“Bulletin’S” Comment.

Sydney "Bulletin,” after showing that this Company has paid 8 per cent, since 1923, while reserves, in 10 years, have grown from £6,126 to £227,815, says: The position is snug, and the steady 8 p.c. is free of income tax, excepting the unemployment-relief impost. The

management has never been talkative; hence the disclosure last year of £86,000 previously tucked away in inner reserves came as a surprise. The company was formed by the Carpenters in 1914, and it quietly built up a sound Island trading and finance business, concentrating principally in New Guinea and the Solomons.

Until slump knocked copra prices to the lowest recorded level (£10 last year), it was the invariable practice to put by more of the disclosed earnings than was distributed. Over the past three years the margin over 8 p.c. has nar rowed—last year’s net profit was equal to 11.3 p.c. on capital compared with 11.1, 12.5, 14.6, 20 and 19 p.c. back to 1928. The year’s £1,786 improvement in gross profits (£45,354) seems to have been mainly due to merchandising activities on the goldfields; the com pany started its own aeroplane service between Salamoa and Wau last January, and freight costs were reduced substan tially. To the close of accounts 500,000lb, of merchandise was carried.

Altogether results have been remark able, the returns on the new capital put up by shareholders, who have trebled their stake in the business over the past decade, being astonishing. Visible re serves stand at £227,815, and the chair man gave his assurance that the inner strength brought to light in 1932 was over and above ample provision for con tingencies. The outlook for the current year remains uncertain, but the directors say the company will be able to hold its position.

To reduce costs the company has been replacing its steamers with small Diesel-driven vessels, with satisfactory results. Two recent additions to the fleet are reflected by a growth of £12,000 in the book value of shipping property since 1931:

The company invested part of its spare cash in plantations, etc.; they were purchased at “bedrock values.”

These deals and the cost of two De Havilland ’planes are reflected by a growth of £23,242 in “branch balances,” an item which is more elastic than specific, movements therein not being of much significance to outsiders. In vestments (£127,698, up £7,041) include the company’s interest in its Solomon Islands subsidiary, whose £112,000 of ordinary capital the parent largely con trols. The pup paid 6 p.c. on its ords., as usual.

With only £15,501 of disclosed liabili ties, covered more than twice over by cash, the parent’s position is very com fortable. Branch balances, of course, may include other commitments, and much depends upon the soundness of book debts covered up under this blan ket, But the board is not the kind to overlook much when providing possible losses.

Visible backing for the shares is 35/per £1 of capital. The scrip stands at 42/- on ’Change; it stuck around 28/for years, but mounted rapidly over the past 12 months. Return at the current price is 3.8 p.c.

1923. £ 1930. £ 1932. £ 1933. £ Paid capital 100,000 301,667 301,667 301,667 Liabilities 12,410 9,655 8,215 15,501 Shipping property 9,530 18,533 22,668 28,075 Plant 319 1,484 517 477 Investments, etc.. 69,332 115,002 120,657 127,698 Stocks 1,189 3,400 1,013 32 Branch balances, etc 38,764 280,890 336,358 359,700 Cash 2,901 12,844 58,577 41,068