Company Notes
By LOTHBURY 1HE latest report for the year ended April 3, 1964, from Furness Withy, the shipowners, is far more revealing than the previous one. Although not entirely comprehensive it does dis- close those subsidiary and associate companies in which the parent has a 30-50 per cent holding. Assuming (that is all it is possible to do) that these investments (producing £403,000 last year) are earning 5 per cent, this would capitalise them at around £8 million. The increase in trading profits from £4.148 million to £5.500 million and earnings at three times the previous year's level, have prompted the directors to restore the dividend to 10 per cent from 8 per cent. The £1 shares at 32s. yielding 6.2 per cent are fairly valued.
Mr. A. L. Bull, the chairman of Central and District Properties, reports a substantial im- provement in pre-tax profits at £714,000 against £638,000 for the previous year. Contributing to this improvement has been a 12 per cent increase in rentals, a net profit of £10,000 against a pre- vious loss of £53,000 from the Canadian sub- sidiary and a lower tax charge. Long-term borrowings are now £8 million and bank over- drafts have risen from £2.9 million to £5 mil- lion. But there are promising developments in shop and office property in the UK and also in Boston, US, France and Melbourne, Australia. The dividend has been, increased from 7.2 per cent to 9 per cent, but the chairman anticipates paying 10 per cent next year, which will put the 10s. shares—now 17s.—on a 5.7 per cent yield basis. The £1 units of 61 per cent Loan Stock 1980/82 (convertible October, 1965) are now selling at 20s. 9d., the equivalent of 21s. 9d. a share, and yield 6f per cent.
The portfolio of Aldford House (Park Lane) has expanded to £5 million of which 55 per cent is represented by leaseholds. The company is now developing six shop and industrial units, estimated to cost £620,000. Other interests be- sides Aldford House and Latymer Court in- clude shops, showrooms, office blocks and ground rents in the UK and a one-sixth interest in a large office block in Sydney, Australia, which will take another three years to complete. The Prudential Assurance has made available (on the security of a debenture) £3 million up to the end of 1965. For the year to March 25, 1964, a 12 per cent dividend is to be paid. There is poten- tial for a further increase in income and divi- dends. The 5s. shares at 8s. yield 4-.7 per cent.
The recent report from Bain and Hodge, the transport contractors; ,reveals a very substantial increase in profits for the year ending May 31, 1964. This is due to various acquisitions whose profits have more than justified the doubled share capital. Pre-tax profits have jumped from £70,395
to £268,883 and, in spite of a higher tax charge, earnings have risen to 39 per cent to cover the increased dividend of 20 per cent against a fore- cast of 15 per cent. The chairman, Mr. R. M. Tilling, gives a full report on these acquisitions and is confident that future prospects are ex- cellent. The company provides specialised ser- vices for the motor-car export industry, the distribution of lubricating oils, butane and pro- pane gases and fruit and vegetable products for the wholesale trade. There is no doubt that the company, with its widespread depots, covering London, Luton, Bristol and Warrington, together with its large fleet of vehicles, is well able to expand its business. Future prospects are ex- tremely bright, so that the present price of the 5s. shares at 17s. 3d., yielding 5.7 per cent on the 20 per cent dividend covered 2.3 'times by earnings, makes them a very attractive purchase.
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