Trans. (N.C.) may issue debentures

Press, 10 December 1981, Page 23

Trans. (N.C.) may issue debentures

Transport (North Canterbury) Holdings, Ltd, is considering making a debenture issue next year, according to the chairman, Mr W. H. Scrimgeour,- in the annual report.

Steps had been taken to prepare a debenture’ trust deed, and when the document was completed consideration would be given in 1982 to issue a prospectus to float the first issue of secured debenture stock-, he said. “This step will initiate the establishment of our term finance funding arrangements on a more economic basis.”

On August 1, the group, along with McAlpines (Rangiora), Ltd, Rowley Aviation, Ltd, and Airwork (New Zealand), Ltd, formed a top-dressing company called Airwork Agricultural Aviation, Ltd, each holding a 25 per cent interest. “After two months of operations, the profit result has been ahead of budget.” The activity had already had a beneficial effect because it brought Transport (North Canterbury) into contact with customers of dif-

ferent areas, Mr Scrimgeour said. The new colour scheme of the transport fleet, and its new logo, had gone a long way to improving the company’s image. The divisions connected with the building industry had earned a considerable improvement in profits, particularly the shingle and logging sections, he said. Specialist cartage divisions had maintained profits, but divisions which depended on stock and general cartage had deteriorated slightly. “The exception to this trend is Cheviot which once again has proved a most satisfactory unit for the group.”

The attention to the maintenance of the plant and vehicles of Christchurch Ready Mix Concrete, Ltd, enabled the company to take advantage of an upturn of the building industry that occurred in the last few months. The reduction in the number of vehicles meant that the average load had increased from 2.9 m in September, 1979, to 3.4 m in

September, 1981, enabling Ready Mix to transport an. increased volume at the same cost.

Rangiora Freight Services, Ltd ( had continued to prove valuable and profitable to the group. It enabled management to rationalise various types of its cartage operation, and Mr Scrimgeour believed that, further rationalisation could take place to tne benefit of the group and its shareholders.

The total group net profit was $695,641 in the 18 months to September 30, compared with $428,311 in the year to March 31, 1980, after the balance date was altered last year. The result was after providing tax of $37,946 for Rangiora Freight Services and a prior period adjustment, and minority interests up $10,827 to $11,621. Total revenue rose from $8.4 million to $17.3M in the 18 months.

The depreciation provision rose $297,204 to $1,054,212 in the 18 months, but no tax was payable on trading in either period because of allowances, deductions, and tax losses.

The recommended 10c a share final gives a dividend rate of 23c a share (23 per cent) for the 18 months when combined with the two interim dividends already paid. The annual rate for the 1980 year was 14c a share. The dividend requirements total $212,058 and are covered 2.6 times by the total profit after allowing for the preference dividends; Shareholders’ funds rose $446,710 to $4,463,911. The working capital deficit increased from $193,885 to $782,607.