Broadlands sees another satisfactory year

Press, Volume CXIII, Issue 33254, 18 June 1973, Page 19

Broadlands sees another satisfactory year

<A’ew Zealand, Press Association)

AUCKLAND, June 14.

The New Zealand economy is basically sound, although inflationary pressures persist in several quarters, says the chairman of Broadlands Dominion Group (Mr A. C. Montgomery).

In the company’s annual report, Mr Montgomery says that the new Government has approached the task it set itself during the election campaign “in a straightforward manner. “In spite of predictions to the contrary, it has not introduced further hampering restrictions on finance companies.” The Broadlands group, Mr Montgomery says, is looking ahead to another satisfactory year.

The annual report discloses strong growth in almost all areas.

Net profit, at $1,101,831, passed the million-dollar mark for the first time, and total assets climbed by

$21.6m to more than s67m.] The earning rate on share-] holders’ funds (up by $2.2m) edged to 17.9 per cent from ■ the previous year’s 17.5 pei I cent, and the rate on average .capital rose to 25.2 per cent, ! from 21.9 per cent.

Net accounts receivable climbed by Slim, or more than 50 per cent. There was a strong advance in consumer loans by Broadlands finance division and a consequent decline in commercial credit. The market value of the shares that Broadlands owns iin other companies was >almost 100 per cent higher, |at sl.6m.

The amount of money the company had borrowed in

terms of debentures, unsecured deposits and mortgages stood at $47.7m at March 31, compared with s29m a year earlier.

The dividend of 6c a share, or 12 per cent, is covered twice by profit, and the directors are confident that the 12 per cent rate can be maintained on the capital to be increased by the proposed one-for-10 bonus issue. Broadlands also made a capital profit of $440,226 from last year's United States dollar "devaluation on a ssm Eurocurrency loan. This profit has been retained as a reserve against future exchange fluctuations. The group’s merchant banking subsidiary, Broadbank Corporation, formed an unofficial money market company late last year, but the report says it had not actively traded by balance date.

During the year under review Broadlands increased its ownership of Delfin Discount Company, an official money market operator, to one-third, and formed a new company, Broadlands Fund Managers, Ltd, with a portfolio of $3m —raised from private investors and lodged in commercial and residential mortgages.