Dalgety N.Z. profit helped by rebate

Press, 17 February 1978, Page 16

Dalgety N.Z. profit helped by rebate

Dalgety New Zealand, Ltd, reports that unaudited group profit before tax for the half-year to December 31, excluding minority interests, fell 43 per cent to $1,948,000.

Because of the special taxation relief related to merchandise stocks taxation liability decreased $724,000, and net profit rose 5.1 per cent to $1,803,000. Group turnover fell 2.2 per cent to $227.4M. "The half-year has been an extremely difficult one for the stock and station industry and fanners. The industry has experienced unprecedented increases in costs, and operating .overheads, which are now running at 19.6 per cent above last year, and 47 per cent above two years ago.” says the chairman (Mr L. M. Papps). “This has forced the industry, reluctantly, to seek increases in wool store charges, and increases in livestock selling commissions, the first general increase since 1954. Although some increases had been made in certain areas in 1971.

“These increases, which came into effect on January 1, 1978, are not reflected in the half-year’s results.

“Another significant factor has been farmers requirements for increased work-ing-capital in the form of seasonal finance. This de-

mand, coupled with our own requirements to fund merchandise stocks, has placed a severe strain on the group’s short-term resources. However, because of early action taken, the group has been able to meet all the demands placed upon it,” says Mr Papps. The release of moneys held by the Wool Corporation under the wool retention scheme will help a lot of farmers who are under financial pressure, and it may well avert the sale of some stock held under the livestock retention scheme, he says. “In the six months, farm operating expenses showed a further increase of 11 per cent above last year, and farm revenue for a number of reasons has by no means kept pace with this. The late kill, seasonal conditions, the livestock retention scheme, and lower wool and livestock prices are all contributing to the shortfall. “The continuing decline in export earnings from the farming sector will, of course, affect New Zealand’s balance-of-payments, and I can only hope that despite all the problems facing the farmer, farm investment can and will be maintained.

“It is crucial that every section of the industry maintains confidence, and plavs its part in ensuring the continuance of a thriving and thrusting industry — we

of Dalgety New Zealand will certainly play our part because of our confidence in the future,” Mr Papps says. An unchanged interim divident of 5c a share is payable on April 3, ex dividend March 15, from realised capital profits, except for the dividend payable to Dalgety Investments, Ltd.