Mair begins well

Press, 28 October 1981, Page 27

Mair begins well

Mair and Company, Ltd, had a buoyant start to the 1981-82 financial year, and given average trading further worth while results should emerge, said the group’s managing director, Mr A. D. Shadwell, in the annual report. Some of the major trading partners, particularly the European Economic Community, were not fully recovering from the recent recession, and any fallback that they experienced would inhibit international trade. Mair achieved a better result in the year to June 30, and some of the potential of the group was at last emerging, he said. The increase in profit was particularly pleasing because it exceeded 1 per cent on turnover, the first time this had happened for some years. “Margins on commodity marketing are notoriously thin and the move by the group into processing is aimed, at least in part, as a cushion against these margins." Progress had been made in consolidating the group. Shareholders’ equity had been given close attention,

and had recovered to almost 20 per cent. It was the aim of the directors to raise it to about 26 per cent within the next two years. It was decided to identify more clearly the major group interests of wool, leather, foods, and ■ industry because of the diversification, growth, and international trading, of Mair, Mr Shadwell said. The streamlining of interests would provide tighter control than achieved. The streamlining of executive responsibilities would provide better and tighter control, and at the same time would not frustrate the need for quick decisions in international marketing. Australia, Iran, and the United States were bright spots in the demand for wool, but generally the scene was still depressing,' and Mair could not see a major rise in New Zealand wool prices until the carpet market turned upwards. Signs of this were slow in emerging, he said. As reported, the group net equity profit rose 73.3 per cent to 51,362,313, including an extraordinary loss of $72,900 (nil previously) be-

cause of investment. Equity profits more than doubled from $217,420 to $578,579. Group turnover fell 13.3 per cent to $130,082,342. The profit was after providing $200,512 more for depreciation at $335,876, but $8296 less for tax at $lOll.. A recommended final taxfree dividend of 6.25 c a share gives a steady annual rate of 12.5 c a share (25 per cent) on capital increased by the one-for-eight bonus issue last November and the 198,000 shares as part consideration for the acquisition of a Napier tannery. The dividend requirement is $339,155, and it is covered 3.9 times by the total dividend after allowing for the preference dividend. The proposed one-for-seven bonus issue and the one-for-six rights issue do not qualify for the final payment. Shareholders’ funds rose $1,325,168 to $7,277,358, including share capital up $238,620 to $1,676,620. Working capital fell $362,629 to $560,329 and the current ratio was steady at 1.0 to one. The net asset backing a 50c ordinary share improved from 252 c to 256 c.