BMC repeats interim dividend
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1HE directors of BRITISH MOTOR CORPORATION announced
that the interim dividend is being maintained at 4-id. per 5s. Ordinary share. This payment will be made on March 31 next No further payment is contemplated until December. As usual an interim statement will be made by chairman Sir George Harriman in April—a statement that will be awaited by the market with the usual high degree of interest The price of these shares has been a shade firmer recently; currently they stand at 14s. 41d.
The shareholders of LEP GROUP can look forward to the immediate future with cautious optimism. The interim dividend is being raised to 91% from 5% the previous year. Announcing this, however, the directors warn that the rise is on account of the provisions of the 1965 Finance Act: it should not be interpreted as implying a larger total for the year—that is, 23%. Nevertheless, the board reports that the final results for last year's trading will show "a slight improvement" compared with those of 1964.
This news, added to the fact that last year's dividend was covered by as many as 4-1 times by earnings, are sound reasons why shareholders understandably may feel a higher total for the year could become a reality. At around their current price of 157s. 6d. these shares yield 2% based on the latest 23% payment. GREENWOODS (St. Ives) has a sizeable stake in road haulage. During the year that ended on September 30 last, trading profit rose for the fifth year in succession to £1.4m. from f 1.2m. the year before. In his latest annual review sent to shareholders the chairman—Mr. Julius Silman—states that, because of the uncertain outlook in the building industry (the group manufactures concrete and trades in gravel) it would be "dangerous to hazard too optimistic a forecast for the current year".
The management of this group is excellent and a glance at the record underlines this. There are times when shareholders may have felt they could have been handed a larger dividend cheque, but there is little doubt the board's conservative distribution policy has been a main factor enabling equipment to be kept modern. Margins are under some pressure, but the latest 20% dividend. covered 1+ times by earnings, looks to be safe enough.
At their present price of Bs. 9d. these 2s. Ordinary shares yield 11% based on the latest payment. But the comparative thinness of this return would not persuade me to advise a holder to sell.
Martin Younger