YEAR REVIEWED.

Press, Volume LXVI, Issue 20103, 5 December 1930, Page 17

YEAR REVIEWED.

(Extended report by arrangement.) I

FREEZING INDUSTRY. NORTH CANTERBURY SHEEPFARMERS' COMPANY. The fifteenth annual meeting of shareholders of the North Canterbury Freezing Company was held on Wednesday last in the Chamber of Commerce, when the chairman, Mr J. H. Blackwell, presided over an attendance numbering between forty and fifty members, of whom a largo majority were producer shareholders. Chairman's Address. The chairman in moving the adoption of the report and balance-sheet said:— In submitting for your consideration the annual report and balance-sheet, I .join with rnv fellow-directors in thanking our producer-shareholders for the support accorded to the company. Twelve months ago, it was reported to you that very considerable guarantees of stock had been promised lor the season, and I have pleasure in informing shareholders that the numbers promised were exceeded, resulting in 1930 being a record for some years for killings at Kaiapoi. As doubts had been expressed in some quarters as to the reliability of those guarantees, I am confident that shareholders generally will appreciate the loyalty of our farmer-suppliers. The contract entered into a year ago for the sale of a substantial portion of our meat has worked satisfactorily, and proved to be to the benefit of the Company. The disposal of the other portion, however, on which we ourselves took the market risk, lias given much concern to your directors, as shipments arrived in London on a steadily receding market, varying for prime lamb under .'Mi's from 11-Jd in February to 8-} d in May, while weights from 37's to 42's were a penny less. Though prices firmed somewhat later, the r.verage price of these two grades to the end of June was fully Jd per lb less thefn for the same period in 1929. Mutton prices have been even more unsatisfactory, ewes selling in London for as low as 2Jd, and wethers 4Jd per lb. These are the lowest prices for many years, imported mutton being the only meat product selling at less than pre-war prices on the London market. Wool—The serious drop in wool values has naturally very adversely affected the season's results not only by the lesser returns for the staple itself, but indirectly in its effect on the returns for lambs bought in the earlier months of the season. Wool losses alone represent a very substantial portion of the year's deficiency. liye-I'roduct.-i—The general fall in world prices has also swept with it values in nearly all bye-products, forming part of a freezing company's business.

Pelts—The market both in Britain and U.S.A. has slumped badly, one factor being heavy supplies from .Russia. tViih the leather market very depressed, prices for New Zealand pelts are back to pre-war level with no present sign of improvement. Tallow has also suffered a severe drop in values. Heavier killings throughout New Zealand have increased the supply, but tallow also suffers from increasing competition for the purposes for which it is used. One such competitor is whale-oil, of which a large increase in supply seems certain. Its use in margarine is also affected by the disastrously low prices ruling for butter. Casings have been particularly affected by price slump. Synthetic casings made from wool fibre are being marketed. A bigger factor has been heavy supplies from Russian sources. The drop in casings equals 8d per lamb. Small Goods prices have been similarly affected; rates for tongues, kidneys, etc., all being substantially reduced. Considerable inconvenience and loss were caused to the company and to producers, by labour difficulties at the busiest part of the season. No cause of trouble existed between the company and its staff, yet, on account of a dispute in another province, Canterbury works were held up temporarily by a "go-slow" policy among slaughtermen. Wiser counsels eventually prevailed among the workers, but not before the killing capabilities of the works had suffered serious curtailment at a time when there was urgent need for every hook at full capacity. In addition to direct loss to freezing companies, thousands of pounds were lost to stock-owners, owing to their inability to get stock killed at that time of feed scarcity. It wil l be seen that the past season has been a difficult one for the freezing industry, and one of considerable anxiety to your directors, who regret that results as reflected in the balancesheet, ihow that the trading loss exceeded the company's revenue from charges by £5411 9s 4d. This amount your directors recommend to bo added to the balance of appropriation account. Since the inception of the company our policy has been to kill, freeze, ship, and sell to best advantage put in to us by producers on their account. This has been done carefully and efficiently, and we believe our producer clients are satisfied that we have obtained for them tho best results possible.

