HUGE LOSSES.

Waikato Times, Volume 105, Issue 17632, 9 February 1929, Page 7

HUGE LOSSES.

ARMSTRONG, WHITWORTH. TO WRITE OFF £14,117,538. RE-ORGANISATION of finance. (By Telegraph—Press Assn. —Copyright.) (Australian Press Association.) LONDON, Feb. 8A drastic reorganisation of the finances of Sir W. G. Armstrong, Whitworth and Company has been announced. It involves writing off losses amounting to £14,117,536. The ordinary shareholders will receive a shilling share for each £2 now held. The new capital will consist of 4,9G2,812 shares, and £1,036,014 of loan capital. The fact that the company’s postwar operations had involved enormous losses has been known for several years, but the highest figure previously suggested was £11,000,000. Before the war Armstrong’s, with an ordinary capital of £4,012,500, regularly paid a dividend of 12A per cent., its profits in 1913 being £689,000. After the war the company entered entirely new fields of activity, and, in particular, embarked on a big power and paper undertaking in Newfoundland. This venture and others proved disastrous, heavy losses being sustained. At the annual meeting reference was made to losses, not then precisely ascertained, in respect of civil engineering contracts in New Zealand (thc Arapuni hcadworks and the East Coast railway construction). Provision was made in the 1927-28 accounts for losses on contracts to the extent of £364,473, including £251,973 in respect of civil engineering contracts, mainly in New Zealand- The balance-sheet of thc company at December 31, 1927, tlie latest available, showed issued capital amounting to £10,012,500.