COMMERCE AND FINANCE

Otago Daily Times, Issue 21405, 5 August 1931, Page 5

COMMERCE AND FINANCE

THE SHARE MARKET DUNEDIN STOCK EXCHANGE The only business recorded on the Dunedin Stock Exchange yesterday was • reported sale of King Solomons, a ! P® r ' cel being turned over_ at 2s The shares were later being offered at 2s 6d, but buyers would not then give more than 2s sd. The demand for Westport Goals improved to 23s 3d, but no seller was attracted. Ordinary D.l.C.’s were asked for at 13s, a margin of 2s 3d separating buyers and sellers at the close of the market. Christchurch Gas shares were quoted ex dividend, an offer of 24s 9d failing to attract a seller. New Zealand Breweries continued to ease and the shares were offered at 29s 6d yesterday with no buyer in the market. An offer of 3s lOd for Paddy’s Points found sellers firm at 4s. Sales reported: King Solomon, 2s ojd. The following are yesterday afternoon s buying and selling quotations, ’ which are subject to the usual brokerage:— BANKING. Bank of New South Wales —Buy 1 £24s lOd. ' r Bank of New Zealand—Buy 48s 3d. Bank of New Zealand (long “D ) Buy 25s 6d. _ Commercial Bank—Sel 14s 3d. National Bank of New Zealand Buy *4. sel £4 ss. Union Bank —Sel £6 14s. INSURANCE. National Insurance Co. —Buy 12s 9d, sel 13s 2d. - „ „ , Standard Insurance Co.—Sel 475. / SHIPPING. Howard Smith —Buy ss, sel 7s. U.S.S. Co. (pref.)—Buy 19s 10d. COAL. Kaitangata—Sel 2s 3d 1 dis. Westport Coal Co.—Buy 23s 3d. LOAN AND AGENCY. Goldsbrough, Mort-r-Buy 19s 3d, sel 20s. National Mortgage (“B issue)—Sel •Os. Perpetual Trustees —Buy 595. Trustees, Executors and Agency Buy 88s. * MEAT PRESERVING. ' New Zealand Refrigerating (cont.) Buy 3s, sel 3s 4d. miscellaneous. British Tobacco—Sel 24s 3d. Bruce Woollen Co. (pref.)—Sel I9b. , Colonial Sugar—Buy £34. ■ D.I.C. (ord.)— Buy 13e, sel 15s 3d. D. 1.0. (pref.)—Buy 19s 6d. Dominion Rubber —Sel 12s 6d. Eclipse Petrol—Sel 10s. , Kaiapoi Woollen (ord.) —Sel 7s 9d. New Zealand Drug Co. —Buy 50s. New Zealand Milk Products (debs.)— Buy 20s. ~ _ New Zealand Paper Mills (ord.) Buy Daily Times —Buy 495, sel 50s ed. i Wilsons (N.Z.) Cement— Buy 355. GAS. Christchurch —Buy 24g 9d (ex div.). BREWERIES. New Zealand Breweries, Ltd. —Sel 29s New Zealand Breweries Debent.— Buy 81s. Dunedin Brewery—Buy 15s. MINING. Waihi Grand Junction—Buy 3s 9d, sel 4b 2d., ; Mount Lyell—Sel 17s 3d. > Mahakipawa —Buy 7d, sel Bd. Kiltiare—Buy 9d, sel lid. Okarito —Buy 9s lOd, sel 10s 6d. Paddy’s Point—Buy Bs lOd, sel 4s. Cornish Point (pdj—Buy 6d, selJod. Golden Progress—Buy 265, sel 28s. fKing Solomon—Buy 2s sd, sel 2s 6d. Golden Point —Bpy Is sd, sel Is Bd. Moturoa Oil—Buy 3s. g, % .. WAR BONDS. ii per cent. Bonds, 1938— Buy £99 ss. ,44 per cent. Bonds, 1939 —Buy £99 ss. 44 per cent. Bonds, 1941—Buy £99 ss. 4| per cent. Inscribed, 1938 —Buy £99 cent. Inscribed, 1939—8uy £99 per cent. Soldiers’ Bonds, 1933—8uy £99 10s. ;5J per cent. Inscribed Bonds, 1941 — -Buy £99 10s. >54 per cent. Inscribed, 1936 —Buy £99 lOfl '54 per cent. 80nd5,1937— Buy *54 per cent. Inscribed, 1937 —Buy £»» 10s.” ‘ '-■ - \ NORTHERN EXCHANGES ■ (Per United Press Association.) The following business was done on ’Changes yesterday:— ;, o , v . /Auckland.