Company Notes
By CUSTOS
As the stock markets were not badly affected by the dock strike they were not greatly moved by its settlement and were inclined to go easier on balance. The week has not been without its good features. COURTAULDS rose from 36s. to 39s. on the interim dividend of 4 per cent, paid on the doubled capital. Previously two interim dividends making 61 per cent, had been paid. If this 4 per cent. can be regarded as an effective 'rise from 31 per cent. the total for the year might well be 10 per cent, against the equivalent of 8 per cent, last year. The directors state that the increased dividend is justified by the trading results of the first half of the year. No doubt the company has fully shared in, if it has not been leading, the recovery of the rayon industry this year. Exports are 10 per cent. up in spite of keener competition and the home trade is expanding. According to the indices the output of the industry is 20 per cent. higher„than in 1953, which indicates that the reduction in prices in July last year stimulated consumer demand. Courtaulds themselves are planning higher production from the new factory to be built at Grimsby and from their American subsidiary. At the present price of 39s. the shares afford a potential yield of 5.1 per cent. and seem cheap as compared with other blue chips.' • • ON the eve of the Persian oil `share-out' ANow-IRANIAN have been an erratic market —up to 181 and back to 171. If a four-for- one bonus is not distributed the bulls will be very disappointed. I have always felt that it is safer to take an interest in this wonder share through nuastait on, which have risen to over 120s. and should be held whatever happens. If the small investor who has been lucky enough to have a few Anglo-Iranian wishes to increase his income, he can secure high yields from the oil producers, but of course he must face a mining risk and a wasting asset. arrocK will give 10.2 per cent., APEX (TRINIDAD) 8.1 per cent. and TRINIDAD PETROLEUM DEVELOPMENT 5.65 per cent. I see that interests connected with Blur 'ISH CONTROLLED, which is to be liquidated, are anxious to oust the chairman of TPD and gain control of the board. As British Controlled 00 50 per cent. of TPD I presume the idea is to make TPD shares rise in market value. This may be fun for the shareholders bus, not necessarily in the long-term interests 0! ,TPD which has been very soundly manageo by its present board of directors.
SMET-HWICK DROP FORGINGS is a highlY efficient firm making drop forgings for the, motor, aircraft and electrical industries and with an issued capital of only £610,000 it is often rumoured that it will be bought oid by one of the motor giants—Vauxhall, for example, which gives it large standing orders. But there is no reason to suppose that ill unique position in the trade will be disturbed. It distributed a 100 per cent, bonus in JO', 1952, and another 100 per cent. in nth 1954. For the year to March, 1954, the, equivalent earnings were 40 per cent. ano dividend 15.6 per cent. For the current yea, it would be safe, I think, to assume a dividend ' of 171 per cent. At 12s. 6d. the 5s. shares would return a 7 per cent. yield if my for& cast is correct. Even for a small industrial company this would be an attractive return, having regard to the efficiency of it management.
• • • IN November last year I called attention le CRABTREE ELECTRICAL INDUSTRIES Wilieb had experienced a fall in profits for the year, 1952/53. The accounts for the year endeo July 31-, 1954, reveal a recovery of no less, than 43 per cent. in net profits. The dividetve which was not quite earned in 1952/53 has been raised from 171 per cent. to 20 per cefit. and at 30s, cum dividend the 10s. shares yield 61 per cent. The high yield indicates that the dividend cover is slender, earnings being only 24 per cent., but the risk takes is not an unreasonable one. For what is calla` 'mixing' purposes—that is, to improve income—the small investor might well he adding Smethwick Drop Forgings an' Crabtree to his portfolio.
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