Forum Archive Index - March 2000

["David Reid" <aspex@ix.net.nz>]

As posted at RNS London but the dividend is payable 28th March as an interim (1,0p)

 

CHAIRMAN'S STATEMENT

The  1999  net profit of #112 million is the highest  GPG  has
ever  produced  and, in the circumstances, is unlikely  to  be
repeated in the foreseeable future.

As  already  well  documented in previous reports,  the  major
component  is the #95 million surplus on the sale  of  Tyndall
Australia  shares.  Otherwise, the result is satisfactory  but
not  outstanding.  Nevertheless, the 1999 year as a whole  was
obviously  an  exceptional one by any standard of measurement.
If  the  sale of Tyndall shares had not occurred, it is likely
their realisable value would be much less in today's climate.

Notwithstanding the impression of a very buoyant  sharemarket,
it  is rather more narrow than generally realised.  While  the
technology  and  communications sectors have shown  remarkable
gains,  many  traditional  industry leaders  have  receded  in
price.  Suitable buying opportunities have therefore been more
prolific than originally anticipated with the consequence that
GPG's  level of reinvestment has been quite rapid.  The flight
of capital into speculative issues has been to GPG's advantage
as  a ^value investor^ but, ironically, has also been a factor
adversely  affecting  our own share price  performance.   This
distortion of relative values cannot endure indefinitely.

Balance  Sheet stability is the key factor in GPG's value  and
future  prospects  and, in this respect, the  position  at  31
December  1999  (or more positively, 1 January 2000)  is  very
reassuring.