Mainstay’s first year

Press, 1 April 1985, Page 33

Mainstay’s first year

The future will see Mainstay Properties, Ltd, go from strength to strength, said the chairman, Sir Ronald Scott, in the company’s first annual report.

“Your board views the 1985 year confident in the ability of the company to achieve a result in keeping with the solid performance in its establishment year of 1984.

“We are certain that the company’s interest will be further advanced with the completion of the Mayoral Drive project in Auckland and by other ventures aimed at maintaining growth.

“Details of these will be announced at the earliest date.”

Sir Ronald said that it was possible also that there would be opportunities to broaden the scope of Mainstay activities. As reported, the company exceeded ail its prospectus forecasts in its first year of operations. Pre-tax trading profit was $413,000, 15 per cent higher than forecast, and revaluations by independent consultants assessed the current property portfolio at SB.9M — more than twice the forecast.

Of the trading profit some $209,000 resulted for the sale of a contract to purchase a property in Hereford Street, Christchurch, from Castleton Securities, Ltd.

Taxation required $123,000 leaving a net trading profit of $290,000. The surplus on property revaluation was $1,091,000. After allowing for $421,000 in preliminary and share issue expenses written off, the profit accruing to shareholders is shown as $960,000.

The directors are recommending payment of a final

dividend of 5 per cent, amounting to $273,000, payable on April 30. The balance sheet shows shareholders’ funds at $6,239,000, represented by investments of $8,943,000 less term liabilities of $3,537,000, And current assets of $1,376,000 less current liabilities of $543,000. The notes show that Mainstay acquired 100 per cent of the share capital of Lagel House, Ltd, on December 21, for $lOO. Contracts entered into for development of further properties amount to $5.5M. An off-shore loan was raised of 4,310,000 Swiss francs secured over one of the properties of the company, at an interest rate 1.75 per cent above Singapore banks’ base rate. Exchange losses amounted to $37,048, and forward cover contracts were amortised at $9418. Part of the increase in the valuation surplus is the result of the acquisition, since the date of the projections, of the prime Christchurch property currently leased to Fanners’ Trading Company, Ltd. “This quite exceptional property with frontage on four major city streets has unusual ■ potential,’ 5 Sir Ronald said. “We are currently evaluating the alternative development options.” There is considerable interest from potential tenants for space in the new six-storey office block in Auckland’s Mayoral Drive, due to be completed before the end of 1985. The property contract price is $5.5M. ‘it can be expected to show substantial returns which will begin to come into account towards the end of the 1985 year.” A third major feature of the 1934 year was the completion on schedule of the four-storey commercial building in Armagh Street, Christchurch, now fully leased, with Mobil Oil New Zealand, Ltd, the major tenant.