—Sales: War Bonds (1938) 4J per cent., £IOO 7s 6d (two parcels), (1936) 54 per cent., £99 125,6 d; Inscribed Stock (1927-41) 5i per cent. £97 10s; Commercial Bank of Australia, 14s; National Insurance, 12s lid; Auckland Gas, *2s 8d; Leyland, O’Brien Timber, 21s 9u, Colonial Sugar, £34 ss; King Solomon, 2s’; sd, 2s Slid (three parcels), 2s 6d. Waihi, 15s 7id; Mount Lyell, 16s Sd, Mount Eden Borough (1961) 51 per cent.. Wellington.—Sales reported: Commercial Bank of Australia (ord.), 14s (cun, div., late Monday); Okarito Mining, 10s 2d; Mahakipawa Mining, 74d and /sa. Christchurch.—Sales: Bank,_of Australasia, £8 16s, £8 14s; Commercial Bank of Aust.. 13s lOd, 13s 9d; Bank of Neiv. South Wales (cum div.), £24 ss; Bank of Nhw Zealand. 48s 8d; Union Bank 0. Anst., £6 10s, £6 lls, £6 10s (two paicels): New Zealand Breweries, 29s .id (three parcels), 29s Id, 29s (two parcels) 28s lOd (six parcels); Mount Lyell, 16s 10d (three parcels); King Solomon, 2s 6jd (two parcels), 2s od, 2fl 51d (Uo parcels); Mahakipawa, 74d (three parcels) 7d; Golden Point (Is paid), Is 6K Is. 6d (two parcels). Sales reported. Commercial Bank of Aust. (cum div.), 13s lid; Goldsbrough, Mort, 19s 6d. I GOLD EXTRACTION S-A NEW PROCESS CLAIMED. Should large-scale treatment operations •nf old mining dumps with a new recoverj process give the results obtained from experimental tests, a new company, backed by British capital, expects to have a lengthy and profitable future (states the Melbourne Age), , „ Three and a-half years ago Mr y. Nightingale, consulting engineer, set to ■work in his laboratory at Heidelberg with the object of perfecting a cheaper process for dealing with the extensive dumps in Victoria and New South Wales than the present methods of cyamdmg and chlorination. Experiments and research work led to the adoption of electro static and electrolytic chemistry, ihe former Mr Nightingale regards as a new discovery. A small plant was installed and treated 30 tons of material from the Bethanga dump, containing refractory minerals, and 540 z of gold was separated. A new company, Electrolytic Gold Pty.> Ltd., was then formed, with a nominal capital of £20,000 in shares of £1 each, and 15.000 shares were taken by a strong English company, 5000 shares being heid in reserve. A second company. Electrolytic Gold Pty. (Overseas), Ltd., was also formed, and has applied for patents in other gold-producing countries. Stawell is regarded by the Australian company as offering the greatest opportunity for the commercial plant. The Magdalla-cum-Moonlight dump there contains over 200,000 tons of tailings. The plant to be installed will deal with 1000 tons of tailings per week. The successful treatment of each dump, it is asserted, will require much technique. A feature of the process is that it is a straight flow, and the machine does not interrupt the stream of operation. Should the plant prove that the dumps -an be profitably treated, a new era in mining will be opened up. The claim is made that the process will definitely treat arsenical pyrites, antimony ores and sulphide ores. Furthermore, should recoveries be improved, gold mines that • have been barely payable could be reopened, as working costs now are lower.

LOCAL AND OVERSEAS MARKETS.

