Company Notes
LEYLAND MOTORS can proudly claim to be Britain's greatest exporters of commercial vehicles, in fact 62 per cent. of their total out- put goes overseas. Since the recent acquisition of Standard Motors I anticipate that overseas sales will be further boosted. Their sports cars, such as the TR3, sell 80 per cent. abroad, the US being the biggest buyer, whereas Leylands sell roughly 20 per cent. of their exports to each of five areas, the US, Africa, Australia, Europe and the Middle East. It is their excellent after- sales service that counts, in bringing in renewals, I am told by Mr. Donald Stokes, the tireless Sales Director. He visits all parts of the world where the company now has a network of agents te whom they can offer a wide range of vehicles, from cars to light and heavy lorries and buses. Leylands are best known for their heavy vehicles, that is, the 5-ton and over class, of which type they make more than all other British producers put together. The company has Indian, Spanish and Israeli subsidiaries which make quite a part of the vehicles sold in their countries. The chairman, Sir Henry Spurrier, has built up Leylands to its present strength. He knows the business through and through and is alive to the limitations of the home market and the vast potential of the expanding overseas market, This is a company to follow. The £1 ordinary shares have recovered from a low point of 79s. this year. They are worth buying at 96s. 9d. to yield just over 4 per cent. on the last dividend of 20 per cent.
Lethenty Tea Estates suffered from exception- ally bad weather last year due to the extension of the monsoon, so that a similar crop was har- vested at an increased cost, of 21d. per lb. How- ever, the gross average price obtained for the crop (90 per cent, of which was sold in London) was 5d. a lb. above the 1959 price. This resulted in a net profit for 1960 (subject to tax) of £11,704 against £6,667. The Ceylon Government now levies an exorbitant tax of 80 per cent. on assess- able profits on all producers and consumers of Ceylon tea. This, the chairman, Mr. G. S. Napier- Ford, points out, depresses the capital value of their tea estates and does not encourage any in-
vestment in the island. This is a depressing situation for shareholders in Ceylonese com- panies. The 2s. ordinary shares, which last changed hands at 3s. 6d., receive the same divi- dend as last year, namely 7f per cent.
Bukit Sembawang Rubber, the largest producer of rubber in Singapore, celebrated its golden jubilee last December. When Mr. Harold Evans became chairman in 1956, he reorganised its affairs to the extent that today it has two func- tions, firstly as a producer of rubber and secondly as a holding company for those subsidiaries which are developing property. The production of rubber for the year ended March 31, 1961, was 1,728,000 lb. against 1,134,000 lb., but this pro- duced a smaller trading profit due to the lower price for rubber. However, the net profit after tax was £31,056 again £22,575. The total dividend payment of 10 per cent. exceeds the net profit by just over £5,000, but the chairman feels this Is justified by the substantial liquid position. Last February 3d. per share was paid out of the pro- ceeds of land sales and it is the directors' inten- tion to make further cash distributions from capital profits as and when they are realised, which gives an added savour to the 2s. ordinary shares, now 3s. xd., and accounts for the low yield (on a rubber share) of 6.6 per cent.
British American Tobacco has announced a second interim dividend (similar to the first) of 51 per cent. tax free for the year to September, 30, 1961. I do not expect, this year, any moro than a maintained 10 per cent. tax-free final, butt) even so, here is a company selling all its products overseas whose 10s. ordinary shares at 67s. give the very good yield of 5.3 per cent.
Anglo Auto Finance Company has just dee- lared a second interim dividend of 74 per cent, and with it the chairman, Mr. Julian Hodge, announces that he intends to make a one-for-ten scrip issue and, subject to future trading results, being satisfactory, this will become an annual feature. It is expected that the final dividend far the current year will be 15 per cent. as forecast. The is. shares at 9s. should prove an attractive investment.
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