Nth B.H. woos shareholders

Press, 9 April 1977, Page 18

Nth B.H. woos shareholders

NZPA Melbourne] ; North Broken Hill Hold-! lings, Ltd, is predicting a net' 'profit for the year to June'3o of about sAustl7M( ! almost double last year’s re-j jsuit, and well in excess of' (the record SIO2M in 19731 /4. i The forecast was in a let-; 'ter sent by the directors to! I shareholders, and which' !aimed to give “a clearer (understanding of the present; lvalue of your investment in| (North Broken Hill Holdings! Ltd, and of its potential fori [-future increases.” >j 'Discussing the company's; (dividend policy, the directors: (said that they expected that the final ordinary dividend for the current year would; i “continue to reflect a sub-; ■ stantial improvement in the! company’s result.” “This will be due to an improvement in mine operations and considerable increases in income from our company’s investment portfolio,” they said. The company recently • paid an, interim ordinary dividend of 3c a share, which absorbed $4.4M or 70 per cent more than that dis- ' tributed in the first half of 1975-76.

The directors of North Broken Hill had previously stated that investment income in the current full year would rise from $7.4M to around SI2M, reflecting a sharp increase in income from this source in the second half of the year. In their letter they said they believed that investment income would increase further in 1977-78. “It will be obvious to shareholders that there has been a dramatic improvement in the earnings capacity of a number of the companies in which North has important investments, and there is a corresponding increase in the value of these [investments,” they said. The letter also said that the directors had noted the large number of the company’s shares being traded on Australian stock exchanges, and had decided to make shareholders “aware of the value of the company's assets.” A detailed re-valuation was now under way; the accounts for the full year would reflect the values established, the directors said.

On this basis, the directors estimate the net asset 'value of the company at about S29OM or 200 c a share. The net assets figure shown in the company’s latest balance sheet was 5135.6 M. The revised asset backing a share figure is well in excess of the current market value of the shares.