Company Notes
Ma. HARRY F. OPPENHEINIER, chairman of . Anglo American Corporation, for the third year running reports excellent operating results; the gold and coal mining interests in South Africa and the Northern Rhodesia copper !nines all produced record profits. The investment 'neome also showed an increase of 15.7 per cent. 'ver last year, but the adverse political factors have reduced the market value of the Corpora- tion's quoted securities, which declined from 029.938,543 to £99,828,153—a fall of 23 per vent. Consequently, the swing round from the realisation of investments from a profit in 1959 to 4 loss in 1960—an amount of £1,603,212—more than offset the increase in dividend income. Mr. Oppenheimer points out that the result of the union of South Africa leaving the British Com- Hlanwealth will be disastrous and its full conse- 4u2nces cannot yet be assessed. The outflow of capital is already affecting the country's economic standards. So this great company is faced with a Illtation beyond its control, as to its future, and 't'i shareholders with uncertainty, even to the pos- "Ility of the door being closed against remit- 1,inces from their investment. At 131s. 3d. the 10s. ,,ordinary on the 9s. dividend yield 6.6 per cent. Standard Bank of South Africa has also been ''hie to increase its profits for 1960 by approxi- 11141ely £158,000 to £1,338,862, and has put the dividend up a point to 15 per cent., the cover for %%Welt has increased from 17.5 per cent. fo 19.5 I'er cent. This bank has, of course, large interests !in the Union but not all of its assets are there. Il c" e £1 ordinary shares at 37s. give a return of '..‘t per cent., which is not bad, allowing 1"I' the political risk which attaches to any com- odny today operating in South Africa. I he dynamic store of Marks and Spencer, those chairman, Sir Simon Marks, has just been !114)Ie a peer, once again reports record figures. ' he growth in sales and profits over the past ten (oars has been quite amazing. It is wondered if the same rate of expansion will be possible in the !uture now that competition in the clothing Ntistry is so much keener, and there must be a 'ITht to the number of new stores the company '44 Open. In fact • figures do disclose that the Pri)fits are slowing down. Those for the year elided March 31, 1961, were £20,495,000 (pre- ,n1%) against £17,806,000 and once again the dividend Wend has been increased, this time from 40 Per cent. to 47.5 per cent., covered by earnings nl 75.8 per cent. The 5s. 'A' ordinary shares are now 116s. 3d. (this year's highest price was I I7s. 6d.), at which price they give the low yield °f2.0 per cent., which is expected and accepted 4 n) investors in this bluest of 'blue chips' shares. , An extract of the chairman's report of tiallahers appeared in last week's issue. This disclosed a 15 per cent. rise in sales and a 23 per cent. increase in gross profits. Last year the company made a rights issue which produced over £10 million, but in spite of this the com- pany has to rely upon bank overdrafts to finance further expansion. The new Nelson cigarettes have been a winner, which will contribute to future profits. Quoting the chairman, 'it is difficult to make a forecast for future profits.' This is understandable as there are fears of an even higher rate of taxation being imposed, but this company, in line with others, has already increased its retail price by Id. for a packet of twenty. The 10s. ordinary shares at 49s. 6d. yield 4 per cent. This is a good return on such a fine company.
The group net profit of Oxendale and Com- pany for the year to February 28, 1961, rose from £134,510 to £143,391; the dividend has been in- creased from 4d. to 4}d. per Is. ordinary share. Mr. W. H. Smith, chairman of this mail order stores business based on Manchester, is confident that the company will have another successful year. With good prospects ahead the Is. shares cannot be overvalued at 7s. 101d. x.d., to yield 4.7 per cent.
Last year Artizans and General Properties made an issue of debenture stock, which has increased interest charges this year from £8,100 to £73,409, but pre-tax profits are only down by £4,500 after very large progressive increases over the past four years. The dividend is increased from 12 per cent. to 121 per cent., and the future outlook appears encouraging for the £1 ordinary shares which, at 59s. 3d., yield 4.2 per cent. and are not, as so many property shares, too highly valued.
During 1960 London Asiatic Rubber and Pro- duce absorbed two companies having five estates, with the result that the rubber crop increased from 18,398,047 lb. to 28,056,500 lb. This has brought about a net profit (after tax) of £926,493. The chairman, Sir Eric Macfadyen, reports that a general rationalisation of the group of proper- ties has been made and that the board has decided to provide £357,164 for future replanting. Profits have come out well with rubber selling at a lower price than before, partly the result of the British and US Governments placing on •the market 155,000 tons of stockpile rubber. The output of rubber for the current year is estimated at 29f million lb., but by 1966 is expected to be as much as 40 million lb. with possibly 6,000 tons of palm' oil. Profits for this year will no doubt be lower. The 2s. ordinary shares, now 5s. 6d. yielding 16 per cent., reflect the uncer- tainty of the maintenance of the 45 per cent. dividend, but this group is one of the cheapest producers of rubber and palm oil, so that their
future looks most encouraging. .
Once again the chairman, Mr. Alec C. Higham, of Bighorn's Limited has been able to declare a dividend of 20 per cent., the same rate as for the past three years. This company of cotton cloth manufacturers increased its net profit from £235,692 to £240,520 so that the dividend is more than twice covered. This is a good result when it is remembered that a serious flood at one of the branches last autumn cost the company £50,000. The future trading outlook is somewhat obscure, for, until there is some satisfactory com- promise regarding the Hong Kong trade agree- ment now being discussed, there is uncertainty as to the future imports of grey cloths into, this country at t:ompetitive prices. This state of affairs is reflected in the price of the 4g. ordinary shares which, at I Is. xd., yield 7.2 per cent. The shares offer a good income return for those who are prepared to take a reasonable risk.
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