* * * * ROLLS-ROYCE PROFITS RISE
Rolls-Royce, now perhaps more famous as the makers of aeroplane engines than as motor-car manufacturers, have pro- duced a remarkably good result for 1938. The net profit, before tax, has risen from £393,259 to £479,45o. How far these profits result from rearmament and may come within the scope of any special taxation on such profits and how far they result from the motor market and will in future years be affected by the higher horse-power tax seems almost an academic question ; the company's business is of the kind which is vulnerable to taxation changes in both directions, but its distribution policy is conservative enough to give the shareholders generous protection. The total distribution has been raised from 224 per cent. to 25 per cent., but still leaves an ample margin of undistributed profits.
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