Sth Brit. Lifts Profit To New Peak

Press, Volume CVII, Issue 31521, 8 November 1967, Page 29

Sth Brit. Lifts Profit To New Peak

(New Zealand Pre,, Association?

AUCKLAND, November 7.

The underwriting profit of the South British Insurance Company, Ltd, Auckland, eased 4 per cent from last year’s peak in the year to August 31, but the decline was ofi-set by a 3.1 per cent increase in investment income. The consolidated net profit edged up $18,939 to a record $3,384,051.

Premium income rose $2,640,295, or 7.7 per cent, to $36,851,797 —a satisfactory result, the chairman (Mr K. B. Meyers) says in the annual report.

Underwriting profit did not follow the upward trend but, at 4.1 per cent on earned premiums, it compared more

than favourably with industry results of recent years, he says.

1967 Change $ $ Ins. rev. 1,467,767 —60,775 Invest. inc. 2,314,129 +69,587 Total inc. . , 3,781,896 + 8,812 Deprec. 397,845 —10,127 Net prof. .. 3,384,051 +18,939 % av. fds .. 10.3 10.7 % on cap. .. 23.3 23.1 Div. % 14 13 1-3 Payout . 2.036,865 +96.995

Of the investment income, $928,247 (up $7993) came from government and local body securities, $504,894 (up $57,508) from companies and $880,988 (up $4086) from other investments. The balance sheet showed that the strongest increase in investments was in the company sector. On August 31, the market value of investments exceeded the book value by $1 million (last year $300,000), The portfolio consisted of: Government and local body stock $21.9m (up $209,613), investments in companies sl2m (up sl.4m) and other investments $14.2m (up $1.56m). 1967 Change $OOO $OOO

Chairman’s Review

In New Zealand there was a satisfactory year of progress in all departments. In Australia, which produced more than 40 per cent of premium income, termination of the management agreement with the A.M.P. had allowed co-ordinated concentration upon group affairs with satisfying results.

There could be little doubt that with its diversified resources Australia offered excellent prospects. By assisting

its economic development, the group could expect to participate in the rewards. The United Kingdom market was experiencing a difficult period, but it was believed that portfolio would yield a reasonable return. Investments On investments he said problems of international liquidity continued to restrict the mobility of funds which would otherwise have become available for investment. In some territories, surplus funds had to be left on deposits at a lower return. Assets administered by the Guardian Trust increased by sl6m to sl39m. On investment trends, the trust’s chairman (Mr E. H. Nolan) drew attention to the popularity of debenture issues. In the last two years, the sharemarket had remained comparatively stagnant. “Gone for the present, at least, are the days when the average investor relied as much on capital gain as income return,” he said.

Liabilities— Capital 14,549 n.c. Reserve! .. 18,872 +1,363 Funds . 4 33,421 +1,363 Current ». 41,612 +2,236 Assets— Fixed b. 9,372 + 268 Investm. 48,148 +2,777 Current .. 17,505 + 556