After suffering severely through drought in Queensland and in New
South Wales, the Australian Estates and Mortgage Company's profits showed an improvement over last year, and the dividend was restored to 5 per cent. after having been 4 per cent. for the two previous years. Actually the recovery is substantially greater than is represented in the mere figures of 1 per cent. in the dividend, for the worst effects of the drought were not felt by shareholders, thanks to the con- servative finance of the company in the past. In 1926 the directors took £100,000 from balance-sheet reserves, and they also stated that the figures of the Report were only made possible by having recourse to special provisions which had been made in the past. In 1927 the 4 per cent. dividend was not quite covered by the profits as the carry-forward was reduced by about £10,000, but from the 1928 profits £20,000 was added to the Reserve and £5,000 set aside to Provident Fund. Even so, the better results have only been achieved under most difficult conditions, for the drought persisted in certain areas. The outlook, however, should now be dis- tinctly better, for, with the exception of one Queensland station, the company's estates in that State have enjoyed good rains, though in New South Wales more rain is still needed. The company's balance-sheet shows a very strong position, with marketable securities amounting to nearly £750,000, and in view of the proof provided in the last few years of the impossibility of carrying on pastoral operations on a big scale in Queensland without the backing of large financial resources, the great joint stock companies engaged in the business obviously deserve every encouragement from the Government, though in the past their interests have often been sacrificed in pursuit of the political aim of " closer settlement," whereas the Australian climate obviously offers very serious disadvantages to the small-holder.
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