Merc. Credits down 54 p.c.

Press, Volume CXV, Issue 33917, 9 August 1975, Page 19

Merc. Credits down 54 p.c.

IN Z Press Assn—C.tipyricjlit I 1 SYDNEY The group net trading pro-: fit of Mercantile Credits, Ltd, fell 54 per cent to $A2.3m ini the year to June 30, the directors report. An" extraordinary loss of $314,517, was realised compared with a profit of Sl.4m previously. Net receivables fell from $263.7m to $229.9m. Exceptionally high interest rates during the year were; the predominant factor affecting net earnings. “The position was further: aggravated by the unfavourable economic conditions,: which caused the business community in general to suffer considerable liquidity problems during the first half of the year. “In order to assist in maintaining its own liquidity, the group was forced to restrict the acceptance of new business,” the directors say.' Profits in the final months; of the year were in excess of average earlier profits, and they expected this trend to I continue. The final dividend rate is down from 7.5 per cent to 5 per cent, and the annual’ dividend rate is cut from 15 per cent to 10 per cent. The earning rate on capital fell from 34.1 per cent to 12.7 per cent. The major shareholders in Mercantile Credits include the Hong Kong and Shang-i hai Banking Group, with 30 per cent of the issued capital, and the National Mutual Life Association of Australasia, with 27.5 per cent. I