Millers able to recover

Press, 4 March 1978, Page 18

Millers able to recover

By

ADRIAN BROKKING

Commercial Editor

Millers is not bust. No company is bust 8s long as its assets are more than its liabilities.

This needs saying because of the many people who were walking around Friday week ago saying: “Millers gone bust.” The company has a cash flow crisis: that is why it is asking creditors at the meeting on Tuesday to agree to a postponement of debts for six months. The groundwork for the recovery has already been laid. The closing of a number of stores has reduced the scale of operations, which means that the retail business can at least break even now, according to Mr P. L. Mortlock, who became a director nine months ago. As he dryly remarks: “No one in retailing can look forward to any increase in profitability. The closing of shops also means that there is surplus property: the disposal of these should make a big difference to the company’s liquidity. But the most important

factor pointing to a recovery I is the clean sweep in man-'J agement. I 1 Which reminds me again! of something my old grand-!* father once said to me. I have mentioned my ' grandfather before on this 1 page: he was a director of | four companies and a share- 1 holder in many more, and he 1 was a man as tough as most people only think they are. 1 What he said to me was: ’ “Little boy” (that’s what he always called me— I sup- ( pose I was little in those 1 days) “little boy, when you ■ first hear of a company in i trouble, the management of " that company will always < talk in glowing terms of the measures they are taking to ' retrieve the situation.

“But don’t take any notice. All they are doing is stroking and caressing the problem. “Sooner or later you will hear talk of changes" and reorganisation. But ignore that also — that is only stage two.

“What you wait for is stage three: that is when they make a clean sweep of management and put a new team in. That is the time to buy the shares, you will be getting in on the ground floor.” Mr W. N. Scotts, who joined the Millers board at the same time as Mr Mortlock, will manage the group. Middle management has also changed.

I Mr G. Francis came from Myer, Ltd, the huge Austra- ' lian retail group, to take | charge of Millers’s retail I operations. Four months later the new directors appointed Mr G. MacKensie as manufacturing manager. Mr MacKensie is a New Zealander who was employed by Acmil, the large Australian diversified manufacturing group formerly called Felt and Textiles. The manufacturing unit is doing well, now that it is no longer manufacturing on stock for Millers’ retail shops, but solely on order. The plant is modern, and exports are high.