COMMERCIAL Comalco expects further fall

Press, Volume CXV, Issue 33816, 12 April 1975, Page 18

COMMERCIAL Comalco expects further fall

(New Zealand Press Association —Copyright) Comalco. Ltd. expects a decline in its net profit for the six months to June 30. after a 10 per cent fall in earnings for the three months to .March 31. the chairman (Mr D. J. Hibberd) said at. the annual meeting.

The outcome for the full; [year depended so much on' : the policies and. actions of I; governments that Mr Hibberd was reluctant to make,: forecast. ‘‘Our hopes for the full!, year, depend upon a revival !' of activity in the second half, as some prophets pre- . diet,” he said. Bauxite sales from Weipa 1 were expected to rise this year, although the total would be well below earlier expectations. |j Because of the downturn in the demand for aluminium products, half of the No. 1 pot-line at the Bell Bay smelter had been closed in January, and it is now operating at 90 per cent of capacity. Price support Staff numbers had been! reduced by 80, by not replacing those that left, and Mrl Hibberd said that some ret-1 renchnient would be inevi-i table if any further’ significant reduction of out-t put became necessary. The commissioning of aj half pot-line at Bel! Bay, i scheduled for October had! been put back well into next! year. The completion of the] third stage of the smelter ati Bluff had also been delayed until next year. The present policy of reducing production to match falling demand gave some hope that prices for aluminium would not drop to the uneconomic levels of 197172, Mr Hibberd said. According to the latest information available, production had been cut by 16 per cent in the United States, 14 per cent in Canada, and 28 per cent in Japan. Mr Hibberd described! as

“most distrubing” the draft; ! report of the Industries! i Assistance Commission. I 'which had decided that pro-1 tection for the primary alu-i i minium industry was not! justified. Australian producers had; :asked for protection, main-’ taining that even a modest: increase in the normal vol-i time of imports could cause! severe damage to the Aus-1 tralian industry. The average wage of Com-, alco employees had risen by 157 per cent, in the 18 I months to December. Shares change It was apparent that there had been a significant shift in the share of national product from those who provided capita] from their savings : to those who provided their I labour, Mr Hibberd .said. ! “This situation must | change if Australia was to ■avoid a drastic reduction in I production, and employment ’opportunities,” he said. “Salary and wage earners i were continuing to demand ; improved standards of living ' from an economy which was

no longer growing in real terms. “If these demands con-i tinue to be met, the inevi-i table results will be that the’ costs of production will rise; even faster, profits and in-1 vestments will suffer more: severely, and inflation and unemployment will increase ■ still further. The recession I would then become depression,” Mr Hibberd! said.

Chrysler U.K. loss

The British subsidiary of the Chrysler Motor Company had a loss of £77.7m in 1974. compared with a profit of £3.Bm in the preceding 13 months. Chrysler U.K. blamed the loss on the decline in the world car market, inflation, and big increases in wage costs since restraints were lifted in July. The chairman (Mr G. Hunt) repeated assurances that Chrysler intended to remain in Britain. Most Chrysler plants were now working full time because of contracts with Iran for unassembled cars.