Tax Allowances May Help C.S.R.

Press, Volume CVI, Issue 31109, 12 July 1966, Page 21

Tax Allowances May Help C.S.R.

(N.Z Press Association—Copyright) SYDNEY, July 11. Taxation allowances are likely to assist the profit of the Colonial Sugar Refining Company in the current year by “nearly as much as in the year ended March 31, 1966,” directors say in the annual report and accounts released today.

They say tax benefits will also be available in later years to a smaller extent. In the year ended March 31, profit fell by only 132,592 dollars, or 1 per cent to 12,913,130 dollars in spite of disappointing sugar prices in the period.

Taxation allowances for shares taken up in mining ventures and investment in new plant saved the group from a sharp profit drop. Taxation provision was 5,806,005 d011ar5—2,703,587 dollars less than the 8,509,592 dollars provided for 1964-65. Commenting on sugar activities, directors say the five Australian refineries sold 590,000 tons of sugar during the year, an increase of 2) per cent over 1964, The lowering of sugar prices in New Zealand led to an increase of 16 per cent in the sales by the New Zealand subsidiary. Commenting on the Mount Newman iron ore project, directors say the venture seems likely to be enlarged, improved and made more readily financeable by becoming a four-party consortium.

Partners in the venture are American Metal Climax Inc., Cleveland Cliffs Iron Company," of the United States, Broken Hill Pty., and C.S.R. They say the “feasability study” of the Gove alumina project continues. However, the method of financing C.S.R.’s interests in the iron ore and alumina projects cannot be decided until details and timing of their capital requirements are verified. Directors say it is not known whether C.S.R.’s participation in the two projects will call for new fund raising by C.S.R.

It is not known what form the financing would take if required. Shareholders will be asked at the annual meeting on July 20 to approve an increase in capital to 85m dollars by the creation of 15 million new one dollar shares.

But the directors say there is no intention of issuing further shares at this time. During the year, the company raised a private unsecured loan of 10m dollars and a premium share issue was made to ordinary shareholders in the ratio of one-for-eight