8 3 6 



REVIEW OF REVIEWS. 



October 1, 1913. 



balance of £44,000, makes the proprie- 

 tors' funds about £3,044,000. 



* * * 



The margin offered to depositors is 

 not a large one compared with that 

 offered by most of the other banks, but 

 it should be increased when the £900,000 

 of new funds obtainable from the new 

 issue of shares is in hand. This issue 

 comprises 20,000 £75 shares paid to 

 £25, with a premium of £20. The 

 shares will not be fully paid until De- 

 cember, on which date the capital will 

 have been raised by £500,000, while the 

 premiums of £400,000 will go to in- 

 crease the reserve fund. Unless the de- 

 posits grow considerably during the 

 period the margin shown in the March, 

 191 3, should be very satisfactory. 



It was not to be expected that the 

 bank could ask their shareholders for so 

 large a sum as £900,000 without pre- 

 judicing the market value of the old 

 shares. Those, six months ago, were 

 selling at almost £60, whereas at the 

 time of writing the current buying rate 

 is £53 17s. 6d. This, of course, is much 

 below the average price current for the 

 shares in past years, which makes the 

 stock rather attractive. The return is 

 nearly 6^ per cent., while there is in the 

 current price £44 6s. of assets value, 

 leaving less than £10 for inner reserves. 

 The buying price of the new shares paid 

 to £10 is now £26 15s., which is not 

 dear, seeing that when the balance of 

 £25 is paid up they will not have cost 

 the purchaser more than £51 15s. 



THE AUSTRALIAN WOOD PIPE CO. LTD. 



Though the report of this company 

 for the June, 191 3, half-year does not 

 show any marked improvement in the 

 profits, it is yet an encouraging state- 

 ment. The net earnings were £3364, 

 which is only £15 better than they were 

 in December. Still it should be remem- 

 bered that during the past six months 

 the company has been carrying out a 

 great deal of development work. In the 

 December period new capital to the ex- 

 tent of £13,000 was obtained, of which 

 only about £2000 went into property 

 and plant, the greater proportion being 

 used to wipe off the liabilities. A fur- 

 ther sum of about £7000 of share capi- 

 tal was obtained in the June period, 

 while the sundry creditors were in- 

 creased by over £9500 to nearly £9900. 

 This new money of over £16,000 was 

 spent in plant. The directors added 

 £7800 to the property and plant, making 

 it £22,400, while they increased the 

 stocks on hand by £6800 to £22,000. 

 At the same time business increased so 

 that the sundry debtors are about 

 £17,000, an improvement of over £3000 

 in the half-year. 



* * * 



All this extra outlay has had no im- 

 mediate effect on the published earnings, 

 but there would seem to be good reason 

 for it. This reason may best be set out 

 in the following quotation from the re- 



port : " A delay occurred in the delivery 

 of the power plant for the new factory 

 at Port Adelaide, and in consequence 

 the works were not employed manufac- 

 turing pipes during the period under 

 review, but the factory is now in good 

 working order, and a start has been 

 made on the company's contract with 

 the South Australian Government, and 

 it is expected that the New South Wales 

 Public Works Department will require 

 the company to make first delivery of 

 the 18 in. pipe for Umberumberka water 

 supply about the end of present year. 



From a shareholder's point of view 

 the half-year was not unsatisfactory, 

 for the profit earned was ample to pay 

 the customary 10 per cent. p. a. dividend 

 of £2500. The balance was used — £500 

 to reduce the goodwill account and £364 

 to increase the reserve account of £2524. 



Allowing for the goodwill, which is 

 now £3464, the surplus assets of the 

 company are now £49,200. This sum 

 being a little less than the paid-up capi- 

 tal of £50,149, the assets value per 

 share is not quite par. The market, 

 however, viewing the company from the 

 dividend side of the question, values the 

 shares somewhat higher, for they are 

 now being sold at 22s. 6d., at which 

 price the yield is over 8| per cent. 

 (Continued on page &kh-) 



