FINANCIAL NOTES

GOVERNMENT STOCKS WEAK.

AFTER a fairly substantial rally British GovernmeAt -stocks have again fallen away rather sharply, but though the contributing causes may be many, I cannot help thinking that the situation has not been improved by the fact that in the case of one or two of the more recent issues of new Government loans the terms have been far too high to bring in the general investor. Large blocks are generally believed to have been taken up by Govern- ment departments, which of course cannot be regarded as per- manent holders, so that the feeling is created of unwanted stocks coming at any time upon the market. Then at the present moment a weakening influence is to be found in the uncertainty which prevails about taxation proposals in the coming Budget, and though there may be no expectation of a national defence loan for many months to come the fact remains that sooner or later some such issue will probably be made. During the past week there has also been a good deal of talk of a new loan in connexion with the Tithe payments but there will, of course, be no public appeals for money in that connexion, but merely a gradual issue, over a period even of years, of 3 per cent. stock to present recipients of Tithes, and while in some instances the allottees of the stock may be offering a portion for sale, the larger blocks are likely to -go into the hands of public bodies who will have no need to force their stock upon the market. Apart from gilt-edged securities, other markets have moved somewhat irregularly.

* * * * THE FIRST OF THE RAILWAY DIVIDENDS.

All things considered, the preliminary profit statement of the Southern Railway is about equal to market expectations, the full dividend being announced on the 5 per cent. Preferred Ordinary stock and 1 per cent. per annum on the Deferred Ordinary. This is the first distribution to be made on the Deferred Ordinary since II per cent. was paid for 193o. The company reported an increase of £544,000 in gross receipts, according to the published weekly traffic receipts, but the final result represents an improvement on this with an increase of £751,042, probably partly due to increased revenue from " ancillary businesses," and partly perhaps to the working of the pooling scheme with the L.P.T.B. " Pau'

That stupendous insurance undertaking, ThePrudential, has announced a higher dividend for the' lait year, the finals dividend` on the " A " shares being 14s. o2/,d., making with the interim dividend a total of 19s; o°/5d. -as -compared - with 18s. 83/,d. for 1935, while the " B " receive 2S. per share against Is. 9d. per share. The dividends as usual are free of tax. The Board also announces the following rates of bonus to participating policy holders in Ordinary and Industrial Branches. The Ordinary Branch reversionary bonus is 46s. per cent. on sums assured on whole-life policies and 4os. per cent. on sums assured under endowment assurance policies, these rates being the same as in the previous year. In the Industrial Branch the rate of reversionary bonus is also the same as a year ago, namely, 32s. per cent. on the- sums assured, subject to one full year's premium having been paid.

* * * *

GAS LIGHT AND COKE ENTERPRISE.

I am impressed by the vigour displayed by the Governor of the Gas. Light and Coke Co., Sir David Milne-Watson, in demonstrating, as he did to shareholders at the Annual Meeting, the manner in which the company has succeeded in promoting the progress of the gas industry despite all the competition repre- sented by electric lighting and electric power. At the meeting held last week Sir David, after referring to the success which had attended the company's recent issues of Debenture stock, explained that the new capital had been required mainly for the financing of the issue to consumers of new and modern appli- ances on hire purchase terms. That the efforts in this direction had been successful is shown by the further increase of £9oo,000 in total sales by the company of appliances on hire purchase and for cash. Moreover, Sir David explained that this increase followed upon one of £75o,000 for the previous year and the total sales for 1936, which reached £2,800,000 largely contributed to the expansion of 3.69 per cent. in gas sales. Coke sales also expanded in volume. At the same time, the Governor expressed concern with regard to the present coal position, though the company had not as yet, he said, felt the new prices to any great extent. The revised selling schemes, Sir David said, had vested the control of coal buying and selling in the District Coal Board, and all the Boards are exclusively formed of coal owners, thus creating complete monopoly. The Gas Light and Coke Co. this year celebrates its 125th birthday, and the Governor made the interesting statement that the company had lit Pall Mall as long ago as 1812 and was still lighting that thoroughfare in 1937.

