Startling Announcement
p. 12 · Read in the full issue
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Startling Announcement by South Seas Co.
AVERY interesting announcement has been made by the directors of Burns Philp (South Seas) Co., Ltd. The company, which is registered in Suva, has an issued capital of £750,000, and re serves totalling £630,000, which are used in the business. The company operates in Fiji, Tonga, Samoa and New Heb rides. The parent company covers the Western Pacific.
The net profit made in the year ended January 31. 1946, was £80.401. compared with £49.000. £112.000 and £96,000 in 1943, 1944. and 1945, resnectively. £BO,OOO re presents 11 per cent, on the issued capi tal, but only 6 per cent, on the total funds employed.
It is noted that “Investments,” which were only £250.000 in 1943, had increased to £500.000 in 1945, and are now no less than £1.133.000 —proving that the com pany has a huge amount of surplus canital.
The directors, in their latest report, say this: “Wartime conditions, coupled with enemy invasion of certain Pacific Ter ritories, necessitated the withdrawal from the Island trade of a substantial portion of the company’s working capital.
“It was anticipated, following the termination of hostilities, that the op portunity would return for reinvesting these funds in erstwhile channels of employment.
“However, as it would now appear that one of the most important fea tures of Island trading, namely, the purchase, handling, oversea shipment and marketing of conra, is likelv to remain a function of Government at most centres for an indefinite period, and having regard to the probable con tinuance of other restrictive factors inimical to the profitable re-emplov ment of these surplus fund*, your directors have under consideration the advisabilHy of recommending to share holders that half the subscribed capital of the romnanv be returned, thus re ducing the value of the shares from £1 each to 10/- each.”
NOTHING could be plainer than that.
The handling of copra, apparently, is to remain a function of the vari ous Governments of the British Com monwealth, and so a large part of the usefulness of the big trading firms dis appears. Read the announcement, else where in this issue, by the Australian Minister, Mr. Ward, concerning the future operations of his Production Control Board, in Papua-New Guinea.
Another big South Seas company, Morris Hedstrom, Ltd., is in much the same position. Its last published ac counts showed subscribed capital £740,000; some £270,000 in reserves; net profit £86,000; and investments and Govern ment stocks, £BOO,OOO.
The parent BP company, operating in Australia and Western Pacific, has £2,000,000 of issued capital, more than £2,000,000 in reserves —and about £3,000,000 in Government securities and similar investments!
What is going to happen to all this capital? Presumably, as the Govern ments are cutting out means for its profit able employment, it will be handed back to individual shareholders; the latter, for the most part, will invest in Govern
ment loans; and a great part of the money will be frittered away by politicians.
It is a grim outlook, not only for “capitalists” generally, but for the whole mass of people. But, of course, they will not see the danger, until the whole economic structure falls in on top of them.
In the Western Pacific High Commis sion Gazette for March 5, the deaths of two Commission officers were an nounced. Mr. I. G. Bates, who was Chief Magistrate and legal adviser of the BSI Protectorate, died on November 23, 1945.
Mr. F. Keeble, who was storekeeper of the Government Trade Scheme in BSI. died on January 30, 1946.