I. W. Dow plans 1:7 bonus

Press, 20 February 1980, Page 24

I. W. Dow plans 1:7 bonus

Tvon Watkins Dow, Ltd. the New Plymouth chemicals manufacturer, proposes a bonus issue and an increased dividend after more than doubling group net profit in the year ended December 31. The directors say in their preliminary report that stable

marketing conditions, strong demand, and improved productivity were ’key contributors to the company’s outstanding performance and the record financial result. The decision for the extensive capital investment in plant renovation, replacement, and extension during the past few years was confirmed by the sustained pressure of product demand. “Key facilities had to be operated at near capacity levels for most of 1979, resulting in a significant improvement in productivity.’’ they say. The audited results show that group net profit after tax rose 117.4 per cent- to

$3,843,000; profit before tax rose 123.3 per cent, pom $3.2 M to S7.OM. Sales increased 31.8 per cent to 533.8 - The earning rate on shareholders’ funds jumped from 15.0 to 25.5 per cent, and earnings a 50c share from 26.2 c to 56.2 c. The profit margin on sales increased from 6.9 per cent to 11.4 per cent. Cash flow improved from 53.2 M to $5.2M. The directors will recommend to shareholders at the annual general meeting on April 29 that a one-for-seven bonus issue of shares be made from the share premium account, and that the final dividend for the year ended December 31, be increased from 5.25 c a share to

5.50 c a share making a total of 9.5 c a share for the year. This compares with the 8.75 c a share paid last year.

Subject to shareholders’ approval the dividend will be from revenue sources and will be paid on May 20, on the basis of the shareholdings at 4 p.m. on May 6. The bonus issue will be one 50c ordinary share for each seven shares held on the basis of shareholdings at the same time. These bonus shares will participate in the final dividend for the year, which will give an effective dividend for the year of about 10.28 c a share on shares held before the bonus issue.