FINANCIAL NOTES

SHIPPING SHARES STRONG.

AT the moment of writing business on the Stock Exchange has scarcely been fully resumed after the Easter holidays. So far as British Funds and kindred stocks are concerned, the tone is steady, with little business passing, owing, no doubt, to Budget uncertainties. On the other hand, as noted elsewhere, commodities have been an active and rising market, a matter to which fuller reference was made in a previous article ; while in the Industrial section, a feature at the time of writing is the activity and strength of Shipping shares, the movement being stimulated by the steady rise in freight rates.

* * * * CHARTERED BANK REPORT.

A feature of the Report of the Chartered Bank of India, Australia and China for the past year is the expansion of over £5,000,000 in its Balance-Sheet total, although the net profits were actually a trifle lower. These net profits however, were arrived at a year ago, "after providing for all bad and doubtful debts other than provided for out of Contingencies," whereas this year the qualification has disappeared. The usual dividend of 14 per cent. less tax has been declared with L35P00 added to Pensions Fund and £4o,000 to Contingencies Fund.

* * * * A GOOD RECOVERY.

The Report of the Hudson's Bay Company for the past year strengthens the good impression created by the preliminary profit statement, to which I referred in The Spectator of March 19th. After charging Depreciation, &c., the net trading profit was £226,695 as compared with £144,717 in the preceding year. The increase in the profits was such as to enable the company to clear off six years of Preference interest, and, but for these arrears, it is evident that a dividend could have been declared on the Ordinary shares. How great the progress of the company has been may be gathered from the fact that two years ago the net profit was only £21,000. The Annual Meeting will be held on the 14th of this month and considerable interest always attaches to the Governor's statement at this meeting, both as regards the progress of the company and the general outlook in Canada.

* * * * A BUMPER REPORT.

The latest Report of the Associated Electrical Industries makes a wonderfully good showing, the net trading profit (Continued on page 646.)

FINANCIAL NOTES

(Continued from page 642.)

being - up by no less than £277,000, the total being over Li,o55,000. Not only has the Company been able to raise its dividend from 8 to io per cent., but substantial additions have been made to the Reserve, while the amount charged to Depreciation is larger than in the previous year. The Con- solidated Balance-Sheet shows that the Company is in a strong position, its investments and cash aggregating over £1,200,000.

* * * * FRITH AND CO.

At the Annual Meeting last week of Erith and Co., the Chair- man, Mr. S. A. Garner, was able to place before the share- holders a most excellent Report showing that the past year's trading was the largest in the history of the Company. This profit enabled the directors to recommend a final dividend of r21 per cent. making, with the interim dividend, a total for the year of 171 per cent., less tax, an achievement all the greater as it was paid on a larger capital than in the previous year. The Balance-Sheet, too, was a good one, while the Chairman spoke hopefully with regard to the future.

* * * * ALFRED DUNHILL, LIMITED.

With a comparatively small capital, the business of Alfred Dunhill, Ltd., which is that of pipe manufacturers and tobacco blenders, steadily progresses and at the recent Ordinary General Meeting the Chairman, Mr. Dunhill, was able to state that the profits for the past year were the highest since 1929, enabling the Company to recommend a final dividend of 71 per cent., making io per cent. for the year, together with a bonus of 7f per cent., thus giving a total distribution for the year of 171 per cent. In addition, there was also an increase in the Carry Forward. Moreover, the Chairman stated that the increased distribution was justified by the fact that there was a reasonable expectation of the profit for the current year permitting a similar dividend. The sales of the Company continue to increase.

* * * * PROSPERITY IN THE DIAMOND INDUSTRY.

