BASE METAL PROFITS

Wanganui Chronicle, Volume 80, Issue 256, 28 October 1937, Page 11

BASE METAL PROFITS

ELECTROLYTIC ZINC KEEN DEMAND FOR OUTPUT STRONG FINANCIAL POSITION Additional details of the operations of the Electrolytic Zinc Company of Australasia, Limited, for the year ended June 30, are provided by the accounts of the company, which are now issued. Gross earnings transferred to the proiit and loss account were £714,000, an increase of £276,000 on those of the preceding year. The net prolit was struck after providing £130,534 for taxation, and £145,000 was carried to reserve for amortisation and depreciation. The world demand for zinc, the directors point out, has been keen throughout the year, and stocks of refined metal are low in the main producing countries. The price, however, has not moved in line with consumptive demand because of the uncertainty brought about by the trend of international events. Australian sales of zinc during the year represented 36 per cent, of the output of the company's works at Risdon (Tasmania), but since the close of the period Australian sales have risen to 50 per cent, of the production. The West Coast mines and mill of the company, except for a fortnight at Christmas, operated at full production. Ore extraction amounted to 144.728 tons. Reserves of probable and known ore, nevertheless, remain at last year’s figure of 1,500,000 tons. This is attributed partly to further discoveries by development and diamond drilling, and partly to the mining of lower grade ore not included in the original reserve, which became profitable because of the rise in metal prices. Ore treated amounted to 149,963 tons, assaying 20.41 per cent, zinc, 5.69 per cent, lead, 6.560 z. silver, and I.9Bdwt. gold a ton. Dividends on both preference and ordinary shares at the rate of 15 per cent., in addition to a bonus of 6d per share, were paid, compared with dividends of 10 per cent, on both classes of shares in the previous year. . The increase in revenue has been used to strengthen the already strong financial position of the company. Cash and investments show an increase of £255,500 on those of the previous year, and the sinking fund against the debenture issue of £400,000 which matures in 1942 has increased by £23,900 to £273,000. NORTH BROKEN HILL YEAR INCREASED ORE RESERVES From a record net profit of £910,627 earned by North Broken Hill, Ltd. for the year ended June 30, shareholders received £840,000 in dividends. This sum, which represents 6s for each 5s share, or 120 per cent., is £140,000 more than the capital of the company. The previous year’s dividend was 7Ji per cent. Ore reserves increased during the year to 5,021,000 tons. The profit was arrived at after providing £276,000 for taxes and the unchanged amount of £30,000 for depreciation. Compared with the previous year, the prolit shows an increase of £273,700. Appropriations for new plant amounted to £101,613. General reserve shows an increase of £126,613 and there has been a fall of £27,761 in surplus liquid assets from the figures of June 30, 1936.

For the second successive year, the company’s returns were affected by a fall in the price of silver. The company, nowever, profited by a rise in the average prices of lead and zinc in the same period of £6 18s 2d and £4 18s 2d respectively. Development work done at the north section has resulted in an increase in ore reserves. The general manager estimates reserves in the North British and Junction sections at 5,021,000 tons, exclusive of ore disclosed by diamond drilling only. This is an increase of 271,000 tons for the year.