FOREIGN EXCHANGES

Otago Daily Times, Issue 22364, 11 September 1934, Page 6

FOREIGN EXCHANGES

(British Official Wireless.) (United Press Association.) (By Electric Telegraph—Copyright.) RUGBY, September 8. (Received Sept. 10, at 5.3 p.m.) Paris— Far. Sept. 7. Sept. 8.

COMPANY BALANCE SHEETS THE MILBURN LIME AND CEMENT COMPANY, LTD. Paid-up Net *DlvlJuly 31. Capital. Reservea. Profit. dend. £ £ £ p.c. 1920 .. 117,118 18,317 11.951 10 1022 .. 130,300 11.963 14,415 10 1924 .. 130.300 18.071 18,101 10 1928 .. 130,300 20.882 14,407 10 1928 .. 182,575 22,092 19,183 10 1929 .. 109.287 21,848 19.603 10 1930 .. 200,000 23,002 21,004 10 1931 ~ 200,000 25,133 23,131 10 1032 .. 200,000 24.960 14,835 7)4 1033 .. 200,000 25,351 12,383 6 1934 .. 200,000 41,098 25,259 £?i * Including bonus.

After a few seasons on the down grade, the net profit hag made a pronounced move upwards. The return is equivalent to 12.13 per cent, on the paid-up capital, and the recommendation is that shareholders receive £5500 of the increase, while £7750 is retained in the business. As during the previous two years shareholders have been allotted almost the full net surplus, this attention to the strengthening of reserves need cause no surprise. Specific transfers of £1414 and £SOO are made to general reserve and doubtful debts reserve respectively, but it is the floating balance, which is raised to £8696, that is the chief gainer. How far the larger profit is due to greater revenue and how far to smaller expenditure is not disclosed. Directors’ fees (£540) continue to be the solitary charge of which the amount is stated, while transfer fees (£8) constitute the one individual item of revenue. The net balance brought out on trading is £25,791, or more than double that for 1932-33.

If the fixed assets arc excepted, the figures generally show expansion. The sundry creditors group, at £23,619, has risen over 100 per cent., but the disappearance of employees’ benefit fund from the balance sheet may account for the increase. If the provision for income tax, which is included, consists of a round figure, the group may hold a reserve. Visible reserves have grown, as well as the net surplus, the general account showing an increase of £8586 during the year. •With the addition of the £1414 allotted, general reserve will be larger by £IO,OOO and will stand at £20,000. Accident insurance reserve is intact at £IO,OOO, but doubtful debts reserve will be raised to £3OOO. In view of the larger sundry debtors, the strengthening of the relative reserve is a natural sequence. In all, visible reserves come to £41,696, which considerably exceeds any previous aggregate. Fixed assets continue to fall, their drop on this Occasion being the greatest since their large expansion during 1927-29. They are grouped at £124,370, and comprise all fixtures from land to office furniture, with their varying rates of depreciation. As the decrease is equivalent to over 12 per cent, upon the whole, it may reasonably be assumed that some realisation has taken place. The increase to general reserve during the year may be connected with this reduction in fixed assets. In relation to the total assets, fixed assets and investments stand as follows:

The substantial increase in investments is one of the features of the annual result. Shares in the subsidiary company account for £12,000. Apart from these, however, outside holdings—fixed deposits. New Zealand Government Stock, and general—come to £89,181, In recent years the tendency has been for the margin between fixed assets and investments to narrow, but, if the present progress is maintained, the margin should disappear and investments appear in the ascendancy. The method by which outside investments are valued is not stated. Presumably the subsidiary company’s shares are entered at Sundry debtors, at £19,533, and bills receivable, at £IBB6, have each risen. Stock, on the other hand, has fallen to £21,649. The total of the three is almost the same as at July, 1933, the increase on the first two having been made apparently at the expense of the last. Although the addition of £SOO to doubtful debts reserve is not in proportion to the increase in sundry debtors, the reserve stands as high as approximately 14 per cent, of the amount it concerns. While indications point to considerably larger sales, the stock has not kept step. When the relation of stock to net profit is considered the relation of the former to gross profit must be exceptionally small. It may be that, from its nature, large stocks do not require to be held. The bank current account, at £6696, brings the total of the floating assets to £150.945. As this is over £25,000 larger than the fixed, section,, the position for a manufacturing business looks of more than average strength.

