NEW ZEALAND SHIPPING COMPANY.

Press, Volume XLIX, Issue 14829, 21 November 1913, Page 12

NEW ZEALAND SHIPPING COMPANY.

REARRANGEMENT OP CAPITAL

(FROM OVn OWN' CORRESPONDENT.) LONDON, October 15. Following the usual custom, the annual general meeting of the Now Zealand Shipping Company was privuto.. Subsequently a eaort official account of tho proceedings was issued. In addressing tJio shareholders, tho Chairman (Mr W. C. l>awee) made the following remarks regarding the pro-' posed scheme for tho rearrangement of the company's capital:— "Ie will be remembered by old shareholders that some 23 years ago the position of tho company was very different from what it is to-day. My father, Sir Edwyn Dawes, had then recently become chairman-of tho company, and he deoided on the rather drastic step of writing off the sum of i$ from each ordinary share of £10,. a course of action which, 1 think you will agree, has been fully justified. Since than the directors have looked forward to the time when tho £2 could be replaced without weakening the financial position of the company, and in their opinion the time has now come. In the balance-sheet for the year ended June 30th, -19152, there appeared for the first time a new item, 'capital reservo £209,116.' Since that date capital reserves havo been increased, and after this capitalisation has been effected sufficient reserves will be left to maintain tho /'company's strong financial position, and the reserve and insurance accounts ahowu in the bal-ance-sheet now before you will not need to be trenched, upon. "Shareholders will notice that power is taken.to create £1,000,000 bus. per cent, cumulative preference ebaros, of which, under the present scheme, only £'226,000 will bo issued, and the bal* nnce will bo available to provide for future capital requirements. ( It is not the intention of the directors to make any further isauo of shares at present, but in view of the natural exiMuision of the company's business they consider it wise to put themselves in a position-to raise further capital whea it is required. Not so very many years ago steamers, in every way suitable for the company's trade could bo built for about £75,000. To-day 'a | steamer which will .satisfy the requirements of our shippers costs more than i£200,000, and shareholders will understand that as the older steamers have 'to be replaced, and the fleet increased by the addition , of these expensive vessels, the capital outlay required is very large compared with what it once was. It is perhaps hardly necessary to say so, but I think J should point out to shareholders that such a capitalisation of assets as we propose does not necessarily increase the earning capacity of the company. It eiaiply enlarges the nrea over which the available profits will have w> be spread." A dividend of 16s T»r share (of which 8s per share was paid in April last) was declared, free of income-tax, and the retiring directors were re-elected.