Sth Brit. Cautious But Optimistic

Press, Volume CVII, Issue 31542, 2 December 1967, Page 18

Sth Brit. Cautious But Optimistic

Shareholders’ funds in South British Insurance Company, Ltd Auckland, at August 31 would have been about $7,162,000, . or 21.4 per cent, higher at $40,583,000 if assets and liabilities had been calculated at the new exchange rates after the devaluation, the chairman (Mr K. B. Myers) told the annual meeting. ; ■[..

No useful purpose would be served by attempting to recalculate the profit for the year to August 31, he said. Because of possible economic measures in various countries and the nature of the company’s business, it would be injudicious to predict the outcome of the current year’s underwriting. However, subject to these reservations, projected investment income could be expected to increase in some measure when converted to New Zealand currency.

“The hew exchange rates do not 'in themselves automatically increase the company’s productivity or the mobility of funds, although if they remain constant they will enhance, balance' sheet figures which express the company's -interests at home and overseas in New Zealand currency,” said the chairman. It continued to be the directors’ policy to recommend dividend distributions which would ensure an adequate and fair return to shareholders.

But these recommendations must be formulated in relation to the overall profit and

this policy would be fallowed when the next interim dividend was considered in April. Mr Myers said the various countries in which the company operated had to decide what action to take on their own econoniies after the devaluation of sterling.

Already some had taken action and others during the next six to 12 months would be assessing the effects. Quite possibly, they might find they had to act to safeguard their finances. In these circumstances, it would be imprudent to make a positive evaluation of the assets and liabilities domciled overseas.

Clyde Passes Div.

The directors of Clyde Engineering, Ltd, Lower Hutt, resolved “that in view of the present economic conditions and the uncertainty of future trading prospects, no interim dividend be declared.”