A. B. Cables Sees Better Demand Late This Year

Press, Volume CVIII, Issue 31754, 10 August 1968, Page 18

A. B. Cables Sees Better Demand Late This Year

In spite of a drop in sales by Associated British Cables, Ltd, Christchurch, reasonable results have been achieved in the first quarter of the year but it is expected that the second quarter will be difficult, says the chairman (Mr A. T. Young) in his annual report.

With the easing of building controls and indications that the state of the economymay now be improving, it is expected that demand will reach a better level towards the end of 1968, he says. The company will be in a position to take immediate action to meet any rise in demand and maintain its competitive position. This arises with the completion of the power cable project in sight, the new Auckland factory already established and with the

further plant acquired from Urlwin Industries, Ltd, yet to be installed. Record Sales

Although sales and production for the latest year to March 31 were at record levels, the profit fell 863,463, or 17.6 per cenL to $297,703. The steady 11 per cent dividend requires $22,000 more at $220,000 and is covered 1.35 times by profit. Included as charges against the latest income are $35,858 as debenture issue expenses and $46,216 as debenture interest both new items.

Depreciation provision is $62,158 higher at $162,456 and the amount provided for tax is $16,585 lower at $329,993. Earning Rates

The earning rate on average shareholders’ funds is down from 13.3 to 9.4 per cent while the rate on ordinary capital is down from 20.1 to 14.9 per cent. In the Christchurch factory, the wiring and general cables division operated for most of

the year with an excellent load factor, says Mr Young. However, during the final quarter a considerable drop in production was necessary because of the reduction in demand.

Disappointing delays in delivery from overseas of major items of plant have been most frustrating in the power cable division and only a limited amount of production was achieved in the last quarter of the financial year, he says. Auckland Factory

Production at the Auckland factory has increased steadily and this new factory is now meeting its target for the first stage of development.

Shareholders’ funds are $77,703 higher at $3,202,401 with ordinary capital steady at s2m.