Ballins striving for efficiency

Press, 5 August 1981, Page 22

Ballins striving for efficiency

Ballins Industries. Ltd. had begun a phase, of expansion to allow it to rationalise the retail and distribution activities of its wine and spirit division, said the chairman (Mr W. Wilson) at the annua] meeting yesterday. The group believed that modern techniques must be introduced into the liquor industry, and this had become the cornerstone of Ballins’ policy. "In striving for better performance and efficiency we hope that the benefits can be shared by our customers in keen prices and by our shareholders in better profits." Mr Wilson said. In line with this policy Ballins had acquired the outside shareholdings in Franklin Wines and Spirits. Ltd. Pukekohe (74 per cent): Buckham Wines and Spirits, Ltd. Queenstown (30 per cent); Mitchells Wine and Spirits (Panmure). Ltd. Auckland (49 per cent); Canterbury Wine and Spirit Co.. Ltd Christchurch (26 per cent): R. Powley and Co. (Canterbury). Ltd. Christchurch (33.3 per cent), and South Canterbury Wine and Spirit Co.. Ltd, Timaru (26 per cent). The agreement to buy the wine and spirit division of Dalgetv New Zealand. Ltd. fitted in with the stated' aim of rationalising retail and distribution activities, and would add to Ballins'

national chain. Mr Wilson said, but it was with regret that he had to tell shareholders that the approval of the Examiner of Commercial Practices was not forthcoming.

"We intend to pursue the application because we believe that it is in your interests as shareholders, and also in the consumers' interests."

Agreement had been reached to acquire for cash the remaining 75 per cent in Johnstons Wholesale Wine and Spirit Co.. Ltd. of Onehunga, one of the most successful liquor businesses in New Zealand with a 198081 turnover of $4 million.

The agreement was subject to the approval of the Examiner of Commercial Practices, and an application had been filed, he said. Since the March 31 balance date, the wine and spirit sector had continued to show a pleasing trend. “We have opted to seek an increased market share during this period and this has involved sacrificing some margins and incurring heavy advertising costs. We believe that these short-term costs will be entirely justified by future long-term growth and profitability." Ballins held a 29 per cent interest in McWilliams Industries. Ltd. and the directors believed that some further rationalisation may oc-

cur in the wine industry in the next few years to avoid duplication of investment in costly production facilities.

"We are currently studying our investment in'the wine industry to determine the best policy if these changes do occur." Mr W'ilson said.

The Chicken Spot fast food chain had been a headache for Ballins. but during the last year the operation had come into profit after being reduced to two outlets. "It is pleasing to note that since balance date this profitable return has continued and we are now examining whether additional investment should be made in the fast food area."

Since balance date Ballins' holding in Lion Breweries. Ltd. had been sold for a cash consideration exceeding S2M, leaving a capital profit of $1,365,000. In addition, the disposal of plant and chattels to the Lion Breweries-Ballins joint-venture company. Inns of Canterbury. Ltd. and the selling of shares in Fletcher Humphrey and Co.. Ltd. gave further extraordinary profits of more than SIM. The early months of the new Inns of Canterbury jointventure indicated that the decision to allow Lion Breweries to participate was correct, and that the contribution to the group's profit from this sector would improve. he said.