Alloy Steel: Need For Expansion

Press, Volume CVII, Issue 31384, 1 June 1967, Page 16

Alloy Steel: Need For Expansion

While the order .book of Alloy Steel (N.Z.) Ltd., Christchurch, has been noticeably affected by the present economic difficulties, directors feel that this is only a temporary phase, says the annual report.

x tie pvujuuai vypvi uuuiiy ahead of the company makes expansion moves imperative, they say. The profit for the year to March 31 increased by £7695, or 54.3 per cent, to £21,873 after sales of steel castings increased by 51 tons on the previous year. As announced, total dividend has been increased from 10 to 11J per cent and requires £lO5O more at £9450. This is covered 2.3 times by profit. Earning rate on average shareholders' funds rises from 11.1 to 15 per cent while the rate on capital is up from 16.8 to 26 per cent. Capacity Limitation Sales of steel castings are definitely limited by the melting capacity of furnaces working on extended hours, says the chairman (Mr H. B. Anderson) in the directors’ report. The quality of the product has been maintained and under these circumstances directors feel that provision of further melting capacity can be no longer delayed. A start will be made on the balance of the reorganisation scheme. Meanwhile the building extensions and installation 'of new equipment, which formed the’first part of the scheme, is nearly completed.

The latest profit is after providing £llO7 more for depreciation at £2684 and £6942

more for tax at £20,174. No provision has been made for assessment for tax of £3996 for a disallowed claim. This is disputed by directors. Shareholders’ funds are £12,512 higher at £143,096 and include steady capital of £84,000.