“Devaluation advantage now eroded”

Press, Volume CXI, Issue 32777, 30 November 1971, Page 23

“Devaluation advantage now eroded”

(New Zealand Press Association)

WELLINGTON, November 29.

“The present cost structure has now eroded any advantage we had from devaluation and we have also experienced considerable resistance to our selling in some countries” says the chairman of Sharland and Comnanv. Ltd, (Mr B. T. O’Connell) in his annual review.

However, Mr O’Connel also says that export sale were higher this year, mostl; in fish products, in new mar kets that the company ha, been penetrating.

If Referring to imports, the i chairman says “we view with d alarm the policy of the Gov- ■ I eminent proposing to release I from the present form of licensing, importations of finished goods similar to those being produced by our factories. "This political policy, of a theoretical, economic nature will be found to have serious repercussions on ours and other industries, retard export development, affect employment and finally the primary producer and the national economy. "It is hoped the Government will realise this danger and act quickly to revise this policy which is contrary to the stem realism of national development which will be desperately needed in the years to come,” Mr O’Connell says.

As already announced, the net profit for the August 31 year was $305,127, compared with $325,318 last year; this difference is about the amount of payroll tax ($16,587). A steady 12 per cent dividend is being paid, with the final 7 per cent being from capital reserves, and tax free in shareholders’ hands. In his review Mr O’Connell stresses the problem of increased expenses in the group’s South Island operations compared with the North Island. He says that in Auckland and Wellington sales had increased, and expenses had to some extent been contained. “But in Christchurch and Dunedin increased expenses have overtaken the profitability, and the necessary steps have

been taken in an endeavour to adjust the position.” Mr O’Connell does not reveal what these steps were. The profit result was struck after providing $140,977 for depreciation ($165,142 in 1970), and $165,679 ($172,111) for taxation; unappropriated profits carried forward total $157,230 ($146,952). The consolidated balancesheet shows shareholders’ funds increased from $4,601,795 to $5,345,078. This includes issued capital unchanged at $1,856,092. Total current assets are slightly down from $4,617,300 to $4,419,580, while current liabilities have decreased from $2,101,643 to $1,870,732. This makes net working capital $2,548,848 ($2,515,657).

Edmonds trading “satisfactory” The directors of T. J. Ed- ; monds, Ltd, have declared an unchanged interim ordinary dividend of 5 per cent, payable December 22. This reflected the satisfactory trading of the company in the first half of the financial year, they said. Offer unconditional U.E.B. Industries, Ltd, has declared its offer for all the issued ordinary shares in the capital of Marlborough Lucerne Meal Company, Ltd, unconditional.—(P.A.).