Profit pinch for Realties

Press, 22 August 1978, Page 19

Profit pinch for Realties

! The audited net profit of [City Realties, Ltd, fell (slightly in the year to June ,30, from $62,709 to $60,619, [ the directors announced (yesterday. It was after pro- : viding $4405 more for tax at [517,328, and $855 more for [depreciation at $13,181. The i equity share from Westermans is included. “This may be considered a disappointing result in normal economic circumstances for a company where growth is an intrinsic feature of board policy,” they say. “Much as it would be desirable to have been actively involved in profitable development projects which

fi would have produced current ji revenue from promotion as J well as providing an inI vestment base for the future, )ithe explanation is simply I that last year’s high interest . j rates, and escalating building J costs — associated with a ’'[fall in demand — made satr I isfactory property devel- ? opmen t schemes difficult to -[arrange.” ( “Westerman and Company I, Ltd, our 50-50 joint venture ■ I with Haywrights, did not s[escape the effects of the II national decline in retail r ; trading, and our share of tax [paid profit from this source j ) was $6562 compared with -jthe 1977 figure of $17,603. •j These figures are net of i (management fees paid to the >

equity partners and included as part of their income.” An improved result is expected in the current finan cial year. In accordance with the articles of association recog- , nising the extent of its shareholding, National Insurance Company of New Zealand, Ltd, is entitled to nominate one director to the board: Mr Russell Hendry, of Dunedin, has replaced Mr P. W. Fells as the National Insurance nominee. The earlier-announced 14 per cent dividend (1.4 c a share) will be paid on October 2, ex September 15, from share premium reserve; it will take $35,000 —- covered 1.7 times by profit.