Favourable outlook for J. Rattray

Press, 10 November 1978, Page 14

Favourable outlook for J. Rattray

The outlook of J. Rattray i and Son, Ltd, for the first half of the year is favour- 1 able, and hopefully this momentum will be maintained in the second half, says the chairman (Mr A. W. Barnett) in the annual po'The year completed must be one of the most difficult the company has experienced in trading, because of the economic climate of the country and Government efforts to dampen down spending, he says. Shareholders will be aware of the acquisition of Fairburn Wright, Ltd, during the year, and it is the company’s, intention to develop the acquisition as a major supplier to the retail trade in all areas and to ensure a successful wholesale distribution with a subsequent contribution to group profits.

A new 20.009 sq. ft leaseback warehouse was opened at Alexandra and has traded at a profitable turnover rate in the first four months of working. In addition, the company: has continued in its policy of assisting clients to improve and diversify their activities, and this is currently showing substantial results, Mr Barnett says. As reported, group net profit rose 25 per cent to $752,054 in the year to July 31. on sales which increased 12.3 per cent to 551.4 M. The profit was after providing $40,921 more for depreciation at $143,213, but! ; $70,052 less for tax at $419,918. The trading stock valuation adjustment totalled $lll,OOO. Interest payments, increased $104,000 to $240,581. A recommended final dividend of 6c a share makes

an unchanged tax-free 12c a share (12 per cent) for the year. The dividend requirement is $227,362, and is: covered 3.3 times by the profit excluding the preference dividend. Shareholders’ funds rose $544,969 to $6,379,000 includ- ! ing $2750 more for ordinary shares at $1,949,804. $200,388 less for capital reserves at $416,601 and : $742,607 more for general reserves at $4,012,595. The earning rate on shareholders’ funds rose from 10.3 per cent to 11.8 per cent, and on capital from 30.9 per cent to 38.6 per cent. Working capital fell $13,554 to $4,112,389 and the current ratio declined from 1.9 to 1.5 to one. The shares last sold for 140 c for a dividend yield of 8.6 per cent and an earnings yield of 28.4 per cent. The price-earnings ratio was 3.5.