Golden Bay Sees Steady Year

Press, Volume CVII, Issue 31501, 16 October 1967, Page 17

Golden Bay Sees Steady Year

Sales by Golden Bay Cement Company, Ltd, Wellington, for the last three months were down on those for the previous year, and the ordinary domestic demand may fall still further, says the chairman (Mr D. O. Whyte) in his annual review.

However, because of the start on the Tongariro scheme and the need for more cement for the Manapouri scheme, the directors expect that the results for the year will be satisfactory.

As announced, the group profit fell $58,141, or 6.5 per cent, to $828,524 in the latest year to June 30. A steady ordinary dividend of 11 per cent requires $34,440 more at $576,840 and is covered 1.4 times by profit The earning rate on average shareholders’ funds is down from 12.0 to 10.9 per cent and the rate on average capital is down from 18.0 to 15.8 per cent. Sales of cement fell 15,556 tons, or 5.8 per cent, to 252,270 tons, and production fell 12,673 tons, or 4.7 per cent to 255.225 tons. Last June, after costs rose substantially, prices were increased and this increase is not reflected in the latest accounts, says Mr Whyte. Production Capacity

The new plant at Tarakohe increases production by 160,000 tons a year. This plant was installed at the request of the Government so that the company could meet all its demands as well as the demand of the Tongariro hydro electric scheme. However, the power scheme was seriously delayed but Golden Bay has had to provide a substantial provision for depreciation with little return from the new plant Work on the power scheme has started and Golden Bay recently began supplying modest quantities of cement. This will grow as the scheme develops. The installation of additional milling capacity has been delayed and will not be completed for some months. Improvements to the Te Kuiti plant have been deferred. Provisions The latest profit is after providing $146,898 more for depreciation at $683,408 and $156,500 less for tax at $730,300. Shareholders’ funds are $253,054 higher at $7,721,783 and include steady capital, all ordinary, of $5,244,000. Working capital is $32,555 higher at $2,082,597 and the ratio of current assets to current liabilities is 2.5:1.