Buoyant Conditions Benefit Mason Bros

Press, Volume CX, Issue 32350, 16 July 1970, Page 17

Buoyant Conditions Benefit Mason Bros

(New Zealand Press Association)

AUCKLAND, July 15. AU companies in the Mason Bros, Ltd, group, Auckland engineer and merchant, were benefiting from present buoyant conditions, and a good volume of business in the lines in which the group intended to specialise was on hand, the chairman (Mr J. G. Souness) says in the annual report.

Further reorganisation and rationalisation continued, but while the directors were confident of improving returns, they were concerned about spiralling costs. There was every reason for optimism. As announced, the group net profit continued to recover in the year to March 31, rising $47,905 (or 30.3 per cent) to $206,131, with sales exceeding slom for the first time.

Although engineering turnover was down, improved results were obtained from all companies. Merchant turnover rose 22 per cent.

The Christchurch engineering subsidiary, Andersons; would have been profitable but for the provisions against the Manapouri turbine casings contract, completed since the balance date, the chairman says.

This company, which had shown an all-round improvement, was budgeting for a profit. The merchant sales and distribution company, with record sales, continued to make a substantial contribution. On a turnover basis, it was becoming increasingly difficult to hold profit margins. Much of the company’s development was concentrated on specialist engineering services in the mechanical handling field and equipment for the timber industry. The company would supply the mechanical handling unit for the first high density cool store in Auckland, and the

50 per cent-owned Australian associate had a similar contract.

The crane division would design and build the largest and fastest grabbing crane in the country, with a capacity of 11 cubic yards. Fork trucks and hoists were manufactured in quantity. The company was negotiating with overseas principals for the incorporation of more local engineering content in woodworking and forestry equipment. 1 It was narrowing its activities and increasing its specialisation. The volume of business' remained good, with a high forward order level.

Reorganisation in the two engineering subsidiaries was aimed toward rationalisation, with a (rend away from contract work toward production of standard lines. In Auckland, better control contributed to a profit. The export subsidiary expanded sales to $155,679 — most of it in automatic packaged boilers. Operations of the Australian company were highly satisfactory. This year the .first dividend from Weldell (N.Z.) one-third ; owned, was expected. The net profit was struck ■ after depreciation of $173,838 (up $2573) tax of $168,371 ’ (up $118,239) and minorities . of $3279 (up $865).

In addition, reserves increased by $64,181 mainly

from capital profits and recovery of depreciation. As announced, the dividend had been lifted from 5 to 7 per cent taking $100,684, besides the $14,000 preference charge.

The earning rate on average ordinary shareholders’ funds rose from 5.0 to 6.4 per cent and on ordinary capital from 10.1 to 13.4 per cent. Shareholders’ funds increased $155,628 to $3,319,965, including capital of $1,688,339 ($250,000 preference). Minority interests were $654 higher at $42,086, and term liabilities were $69,254 lower at $1,357,601. Fixed assets were $28,088 down at $2,442,303. Investments rose $43,662 to $245,350. Working capital improved by $71,454 to $2,031,999.