COMMERCIAL Price-war caused fall in J. Nathan profit

Press, Volume CXV, Issue 34012, 28 November 1975, Page 16

COMMERCIAL Price-war caused fall in J. Nathan profit

(Aew Zealand Press AssocicUion.i WELLINGTON. Joseph Nathan and Company, Ltd. merchant, importer, and manufacturer, suffered a 38.3 per cent decline in net profit to $50,087 in the year to August 31, because of price-cutting by competitors, the annual report says.

The trading of some sections of the company suffered from gross overstocking by some New Zealand traders, who, having to overcome major liquidity problems offered their products at or below cost, with the result that sales of some products, particularly steel, were seriously affected. “We did not enter this price war, and instead retained stocks at levels much higher than normal.

“However, it can be reported that since the start of the new financial year there has been an improvement to more stable trading conditions.

“The devaluation, and doubts as to future government policies have tended to boost demand for our products, but it is felt that this could be temporary only, and that the 1976 year will again be difficult with costs continuing to rise, and possible ■restrictions in imports and/ or foreign exchange.” the chairman (Mr T. M. Pacev) says. As reported a steady’ 6 per cent final dividend is payable on December 9, tax-free from realised capital products, making an unchanged total of 10 per cent (10c a share) for the year. The company maintained net profit at previous levels during the first half of the year, but trading during the second six months resulted in a decline in earnings. The profit was after providing $6077 more at $36,012 for depreciation but $28,180 less at $30,862 for taxation.

METALS

(N.Z.P.A.Reuter—Copyright) LONDON, November 24. Buyer Seller £ £ a ton a ton Copper .. .. 565.00 566.00 Tin .. .. 3056.00 3058.00 Lead .. .. 162.25 162.75 Zinc .. 338.50 339.00

Shareholders funds rose $74,158 to $928,337 mainly because of revaluations of the company’s properties. Issued ordinary capital was steady at $300,000. Working capital rose $190,784 to $868,984, "and the current ratio rose from 1.3 to 1.5 to 1.