The proportion of farmers who are both willing and' able to curry their own market risk is not large, and is not growing. Since the commandeer period the bulk of stock handled has been bought at ruling rates, and consigned to Great Britain, where it is sold, c.i.f., ex-ship, or through store as may seem best. The experiences of the past few years show that the uncertainty of priees in London realising New Zealand cost of stock plus charges, involves a speculative risk, which has been the cause of this company's heavy losses. Last year your director's made a contract for sale of portion of our output, which has proved satisfactory. In view of the above-mentioned facts we again took up the question, and, through our agents, have effected an agreement for the sale of the remaining portion of output on satisfactory terms. This will eliminate entirely the risk of selling our meat and wool on consignment, while enabling us to pay market rates for stock. The control of the works is unaffected and remains entirely with shareholders of this company—through its directors —and every producer has maintained for him the "open door" to have his stock handled on his own account. Under these conditions, your directors look forward with confidence to steady regular improvement in the finances of the company, and increase in the benefits which this company has given to the producers of North Canterbury. During the year particular attention has been given to the maintenance of the works in first-class order. Sundry renovation? and additions make the Kniapoi works better fitted than ever before to handle our business in the most efficient and economical manner. Overhead costs have been reduced, and every avenue of effecting economies and improving efficiency is under scrutiny. It has been sometimes said that there are too many freezing works. In this connexion a study of the sheep

statistics is very illuminating. The total flocks in New Zealand show: — 1922 ... .. 22} millions 1926 .. 25 millions 1930 .... 30J millions For the past eight years in succession an annual increase has been shown, totalling in that time 8} millions, of which 5} millions have been in the last four years. Still more significant is the increase in breeding ewes:— 1922 .. .. 12J millions 1926 . . 14 millions 1930 .. .. 17J millions Of the total flock increase of 8£ millions in eight years, five millions are breeding ewes, of which 3$ millions are in the past four years. Of special interest to us is the fact that since 1926 South Island flocks have increased by per cent, compared with 13 per cent, for the North Island. The figures are arresting, and, with modern methods of pasture improvement, are likely to increase further. The building up of her flocks and maintenance of her famous high quality are very important factors in the future prosperity of Canterbury. Last year the existing works were working at highest pressure for over two months on account of the dry autumn. Had one works, such as ours, been not available, it is safe to say that the effect on stock prices would have been serious. Since our works were built the export of lambs from New Zealand has almost doubled, and the rapidly increasing numbers to be treated show that our company provides necessary and indispensable services to the stock community. The most reassuring feature for the coming season is the consumptive capacity for lambs of the Home market in the United Kingdom. Since 1922 New Zealand has increased its lamb exports by 50 per cent., or over two million carcases. Australian supply has remained at approximately an even figure, but South America has more than doubled her exports, the increase being three million carcases. These three countries this year sent to Great Britain over thirteen million carcases, as against less than six million pre-war, and nine millions in 1926. This is a remarkable increase, and a wonderful tribute to the absorptive capacity of the United Kingdom market, and incidentally to the popularity of Canterbury lambs. Though price is bound to be affected by the growing South American competition, with careful attention to quality Canterbury lambgrowers should command a ready market for their increasing supplies. As present prospects are for a record lamb export in 1931, your Directors have provided extra hooks to enable our share of supplies to be handled more expeditiously and to minimise as far as possible delays and loss to producers by congestion in the height of the season. Mr Alfred Fisher seconded the motion, and in the course of his remarks said he thought farmers had cause to be proud of the directortate for having presented a balance-sheet which, though not exactly what they would like, was much better than an ticipated. The company was holding its place as a farmers' works should, in competition with other firms, and so long as the present policy of the directorate maintained this position the farmers would be well served. In face of falling markets he considered the directorate should be congratulated heartily for having brought the company through a very difficult season. Mr H. E. A. Lock said that as one who had taken a keen interest in Kaiapoi works for some time, ho supported the previous remarks. The speaker instanced a line of sheep which returned him several shillings per head more at the works, compared with what he was offered in tho Yards, and he expressed his intention to continue his support to the works, and hoped that- his fellowshareholders would do likewise. Mr J. E. Austin said that he had stood for the directorate of the company, and had been an advocate for the past four or five years of amalgamation of all the freezing works in the South Island. He referred to the enormous cost of so many freezing works, and the overlapping of stock travelling from one district to another, which lie estimated would run to about 15 per cent, of the working cost. Mr Austin said that freezing companies would have to economise to bring down the cost of production and this would be quite possible if all the freezing works in the South Island were amalgamated. Mr James Carr, referring to Mr Avistin's remarks, said that while a reduction in costs was a desirable thing, lie did not consider such an amalgamation possible at the present time, for we were living in a world of reality, where competition was keen, and where business interests were of necessity in conflict. Mr Carr said he would support amalgamation only if all the companies could be brought into line, and not have one outside enjoying all the privileges. Following upon the adoption of the report and balance-sheet, the chairman announced that as a result of the balI lot Messrs J. W. Black, H. G. Parish, James Carr, and C. T. Jessep had been re-elected to seats on the Board, and these members in turn thanked tho shareholders for having returned them. Mr J. W. Black, in the course of his remarks, said that he hoped the shareholders would afford loyal support to the company during tho coming year by sending in all their available stock to the works; for if this were done he felt sure the next balance-sheet would be very much better. He ■ considered that shareholders had received a bonus on their stock by virtue of the prices paid, even though no dividend had been possible. Mr Carr, in returning thanks for his election, mentioned the happy relationship which had existed during the past year between members of the Board, which, in his opinion, had materially assisted the work of the directors of the company's interests.

