20 DECEMBER 1963, Page 24

Company Notes


HE most encouraging point in the pre- Mliminary statement from the directors of Colvilles, the Scottish steel producers, is that de- mand on the heavy side picked up smartly in the last two months of the year ended Septem- ber 30, 1963, and is expected to remain strong for 1963-64. Group gross profits of £7,187,848 compare with £7,412,819, but the company, having passed the interim dividend, is paying a final of 12 per cent against a total of 13 per cent for the previous year. Depreciation is heavier by £1.2 million, which has reduced pre- tax profits from £3.2 million to £1.79 million, but there is no tax charge against £1.844 million previously. Now that the new Ravenscraig strip mill has been run in at a cost of £602,000, the company should be well able to meet the in- creasing demand for sheet steel. On the dividend, the £1 shares were a little better at 26s. 7-fd., but still yield 9.4 per cent. Political clouds cast their shadow!

A drop of £1 million in the trading profit of Dorman Long, the heavy steel producers, has not adversely influenced the directors in their dividend decision, as the outlook for 1963-64 is better. In fact, having cut the interim divi- dend by I per cent, the final is increased by 1 per cent, making a total of 9 per cent, against 8.5 per cent, for the year ended September 30, 1963. A small tax credit has improved the net result at £1,949,747. The improvement has oc- curred in the roll steel output and not as yet in the constructional subsidiaries or the chemi- cal and engineering divisions. As the construc- tion boom continues the company is bound to benefit, but so long as the political uncertainty persists in regard to the steel industry, the £1 shares at 23s. 6d., yielding 8 per cent, must be considered fully valued.

Mr. Julian S. Crossley, chairman of Barclays Bal( DCO, describes 1963 as a year of expan- sion, for there are now twelve more full branches in operation, eight more sub-branches and twenty more agencies than at this time last year. An important point made by the chair- man is that in spite of so much nervousness that

is being publicly expressed about the economics and political future of Africa, in which con- tinent the bank has 60 per cent of its interests, it continues to expand and carry on a profitable business. The bank has, through its Development Corporation, played a great part in financing, to the tune of £28 million with medium-term 'finance, the new countries in the African conti- nent. The chairman deals very fully in his report with the company's affairs and progress. It now has 1,364 branches operating in forty-one different countries. The after-tax net profit rose from £738,113 to £918,618 for the year ended September 30, 1963. The dividend is maintained at 10 per cent on capital increased by a one-for- eight scrip issue on the £1 shares, which, now at 49s. 9d., give a very good return of 4.8 per cent.

Hollindrake Automobiles, dealers in a wide range of cars (excepting Morris) with emphasis on the Standard-Triumph group, has done well for the year ended September 30, 1963, with a net profit of £60,815 against £40,982. The final dividend of 15 per cent raises the total by 2.5 per cent to 23.5 per cent. The recent issue of £300,000 of debenture stock has strengthened the balance sheet by eliminating bank overdrafts. The company has an Esso franchise for Cheshire which should continue to produce a good additional income. The 5s. shares at 22s. give a fair return of 5.3 per cent..

Mr. L. Jacobson, chairman of Montague Bur- ton, tailors and manufacturers of clothing, tells shareholders that he is optimistic about the current year and that he is considering various projects for diversification. The company has recently moved into the EEC market with a £1 million interest in a French clothing com- pany which has interesting possibilities. The 10s. non-voting IA' shares at 20s., yielding .3.5 per cent on the 7 per cent dividend, are well worth putting away.