RECOVERY IN AMERICA EFFECT OF PRESIDENT’S NEW DEAL. Mr S. J. Robinson, of Auckland, wljo has returned to the Dominion after a visit to the United States of Amercia and to Canada, gained a very favourable impression of the effect of President Roosevelt’s recovery legislation on trade in the States. In an interview with a Christchurch Press reporter, he said that conditions in America were much better than a superficial reading of cabled reports indicated. Although there was a good deal of criticism of the National Recovery Administration, it was obvious that the great majority of the business men were stiil behind President Roosevelt in his fight for recovery and still strong in their belief in the recovery administration. On practically every side the administration had proved a good thing for the United States. Unemployment had decreased by millions in the last 12 months, and prices were higher. All the large business concerns seemed to be making money to-day, whereas they were losing it a year ago. Motor car sales offered a sound indication of the state of affairs. Although not a record, reports from the principal companies showed that sales in the last six months were heavier than for any period except in the boom years.

Trade conditions in Canada were even more promising than in the United States. Opponents of the National Recovery Administration pointed to Canada’s improved trade when arguing that the States could have done without the “New Deal,” but the fact was that the trade of tue two nations was so interlocked that, as the supporters of the administration said, Canada was reaping the benefit of the recovery legislation. AID TO PRODUCERS AUSTRALIAN GOVERNMENT’S PLANS. The Commonwealth Minister of Defence (Sir George Pearce) said, in a recent address, that the expected cost of the Australian Government’s plans for the rehabilitation of the primary industries was between £10,000,090 and £15,000,000. The chief objective was to enable primary producers to compete in the world’s markets. Because many primary producers could not carry on successfully under present conditions, and there was no immediate prospect of an effective increase in prices of produce, it was proposed to use the credit of the Commonwealth to raise money for rural relief. What suited one State would not suit another, and it was proposed to deal with each separately through the State Governments. Each State' Government would be asked to put forward its own proposition, based on what was considered to be the most suitable to its particular circumstances, the Commonwealth finding the money. in some States, for instance, a reduction of railway freights might be one means for providing relief. A scheme for the bulk handling of wheat might be proposed, or some form of assistance based on export. All schemes would be considered from the Commonwealth aspect, the Minister added, and a lessening of the costs of production would be the test of their suitability.

Francs to £1 Brussels— 124.21 74 27-32 74 27-32 Belgas to £1 Oslo— 30 21.02 21.01 Kroner to £ 1 Stockholm — 18.180 19.90$ 19.90$ Kronor to £1 Copenhagen— 18.130 19.39$ 19.39$ Kroner to £1 Berlin— 18.150 22.40 22.40 Marks to £1 Montreal— 20.43 12.43 12.46 Dollars to £ I New York — 4.80 2-3 4.86% 4.853 Dollars to £1 Yokohama — 4.86 2-3 4.99 11-16 5.00 Fence to yen .. Hongkong— 24.582 14% 14% Pence to dollar Bombay— 24.58 18 13-16 18 13-16 Pence to rupee Batavia— — IS 1-16 18 1-16 Florins to £1 Milan— 12.10 7.27 7.27 Lire to £1 .. Amsterdam — 82.46 57$ 57$ Guilder to £1 Prague— : 12.107 7.28$ , 7.28| Kronor to £1 104$ Geneva — 118$ 118$ Francs to £ 1 Vienna— 23.22$ 13.10 15.12$ Schillings to £ 1 Helsingfors— 84.86$ 26$ 26$ Marks to £ 1 Madrid— 193.23 2263 226J Pesetas to £ 1 Belgrade— 25.22$ 36% 36$ Dinars to £ 1 Athens — 25.22$ 216 216 Drachma to £1 Lisbon— 375 513 515 Escudos to £1 Bucharest— 110 110% 110% Lei to £1 .. Klo de Janeiro— 931.6 493 490 Pence to rallreis Buenos Aires— 5.890 4i 4$ Pence to pesos Shanghai— 47.28 36$ 36$ Pence to tael . . Montevideo— — 17% 17% Pence, to pesos Warsaw— — 39% 39% Zlotys to £ 1 — — —

Total Filed InyestJuly 31. Assets. Assets. Ratio. ments. Ratio, £ £ p.c. £ p.c. 1020 .. 103,334 56,100 34.24 55.900 34.12 1922 194.950 84,947 43.57 54.760 28.08 1924 .. 193.720 82,250 43.46 40,750 25.68 1928 .. 183.441 71.088 32.20 39,950 21.90 1028 .. 200.055 153,330 59.04 34.637 13.32 1029 .. 278.805 170,233 03,20 23,987 8.00 1930 .. 278,924 170.100 60.98 17.787 6.38 1931 .. 204.431 158,820 (10.00 40.158 15.19 1932 .. 258,332 149.780 57.98 39.943 15.40 1933 .. 250,513 141.420 55.13 50,140 21.89 1934 .. 275.315 124,370 45.17 101,181 36.75