COMPANY BALANCE SHEETS.

Otago Daily Times, Issue 19047, 18 December 1923, Page 6

COMPANY BALANCE SHEETS.

DALGETY AND CO. (LTD.). Paid-up Capital, £1,500,000. Year Profits. Dividends, ended Reserves. Gross. Net. Pref. Ord. June 30. £ £ £ !>■<-'■ P-c----1919 ... 970,928 857,773 262,157 5 14 1020 ... 1,028.505 057,228 222,577 5 15 1021 ... 1,034,112 683,160 140,606 5 10 1022 ... 1,101,901 *775,660 * 04,580 5 15 1023 ... 1.116,063 920,077 254,162 5 15 •Excluding. excess profits duty recovered. Notwithstanding somewhat unfavourable climatic conditions which in large areas of Australia took the form of drought, and iu New Zealand a super-abundance of ruin with heavy snowfalls in certain parts, there has been a continuation of the recovery from the depression of 1920-21. This movement has during the past season been more marked in Now Zealand than in Australia, where the recovery came earlier. The net result 10 a profit of £254,162 —a figure not far removed from those of pre-depression days, and nearly three times that of 12 months ago. The holders of ordinary shares receive 15 per cent, after the 5 per cent, distribution is made to preference shareholders, £50,000 is used in writing down premises, and £15,000 is added to the staff provident fund. After these entries are made the floating balance null be augmented oy £14,162. It is not prop-ceed to swell the reserve fund. The gross profit shows the substantial increase of £145,317 over last year. On that occasion there was recovered for excess profits duty a sum more than sufficient to meet the ordinary share dividend of 15 per cent., and the deficiency was made up in that way. General expenses continue to mount up, and are 40 per cent, higher than four years ago. The taxes, both Australasian and British, have come down in proportion to their respective amounts. The result relief to the extent of £31,618 in a year when the profit has risen approximately one-fifth above the year preceding. Interest continues to claim a fair share of the profits. The portion applicable, to the debenture stock remains as before. There is a reduction on the amount paid for terminable debentures, some £IB,OOO of these having been repaid. The company’s position regarding reserve fund is exceptionally strong. The fund stands at £1,000,000, equal to the amount of ordinary share capital paid-up, and is invested outside the business in gilt-edged securities. Xfiese consist chiefly of British Government funds and the total nominal value comes to over £1,330,000. It is apparently the habit to take the valuation of investments at a conservative figure, as a short time ago a profit of £20,000 was made on certain sales. This gives a reserve within the reserve. The staff benevolent or provident fund, as it is now termed, will have reached £166,000 when the latest addition is included. The liabilities to customers and outsiders total £2,787,515. AVhen placed against advances, bills receivable, customers’ balances,’ etc., the relation seems somewhat high. A comparison of the respective aggregates for the past five years works out as follows: Advances Bills payable bills receivable customers’ customers’ balances balances and sundry and sundry creditors. debtors. Katie. Year. £ £ p. c . 1918- ... 2,461,404 4.759,472 51.72 1919- ... 2,843,690 4.994,188 56.94 1920- ... 2,368,060 6,311,021 4-1.69 1021-22 ... 2,701,763 4,530,764 59.C4 1922-23 ... 2,878,515 4,515,606 61.73 The capital remains as formerly, the preference issued being fully paid, and the ordinary fully subscribed, one-fourth paid. The irredeemable debenture stock, amounting to 50 per cent, more than paid-up capital, has been issued at the low rates of 4 per cent, and 4J per cent., chiefly at the former figure. As the money market stands now this is distinctly advantageous to the company, which when borrowing a few years ago on terminal debentures had to pay 6i per cent, for £300,000. The fixed assets represent a email proportion of the total. They are comprised under the one heading freehold and leasehold premises, plant, and furniture, and have apparently been extensively increased during the period. AVhen written down by £50,000 as recommended, they will appear at £347,217, an increase of over £IOO,OOO, after the usual' depreciation has also been provided. The liquid assets in aggregate are close to eight million pounds. The largest item, as might be expected. is the money advanced on security, £3,644,9/6. It may be taken as a good indication of conditions general’,y that this is the lowest figure touched for some years on this account. A cash balance is retained of well over a million. It is considerably smaller than 12 months ago—a re®ult which may be traced to the increase iu the fixed assets, balances in transit and merchandise. The last-named, although not approaching the valuations of recent seasons, makes up the important sum of £418,347. Investments, other than those earmarked for reserve, stand at £650,862. This surplus cash is employed chiefly, if not entirely, in war loans. If circumstances permitted, possibly the best investment the company could make would be to take up its own debentures. • A survey of th© accounts for the financial year 1922-23, in which according to the report, "seasonal conditions broadly speaking, have not been favourable,” is apt to make the reviewer wonder what height would have been reached if seasonal conditions had been favourable.