MONEY MATTERS
Page 71
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Spurling on Right Road
DURING the three years previous to 1963-64 profits of SPURLING MOTOR BODIES fell from around £300,000 to around £180,000. In the trading year 1963-64, however, they improved to £205.000. And the welcome news for shareholders is that this improvement is continuing. In an interim report which accompanies the accounts covering the year that ended on May 31 last the chairman, Mr. C. .1. Calderwood, reports that trading has been considerably better. The trading year 1963-64, he states, was not as good as the board had expected it would be. He adds: " I am convinced the difficulties are now behind us ".
Two of those difficulties appear to be losses which were made by two subsidiaries engaged in activities outside the commercial vehicle trade. Group pre-tax profit for the first five months of the current financial year amounted to £51,000, an increase of £38,900 on the total for the same period a year ago. This reflects the considerably better order book position.
All the motor divisions of the group appear to be doing well. Of particular encouragement is the news that Marble Arch Motor Supplies, which made a loss during the year ending May 31 last, has returned to profitability. Overall the group shows a " great measure of improvement" in both turnover and profit (before tax). The interim dividend is expected to be declared early in 1965. Last year's 124% total payment for the year was covered with only a little to spare by earnings. The market opinion is that the interim may well be maintained, there being cautious hopes that the current brighter outlook and increased trading could spell a small increase in the final. At their present price of 7s. 6d. they yield 64% based on the latest distribution.
To date OLIVER RIX has been known with respect as agricultural engineers, tractor and combine harvester specialists. The company has now announced some interesting acquisitions that diversifies its activities into the field of dealing in commercial vehicles, as well as motorcars. First to be announced was the purchase, for a consideration of 2m. Ordinary shares, of Cambridgebased King and Harper—dealers in B.M.C. vehicles, Estimated net assets of this new subsidiary are not less than £500,000: pre-tax profits for last year come out at•£45,374.
On the heels of this acquisition came the announcement that WIN Piccadilly, Hills Diesels and Hills Motor Factors of Manchester had been purchased at a cost of £60,000 in cash. Hills Piccadilly is a distributor of Seddon Diesels. Net asset value (combined) as at April 7, 1964 was £20.750, and the combined profit of the three companies for the year ended on that date was £19,329 before tax. These acquisitions look wise and should bring benefit to the parent group. At the present price of 3s. 3d, Oliver Rix Is. Ordinary shares yield 4% based on the latest 16% dividend, a dividend that was covered
more than twice by earnings. Martin Younger