Expansion And Growth Combined By Trans

Press, Volume CIX, Issue 32120, 16 October 1969, Page 16

Expansion And Growth Combined By Trans

Expansion and consolidation might not appear to go hand in hand, but it has been achieved b yTrans Holdings, Ltd, the Christ-church-based tourist group, in the year to June 2, says the chairman (Mr J. P. Cronin) in his report with the annual accounts.

The result of this was, much as predicted, he says—increased turnover but a lower profit. Heavy expansion, in North America, Australia, New Zealand, and Fiji, affected the profit.

The company consolidated its position in New Zealand and Australia, and expects to reach the same stage in North America and Fiji next year.

The volume of business from all sources, was running at record levels in the first quarter of the current year, and Mr Cronin “confidently predicts” that turnover will be higher than s3m. This compares with s2m last year, and sl.sm in 1967.

As already announced, group net profit in the year to June 2 dropped from $90,040 to $60,948. Mr Cronin says this is regarded as a very satisfactory result in view of the considerable initial and market establishment expenditure incurred in expansion of the group. Sales were up from $1,562,881 to $2,002,989 and expenses in the expanded I group rose from $206,562 to $357,978. ’ The net result was reached after providing $13,144 more for depreciation at $30,214. There was no tax provision against last year’s $20,416 This is brought about by the legislation which permits the aggregation of profits of companies within a group and the overseas tourist promotion exemption. There is, however, a contingent liability for Austra- ’ lian and United States taxation which cannot be calculated at present. Dividend has been raised from 5 to 6 per cent and requires $14,300.

The earning rate on capital, up from $200,690 to $285,603

.goes down from 44.9 to 21.3 per cent, while the rate on shareholders’ funds is down from 27.3 to 15.5 per cent On the subject of tourist accommodation in New Zealand, Mr Cronin says that the situation as far as good, medium or first-class—rather than de luxe or international class—accommodation is concerned is quite usatisfactory. “Far too much of what is available in this class is fragmented in small units, quite unsatisfactory for big parties. “The amounts of money needed to erect the size and quality of accommodation required is virtually imposible to raise.”

Shareholders will be asked at the annual meeting on November 7 to approve changes to the company’s articles, after which it will apply for Stock Exchange listing.

It is also proposed to increase the authorised capital from $500,000 to s2m.