Crown Corp, lifts profit 37.4%

Press, 11 October 1985, Page 14

Crown Corp, lifts profit 37.4%

PA Wellington The large diversified rural support group, Crown Corporation, Ltd, has increased its annual profit before extraordinaries by 37.4 per cent to $22,712,000 ($16,527,000) for the year ended August 1.

Extraordinaries of $8,352,000 ($1,865,000) lift the total profit to $31,064,000 ($18,392,000), up 68.9 per cent.

Turnover was S2OBIM ($1661M). Tax took $11,750,000 ($10,599,000) and minorities $643,000 ($124,000). Associates added $6,407,000 ($1,059,000). The final dividend will be 6c a share (1984 sc) to be paid on December 4. Books close on November 19.

Crown’s 20 per cent interest in Cable Price Downer, Ltd, was equityaccounted for the first time and the Crown chairman, Sir Roderick Weir, said the

company was proud to be associated with CPD. During the year the remaining 50 per cent of HBF, Dalgety, Ltd, was acquired and a full year’s result for that company was included in the result. Sir Roderick said it was a satisfactory performance, especially in view of the fact that the company had forecast in its prospectus of 1983 a tax paid trading profit for 1984-85 of $14,450,000. The result reflected the benefits of the Crown and Dalgety merger nearly two years ago. It would have even been better had it not been for the exceptionally high interest rates that Crown had to absorb during the last few months of the financial year. “It is hoped that the Government’s objective of reducing inflation will soon become effective because the burden of high interest

rates on the corporation, and on its farmer clients, is becoming hard to bear,” he said. Sir Roderick said all group companies had satisfactory performances in view of the trading conditions.

However, the increases in debt-servicing costs in the latter part of the year affected results, particularly those of Dalgety Crown. He said Crown Corporation was now a diversified business although its major investment was still in the stock and station agency subsidiary, Dalgety Crown. Shareholders funds are now $203.9M, with an equity ratio of 42.2 per cent. Taking into account the bonus issue last December and the increased dividend, shareholders’ income has increased 32 per cent during the year. The ordinary dividend is covered 2.33 times.