FINANCE AND INVESTMENT
By CUSTOS
IN Throgmorton Street the accent is still on recovery shares. It not yet a case of heavy buying, which is not to be expected w the first battle on the Russian front is reaching a critical s but long-headed investors are beginning to search out possibiliti The trouble is the virtual absence of sellers. Those who have h on grimly through the vicissitudes of war are not likely to be temp into selling now that the crest of the ridge is in right.
FINE SPINNERS RESULTS
Recent references here to the merits of Fine Cotton Spina shares are justified by the resumption of ordinary dividends. the directors foreshadowed when carrying out their capital organisation scheme, gross profits for the year to March 31st h fallen quite considerably. Preliminary figures show a gross pr total of £635,228, which is 23 per cent, below the comparable fi for the preceding year ; but after debenture interest, War D insurance, tax, &c., the net balance is only moderately down £300,676 against £339,742. It is true that the new Funding ficates for which a cash offer of as. 6d. is now made, do begin to rank for interest before the financial year 1942-43, but amount of £5o,000 is set aside for repayment under the terms the reorganisation scheme. Allowing for this charge, there is balance of £175,676 available-for the ordinary capital, equivalent roughly 6.1 per cent. It is apparent, therefore, that in res ordinary dividends with a payment of 3 per cent. the directors ha proceeded cautiously. Their decision is consistent with a tran of £8o,000 to reserve for replacement of basic stock. Bearing mind the troublesome period which may lie ahead, especially in early post-war years, the ordinary Li units seem to me to reasonably valued around 8s., at which the yield is 74 per cent
BRITISH CELANESE HOPES
Optimistic forecasts concerning British Celanese have so oft proved misleading in the past that one hesitates to raise any f hopes. There is evidence, however, that at long last this ill-fat company has succeeded in improving its earnings so substann that holders of the kr second preference shares can reasonably I forward to regular dividend payments. A beginning has alre been made with a half-year's dividend, but this still leaves to!, y arrears, equivalent to nearly 8s. net per share, to be cleared Negotiations over E.P.T. liability have not yet been completed, a decision seems likely in the near future. It may well be, in event, that the board will bring forward funding proposals. Qua just over par, the 74 per cent. second, preference shares should out well for investors willing to shoulder moderate risks for a hi potential yield and a chance of capital appreciation.
BRUSH ELECTRIC PROGRESS
Stockholders in Brush Electrical Engineering have had to exer a good dew of patience in recent years, but they now get reward—or rather the first instalment—in a 6 per cent. divid Results announced for 1941 demonstrate the benefits of thoroughgoing reorganisation plans carried through in recent Y Profits rose from £129,879 to £185,446 and the surplus, after dedu ing the 6 per cent. ordinary dividend, and sufficient to cover s writings off amounting to £24,465 and an allocation of £50,000 general reserve. At the same time, bank overdraft has been rer and the financial position substantially improved. The Carl tore will be simplified and strengthened by the redemption of vhole of the debenture stocks through the issue of preference irdinary shares. Brush 5s. ordinary units at 5s. 9d. offer scope urther recovery. So also do the option certificates, at zs. 9d., erring the right to subscribe four new ordinary 5s. units at Mil September 30th, 1943. As this is equivalent to paying than 9d. in relation to the new 5s. unit, the buyer of the n gets the 16 months' run for nothing, subject, of course, to the attending any setback in the price of .he units from the current of 5s. 9d. There are interesting possibilities.
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