Tag raises profit 22.5% to $1.4M

Press, 24 March 1988, Page 32

Tag raises profit 22.5% to $1.4M

PA i ; [ Wellington ’iT | ■ ! Investment group, Tag Corp,' has [reported a 22.5 per cent [rise in interim profit !to $1,493,000 from $1,218,000 fojr | the six months ended December 31, 1987. [ | i But a change in balance date tnearis the results are not (strictly [comparable with ! the; previous six .months ending on September .’1986. j The[ company will [pay unchanged interim dividends [ of; 3.75 c a share (7.5 per cent) |on ordinary shares, and jc (2.5 [per cent)! [ on' property link shares. The dividends will be paid on April 22. | i Although tne | dividend rate remains constant,) the number of shares on issue has risen [ considerably in the past year) the chairman, j Mr Peter Vise, said in a statement. ) The issued capital of the group is now! 9,86/910 ordinary 50c shares and 9,338)671 pre petty link 40c shares. [ [ [ The total interim dividend/ payment | has increased .by almost 50 per cent,[he added. [

Pre-tax profit [dropped to : $2,130,000 ; from $2,398,000 ) but tax also dropped to! $527,000 from $1,006,000 leaving aftertax profit |; at $1,603,000 against $1,392,000. I Minority![interests took' $llO,OOO against [5314,000. I There was rio equity ; accounted [ profit this [ period against $140,000 in the previous period, leaving the bottom line at $1,493,000 compared with $1,218,000,.[ | : The corripany [increased its holding in [ Lectrica Holdings, Ltd, from 30 per cent to 51 per cent in i 1987. “While this has! had the effect of[ depressing profitability in [the short term, the; [restructuring programme; that Tag has been instruriiental in implementing [ within that company is expected to bear fruit in the) 1988-89 year,” Mr Wise' said.;! “Tag’s other ) trading activities have made [good progress over the period and continue to [provide a good cashflow base. “The impending deregulation of the oil [industry has created certain profit

opportunities and an announcement [will be made in coming weeks,” he added. The sharemarket decline has affected the company’s ability to develop its Link Unit concept, but Tag has no underwriting liability for the three classes of Link Units, he said. i I j . The equity link units derive benefits directly related to the performance of Brierley Invest-i ments, Industrial Equity and Ariadne! Australia. Property Link activities were' expanded in Auckland, Hamilton, and Wellington bringing the total number of properties in the portfolio to 13. J ! i | The property link! shares benefit from the! performance of Tag’s pro-! perty subsidiary, Property. Link. "No material change to' the company’s fortunes is anticipated ih the second half of the year, but the state Jof thej economy is causing directors to take a slower and more cautious approach to th,e expansion of the group,[’ Mr Wise said., i ' | | i•.