A HIGH TRUST YIELD
I see there is some support in the market for Ever Ready (Great Britain) 5s. ordinary shares around 25s. following the interim dividend statement. This company's financial year runs to March 31st, and in maintaining the interim at 15 per cent. the board state that busi- ness for the six months ended September 3oth, 1939, has been satisfactory. That period did not include any war-time experience, and I should imagine that as a manufacturer of electric batteries and torches the Ever Ready Company is now doing a record trade. On the ex- port side, of course, there must be difficulties, but I shall be surprised if under present conditions the board does not find it possible to restore the old dividend rate of 35 per cent., which was steadily maintained—there was a to per cent. cash bonus as well in 1937—until 1939. The company has immense reserves, amounting to over £ t,000,000, and is well placed in relation to Excess Profits Tax. On the assump- tion that the 35 per cent. dividend is restored the 5s. shares, at 25s., will give the generous yield of 7 per cent.
I feel, however, that for those who are impressed by the Ever Ready trading prospect but dislike putting all their eggs in one basket, the it ordinary shares of the Ever Ready Trust offer the more attractive medium. This trust is of the orthodox management type with virtually the whole of its investments in the British Empire. Most of the invest- ments are in ordinary shares, which, apart from a substantial holding in the Ever Ready Company, are well spread over the industrial field. At March 31st, 1939, the capital position was very strong, net assets having a market value of £378,425, against the issued capital of £3oo,000. Since that date there has been a moderate fall in industrial share values, but it is worth noting that Ever Ready ordinaries, in which the trust has a substantial holding, have actually risen from 21S. 9d. to 25s. It is virtually certain, therefore, that there is still a surplus of market values over the trust's capital.
As to income, Ever Ready Trust has earned between 9 and to per cent. and paid an 8 per cent. dividend in each of the past three years, and has just maintained the 3 per cent. interim for the year ending March 31st next. Oddly enough, the trust's Lr ordinaries are quoted at par to yield 8 per cent., which is t per cent. more than can be had on the equity of the trading company. I think they are a good high-yielding investment.
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