LORNEVILLE STOCK SALE (Special to Dailt Times.) INVERCARGILL, August 4. There were considerably larger entries of both fat sheep and fat cattle at the weekly Lorneville stock sale to-day, but the store sections were very small, and did not attract much attention. Sheep.—The yarding comprised some 1200 head, and was the largest entry for several weeks, the quality being somewhat mixed, including fair proportions of both good and inferior sorts. With the larger offering it was apparent that the butchers were not prepared to pay the high rates which, have ruled during the past fortnight, when supplies have been short, and the market opened at a reduction on last week’s values of about 4s pqr head. As the sale progressed, however, prices showed a firming tendency, and towards the close of the auction values were about 2s lower than a week ago for best quality and up to 4g for inferior lines.

A similar position existed in the fat cattle market, where the entry was more than double that of the previous sale, and prices showed a reduction of from lOs to £1 per head. Promising young dairy heifers were the only sorts in the store cattle section; which attracted any attention, and these were in demand, with prices ruling from £5 to £B. Aged ewes comprised a very small entry in the store sheep section, and values were about on a par with recent sales. STANDARD INSURANCE COM- • PANY, LTD. ANNUAL REPORT. The annual report of the directors of the ‘ Standard Insurance Company, Ltd., states that the income from all sources for the year amounts to £226,949 8e Id, to which has to Jae added the balance brought forward from last year, £23,144 9a 4d. The surplus on the year’s operations, after making full provision for all ascertained losses to June 30, payment of an interim dividend, donation to the Guarantee and Provident Fund, and the depreciation of securities, amounts to £35,558 19s sd. Out of this surplus the directors ’ recommend the payment of a dividend at the rate of Is 3d per share, and the carrying forward to next year of £23,058 19s sd. WHEAT AND FLOUR DUTIES PROTEST AGAINST REVISED SCALE. (Per United Press Association.) ASHBURTON, August 4. At a, largely attended meeting of residents of the borough convened by the Borough Council the following resolution was carried unanimously:— This meeting of ratepayers and residents of Ashburton borough emphatically protests against the revision of the sliding scale of wheat and flour duties as suggested in the Budget, We are strongly of opinion that the scale should Le amended to a basis guaranteeing the grower 4s 9d a bushel, net on trucks, at country stations, sacks extra, Tuscan, March-April delivery.” Mt was decided to send copies of the resolution to the Prime Minister and every member of Parliament. RABBIT 3KIN SALE' The Dunedin Stock Agents and Woolbrokers’ Association (Messrs Dalgefy and Co., Ltd., Donald Reid and Co., Ltd., Stronach, Morris, and Co., Ltd., New Zealand Loan and Mercantile Agency Company, Ltd., Wright, Stephenson, and Co., Ltd., Otago Farmers’ Co-operative ‘Association, Ltd., and National Mortgage and Agency Company, Ltd.) reports as follows: No doubt owing to the heavy falls of snow recently, catalogues were smaller at yesterday’s rabbit skin sale. There was, a steady demand for low grades, which sold at prices which showed little change from last sale’s rates, but competition for winter bucks and does was restricted, and prices for these were from 6d to 9d lower. Owing to the unsettled conditions on the Continent, there is at present very little demand for does, and spotted and outgoing sorts are in poor , reqjiest. The following is the range of prices:—Summer broken, 3Jd to 3|d; autumn broken, 8d to B£d; first winter broken, 12d to 124 d; runners and suckers, 4d to 5Jd; summers, 44d to 4|d; light racks, 74d to BJd; prime racks, 7d to 74d; dawny autumn, 8d to B£d; early autumns, 12£d to 134 d; autumn. 30d to 32d; second incoming, 15d to 16d; incoming winter, 34d to 39d; early winterdoes 23d to 26d, bucks 55d to 604 d; second winter bucks, 56d to 58d; second winter does, 27d to 32d; first winter bucks, 75d to 79d; first winter does, 45d to 46|d; prime bucks, to 79d; prime does, 54d to 55jd; outgoing, lid to 13d; springs, 9d to 104 d; milky, 4d to 9|d; fawn, to 40d; winter fawn, to 82Jd; summer black, to 3d; autumn black, 6d to lOd; first wintc.r black, 18d to 184 d; second winter black, 12d to 15d; hareskins, 4d to 0d; horsehair, to 15d.

