r --MONEY MATTERS --- I
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BET pays more
THERE was a pleasant surprise for the shareholders of BRITISH ELECTRIC TRACTION. For the year that ended on March 31 last the directors recommended a final dividend of 45%. This raises the total for the year by 7+% to 70%. The payment will come out of a group pre-tax profit that was lower at £8.4m. compared with £8.5m. the previous year. But mainly because of a lower tax charge—£892,970 against £3.2m.—the net balance comes out at £7.46m. compared with £5.25m. the year before.
In his latest annual review sent to shareholders the chairman of GEORGE EWER AND CO.—Mr. J. H. Ewer—states that from a trading point of view he expects good results in respect of the current trading year. But he warns that optimism should be controlled, because be believes that the new tax legislation "may affect future dividend policy". Nevertheless, to be going on with. Mr. Ewer is able to tell his fellow members that turnover during the first four months of the current year was 8% higher than during the same period a year ago. So far as coaches are concerned the order books are full, he comments, and with better weather prospects he believes that 1966 should be a good "coaching" year.
About the selective employment tax, Mr. Ewer points out that it will be recoverable in respect of the group's transport division, but not in respect of its motor trade activities. He adds, therefore, that so far as the latter section is concerned more efficiency and economy "allied to an appropriate increase in charges to customers" will need to be looked for. Mr. Ewer was reporting upon a year (1965) that with one exception—a temporary setback in the haulage section—all sections of the group contributed to making it "satisfactory" so far as the results of the year's working were concerned.
At around their present price of 4s. these Ordinary shares of 2s, each yield 8% based on the latest dividend of 16%, a dividend that was barely covered by earnings. Nevertheless, I regard the management as first class and taking a longer-term view I hold the opinion that they are worth retention. They should adequately pay for their keep pending further growth.
Martin Younger