10 MARCH 1939, Page 34


Sir William Firth, the chairman of Richard Thomas an3 Company, the sheet steel and tinplate makers, seems to ha‘ done some really good business in Canada and the Unite.! States. Not only has he pocketed the usual annual ord,r from the company's big Canadian customer, but he h • managed to get a contract spread over five years. Here 3 the first fruit of the company's new plant programme lt Ebbw Vale ; the new strip-mill has already demonstrate.., during its trial run, that the product turned out at low C( is of excellent quality. Richard Thomas's total productio, capacity is, of course, very large, and at the moment is , vastly in excess of demand that one must be prepared LI (Continued on page 424) FINANCE AND INVESTMENT (Continued from page 422) disappointing results for the year ending March 31st; indeed, a substantial falling-off in profits has been frankly anticipated by the chairman. I feel, however, that the recovery poten- tialities, which are obviously considerable, may soon be getting a chance to prove themselves.

In the last few weeks, for example, without any iitimulus from the United States, the Welsh tinplate trade has en- countered a fairly sharp increase in demand as a result of which the industry is now working close to 50 per cent. of capacity, against something well under 40 per cent, at the end of last year. Stocks, which had been allowed to run very low, have had to be replenished, and if, as now seems likely, the motor trade is to enter a genuine recovery phase, one could see Richard Thomas becoming reasonably busy by the late spring. In recent months I have often stressed the merits of the company's 41 per cent. Debentures as a sound investment with possibilities of a few points improve- ment in capital value. They are now quoted at 77, yielding just under 6 per cent. Those who do not mind forgoing income for a year or so might do worse than put away a few of the £r Preference shares standing at los. I do not look for a resumption of regular dividend payments just yet, but if all goes well there should be dividends and a capital profit in a year's time.