* * * - * AN INSURANCE BONUS.

The National Mutual Life Assurance Society now conducts a biennial investigation into the profits and the distribution of the Life Fund, and it is announced that the distribution for 1935 and 1936 will be 52s. 6d. per cent. per annum compound on Whole Life Assurances and 45s. compound on Endowment Assurances. These rates include the special distribution of los. per cent. per annum for Whole Life, and 7s. 6d. per cent. t. per annum for Endowment Assurances, these rates being at the same level as at the previous distribution. On special low- premium policies the bonus rate is 17s. 6d. per cent. per annum compound inclusive of a special distribution of 2s. 6d. per cent.

* * * * ALLIED BAKERIES NEW CAPITAL.

At the recent Extraordinary General Meeting of Allied Bakeries the necessary Resolutions were passed approving the

increase of the company's capital to £1,750,000 by the creation of £25o,000 51 per cent. Cumulative Preference shares and 2,000,000 Ordinary shares of 5s. each. The Chairman, Mr.

W. Garfield Weston, was able to report satisfactory progress of the company and he. stated' thrtuart of the new capital was required in connexion with the purchase of the business of Messrs. R. Sharrock and Sons, Limited, of Manchester, the business consisting of probably the most modern and ably- managed bakery business in the country. Some months ago - the company had acquired the business of John Newbould and Sons, of Bradford, and the results had been completely satis- factory.

* * * * DRAPERY PROFITS.

The latest profit statement issued by Dickins and Jonei, Limited, the drapery concern associated with and controlled by Harrods, Limited, is a- satisfactory one, the profits for the year amounting to £12o,5o4 as compared- with £114,143 for the previous year. A final dividend is recommended of 71 per cent on the Ordinary shares, making 121 per cent. for the year as against to per cent. for the previous year. Moreover, it 'was only a year ago that. the dividend was raised from 71 to ra.

(Continued on page 294.)

FINANCIAL NOTES

(Continued from page 292.)

per cent. After paying the higher dividend and setting aside sums for reserve, the balance forward, £53,497, shows a slight increase compared with a year ago.

* * * *

NOTHING LIRE TOBACCO.

The accounts of the Imperial Tobacco Co. for the past year show an increase in the profits over the previous year of about £370,000, and if comparison were made with two years ago the increase is over £I,000,000. The extra t per cent. bonus recently announced costs £375,000, so that the larger distribu- tion accords with the higher profits. As usual, the company publishes an extraordinarily strong balance-sheet, with a General Reserve now standing at £6,750,000. The book value of marketable and other investments is about £500,000 below the previous year, but still stands at no less than just under

£xo,000,000.

* * * *

BREWERY PROFITS.

Peter Walker (Warrington) and Robert Cain and Sons, the brewery undertaking in Lancashire, continues to show progress in its earnings. For 1936 the profit amounted to £504,937 against £455,037 in the previous year. The dividend has now been raised to 6 per cent. against 5 per cent. for 1935, and 3 per cent. for the three preceding years.

* * * *

ABBEY ROAD PROGRESS.

The latest Annual Report—and it is the sixty-second—of the Abbey Road Building Society shows continued progress in the Society's activities. The number of shareholders and depositors has increased from 267,617 to 271,201, while the share capital and deposits now aggregate £45,478,000, against 4'43,826,000. Advances during the year reached the high total of £7,506,680, as compared with £7,282,501 in the previous year. The total assets of the Society are now shown in the balance-sheet at £48,035,000, as compared with £46,132,000 a year ago. The Profit and Loss Account shows that after providing for management expenses, depreciation, &c., there was a resulting profit carried to appropriation of £1,507,038. Dividends to shareholders absorb £1,239,533, the sum of £25o,00o is placed to No. I Reserve Fund, raising it to £2,000,00o, while to No. 2 Reserve Fund £22,673 is added, and there is a balance forward of £70,723.

A. W. K.