Manthel Sales 6.5% Up But Net Lower

Press, Volume CX, Issue 32384, 25 August 1970, Page 21

Manthel Sales 6.5% Up But Net Lower

In spite of record sales of $9.8 million—-6.5 per cent higher than last year—the net profit of Manthel Holdings, Ltd, Wellington G.M.-Holden distributor, fell 4.0 per cent to $204,869 in the year to March 31.

The result was after lower provisions for depreciation and taxation.

The recommended final dividend of 6 per cent maintaining the total of 12 per cent; the payment again takes $72,000, covered 2.8 times by the profit The earning rate on average shareholders’ funds—sl2B,B96' higher at $1,617,435 —is 13.2 per cent Working capital improved from $747,297 to $882,933; the liquidity ratio was slightly lower, 2.1 compared with 2.3:1.

While the volume of the non-remittance new car sales was lower, the free availability of the Holden Utility models enable the company to maintain its previous years new car volume, the chairman (Mr M. N. Manthel) said, in his annual report

Spiralling wage increases affected all departments and it was necessary, where possible, to pass the extra cost on in the form of increased service charges. However, as new car prices remained under price control, the profit margins of dealers have remained static. This meant that profitability could only be maintained by continually Increasing volume, he said. Both the spare parts and servicing departments showed considerably increased turnover. The paint and panel division, now at Rongotai, was well established and operating smoothly. The relocation expenses and the costly installation of modern equipment restricted profitability over the first year’s operations. It was not an efficient division.

With the lifting of import licences for outboard motors in the next licensing year, together with the growing demand for small boats, the company planned to open a marine showroom next to its used car depot in Taranaki

Street. This new division, to trade as Manthel Marine, would open by the end of August and should add further opportunities for profits, Mr Manthel said.

Higher Profit, New Issue

The group net profit of Midland Coachlines, Ltd, for the year to June 30 increased by 26.1 per cent to $80,913, the directors report in a preliminary statement. An issue of ordinary stares will be offered to the public before the end of the year, on terms to be announced later, they say. A special meeting of the preference shareholders is to be held to submit a proposal to increase their rate of dividend from 5| per cent to 6| per cent, and at the same time to modify their voting rights so that they may only be exercised when the preference dividend was in arrears, or in a situation involving a winding up or repayment of capital.