LOAN AND MERCANTILE YEAR

Otago Daily Times, Issue 27291, 18 January 1950, Page 8

LOAN AND MERCANTILE YEAR

Increased costs, taxation, and depreciation had adversely affected the £80,850 increase in trading profits, said Mr W. H. Tatham, chairman of the New Zealand Loan and Mercantile Agency Company, Ltd., at the annual meeting in London last month. Costs and taxation, particularly, were matters beyond the company’s control, and although the subject of increased costs was not unknown to stockholders the impacts on a business such as the company, whose profits are inevitably affected by world prices and climatic conditions, was serious. “ If and when wool prices fall, salaries, wages, and other running costs will not necessarily follow to the same extent, with consequent adverse effects on net profits,” said Mr Tatham. The alteration in the New Zealand rate of exchange had resulted in a gain in net assets of £227,526, and this book profit, which was really a reimbursement of a previous exchange loss, had been added to the general reserve. A total of £22,474 from the profit and loss account had been added, so that the general reserve was now up to the satisfactory figure of £1,000,000, continued the chairman.