N.Z. Newspapers Year

Press, Volume CVI, Issue 31077, 4 June 1966, Page 23

N.Z. Newspapers Year

The fairly rapid rate of progress by New Zealand Newspapers in recent years was likely to continue, the chairman (Mr T. H. Leys) says in the annual report, which confirms the consolidated net profit for the year to March 31 at £413,956, an increase of £53,312, or 14.8 per cent.

In addition, there was a profit of £31,271 on the sale of property.

Sales rose 8.4 per cent while expenses increased 7.1 per cent.

Because of ever-rising costs, accentuated on the newspaperpublishing side by the inexorable demands of daily publication six times a week, the year’s result was not fully commensurate with the increase in turn-over Mr Leys says. Revenue The company’s sales revenue was made up as follows: 1966 1965 (£’000) Advertising .. 4122 3737 Newspaper sales 1225 1154 General printing, etc. '.. 774 757

The profit was reached after providing £20,086 more for depreciation at £375,480 and £82,083 more for tax at £515,148. To provide for the obsolescence factor, which appears inevitable in the newspaper industry, depreciation was again in excess of allowable rates.

The investment allowance of £19,000 had been allowed for in calculating the tax provision. The balance-sheet showed capital £lBOO higher following the acquisition of an interest in a magazine publishing company. The latest profit represents 22.8 per cent on capital £lBOO higher at £1,814,800, against 19.9 per cent last year. As already reported, divi-

end has been raised from 11 to 12j per cent and takes £226,751.

After adding a £31,271 profit on sale of property and bringing in £814,266 from last year, carry-forward is £1,032,646.

The consolidated balancesheet Shows shareholders’ funds up from £3,002,197 to £3,235,172. “The effects of the hearing now before the Court of Arbitration cannot be accurately assessed at this stage, but we must expect further substantial increases in the current financial year,” he says. Newsprint prices showed a slight downward trend last year, but it seems likely that if the threatened rise in New York prices should occur, a considerable increase will be passed on to the New Zealand consumer, the chairman says.

Increase Costs

Based on budgeted consumption of 25,000 tons for the current year, an increase of even £1 a ton would substantially increase costs of production. Capital commitments at balance date were £475,038. The chairman says that additional press units and ancillary equipment are on order for the “Auckland Star.”

It is expected that these will be installed in the first half of 1967. The greater part of the heavy expenditure involved will come to charge this financial year. Shareholders will be asked at the annual meeting on June 23 to approve subdivision of the present £1 shares into 10s or 1 dollar units.