FINANCE AND COMMERCE

Press, Volume LXXIV, Issue 22507, 15 September 1938, Page 13

FINANCE AND COMMERCE

OVERSEAS MARKETS WEAKEN

FAT STOCK VALUES EASE AT

ADDINGTON

* The stock markets in America, London, and on the Continent have weakened. Prices fell by as much as 10 dollars a share in New York, and selling is described as frenzied. The local exchange had another dull day. Dealings were confined to a few stocks, and prices revealed weaker markets.

\ allies for fat stock eased at the Addington sale yesterday. Fat cattle were down by 15s a head and fat sheep by Is. Store sheep sold at the best of recent rates and wether hoggets were 2s a head better.

[BUSINESS IN JULY

Seasonal Recession Shown DOMINION’S EXTERNAL TRADE ' Business figures for July, just released in the latest Abstract of Statistics, show the recession which is normal for that time of the year. Bank debits, although showing a slight increase over the average for June, are operating over a much lower level than during the early months of the year. Bank deposits and advances are Sower than for some months, and net •banknote circulation—although showing a small decrease over recent months —continues at the very high [level of £9,669,982. The net note circulation has maintained a level of more ‘than £9,000,000 since October, 1937. Net overseas funds of New Zealand banks show further recessions, the major contributing factors to the decrease, according to the Abstract, being the close of the export season and the continued high level of imports. The following tables show the moveitnent in overseas trade and net over- • seas funds during recent years:— months

External Trade The value of merchandise exports during July was £3.783,337, showing a decrease of £2,130.139. or of 36.0 per cent., from the June total, and a decrease of £1,040,990. or of 21.6 per cent., compared with the total for July of last year. The decrease in the Value of exports is accounted for by smaller quantities of all the principal primary products being exported in the month under review. Imports recorded a substantial increase from £3,583,123 in June to £4,610,795 in July, the percentage increase being 28.7. The increase was spread over most items, the principal being: £132,500 for motor vehicles, £123,300 for piece-goods, £111,500 for electrical machinery, and £58,200 for apparel. External trading during July resulted in an excess of imports of £827,458, compared with an import excess of £19,041 for July, 1937, and an export excess of £1,150,342 for July. 1930. A comparison of the expired seven months of the present calendar year with the previous year reveals a decline from an export excess of £16,353,915 in 1937 to an export excess of £9,370,121 in 1938. For the 12 months ending with July an excess of exports of £3,568,890 is recorded compared with £13,375,623 in 1936-37. Banking Bank debits placed to individual customers’ accounts during July averaged £16.704.182 a week, the increase over the average for June amounting to £426,822, or 0.8 per cent. The volume of cheque transactions is operating at slightly lower levels than last year, although well above .the levels of preceding years. The aggregate value of bank debits during the 12 months ended July, 1938, amounted to £937,000,000, compared with £924,000,000 for the previous year and £549,000,000 during 1932-33. The average amount on deposit with the trading banks during July (£64,921,555) records the normal seasonal decline for this period of the year. The major part of the decrease was accounted for by free deposits, which—at £32,046,749—5h0wed a decrease of £565,812 as compared with the June average. Fi»;d deposits in July (£32,247,317), while showing a decrease since June, are at a slightly higher level than free deposits, the ratio of free to fixed deposits being 99.38 per cent, in July, compared with 100.65 per cent, in June. Bank advances during July averaged £54.977,527, and although showing a decrease from the average of recent months are nevertheless 14.4 per cent, higher than the figure for July of the previous year. Advances expressed as a percentage of total deposits increased from 83.81 in June to 84.68 in July. The ratio for July is the highest average recorded since February. 1933. Unexercised overdraft authorities on July 25 amounted to £24.764,398, and in comparison with the total on June 27 show a reduction of £142.687.