For some time past the conditions of greater prosperity, especially in the United States, have found their reflection in a great recovery in the Diamond industry, and this recovery in its turn has been reflected in a great rise in the price of the shares of De Beers Consolidated. The latest Report of that Company now shows that for the year 1936 there was a great increase in profits, the Diamond account contributing £2,243,000 compared with £1,520,000 for the previous year. By bringing in the sum of £1,598,000 from the Reserve, the Company has been able to pay the Preference dividends for the four years to June 30th, 1935, and the amount ..carried forward, namely £1,329,000, more than covers the amount of the outstanding half-year's Preference dividend to the date of the Balance-Sheet. It seems probable therefore that these arrears and the dividend for the current six months will be paid in July next. * * * * AN Horn ISSUE.

Southampton, having regard to its great progress, its popula- tion and business activities, is not too well supplied with hotels, and this would seem to offer in itself justification for the issue which is being made shortly of 34,000 6 per cent. Cumulative Preference Shares of Li each at 2IS. per share and 17,000 io per cent. Ordinary Shares of 'cm. each at 15s. per share in Southern Counties Hotels (Southampton), Limited.The business was commenced in a small way some three years ago, and the success achieved would seem to justify the extension which is now taking place by means of an enlargement of the present premises at Cumberland Place and the acquirement of a new property called "Court Royal" in the mote rural districts of Southampton. The total authorised capital of the Company is £101,000, divided into £5o,000 in 6 per cent. Cumulative Preference Shares of Li each, the same amount in ro per cent. Ordinary Shares of los. each and Li,000 in Deferred Shares of Is. each.

* * * * PAST AND FUTURE PROFITS.

Last year the profits amounted to £4,857, but it is estimated that there should be an increase from the extensions of £5,636 and a further profit of £2,378 in connexion with the new premises to be acquired. Deducting Directors' fees salaries and office expenses, an estimated profit is reached of just over £1 1,000, on which basis the dividend on the Preference Shares would be covered three and a half times, and after payment of such dividend and a io per cent. dividend on the

(Continued on page 648.)

FINANCIAL NOTES

(Continued from page 646.) Ordinary Shares, there would be a balance of over £3,000 available for Reserves, etc. The subscription list opens on Tuesday next and closes on or before Thursday, April 8th.

APOLLINARIS PROFITS.

The profits of Apollinaris and Presta, Limited, are usually much affected by climatic conditions, and to the unfavourable weather of last year must no doubt be attributed the fact that the profits for 1936 were £.17,806 as compared with £21,483 for the previous year. The directors state that sales of Presta Waters resulted in a further rise in profits, but it was not sufficient to counteract the detrimental effects of the Exchange and other difficulties. Under the moratorium arrangement, interest at 2/ per cent, per annum has been paid on the 5 per cent. Debenture Stock, absorbing £15,615. The arrangement continues in force until October 1st of next year, and though the company continues to make trading profits, it looks as though some scheme might have to be considered shortly for dealing with indebtedness severely hampering the company under present-day conditions.

NEW BANK DIRECTORS.

Not the least interesting development in connexion with the conduct of the Bank of England's affairs in more recent years has been the evident desire on the part of the Governor and his co-directors to maintain close relations with our Empire overseas. Some years ago, when the Reserve Bank of South Africa was established, the first Governor elected was a prominent member of the staff of the Bank of England, Mr. William H. Clegg. When, some years later Mr. Clegg retired from the Governorship of the Reserve Bank of South Africa, he was elected a director of the Bank of England. From that position he has now retired and in his place the Court has nominated for election next week Mr. John Martin, who is connected with some of the leading Mining undertakings in South Africa, while on several occasions he has filled a position as President of the Transvaal Chamber of Mines. Although now a resident in South Africa, he will spend a considerable period of the year in this country, where he is well and favourably known. There are two vacancies on this occasion in the Bank Court, and for the second vacancy the election is proposed of Mr. Evelyn Jones Bunbury. For some little time past, Mr. Bunbury has served the Bank in what is known as the position of adviser, but previously he was for some years in India, and his knowledge of Indian finance and banking is of an intimate character as he served on the Central Board of the Imperial Bank of India and was

President of the Bombay Board. A. W. K.