Ballins continues rate of recent progress

Press, Volume CXI, Issue 32629, 10 June 1971, Page 15

Ballins continues rate of recent progress

The net profit of Ballins Industries, Ltd, showed a very satisfactory increase—from trading and from investments—in the six months to March 31, and the progress achieved by the group in recent years had continued, the chairman (Mr N. W. Millner) said in the mid-year report.

The contribution made by the new North Island subsidiaries was especially pleas'ing, he said. These new acquisitions had traded at a higher level than was budgeted for. They had shown substantial profits over and above the costs of servicing the capital involved in their purchase, on what were advantageous terms of finance. These results clearly justified the expansion of trading operations, and Ballins’ establishment as a national company. ' To assist shareholders (whose dividend income will have been affected by the increased rates of dividend taxation, the directors will recommend that as a policy matter a proportion of dividends should be paid in (future from the substantial 'capital reserves of the comIpany.

i This portion of the dividend will not be taxable in (the hands of shareholders. On i the basis of the present 12) (per cent dividend per annum, 2) per cent will be paid from capital reserves. Tax-free dividend This policy was purely for the benefit of shareholders, Mr Millner said, and did not arise from a lack of trading profits, and a transfer of a commensurate amount of profits from revenue would therefore be made to reserves to ensure that they were not diminished.

To implement this policy the directors have declared a half-yearly dividend at last year’s higher rate of 5 per cent, of which 1 per cent is to be paid from tax-free

reserves, and will be nontaxable in shareholders’ hands. This dividend is payable on the capital which was increased by last year’s cash and bonus issues to shareholders. The dividend will be paid on July 30, ex dividend July 16. The company’s $1,000,000 debenture issue closed last month fully subscribed. A most satisfying feature was the support given by the smaller investors, with almost 500 individual applications, Mr Millner said. The widespread interest in the issue undoubtedly reflected the new national trading status achieved by the Ballins group of companies. As already advised, the proceeds are being utilised

for the expansion and improvement of the North Island merchants’ outlets and the building of the new Christchurch soft drink factory, for which a substantial quantity of new plant has already been ordered. Contracts have been let for the rebuilding of the Waltham Arms Tavern, and tenders have been received for a new domestic wholesale and retail drive-in bottle store at the Blenheim Road Motor Inn (both owned in conjunction with New Zealand Breweries, Ltd). A contract has also been let for the building of the new Avonhead Tavern (owned in conjunction with Burke’s Caterers, Ltd, and New Zealand Breweries, Ltd).