L. D. Nathan pleased with its forecasting

Press, 5 December 1979, Page 29

L. D. Nathan pleased with its forecasting

PA Auckland The results of trading by L. D. Nathan and Co, Ltd, in the last year were very close to forecasts the chairman (Mr K. V. Coe) says in his annual review. The accuracy of forecasting is very important, with the New Zealand economy subject to constant Governmental regulation, and any planning project, subject to upset, overnight,: by the stroke of a pen in’ Wellington, he says. Mr Coe also deplores the time taken to bring the “cumbersome processes” of the hearing into the L. D. : Nathan/McKenzies takeover to its present stage (a decision is due this week). He says that L. D. Nathan, after being approached to •examine the possibilities of ’the intended rationalisation [with McKenzies, had done all that was possible to expedite matters. j “The whole process demlonstrates just how far we have moved from the free [enterprise system in New [Zealand, and' the ax ent of over-regulation in industry, land commerce,” says Mr Coe. Mr Coe says that the July

31 levels of stock and debtors ' were too high (the balance sheet shows stocks at: $57,925,000 and debtors at $17,729,000). But with the changes occurring in warehousing patterns within the group these levels were not unexpected. Group sales, for cash, had been substantially improved by the inclusions of Woolworths’ sales, and moved from 44.6 per cent in 1978 to 66.1 per cent in the latest year. Because Woolworths isj not involved in credit sales.' group debtors have shown a relatively low movement in relation to the increase in sales. The integration of Wool-; w'orths functions began ini earnest in the second halfyear, particularly of the Woolworths / Supervalue Auckland supermarkets. Because of these changes it had not been possible to make an exact comparison of Woolworths’ results, but profits of the new entity exceeded forecasts, says Mr Coe. As reported, group trading profit (including 10 months figures for Woolworths) rose 44.6 per cent, to $4,806,000.

’This represented a return of 1.2 per cent on sales, the isame as in 197 S when profit I was assisted by $522,000 as| the result of the stock; allowance on tax. Tax this year is $2,307,000 greater at $3,975,000. and j depreciation rose at $3,838,000. The annual dividend rate, increased from 14 per cent, to 15 per cent, takes : $691,000 more at $1,779 000. 1 The return on average ; shareholders’ funds rose j from 11.1 per cent (after adjustment for a $2,726,000 revaluation of assets) to 12.3 per cent. Balance-date capital is $ 4,71 5,0 0 0 higher at i $12,490,000, contributing to | the $6,296,000 increase in shareholders’ funds to $48,289,000. Term liabilities rose $6,296,000 at $24,150,000.1