MONEY MATTERS
Page 81
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George Ewer's Promising Development
THE Is. Ordinary shares of GEORGE EWER rarely J. hit the headlines. Yet this group of coach proprietors, hauliers and private-hire contractors has an enviable profits record. Since 1956 net profit has increased progressively from £17,300 to £70,840, the latter in respect of the year to December 31, 1962. In 1956 the dividend was 10 per cent; for 1962 it was raised 2 points compared with the previous year, to 27 per cent. In order to reduce hank borrowings (which had been increasing owing to the expansion of the business) a " rights " issue of 1.35 m. new Ordinary shares of is. each at 3s. 6d. per share on the basis of 1 for 5 was made about the middle of last year. Last September the interim dividend was lifted 1 per cent to 101 per cent. This was payable on the larger capital, though it was warned this was not to be taken as an indication that the total distribution for the year would exceed that for 1962. Nevertheless, such an increase would certainly not surprise the market; indeed, one or two friends there confidently expect a higher total payment. Further expansion and development seem assured.
In his statement to shareholders reviewing 1962's trading, the chairman (Mr. I. H. Ewer) commented that he expected trading results for 1963 would show a further improvement. These results are expected to be announced during April. There has been some steady buying of these shares around 4s. 101d. recently. I expect to see this interest maintained in the weeks ahead.
That the current financial year "has opened well" is about the only comment on prospects by the chairman of AVON RUBBER in his annual review. Several stockbrokers, on the facts available to them, consider these to be good. For the year to end-September last, pre-tax profits jumped impressively by 25 per cent to £667,859. In January, 1963, Normeir group, one of the country's largest independent tyre distributors, was acquired, the full benefits of which are yet to accrue to Avon. Avon's record in recent years has not been sensational; quiet, steady growth has taken place. Statistically the group now looks well set for a breakthrough in earnings which could be expected to inspire a more liberal dividend policy; the latest dividend of 13 per cent was covered twice by earnings.
Shareholders of BRAID GROUP should find the latest results fully up to the high expectations they founded upon the interim statement made last August, when the half-way payment was raised 21 per cent to 71 per cent, and the board stated that profits were running "in excess" of those of the year before. In fact, pre-tax profits soared from £131,084 to £228,938 and the proposed final dividend of 121 per cent (up 21 per cent) makes the year's total 20 per cent against 15 per cent. These profits almost equalled the peak attained three years ago; the outlook seems sufficiently bright for this small remaining balance of recovery to be achieved with something to spare during the current year. That the rise in the price of these shares was limited to 3d. at 3s. 9d. following the announcement was because, it was felt, of the prevailing uncertain background of equity markets generally.
Martin Younger