Forest Investments thinks grant limit 100 low

Press, 26 July 1976, Page 14

Forest Investments thinks grant limit 100 low

NZPA Wellington Under the Forestry Encouragement Grant scheme an annual limit of $200,000 is placed on the planting expenditure of Forest Investments, Ltd, (unlisted) the chairman (Mr J. C. Fletcher) says in the record on the year to January 31. If the high rate of inflation continues, the company’s planting plans may be curtailed, he says. The Government gave a “sympathetic hearing” to an approach to have the allow-

able amount of qualifying expenditure increased, “but in view of the present economic conditions the company’s request was declined.” In the year under review the areas prepared and planted exceeded the original plan, and costs were kept within the estimates. At the end of the second planting season, 2047 acres had been planted, 1347 at Ngatapa, and 700 at Paengaroa, near Mount Maunganui. A further 1200 acres at Ngatapa have been cleared of scrub, but per-

sistent rains delayed a burnoff in time for this season’s planting. However, alternative areas at Ngatapa are available and another 900 acres will be planted this year, Mr Fletcher says. In addition to the customary report of the auditors, there is a report of the forest auditors by a firm of forest consultants, which reports that: “The direct costs of undertaking land preparation, purchasing trees, planting and release cutting have been checked against other costs in the localities where the forests are being established. These have been found to be fullv competitive or lower than the average.” The forest auditor’s report notes, “The expected appearance of the leaf cast fungus, dothistroma pini at Paengaroa. spraying procedures are scheduled to combat any detrimental effects due to this disease.” The company’s net profit, for the year was $79,840 compared with $37,957 in the previous year. This was reached after providing $2OOl on depreciation ($1938) and $50,721 ($5153) for taxation. All profits have been transferred to reserves and after writing off $9194 (20 per cent of preliminary expenses) retained profits at balance date were $99,033. A gain of $108,596 on revaluation of property has been added to revaluation reserve making the total reserves $207,629. An issue of 1,600,000 shares (paid to 50c) was made to the underwriters, The Fletcher Trust and Investment Co, Ltd. A call of a further 25c a share has been made since balance dale. Resulting from this a further sum of $650,000 has been invested in company debentures. The balance sheet shows shareholders’ funds of $1,715,679 ($731,887) There is a deferred taxation provision of $132,573 ($54,706). Total fixed assets increased from $436,815 to $745,224 including forest assets of $323,076 and freehold land and buildings at $411,665. Investments (debentures in allied company) total $745,224 ($436,815). Total current assets were up from $361,773 to $371,676 and total current liabilities amounted to $96,228 ($58,769). Intangible assets, preliminary expenses were $27,580 ($36,774). The company's annual meeting will be in Auckland on July 27 s