FINANCIAL NOTES SEPTEMBER UNEMPLOYMENT
THE break in the international crisis directs attention once more to the progress of industry in this country and the publication of the September unemployment figures as at September r2th gives a picture of the position as it existed immediately before the urgent demand for labour for trench digging and other defence works sprang up. The picture is scarcely pleasing. Unemployment, at 1,798,618, showed a rise of 39,376 on the previous month. It was partly a seasonal advance but covers a substantial further recession in the building, cotton textile, engineering and iron and steel industries. Better employment prevailed in the woollen, pottery and boot and shoe industries, and even in the relatively depressed industries there are individual firms which are still well supplied with orders and taking on additional men. But the main interest in the present figures lies in the fact that there is now a direct comparison with the figures of 12 months ago, September, 1937, being the first month in which the revised system of counting was employed. It was also approximately the beginning of the industrial recession. Thus, the 459,414 persons who have been added to the numbers of the unemplir. in the past 12 months give a rough measure of the size of recession.
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UNITED STEEL COMPANIES
It is encouraging to find that United Steel Companies, the big Yorkshire, Lincolnshire and Cumberland coal, iron and steel combine—has been able, notwithstanding the trade recession, to show much higher profits for the year ended June 30th. Trading profits for the year amounted to £2,584,540, as compared with £2,075,322 in the previous year. After adjusting for income tax and debenture interest, the net profit for the year advanced by £576,217 to £2,426,547, and the directors' report explains that the works of the group continued to operate at a high rate up to the March quarter, since when there has been a general decline in demand. Dividends of 10 per cent. for the year against 84 per cent. have already been announced.
The decline in demand since March has possibly been the major factor in deciding the directors to be even more than normally conservative in their distribution of profits. The sum distributed to the shareholders is only £646,198, against £565,148, while a total amount of £1,78033493 against £1,285,182, has been added to various reserves and undis- tributed profit balances. The year's profit, moreover, was arrived at after charging against profits the whole cost, estimated at £92,000, of the holidays with pay agreements for the present calendar year. The reserve allocations include £796,000 against £443,5o0 for taxation reserve, £150,000 against £130,000 for pensions, £42,080 against £40,480 for Debenture redemption and £roo,000 against £167,629 for General reserve. In addition, there is a charge of £675,000 against £500,000 for depreciation and obsolescence reserve which can correctly be regarded as a free reserve since a valuation of the properties on the 1936 basis has shown the true value to be in excess of the book value without applying any part of the depreciation and obsolescence reserve.
Thus United Steel companies which have only been in the dividend paying stage for 5 years have now built up reserves of approximately £5,850,000. They are also pressing ahead with the extensions to their Appleby Frodingham unit and making Lincolnshire into one of the most important steel- producing districts of the country.
" EMMIES " LOWER PROFIT It occasions no surprise, in view of the intensity of the depression to which the wireless industry has been subject, that Electric and Musical Industries should have reduced their dividend. For the year ended September 30th a dividend of 5 per cent. is being paid, against to per cent. in each of the two previous years. Preliminary figures suggest that the company has slightly over-distributed the year's earnings which amounted to £146,000, against £363,964. It may therefore be assumed that the directors foresee better times ahead as well as greater stability of earnings resulting from the diversifi- cation of the company's business which now includes Rudge- Whitworth bicycles as well as wireless and gramophone and various other products.
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JOSEPH LUCAS RESULTS The sharp contraction in the motor trade has had relatively little effect on the earnings of Joseph Lucas, the manufacturers of motor accessories. The net profit, after allowing for the increased burden of taxation, fell to £319,626 in the year ended August 7th as against £348,798 in the previous year. The company has announced that it is maintaining its ordinary dividend at 15 per cent. for the third successive year. The dividend remains highly conservative in relation to available earnings. A sum of £75,000, against £roo,000, has been added to reserves, £ro,000, against £15,000, to workpeople's funds, while the balance to be carried forward is increased from £69,385 to £80,581.
WORLD COkkhE OtrrLoox Mr. H. Eric Miller refrained from discussing the rubber outlook when he addressed the shareholders of the Bajoe Kidoel Rubber and Produce Company on Tuesday, reserving his observations for the meeting of Harrisons and Crosfield which will be held next Tuesday. He did, however, give a full and very depressing review of the coffee position. Con- sumption is increasing but slowly and is far below the world's (Continued on page 588) FINANCIAL NOTES (Continued from page 06)
productive capacity. The maintenance of even the present price level seems to depend on the continuance of Brazil's ability to exact a sacrifice quota and destroy the world's surplus. The prospects of arriving at an international agreement are in
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