Command flush for acquisitions

Press, 3 May 1984, Page 22

Command flush for acquisitions

Command Services Corporation, Ltd, the commercial services group, is looking forward to an easing of Tasman investment restrictions, the chairman (Mr G. A. Weston) told the annual meeting yesterday. “The present position is a constraint to our acquisition ambitions and it is to be hoped that, as their term of office proceeds, the Hawke Labour Government will adopt a more pragmatic approach to overseas investment,” Mr Weston said. The latest report shows that at balance date, January 2, the group had almost $7 million in “near cash,” waiting for suitable investments. Mr Weston said after the meeting that the company had acquisitions in mind that would more than treble the return on this money. That would mean an addition to profit of close to $1 million Referring to economic conditions, Mr Weston told the meeting that with increasing size the company became more and more affected by the business cycle. At the moment economic

conditions were improving, he said, but last year had been tough. A promising start had been made in 1934, and “although these are early days, our trading for the first quarter over all has been encouraging. “I believe that, in the first quarter of 1984, there are firm indications that the recovery from recession in Australia and New Zealand is continuing. However, the inflation rate in Australia is still around 9 per cent against 3 to 4 per cent in

New Zealand. “It is difficult to judge the pattern of events in Australia for several reasons. For example, the extent to which the so-called accord between industry and labour in respect of prices and incomes will continue; the effect on inflation of wage indexation and perhaps the most serious to our business, the ever increasing impost of state taxation, particularly in Victoria and New South Wales. “These state taxes, in particular the payroll tax, is a major contributor to unemployment and it is reported that a number of Australian companies are contemplating moving some parts of their operations overseas to avoid this tax We, as a service company learn to live with the problem but it does cause management to be most vigilant about the most efficient use of manpower.” As announced, the comKis making a one-for-six s issue; the new shares do not rank for the final dividend approved yesterday, but will rank equally in all respects thereafter.