COMPANY NOTES
THERE is a belief amongst investors that Great Universal Stores derive the majority of their Profits from hire-purchase contracts. As a matter of fact, less than 25 per cent. of their profits come from this source, so that any fall in their hire- Purchase business would not severely affect the trading profits The company has a brilliant profit record. Pre-tax profits were a record at £272 null1o0—f2.6 million higher than the previous Year to March 31, 1960 Provision of over £20 million has been made for unearned profits or hire-purchase contracts—a very large sum— Which may be more than sufficient to take care of unexpired HP contracts. It is right to assume that the profits on HP contracts are much greater than those on direct sales, but these sales are THERE is a belief amongst investors that Great Universal Stores derive the majority of their Profits from hire-purchase contracts. As a matter of fact, less than 25 per cent. of their profits come from this source, so that any fall in their hire- Purchase business would not severely affect the trading profits The company has a brilliant profit record. Pre-tax profits were a record at £272 null1o0—f2.6 million higher than the previous Year to March 31, 1960 Provision of over £20 million has been made for unearned profits or hire-purchase contracts—a very large sum— Which may be more than sufficient to take care of unexpired HP contracts. It is right to assume that the profits on HP contracts are much greater than those on direct sales, but these sales are from year to year increasing as the company continues to expand its retail interests. The dynamic chairman, Mr. Isaac Woolfson, and his family control the company with the majority bolding of ordinary shares; it is hoped that he may, in the near future, see fit to give a vote to the 5s. 'A' ordinary shares, which at 47s. yield 4.1 per cent. on the 371 per cent. dividend which was more than twice covered.
Sir George Dowty, chairman of the Dowty Group, manufacturers of airframe equipment, engine components and agricultural and mining machinery, has produced wonderful results for the year to March 31, 1960. Pre-tax profits in- creased from £2.17 million ( including three months' profits from the new subsidiary Rotol) to £3.04 million. Since the last accounts the capital has been increased by a two-for-three scrip issue in February, so that the final dividend of 511 per cent. tax-free plus the 6 per cent. interim on the smaller capital is equal to 9.1 per cent. as com- pared with 6.9 per cent, for the previous year. This is a most progressive company whose 10s. ordinary shares at 363. 6d. yield 4.1 per cent. and certainly have scope for appreciation.
United Dominions Trust, as industrial bankers, has a profit record second to none. The chair- man, Mr. J. Gibson Jarvie, states that profits that will accrue from contracts already in existence will produce record profits over the next two years, irrespective of the volume of trading in the current year and next year. This is an out- standing company, which earns most Of its profits from financing the requirements of industry and not, as is generally assumed, consumer goods. Record profits have been recorded for twenty-one years prior to the war and for the fifteen post- war years. Barclays Bank recently acquired an interest in the equity which has proved extremely profitable. Pre-tax profits for the year to June 30, 1960, were £3,785,000 against £3,135,000. The 261 per cent. dividend was amply covered by earnings of 64.5 per cent. The recent credit restrictions have brought about a fall in the f ordinary shares from a 1960 high of 197s. 6d. to the present price nf 165s., at which level the shares yield 3.3 per cent. on the dividend covered 2.4 times. This is an excellent return for an out- standing security which undoubtedly has further growth prospects as to profits and dividends.
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