NEW ZEALAND INSURANCE COMPANY

REDUCED PROFITS. (Special to Dailt Times.) AUCKLAND, August 4. Reduced profits and dividend unchanged at 10 per cent, per annum were the chief features of the New Zealand Insurance Company’s annual meeting to-day. The chairman of directors (Mr C. V. Houghton) stated .that the adverse trading conditions referred to a year ago had been accentuated to an almost alarming degree, not only in the Commonwealth and New Zealand, but in every sphere of the company’s operations; in fact, throughout the world. In India, the Far East, and South America, for example, the economic problems were rendering successful trading most difficult. It must be conceded that the company’s results during the year had been relatively good under the existing state of things. The underwriting profit for the year was £76,573 as against £91,385 last year. Undoubtedly the world-wide depression was primarily responsible for the fall in profits. Prominence must, however, be given to the extent by which the results were affected through losses arising out ot the Napier earthquake disaster in February last. While the company’s policy in regard to earthquake insurance had been, and still was, a conservative one, some earthquake commitments had of necessity been carried. In all centres of New Zealand, including Napier, the income had fallen to £1,145,257, a decrease of £54,124. The losses at £740,244 were higher by .£2526, but owing to the decreased premium revenue the claim cost had increased from 61.51 per cent, to 64.64 per cent. During the year stocks, particularly those of the Commonwealth of Australia, suffered substantial declines in market values. Even at the present time there were coming into operation certain measures which, while’ they were expected to assist materially in the process of restoration, must bring about further falls in the market values unless a general readjustment of ideas took place. The board had, therefore, decided to- make provision for marked fluctuations by the transfer of £95,000 from the available surplus to the investment fluctuation and contingency account, which would then stand at £120,000. COMPANY BALANCE SHEETS NEW ZEALAND INSURANCE COMPANY, LTD.

* Approximately. The past year is the first during which the subscribed capita] has appeared as fully paid, but the net profit has not kept, step with the increased amount. The distribution to shareholders nevertheless continues to rise, an additional penny per share being recorded on this Occasion. The net return, which equivalent to 12,79 per cent., is divided between shareholders and reserves in the proportions approximately of four-fifths and one-fifth respectively. Owing to the larger paidup capital, while the return per share is the highest recorded, the rate of dividend is reduced to its lowest figure for several years. „„„ , , , A shrinkage of some £54,000 has taken place in the net premium income. The revenue from interest and rents has dpne little to make up for the shortage, while losses show a email increase. The position of losses in consequence stands less favourably to income than for any year since 1921-22 as is shown below:— Total Premium Losses. Income. Ratio. Income. Ratio.

previous years. Another point is that the revenue from interest and rents, after having steadily grown annually since 1922, has received a decided check. Reserves have been depleted to bring the capital up to its fully-paid figure. The transfer of the £300,000 required has resulted in a large encroachment upon the general fund which now stands at £350,000. An interval of three years, instead of two, had taken place since the previous transfer, but the amount of the transfer was doubled. The addition of £95,000 to the investment fluctuation and contingency account has been made up of £41,869 from the net surplus, £28,131 from the floating balance, and £25,000 from the unexpired risk reserve. The effect has been to reduce the unexpired risk reserve to £575,000, and.the floating balance to £105,943, while investment fluctuation account has risen to £120,000 after, apparently, some claim has been made upon it during the year. The necessity of strengthening the investment reserve at the present time has evidently been regarded as important when it has been raised nearly threefold. The taxation provision remains at £20,000. Unascertained losses are entered at £209,746, a alight increase on those outstanding at May, 1930, which may be accounted for by the larger amount to deal with. The estimate is not far short of 30 per cent, of the total for the year, and is possibly subject to some adjustment before final settlement, Sundry creditors and unearned premiums form the other liability. At £170,226 they have increased some £17,000. a movement which, in view of the smaller premium income, may be traced to sundry creditors;' Among the assets no allowance appears for premiums due or overdue. Outside investments and accrued interest and rents, the assets are comprised of branch and agency balances (£190,359) and cash (£122,844) Collectively they represent a large sum which, however, when distributed over the offices in different parts

