VICKERS LIMITED

Evening Post, Volume CXIII, Issue 131, 7 June 1927, Page 12

VICKERS LIMITED

A GOOD REPORT

STRONG FINANCIAL POSITION

The following is an extract from "The Times" of 21st April, 1927:— THE VICKERS REPORT. The report of Tickers, Ltd., for the year 1926 makes a remarkably good showing. It is the first report to be issued since the reorganisation, and it therefore covers the first year of office of the new board. It is an obvious tribute to, their, skill that they were able to earn a substantially larger sum than in 1925, for the year was one of the most troublous periods of our industrial history, covering a general strike as well as a prolonged coal .stoppage, when business in many cases must have been very difficult to conduct, let alone at a profit. After sotting aside £110,788 for depreciation and meeting debenture charges which required £173,000, the company earned a net profit of £562,284. This is £141,310 .more than was shown for 1925, but the actual increase is greater, for in 1925 practically nothiug was written off for depreciation out of profits. The dividends on tho two preference stocks and on the 5 per cent preferred stock absorb £418,190, leaving £144,093. This, added to the sum brought in, makes a total of £334,808. T'je directors have wisely decided not to pay any dividend on the ordinary shares, although it would have required only £205,000 to pay 5 per cent. They pursue the more conservative course of transferring £200,000 to reserve, and carrying forward £134,865. STRONG FINANCIAL POSITION. The directors explain that under normal conditions a dividend could have been paid, so that, unless something unforeseen occurs, the shareholders have every reason to anticipate a distribution next spring. During the year, the report states, the business of the company was reorganised, as a result of which considerable economies, both at the head office and at the works, were effected. The most striking feature of the bal-ance-sheet is the strong, liquid position of the company. Its holding of cash and British Government securities alone amount to £1,795,848. In addition it holds marketable securities amounting to nearly £600,000/ besides bills amounting to nearly £300,000. The company is therefore well supplied with financial resources, with which to take advantage of a revival of business at j Homo or abroad. ! A CONSOLIDATED BALANCESHEET. | 1 An important innovation is the presentation of a consolidated balance-sheet j of the parent company and its subsidiary undertakings. It shows a surplus of nearly a million, tho principal figures being shown in the subjoined table: — LIABILITIES. Sharo Capital of Tickers, Ltd 12,465,9G8 Share Capital of subsidiaries (held outside | group) 172,556 : Debenture stock (Vickcrs) 3,284,784 f>cb. issues of sub. coys. (hold outside group) . 107,142 Insurance Tumi (Vickers) 62,228 i Reserve Fund (Vickors) .. 200,000 Creditors—Vickers 1,939,609 Creditors—Subsidiary Companies 1,185,971 Contingent Liabilities, etc. 2,032,873 Filial Preference dividends of Vickers 201,595 Surplus 944,409 £22,603,135 ASSETS. Fixed Assets—Viekors . .. 3,315,056 Fixed Assets — Subsidiary Companies ". 4,009,385 I Stocks—Viekers 1,789,672 Stocks — Subsidiary Companies 1,026,272 Debtors—Viekers 1,640,407 Debtors — Subsidiary Companies 1,354,18~> Investments —Vickers . .. 817,128 Investment — Subsidiary Companies -4,071,940 Cash—Vickers .. 305,84S Cash — Subsidiary Companies . 2.051,497 Bills—Vickers :298,121 Bills — Subsidiary Companies 3,772 British Government- Securities —Vickers ... 1,490,000 British Government Securities —Sub. Coys 19,943 4,169,181 Less Bank Loans, etc., of Subsidiary Companies 120,091 4,049,090 Total £22,603,135 -'Including investment ■in Metropoli-tan-Vickcrs Electrical Company. Here again the most striking feature is the strong financial position of the group. Cash, bills, and British Government securities held by tho various companies, after deducting bank loans and overdrafts (which amount to only a small sum), amount to no less than £4,049,090. Further, the group holds securities totalling £4,889,069. These are taken at cost or market price, whichever is the lower, so that this item probably covers a hidden reserve, sinoe it includes the shares in the Metropolian-Viekers Electrical Company, which stand at a considerable premium. The directors explain that the surplus includes £809,541, the sum by which the a: ets, less the liabilities of the subsidiary companies as shown by thoir audited balance-sheets, exceed Hie value placed on tlipm in Vickcrs' 'books.—(Published by Arrangement.)