Commercial Autocrat TV rentals at record levels

Press, 22 June 1978, Page 14

Commercial Autocrat TV rentals at record levels

Trading in the first month' since the removal of Government restrictions on colour television sets, was at record levels for the television rentals division of Autocrat Holdings, Ltd, says the chairman (Mr R. H. Walker) in the annual report. This is most encouraging, and the demand appears to be continuing at this high level, he says. “Trading during the year under review has been the most difficult experienced for many years. “In addition to reduced turnover arising mainly from the depressed colourtelevision market, two other factors should be considered when comparing this year’s results with last year’s,” he says. “The tax concession on stock holdings to February 28, amounts to $114,600, and while the change to straightline depreciation w’as not significant last year, the additional charge to pre-tax profits is $165,200, being the increased depreciation by this method over the rates allowed by Inland Revenue.

“The tax on this has been shown as deferred tax benefit in the accounts,” Mr Walker says. A broadening of the group’s activities has taken place since approval was given at the last annual

meeting for Sanyo to become a major shareholder. “In addition to Sanyo’s continuing support with television and audio products, we have received a range of gas domestic appliances which are currently beijig evaluated by the appropriat e authorities for compliance with New Zealand regulations. “While the sale of colour television sets was dowm considerably compared to the previous year, resulting in a reduction to the contribution to profits by the sales division, the recent removal by the Government of the hire purchase and rental regulations has greatly stimulated colour sales.

“During the year, stereo and other major audio appliances were the subject of widespread price discounting by a number of manufacturers and overstocked retailers. “The economic downturn has reduced the demand for motor vehicles, and it is expected that this will have some effect on car-radio and car cassette sales,” he says. Exports have reached record figures, and initial sales to Europe of marine products are most encouraging. “The Australian and westem Canadian markets provide a steady volume of business, but until insurance

cover at a reasonable premium is available against liability under consumer protection legislation, we will not pursue representation in the United States.” As reported, group net profit fell 36.8 per cent to $544,765, after pre-tax trading profit was down 54.7 per cent to $689,169. The profit was after providing $50,193 more for depreciation at $561,596, $17,043 more for interest charges at $37,056, but $513,765 less for tax at $144,404. Shareholders’ funds rose $894,950 to $5,712,009, including capital up $480,000 after the issuing of shares to Sanyo Electric Trading Company of Japan. The earning rate on the funds fell from 17.9 per cent to 9.5 per cent, and on capital from 34.2 per cent to 18.2 per cent. A recommended final dividend of 5c a share, makes a steady 8.7 c a share (8:75 per cent) for the year. The dividend requires $244,500 and is covered 2.2 times by the profit. Working capital rose $682,576 to $4,306,051, and the current ratio increased from 1.8 to 2.1 to one. The shares last sold for 85c for a dividend yield of 10.3 per cent and an earnings yield of 22.7 per cent. The price-earnings ratio was 4.7.