12 APRIL 1940, Page 32

I.C.I. AND DUNLOP

Dividend decisions by Imperial Chemical Industries and Dunlop Rubber present a striking contrast. Both com- panies have done well, as one would have expected, but whereas I.C.I. is merely maintaining its ordinary dividend at 8 per cent., Dunlop has sprang a surprise by paying 12 per cent., against 9 per cent. for 1938. Neither company has yet given us its full report, but the preliminary figures point to record earnings. Profits of I.C.I. rise by £750,000 to £9,313,485, and as this is struck after taxation gross earnings must have risen by well over kt,000,000. Central obsolescence fund gets £2,000,000, against it,soo,000, a war contingency reserve is set up with Li,000,000, and £375,000 goes to general reserve. This is sound finance, which justifies the quotation of the kt units at 31s., to yield about 5* per cent. Dunlop has also been conservative in its treatment of a net profit of £2,853,133, against only Li,sor,000 for 1938. Since the outbreak of war, it seems, Government orders have increased, but for 1939 they,repre- seated only 71 per cent. of total turnover. At 355. 3d. the LI units yield about 61 per cent. They seem to me to be very moderately valued.