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MONEY MATTERS

6th March 1964, Page 118
6th March 1964
Page 118
Page 119
Page 118, 6th March 1964 — MONEY MATTERS
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Tartan Arrow

for the Market

DEALINGS are expected to begin in the Ordinary shares of 2s. each of TARTAN ARROW on the Scottish Stock Exchange on March 6. A total of 125,000 shares is being placed by Gresham Trust at 12s. per share and all the 100,000 71% Redeemable Cumulative Preference Shares of £1 each at par. The equity ofTartan Arrow is split into Ordinary and Deferred shares. Gresham Trust (of which Tartan Arrow is a subsidiary) is to retain its interest of a little more than 50% of the equity. The directors of Tartan Arrow and their families retain about 25% of the Ordinary and the remaining 50% of the Deferred.

Specializing in the running of a London-ScotlandLondon express parcels service—almost 50% of its vehicles are engaged on this—Tartan Arrow also provides an extensive storage and redistribution service in Scotland; meat haulage and parcels service in the London area are other divisions. Profits have leaped from £9,500 to around 170,000 during the past four years. The board forecasts a total of not less than £90,000 for the current trading year. The Deferred shares do not rank for dividend until the end of 1966, but a payment of 30% is envisaged on the Ordinary shares in respect of the present year. The brokers to the issue tell me there has been a fair-sized demand for these shares and they expect them to open at a small premium.

DUNLOP RUBBER Ordinary units have been quietly picked up during recent days and the price has edged slowly forward. This does not surprise me, because the results for the year ended December 31 last are expected in early April. Reporting to holders a year ago, Sir Edward Behatrell said that the tempo of research and des elopment was growing; he anticipated that a number of new developments originating from these would reach production during the then current year. In a later and interim statement sales were said to be 4% higher than those for the January-June period of 1962, and that profit (before tax) had jumped by £1•23m. to £6•54m. And there were indications that profit for the year's secondhalf should not he less than the amount for the JulyDecember period the previous year.

It is worth recalling that, despite the directors taking the view in October that profits for the second half of 1962 would not reach the record level of 1961, they did in fact rise above that level. The prospects for the British market are undoubtedly good. But about twothirds of Dunlop's sales and profits are bound up with markets overseas. It is necessary, therefore, to "think globally" when assessing the prospects of this leading group. Nevertheless, despite fierce competition overseas, from Michelin in France for example, the market is optimistic about a modest increase in, the year's distribution—interim raised from 5% to 5 5/6%—which last year was 15 5/6% out of earnings of almost 27%.

Martin Younger

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Locations: London

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