Net bank-note circulation averaged £9.669,032 during July, being slightly below the average for June, but £934,966, or 10.7 per cent., in excess of the average for July of last year. Not overseas funds of the New Zealand banks on the last Monday in July (.£23,336.230) reflect the slackening in the export season, a decrease of £2,789,288, or. of 10.7 per "cent, being recorded since 'June 27. On July 26. 1937, net overseas funds totalled £34,914,005.

FIFTH SERIES OF LONDON WOOL SALES CATALOGUE TOTALS 94,000 BALES (UNITED PRESS ASSOCIATION— COPYRIGHT.) LONDON, September 13. The fifth series of London wool sales for 1938 will commence or\ September 20. and will conclude on September 30 The catalogue totals 94,000 bales, and Includes 38,100 New Zealand and 46,950 Australian.

COMPANY NEWS

BROKEN HILL A marked increase in the output of steel from the Newcastle works of the Broken Hill Proprietary Company, Ltd., is shown in the figures for the first 12 weeks of the company’s financial year. Production for the new year to August 28 is as follows, with figures for the corresponding period of last year in parenthesis:—Pig iron, 168,319 tons (154,895); steel ingots, 227,056 tons (197,244). AUSTRALIAN DRUG Ordinary dividend of Australian Drug (Investments), Ltd., Sydney, has been increased from 4 to 4J per cent, for the year ended June 30. Net profit for the year was £2Ol higher, at £11,120, than in 1936-37. The dividend received from Drug Houses of Australia, Ltd., was 6£ per cent., an increase of i per cent. The report adds that the return is gradually improving each year, and the directors believe that if conditions remain normal the share-holding in that company will become increasingly valuable. FOUNDATION INVESTMENT TRUST The accounts of Australian Foundation Investment Trust, Ltd., Melbourne, formerly Were’s Investment Trust, for the year ended June 30. show a profit of £32.240, compared with £28,960 in 1936-37. The directors have already recommended payment of an unchanged dividend for the year at the rate of 6 per cent, per annum on old shares, and pro rata on new shares, of which 31 per cent, will be paid out of income earned in Australia and 2J per cent, out of income earned outside Australia, and not subject to tax in Australia. The latest dividend requires £30,080, compared with £25.400 last year, capital having been increased in the meanwhile. The sum of £2500 is transferrec to general reserve.

WESTLAND BREWERIES INCREASED NET PROFIT RECORDED Net profit of £9983. compared with £8446 in the previous year, is shown in the accounts of Westland Breweries. Ltd., for the year ended June 30, 1938. Dividend recommendation is unchanged at 10 per cent. The directors in their report say. “The last year has been very satisfactory, the company’s business showing an increase in all its branches. The installation of the latest bottling process allows us to market a chilled and pasteurised product of the highest quality, and has been responsible for further increase of trade in outside districts. ... .. “Three valuable hotel properties were purchased during the year. These houses occupy prominent positions in Greymouth. and with the expansion of the district will prove a valuable asset to our trade. “The gross profit for the year after paving for materials, wages, and beer duly is £25,526. The net profit is £9983 to which has to be added the balance to the credit of the appropriation account at the beginning of the year amounting to £684. “After setting aside £4750 for income tax last year and providing for £237 income tax under-estimated in the previous year there is a balance of £5680 to the appropriation account. From this sum it is proposed to allocate £IOOO in reduction of goodwill, and to recommend to shareholders the 'payment of a 10 per cent, dividend, which will absorb £4362. This will leave £3lB to be carried forward.” The retiring directors, Messrs J. W. Hannan and T, H. Lee, and the auditor, Mr M. J. Phillips, offer themselves for re-election. Balance-sheet items are:—

LONDON BUTTER MARKET LIFELESS

(UNITED PRESS ASSOCIATION —COPYRIGHT.* LONDON, September 13. The London butter market is lifeless. Choicest salted New Zealand 121 s to 1225, Australian 118 s, 'Danish 135 s to 1365. COLOMBO TEA AUCTION r KEEN DEMAND FOR COMMON GRADES (PRESS ASSOCIATION TELEGRAM.'' DUNEDIN, September Is. Mr L. M. Wright has received 'the following cabled report on the Colombo tea auction of September 13:—The ottering totalled 3,750,0001 b. Common teas were in keen demand and prices remained firm. Medium and fine teas declined about Jd, because of the poorer quality of the offerings. An offering of 3,250,0001 b is catalogued for next week’s auction.

