COMMERCIAL D.I.C. reports rising sales and costs

Press, Volume CX, Issue 32458, 19 November 1970, Page 20

COMMERCIAL D.I.C. reports rising sales and costs

(New Zealand Press Association)

DUNEDIN, November 18. The payroll tax for the new trading year was a further inroad into profit by Government in another form of tax collecting, the chairman of directors of the D.LC., Ltd, (Mr H. Q. Harford) told the company’s annual general meeting this afternoon. It would cost an additional $44,000 this year.

The company would be paying $529,500 in tax for the last year. "It is obvious we will have to increase turnover substantially this year to maintain last year’s level of profitability,” Mr Harford said. The effect on public spend, Ing after the recent miniBudget is still to be assessed. If industrial unrest continues it will be upsetting to the economy and create problems in budgeting for sales, stock and expenses. Increased sales volume would be more difficult to achieve this year, but "with in our opinion, this increased charge”

The report says that provision had been made for a distribution of surplus at the rate of 0.4 c per lb, which equals about $1.40 per bale, more money in circulation because of recent wage and salary increases, we have budgeted for increased turnover along with aggressive merchandising aim to reach our objectives,” he said. “At this stage.l am pleased to report that turnover for the first three months is ahead of last year; this will assist towards covering increased costs,” The company’s eighty-sixth year had shown further progress and set new records foi turnover and net profit. Turnover for the year included a full 12 months trading for the Hamilton branch (last year it was nine months) and was $13,399,805, an increase of $1,254,540 on last year’s turnover of $12,145,265. Net profit for the year after making provision for income tax, was $530,488, an increase of $88,658, or 20 per cent, over last year’s profit ot $441,830. Last year’s figure in-

eluded a dividend from D.I.C. Hamilton of $31,856 for nine months only. - Main items of expenditure such as salaries, advertising, rents and other items increased by $576,503. Of total expenses, salaries and wages represented 64.9 per cent of the overhead. The return of shareholders’ funds over the last three years had been growing as follows: in 1968 the figure was 6.9 per cent; in 1969 it had increased to 9.2 per cent; and in 1970 to 10.3 per cent. The return on ordinary capital had also shoivn a progressive increase: in 1968 the return was 16.8 per cent; in 1969 the figure was 22.6 per cent; and in 1970 it had increased to 22.9 per cent. The ordinary capital in 1968 was $1,540,000. In 1969 it was increased to $1,820,000 by the take-over of H. and J. Court, Ltd, Hamilton.. In 1970 the ordinary capital increased to $2,184,000, by the bonus issue.