Visionhire objects to classification

Press, 14 June 1984, Page 28

Visionhire objects to classification

PA Auckland The directors of Visionhire Holdings, Ltd, have made unsuccessful submissions to the Government for exemption from the requirement to hold Government stock. In their annual review they say the group must hold stock in conformity with the ratios imposed on finance companies. “This imposition, which has increased considerably during the year, has had an adverse impact on the profit of the company and on the rental charges to customers.

“Submissions have been made to Government without success on the inequity of regulations that do not distinguish a company like Visionhire from finance companies.”

The balance sheet shows that during the year the group increased its Government stock holdings threefold, from $413,000 to $1,395,000. Since March 31 the company would have been required to increase its holdings further, in line with the higher ratios imposed by the Government.

The review says that the higher earnings (profit rose 11.5 per cent to $1,769,000) reflected increased placements and cost containment.

The colour television market, as 90 per cent of homes have a colour TV,

offers little growth, they say. “The video market will continue to grow at an accelerated rate and although the company is in a position to take advantage of this growth it should be noted that the profitability of video is not initially as high as colour television because of the high depreciation incurred.

“The company’s development into the area of retailing will mean that we can take advantage of any increased activity in the retail area, particularly with colour television, video and related products.”