o! the globe, may not come to anything great in each individual case. At the present time, exchange fluctuations must introduce more complications into the valuation. The slight decrease in accrued interest and rents to £45,719, from its figure of a year ago, is a sign of the times, since the invested funds have grown larger in the interval. Out of an aggregate of £2,766,993, investments placed in Government and municipal securities at £2,051,971 come first. This group, which has increased by approximately £70,000, is well spread over the globe, but is either employed within the Empire or in countries where the company is doing business. The bulk is held in Great Britain, New Zealand, and Australia, and from the order of designation, it may be inferred that Great Britain holds the most. Possibly it is not so much against that group as against shares which have risen to £168,658 that the investment fluctuation and contingency account has been strengthened. Mortgages at £62,000 have altered little, but the rise of fixed deposits to £77,215 may be an indication of the prevailing uncertainty of the investment market. The fixed assets group has further fallen to £417,149, a result which may be due to provision for depreciation. Other properties besides the office premises are concerned, and doubtless contribute substantially to the revenue. Based on the money invested at the close of the financial year, the return comes out at just over 5 per cent. The balance sheet of the trustee branch, as far as a statement of the funds administered is concerned, is annexed to the other. How far this section directly assists the insurance business is not disclosed, no record being published of its trading activities. Seeing that the revenue in the larger business is divided between insurance premiums on the one hand, and interest, and rents on the other, it ie not quite clear where the revenue from the trustee branch comes in. The total funds controlled in that section aggregate £5,976,370, or an increase of nearly £200,000. Investments on behalf of estates, trusts, and clients come to £3,161,966, of which mortgages, at £951,774 comprise the largest part, but the balance is not unequally distributed over debentures, shares, and sundry property. Sundry clients and trust accounts with cash at bank cover £99,765, while securities held as trustees for debenture-holders represent £2,714,640. The management of funds that are not far short of double the total assets of the insurance section must involve a considerable expenditure which has to be placed against the relative revenue, and the result might be as interesting in its way as that of the parent body. _v

Paid-up Net May 31. Capital. Rcsems. Profit. Dividend. per £ £ £ p.o. share. 1921 .. 750.000 1.170,010 200.625 13% 1/4 1022 .. 750,000 1,111,002 54.431 13% 1/4 1023 .. 750,000 1,187,313 162.101 14 1-0 1/5 1024 .. 000,000 1,111,070 173.310 12% 1/6 1925 .. 000.000 1,235.051 238,374 13 7-80 1/7 1920 .. 1,050,000 1,159.207 193,898 11 19-21 1/8 1027 .. 1,050.000 1,272,188 243,511 12% 1/9 1028 .. 1,200,000 1,211.225 224,704 1111-24 1-10 1029 .. 1,200.000 1,305.813 231,287 1111-24 1-10 1030 .. 1.200,000 1.421.551 230,499 •12 1/11 1031 .. 1,500,000 1,170,943 101,809 10 2/-

£ £ p.C. £ p.C. 1920-21 708.819 1.373,697 65,97 1,275.231 00.29 1921-22 750.469 1,181,653 64.02 1,087,616 69.55 1922-23 651.698 1,155,820 ,66.38 1.054,571 01.79 1923-24 608.214 1.130,497 53.80 1.026.045 59.27 1924-25 603,650 1.184,357 50.97 1,072,761 50.27 1925-26 633.973 1,183,252 63.58 1.060,0121 59.47 1926-27 664.684 1.248,783 53.31 1,121,425 59.27 1927-28 694.344 1.280,505 54.22 1,150,232 00.37 1928-29 724,191) 1,318,051 51.94 1,183.974 61.17 1029-30 737,719 1,339,495 65.07 1.199,382 01.51 1930-31 740,245 1.285,553 57.58 1,145.257 64.04 One feature of the past season’s results is the email rise in lessee compared with