots was successful in increasing house sales. Consolidated Metal Industries’ profit of £116,112 in the year to March 31 is the seventh successive increase since the group’s accounts were first presented in 1957. Since consolidation, the group’s ordinary capital has more than doubled—from £200,000 to £434,100. Total shareholders* funds are £892,323 (£834,793 last year), and earning rate has risen to 13 per cent from 11.3 per cent. Recovery Shown Completion of a steady flow of large contracts and constant review of the cost structure helped Hawkins Holdings, of Hamilton, to recover its profit in the latest year. Latest profit of £38,871 is 10.9 per cent or £3833 higher than the previous year’s, but is still £5490 less than the group’s peak profit tn 1962. Sharland’s bid of £592,667 for Irvine and Stephenson’s St. George, of Dunedin, was £176,000 higher than the bid by Greggs made less than three weeks before. As an alternative, Sharland's is offering four of its fully paid shares and £2 10s cash for every five fully paid shares in St George.