Mr Colin Mcintosh said: "As one of the directors who did not have to fa!e the ballot, I should like to thank the shareholders fir thoir practically unanimous vote of confidence in the old directorate, as declared by the recent ballot. It is very encouraging to us to know that yon are satisfied with the directorate as it is at present, and it gives us heart to carry on as we have been doing. We have watched all expenses very closely, and wherever economies were possible they have been effected." Referring to the unfortunate dislocation of killing in April, when so many of the Canterbury freezing works were affected by the "go-slow" tactics by the slaughtermen, and which cost the company a considerable sum of money through the stock losing weignt and having to be returned in many cases to the farms, Mr Mcintosh mentioned that a considerable area of ground adjoining and belonging to the works had now been shut up to produce hay, which would be in readiness to feed the stock at the works if such an occurrence came again. Mr Austin then thanked the shareholders who had voted for him, and congratulated the successful candidates at whose hands he had suffered such a severe defeatIt was decided that the audit in future should be done by one firm, and the appointment and honorarium was left in the hands of the directors.

A hearty vote of thanks to the staff of the company for their services during the past year was carried unanimously, to which Mr E. T. Shores responded on behalf of the office staff, works staff, and buying staff in the field. Before the meeting terminated, Mr Blackwell said he hoped, that during tke

coming season the company would be able to increase the number of stock killed, and with the loyal support of all the producer shareholders he hoped it would be possible to show a satisfactory balance-sheet in twelve months' time.

GOLDSBROUGH, MORT.

INTERIM DIVIDEND DEFERRED.

The following advice has been received from Messrs Goldsbrough, Mort and Co., Ltd., Melbourne, under date December 3rd: "The directors of Goldsbrough, Mort, Ltd., make the following announcement : In view of the serious drop in prices of al) primary products In which the company is interested, and of the disturbing political and financial outlook, the directors nave decided not to recommend payment of an interim dividend, but to defer consideration of a dividend payment until the figures for the full year ending March 31st next are available. Tha ordinary general meeting will be held on December 19th."

The interim dividend paid in December, 1929, was 5 oer cent., and i® June, 1930, a final dividend of 5 per cent, was also paid, the total distributed for the year' being £200,000. In March, 1930, the capital was increased from £2,000,000 to £2,400,000. The net profit in 1929 to the end .of the financial year—March 31st—was £318,647, and in 1930 £190,819. The reserves at the 1930 balance totalled £2,074,644, which included £187,500 premiums on shares in 1936 and 1928, and £200,000 in 1930.

REACTION IN SHARES. (Received December 4th, 8.80 p.m.) SYDNEY, Deoembef 4. Goldsbrough, Mort shares reacted today following the announcement that no interim half-yearly dividend was being paid. THE INVESTMENT MARKET. CONDITIONS IRREGULAR AT SYDNEY. (UKITBD PRESS ASSOCIATION —BT SI.ICTBIC TELEOEAPB—COPXSIGHT.) (Received December 4th, 8.30 p.m.) SYDNEY. December 4. The investment market, generally, is most irregular. Commonwealth bonds have strengthened slightly, and a large volume of business is being done. Bank shares have also firmed, except in a couple of instances. Bank of New Zealand shares are again a bit weaker at 575. OXFORD MARKET. The Oxford nfcrket yesterday was a small one, and business was dull. In the sheep yards, out of an entry of 304, fewer than one-fourth changed hands. The sales were:—Six fat wethers at 16s lOd, 12 fat ewes at 12s Bd, 10 four-tooih wethers at 12s, 10 at 8s lOd, and 19 ewes at 3s Id. There was an entry of 25 cattle. The sales were:—One springer at £lO. 1 at £9. 1 at £7, cow in profit £4 13s. bull £4 10s, 3 yearling steers at £3 16s, 2 at £3 ss, and 2 yearling heifers at £2 lis. Eighteen weaner pigs made from 27s' to 81s each. (CONTINUED ON PAGE 18.)