MONEY MATTERS
Page 70
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Leyland's Soaring Profits and T.D.G.'s Expansion Rate
New Year has started well for shareholders of 'THE MOTORS. For the trading year to end-September last, group profits before tax were virtually doubled at 110-3m. and the proposed final dividend of 3s. 6d. per 11 Ordinary Stock unit increases the year's total payment from 4s. to 4s. 6d. A combination of the news of the order for buses for Cuba worth about £4m. and an expectancy that the results would be good stimulated heavy buying of these stock units immediately ahead of the announcement; the price moved up 2s. 6d, to around 97s. But the figures were even better than expected—and optimism had been pretty strong. Immediately the news was out the price jumped 2s. further to 99s. The leap in profits, it is believed, has been produced in the main by the commercial vehicle divisions, though the increased output by the Standard-Triumph section will have played its part. The chairman's annual review is awaited with keen interest by the Stock Exchange.
When the Ordinary shares of 5s. each of WILKINSONS TRANSPORT were introduced to the Manchester Stock Exchange in 1962 there were those who felt a little doubt about the group's future, investmentwise, because of its comparatively smaHish size; the capital was 1125,000. It was realized that a great deal depended upon sound management. All such doubts should have been completely obliterated in the meantime, judged by the group's progress, progress amply demonstrated by the latest announcement. In order that the issued capital can keep pace with the group's expansion as well as with its profit-earning capacity (which continues to grow) the board propose a capitaliza(.50
tion of reserves by way of a 1 for 4 scrip issue. The chairman states that profits for the seven months to endOctober last were 25 per cent higher than those for the same period a year ago; it is intended to pay a final dividend of not less than 71 per cent. An interim dividend of 7* per cent has been paid; there was a 1 for 3 " rights " issue last October. It is no surprise, therefore, that these shares have been changing hands recently at around 18s. 3d. A year ago the price was about 7s. 9d.
The expansion of TRANSPORT DEVELOPMENT GROUP will take a further substantial forward leap if the bid (just announced and worth about 121 m. sterling) for Australia-based Cargo Distributors succeeds. The build-up of the T.D.G. has been phenomenal. When the company was made public in 1950—the name then was General Lighterage (Holdings) Ltd.—the issued capital was 1470,878. Since then further issues of shares, Ordinary and Preference, have been made which produced about 17-5 m. additional cash. These issues helped to raise the issued capital to its present total of £10,382,337 and materially aided the group's expansion to its present large number of subsidiaries. Further, at the date of the last balance sheet there was a total of 11-97m. Unsecured Loan Stock outstanding. There are something like 24 million 5s. Ordinary Shares on hand, but not yet issued, by which to help make further acquisitions; and I am informed at board-room level that the expansion programme will be pushed vigorously ahead as and when suitable projects come along.
Martin Younger