GOLD FIELDS IN FIJI

GLENROY GOLD LOSS FOR YEAR OF £lB4 A net loss of £194 6s 8d without allowing for depreciation is shown in the accounts of Glenroy Gold. Ltd., for the year ended January 31, 1938. The loss in the previous year was £69. The directors, in their report, say that during the greater part of the year the company had to forgo its share of the gold won in order to keep the claim alive, this accounting for the loss being somewhat • greater than in the previous year. The directors have drawn no fees for more than three years, and the secretary, only £SO since December. 1935.

Recalling that at the last annual meeting, the issue of debentures to an amount not less than £SOO nor more than £IOOO was authorised to complete the outlet for tailings to the Glenroy river, the report says that the response to the invitation to take up debentures was slow, and it was only by the directors subscribing £l5O in a body as the Glenroy Underwriting Syndicate, in addition to their quotas as ordinary shareholders, that the sum raised exceeded £SOO, thus enabling the debenture issue to be proceeded with. Tenders were then called for the construction of a tunnel to the Glenroy river. After considerable difficulty in securing a reasonable price, the contract was finally let for £4OO, that sum including the driving of a 150-feet tunnel and a 30-feet vertical rise. The tunnellers made good progress, but after driving 150 feet, it was found advisable to proceed a further 10 feet before making the rise. The tunnel was finally completed at the end of August at a total cost of £475.

EMPEROR AND LOLOMA NEW TREATMENT OF ORE Experiments are being conducted on the Tavua field, Fiji, for treatment of telluride ore and, should they prove successful, it is expected that more gold will be produced at a lower cost than at present. The experiments pi’ovide for the extraction of gold by the flotation process. This announcement was made by Mr P. F. Cody, chairman of directors of Loloma (Fiji) Gold Mines N.L., who returned to Sydney recently. Mr Codv was accompanied by Mr W. H. Smith, chairman of directors of Emperor Mines, Ltd. Mr Smith emphasised that the experiments were being conducted to obtain the best results and to apply the process to the field. Results to date were encouraging. At present only oxidised ore was being treated, but later attention would be directed to the sulphide ore. Roasting of the Loloma ore was costly, and should the experiments prove successful a reduction in costs was confidently expected. Developmental work in the Loloma mine at 224 feet was disclosing rich telluride ore. The ore body was going down strongly below the level, and augured well for the future of the field at depth. Sinking of the new main shaft was in progress. In the Emperor mine a winze was being sunk from 300 feet to 400 fe-t, the depth at which rich values were being obtained in the Loloma mine. At this horizon the company was expecting better results. The new mills were working smoothly. f

The latest report from the Loloma mine is:—Main shaft, 224 ft level: South drive off main east crosscut at 60ft, advanced to 907 ft. Average value last 33ft, 35dwt a ton over width of 87ln.

GOLDEN DAWN The Golden Dawn Mine report for the month ended August 31 is:— Bottom Intermediate Level —Crosscut west off old pass driven 103 feet. Country rock is still of a splendid class for carrying reefs, interlaced with quartz stringers and mineral veins. We should cut No. 5 reef at any time unless the reef alters its underly as in No. 3 level. Under hand slopes on No. 1 reef south—Reef averages 13 inches. The ore is patchy. A bulk sample taken as above from August 22 to August 31, assayed £1 11s 9d a ton. A total of 40 tons of ore was sent to the battery from here. No. 3 Level—Sloping on No. 4 reef north. Reef averages 10 inches wide and looks well. A bulk sample taken from lip of pass from August 22 to August 3-1 assays £5 5a 5d a ton. A total of 135 tons of ore was sent to the battery from hero. Sloping on No. 2 reef north of old pass. Reef averages 18 inches and looks to bo improving going up. A bulk sample taken from August 22 to August 31 assays £2 7s Od a ton. A total of 100 tons of ore was sent to the battery from here. Sloping on roof going into west wall off No. 1 reef north. Reef 14 inches wide at present looks well. A bulk sample taken ns above from August 22 to August 31, went £2 6s a ton. A total of 70 tons of ore was sent to the battery from here.

