P. AND O. STOCK

Evening Post, Issue 12, 14 July 1936, Page 12

P. AND O. STOCK

WHY DID IT ADVANCE?

The rise in the market price of the deferred slock of the P. and O. Company on the London Stock Exchange was associated with the efforts beins made to secure Government assistance for the Canadian Australasian Line plying between Vancouver. New Zealand, and Australia.

The rise was described as "curious" by "The Times," -which claimed that there had been a misunderstanding. "The Canadian Australasian Line has only two ships, it was pointed out. and it is owned jointly by the Union Steam Ship Company of New Zealand and the Canadian Pacific Company. "The association with the P. and O. is that the latter holds most of the shares of the Union Company. At best an indirect interest in part of the capital of the Canadian Australasian Line could have little beneficial effect for the P. and O. group, with its control of more than 300 ships. From recent discussions the fact has emerged that losses in the operation of the ships between Vancouver and New Zealand and Australia have accounted for a large portion of the capital of the Canadian Australasian Line, and with the most liberal and effective Government assistance it would be long before the company could be expected to pay any dividend on the capital. It would, therefore, be reasonable, to assume that no Government assistance for the Canadian Australasian Line could have any direct influence on tne prospects for the resumption of dividends on the Deferred stock of the P. and O."

It was admitted that the outlook in the early future for the holders of Deferred stock of the P. and O. was improving, for it is probable that the company is doing a little better than a year ago. The directors have made it clear that they look forward to the time, when the patience of the Deferred stockholders will be rewarded —a great deal of hard work has been done in recent years to improve the financial structure —but it is certain that if and when a resumption of dividends is considered practicable much caution will be exercised in the rate for the liabilities of the company in connection with costly new ships are already heavy."