Paper Mills’ Net Profit More Than Doubled In Year Ended Last June

Bay of Plenty Beacon, Volume 11, Issue 91, 21 October 1947, Page 4

Paper Mills’ Net Profit More Than Doubled In Year Ended Last June

Total net profit of Whakatane Paper Mills, Ltd., was more than doubled at £31,763 for the year ended June 30, against £12,339 the previous year. The result is reached after providing £52,262 for depreciation (against £37,568), and £77,514 for taxation (against £22,595), in addition to £SOOO for stock fluctuations for which no provision was made this year.

As the proposed capital organisation scheme contemplates the transfer of active assets to the new Whakatane Board Mills, Ltd., as at December 31, the net profit of £16,896 earned by those assets in the second six months of the financial year will belong to the new organisation, and it has been transferred to a special suspense account, together with the amounts provided for depreciation and stock fluctuation reserves for the same period. Net profit for the first six months of the year, £14,867, remains with the Paper Mills company to increase undivided profits to £29 223 Sales of cardboard totalled £656,509, against £492,785, gross profit was £217,425, against £116,593, and income from investments, etc., was £3453, against £3699. The directors report that the local demand for the company’s products continues to exceed the mill’s current capacity to supply by several thousand tons annually. While some increase in output may be achieved as the result of the introduction of an employees’ incentive production bonus, coupled with more regular and adequate coal supplies, nevertheless, if the company is to cater adequately for the local market’s needs early consideration will have to be given to the installation of a second cardboard machine. Production of 13,017 tons gross, although an increase of 1412 tons on last year’s figure, is still below the record of two years ago. This was primarily due to the loss of five and a-half weeks’ manufacturing time, or no less than one-ninth of the maximum time available, through shortage of coal, which accounted for 26 days, and a strike in April, which accounted for Hi days. Value of tonnage delivered at £656,509 reflects not only the increased tonnage, but also the increase in raw material prices and wages, as well as the increased return on capital employed, granted by the Price Tribunal, to operate from October 1, 1946.