In January fairly serious damage to the water-race was caused by a slip which carried away two chains of fluming. The repairs were done as cheaply as possible, but the total cost was £SO: A The,report goes on to say that has been subscribed in debentures, but the driving of thf tunnel, the repairs to the race and sundry expenses have exhausted that sum, and the directors have no working capital with which • to carry on. They have therefore applied to the Government for a subsidy and are now awaiting ,the decision of the Minister for Mines, the Hon. P. C. Webb. The directors say they are confident that the completion of the tunnel to the Glenroy river will enable the company to put a greatly increased yardage through the boxes, and they have every hope that those who have taken up debentures will be rewarded by seeing the company gradually find its feet as a result of their efforts. The retiring director, Mr J. W. Adams, and the auditors, Messrs Lyttle and Lyttle, offer themselves for reelection. MOUNT LYELL The Mount Lyell Mining and Railway Company, Ltd., progress report for the fortnight ended August 31 is: Extracted from mines—North Lyell 2890 tons. Crown Lyell 1969 tons. West Lyell 33,019 tons, Lyell Comstock 3461 tons. , , ■ Reduction works —Furnace m blast full period; 11,321 tons refinery anodes produced for current year. Concentrator: Mill operated 321 hours and treated 39,952 tons of ore. producing 1961 tons of concentrates. Copper refinery; Tank house in operation throughout fortnight, 522 tons cathode copper being produced. Total for current year, 11,372 tons.

ended July Experts. Imports. £ (N.Z.) £ (N.Z.) 1934 48,616.257 27.876.120 1935 43,320,686 34.381.111 1936 55.122,436 - 40.092,230 '1937 , # 64.765.292 51,389.669 1938 60.878,923 57.310,033 Net overseas Excess of Funds of Exports. N.Z. Banks* £ (N.Z.) £ (N Z.) 1934 20,740,137 39.017.379t 1933 8.939.575 43.245.793 . 1936 15,030.208 43,249,698 1937 13.375.623 34,914.005 1938 3,568,890 23,336.230 * On last Monday in July t On last Monday in August.

Liabilities Change from June 30, last 1938. year. £ £ Capital paid up 39,308 + 7,878 Loan account 4,500 + 3,000 Bank .. .. 15,761 + 12,440 Creditors 2,280 + 610 Dividends unpaid 2 + 1 Tax reserve 4.750 + 1,550 Appropriation account .. 5,680 — 147 72,282 + 25,333 Assets Land and buildiifgs 33.390 + 22,419 Plant and machinery 15,596 -2,815 Leasehold 615 — Water rights 70 — Stock 5,105 +455 Debtors 7,674 + 1,645 Wholesale licence 188. — Goodwill 8,000 -2,000 72,282 + 25,333 June 30, 1937. 1938. £ £ Gross profit 20,885 25,526 Net profit Dividend, per cerit. 8,446 10 9,983 10 Dividend, amount 3,142 4,362

ELECTROLYTIC ZINC The Electrolytic Zinc Company of Australasia, Ltd., production statement is:—* Four w’ks ended: July 27, Aug. 24, 1938. 1938. Zinc (tons) 5,382 5,352 Ol which used at 90 the works 90 Silver-lead product for shipment to Port Pirie for ** realisation — Lead (tons) 200 255 Silver (ounces) 36,100 37,400