Higher result from A. Barnett

Press, Volume CXI, Issue 32703, 4 September 1971, Page 20

Higher result from A. Barnett

Arthur Barnett, Ltd, Dunedin-based department store owner, increased net profit $18,760, or 11.7 per cent, to $179,006 in the year to June 30, the directors report.

Sales increased 14.4 per cent to $5,451,504. The tax-paid profit as a percentage of sales has almost been maintained at 3.28 per cent (last year 3.36 per cent), -says the chairman (Mr C. V. Smith), but expenses now represent 22.9 per cent of sales against 21.9 per cent last year. The directors recommend a dividend of 6 per cent on the increased capital resulting from the bonus issue last year. This, with the 4 per cent interim dividend, makes 10 per cent for the year (11 per cent last year on lower capital). Of the final dividend 4 per cent is tax free.

Mr Smith says that' although sales have shown a 14.4 per cent lift “it must be realised that a large share of this increase is brought about by inflated prices. “In turn, the replacement of these stocks and. the extension of credit facilities at ever-increasing prices, presents a major finance problem.” But Mr Smith says that shareholders may expect reasonable profits. The profit is after providing $9724 more for depreciation at $54,318, and $7904 more for taxation at $174,745. The earning rate on higher shareholder s’ funds of $1,198,410 ($1,675,395) rises from 9.6 per cent to 10 per cent. The earning rate on the higher capital of $773,250 ($515,500) is 23.15 per cent as compared with 31.09 per cent last year. Total current liabilities are higher at $1,018,613 ($995,238). Total current assets rise to $2,125,233 ($1,751,627) and fixed assets are slightly higher at $1,472,479 ($1,404,353. Working capital was $350,231 higher at $1,106,620, and the ratio improved from 1.8 to 2.1 to 1.