Further growth by Motor Traders

Press, Volume CXIII, Issue 33382, 14 November 1973, Page 20

Further growth by Motor Traders

(Nete Zealand Press Association) AUCKLAND, November 13. Motor Traders (N.Z.), Ltd, had further expanded trading of all branches since the balance date, July 31, the chairman (Mr C. A. Staples) says in the annual report.

The vehicle market was growing, and the company should participate in this, he says. As announced, the profit for the group was $114,462 higher at $493,792, of which the steadv 14 per cent dividend took $207,500. in addition to the $6OOO preference charge. The earning rate on’shareholders’ funds improved from 8.5 per cent to 10.4 per cent, and on capital from 25.3 per cent to 32.9 per cent, which is equivalent to 29.9 per cent after the proposed 1:10 bonus issue. ,

In the last year, the demand for the company’s merchandise was strong. However, in the face of a manpower shortage, price changes, uncertainty of supplies, and reduced margins under the stabilisation measures, it is a challenge to improve profitability and maintain acceptable service Mr Staples says. New outlets were established, new agencies secured ■and the joint venture with Borg-Warner for the rebuilding of components begun. Sales of measuring and testing equipment increased appreciably. The engineering division ; experienced an increased demand for jobbing services and sub-contracting work, but because of the availability of new vehicles the pro-| duction of exchange units re-; mained at the 1972 level. Friction materials and brake engineering sales exceeded the 1972 peak by 23 per cent. The output of silencers and exhaust pipe units at Porirua increased by 30 per cent, but failed to meet demand because of irregularities in the availability of labour and materials. Subject to the containment of costs, exports will grow, Mr Staples says. E. W. Pidgeon experienced a growth in garage equipment sales in New Zealand and in Australia and South-East Asia. Hand tools and replacement parts been added to the range |of several branches. E. W. Pidgeon now operates five retail tyre stations. Response to this new venture was very encouraging, and more outlets were planned. I The profit was struck after ; depreciation of $190,535 (up 1 $27,272) and tax of $375,404; (up $50,022). Shareholders’ funds were I $351,164 higher at $4,971,658, including capital of $lOO,OOO preference and $1,482,402 (up I $1325) ordinary. As announced, the com-, pany will make a 1:6 cash! issue after the bonus issue. Term liabilities were $240,790 up at $2,035,791 and include deferred tax of $321,973 and convertible notes of $294,180.