COMPAN Y NOTES
HARRISON AND CROSFIELD have again produced excellent results for the year to June 30, 1959. Group profits after tax have risen' by £84,000 to £624,248, allowing for a maintained dividend of 15 per cent. plus a bonus of 5 per cent. on the deferred stock. By the formation of two new subsidiaries and consequent changes in cer- tain reserves, it is possible for the company to transfer to capital reserve the sum of £1,463,800 from which it is proposed to capitalise million by way of issuing two fully paid deferred stock units for every three held. This is an unexpected free scrip issue. The chairman, Sir Leonard C. Paton, gives a full report on the company's wide- spread activities throughout Asia, Australia, New Zealand, Canada, the US and South Africa, and advises on two recent acquisitions in South Africa and Canada, which will strengthen the group's interests. He concludes by saying that 'the com- pany has never been stronger or more ready to grasp new opportunities than today.' The £1 deferred ordinary stock has improved to 92s. 6d., yields 4.3 per cent. and should be held.
Tube Investments has exceeded the forecast dividend of 17+ per cent. made in January, when it was fighting for (and gained) control of British Aluminium. The final dividend of 12+ per cent. now declared makes a total of 20 per cent. covered by earnings of 61 per cent. The net trading profits are up by about 7+ per cent. at £6,458,000 to July 31, 1959; these excellent figures include the BA profits for the seven months to that date and will in a full year bring in more than the amount of £689,000 (after tax) attributed to BA. Tubes on ' their own last year experienced a setback in trad- ing profits from £16.1 million to £14.78 million; but no doubt there has been a recovery in the over- all position for the current year which the chair- man, Sir Ivan A. R. Stedeford, will comment on at the forthcoming annual general meeting.
On the dividend announcement the tl ordinary shares improved to 118s. xd, at which price they yield 3.4 per cent. The dividend is covered three times by earnings.
Morphy Richards group sales for the year ended June 30, 1959, were over £9 million; this was an increase of 15 per cent. over 1958. Net profit, after tax, was £325,809 against £217,996; this represents 7.3 per cent. of group sales against 6.1 per cent. last year. These very good figures have of course attracted a larger sum for tax at £352,000 against £266,000. The chairman, Mr. F. P. Bishop, reports that the relaxation of credit last autumn greatly increased the demand for the company's refrigerators and spin-dryers, and con- sequently the factory at Dundee is being further extended, A new factory now being built will be in production in 1961. Although export sales have dropped, the demand at home shows a substantial gain for the first quarter of the current year. The company manufactures, amongst its well-known products, irons, toasters, food mixers, hair-dryers and heating appliances. The dividend is being increased from 20 per cent. to 25 per cent., this b,:irig payable on the capital as increased by the recent conversion of loan stock into ordinary stock. The 4s. ordinary stock units at 33s. 6d. yield 3 per cent.
Iligsons Brewery have for several years past shown a progressive profit record. Net profits after tax have risen from £99,330 in 1954 to £151,988 for the year to September 30, 1959. The dividend, which includes a bonus of 2f per cent., has been increased from 11* per cent. to 12+ per cent. The balance sheet is strong with fixed assets at £2,257,107 which include 180 licensed houses and the brewery at Liverpool, which are probably much undervalued. Investments are valued at £360,000 (the company owns the haulage contrac- tors James Addey and Co. at -Liverpool) and cash stands at £238,000. This year the capital was doubled at £900,000 by a one-for-one free scrip issue, so that at the present price of 15s. 6d. the 5s. ordinary shares yield 4 per cent.
Wallpaper Manufacturers. The figures are rather better than expected for the year ended July 30, 1959. The net profit of £2.24 million is arrived at after deducting £200,000 for goodwill of businesses acquired during the year so that the cover for the 20 per cent. dividend on the deferred stock has improved to 72.6 per cent. against 66.1 per cent. The company has in the past year spent a large sum of money from its own resources to expand its business which with the increased activity in the building industry will undoubtedly be rewarded. But even so, net liquid assets are very strong. Not only does the company manu- facture wallpaper, but also the Walpamur Group produces the well-known paint-sales from this quarter have substantially increased. Higher profits have also been earned from the furnishing fabrics section so that the future outlook of the company is indeed good and it is to be hoped that shareholders will eventually benefit from a more liberal dividend policy. The El deferred stock now stands at 120s. xd to yield 3.3 per cent.
South Durham Steel and Iron Company has just issued preliminary figures for the year ended September 30, 1959. As expected; the trading profit has increased by about 10 per cent. at £7.84 million and after allowing for an increased amount in respect of depreciation and various transfers to reserves the net profit after tax on the £10,000,000 ordinary capital (as increased last October by the Finance Corporation for Industry's exercise of its option on 2 million ordinary shares) is around 41 per cent. to cover the maintained dividend of 12 per cent. That the dividend has not been increased will undoubtedly disappoint the market, but there may be various reasons for this decision. One could be that holders of the 6 per cent. convertible debentures can exercise their conversion rights next , March in the ordinary shares, which would increase the ordinary capital ' and thereby decrease the cover available for the dividend. The company will receive substantial benefits from the third stage of its expansion plans which is being carried out, so that future prospects are doubtless encouraging and the chairman's statement will be looked forward to with particu- lar interest; At the time of going to press the 11 ordinary shares are about 60s. to yield 4 per cent., but in the absence of an increase in the dividend they may fall, in which case they would be worth acquiring at the lower price.
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