TOBACCO SECURITIES TRUST
For each of the past three years the Tobacco Securities Trust Company, whose investments are largely in tobacco businesses managed by the British American Tobacco Com- pany, has maintained its ordinary dividend of 16 per cent., and paid just over 41 per cent. on the deferred shares. Net income for the year ended October 31st, 1939, was about L41,400 less than in 1937-1938, but the fall was due entirely to increased taxation. At the annual meeting Lord Catto emphasised the stability of the income derived from the tobacco interests, and also disclosed that sales of the balance of the stocks of shellac held through the Dean Finance Com- pany were being made at greatly improved prices. Completion should be achieved with results very much better than at one time seemed possible.
As for the outlook, Lord Catto was content to take his cue from the tempered optimism of Sir Hugh Cunliffe- Owen, at the recent meeting of the British American Tobacco Company. He reminded shareholders, however, that large profits on the scale which Would cover substantial dividends on the deferred capital, as in 1930-34, must not be expected unless there was a return to "exceptional financial activity." For the present, therefore hope must be centred on improved results from the tobacco invest- ments. At 55s. Tobacco Securities Trust LI ordinary units yield nearly 6 per cent., and are worth holding. The LI deferred units at 16s. 9d. return just under 51 per cent. They are more speculative, but have long-term chances of pital appreciation. * * * *
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