WOOLLEN COMPANY.

Dominion, Volume 3, Issue 916, 8 September 1910, Page 4

WOOLLEN COMPANY.

——-* —— - ;. _ ANNUAL MEETING. ' "A YEAR OF STEADY PROGRESS." AN OUTSPOKEN r CRITIC. •-; Between twenty and thirty shareholders of the "Wellington' Woollen Manufacturing , Company, Ltd., attended tho twenty-seventh., ordinary general meeting, which wa's held in tho hall.of the Chamber of Commerce at noon'yes'tofday. Mr. W. HV P." Barber; rchair- - man; of directors, presided; ' ' • In moving tho adoption, of the report . and balance-sheet, the substance of which has already been published;. the. chairman' said that a 'cursory glance- ,at the balance-sheet would reveal there .was.little, if any, necessity for explanations, whilst a closer examination of the figures would not only" confirm this; but would show the affairs of the company to be in a sound position. .The balance-sheet. was set ..out ■ more fully than was 'usual. withmany ,institutions, so. that there was no need for him to' detain them with repetition of, what was quite,clear. : However, he wished, on behalf of the board,, to draw special attention to a few .comparisons'.' "In .comparing this with last year's balance-sheet, , ' Mr. Barber continued,- "it will be seen' that during the period under. review we have , reduced our indebtedness by £22,600, although the amount.called on shares, including payments in' advance, has only ■increased_ by ■ £66891 A ". satisfac--tory feature is the decrease iii ■' the amount of stock,* which ; shows a diiction in.' gross value of. £12,097." ' It may perhaps be claimed' that; the cut-ting-down of'stock.' is calculated to restrict sales, aiid, of'course, if carried too far, this; would manifestly be so, but the 'directors, whilst carefully guarding , against a. too drastic limitatibri, feel better'content to be Holding a low stock; more especially at a time when wool prices are high, and -may recede at any'moment. ' •";"■ . .-■ '""■■ : " Record Sales. • ;■'"'■ ■■ ■' "I ani , pleased to be. able to'say.'that sales for the' year.' have • ■ considerably' increased, in, fact;.'they ''■■■ establish a .record :for the company,'and it is.satis-', factory, to "'know- that the book-debt's are only; some £1509 higher than _:tiiu" previous year;.whilst tho amount ofbills uridei' discount is less by', £1761. This'speaks' well; for' -the class '' of .accounts we have', and indicates : also: the careful attention given to col-' lections. Bad debts have been ■ written' 'off, and, as will be seen, ample provision made ,for; contingent losses.- ■ We. have' '.in our 'sundry-debtors' a liquid asset, :more "than enough to- cover all we.'owe,- . and another in : our. stock covering , tlip outside liabilities, four times over.-. You will .notice, on the _assets. side that a, "change.-;has ; been'.made 1 in showing-.the freehold land/, and. plant separately;; the reason 'for..'this-.being that we;desired ■to let. shareholders know of .the valuable; asset they have'in'.their, land-—£l2oß is, you will admit, 'a ,low suni';fqr ;17J' acresi of.land. (with its valuable water, rights) 'at :Petone,. and" the directors will probably.-later consider, -the;.'advisability : of revaluing^;it,'' bringing; it ■tip |tq, - say,;/ Government land ■ tax 'valuation. ;.\ '-'i :":/""' .-,' -..";"" ..;. ;•- : -Providing-'for Possibilities"" '■■' .-'.' ■'f "Turning .to ffie'profit and. loss;' ac-. count, .tho debit side shows,, excluding, the £3000 depreciation,' a' reduction , *of £1743,'. which in the face of a • much; •la'rgor .'.business . isVaitdesirableivreßiilt. Last .ye,ar,a;sum 0f,.£2000.,.was written off. the stocky and ;the:directors have..deemed it prudent to-'again .follow ■'ai similaricourse,. an,d;liave. written:'off'] £2500. '\'siui' m'e'th&l. i'sjVat. -this; jurictur©,';d«?med -preferable, to ca-rrying the undivided profit.'.-to Ireseryo, , '' account,. where it would not be'.available, should ke«j|ier.competition.or a fall/in,raw ma-i terial in .the 'immediate'.future necessi-' tate a., lowering of - sale , prices. In 'the. matter, of preference shares J the ;direcin keeping•:with' an expression., of ■opinion^a-t;'th^'-tim6",of'the .flptation, that. it.'iyas; unlikely ,'niore\than"sos. a : 'sharetwould be required, 'haye.for the present discbntiikiedV making ■■callsj - andthey, .at present, do not' contempliito. a -resumption." . The 'further, allotment .of preference, shares : was also- stepped, and as. a -result they are now quote'don the Stock Exchange, at above par; .Looking, 'aV/the. favourable, .terms.on.which ; : they were:issned, -'and the"'excellent.'-security; s\ippoi'tmg : themj there seems-to Jbe'hb ' reason i'why;' if Hhey' reoeive : fair treatj. ment,, they, should; not .promptly.preach a'substantial preitihim. " ;.' ;" v ".,' -.' H;?; VSteatly Progress." " "" '■'.. "-The ...year ,ha.s/beeii one ,of ; . steady progress, and; tho;,di-rcctbrs, : : by .tho -increasing. donjand: for t-he. com.paay's : manufactures, have, agreed to aii. ejrteneipn; at'the mill,- also the;:installation of'; some ■ new machinery,: to iuorease. the. output, and to obviate.- as '.much'-as .possible the present- necessity for overtime—ran expensive aii'd-'ufisatisf'-i factory, method of < conducting operations.: .The company is one. of ■ 'the largest-employers of; labour in the community/ the- number of employees-at present being just under 600, the wages totalling: over £41,000 ]&. year.. lii conclusion, , I have te tho thanks of the. directors ; to' the officers, -heads, of departments, and staff generally for their,efforts, to bring• about a successful year, v 1..-beg to: nipvo , 'the .adoption of the, report and 'balance-sheet, whioh. carries with-it a dividend-0f.7 percent, for the year..- It is interesting to note .thatthis dividend returns to;holders' of '. original shares , the full.' amount of the ■capital ca11ed."..,-(Applause.). ■-. -..: ;;" ■ The -motion was 'seconded by Mr.- j. B;Blair.'.'.■■■■:.--.■:. .:.■-.■ ; "' , : . .'■"" Cbrigratiilation and Criticism. :Mr.: A. Warburton said the : report and accounts showed '■ an excellent position,'- on \vhich he desired to congratulate_ the directors and shareholders...He noticed ■that -the directors had - put back £2500 as a special discpunt,, in-, eluding an increase of £500.:': He would like to see a considerable increase in that reserve, .because he -objected te the policy adopted- last yearljbf the interest., on- borrowed niqney upon the stock,; and thus adding ;jt ; :to r the cost of manufacture;' and aliio because of-tho disorganisation and-braaking'up-bf the Manufacturers' Association and the-, consequent. cutting . of .prices, to meet which arid hold .its own the company would need all its reserves. Ho considered that the stock of.' tho company had been reduced to a dangerous minimum, a state of affairs that was" detrimental to progress and. profits.'' Tho little saving that ..had been made in interest by means of reduction of stock was not commensurate .with' the profits that would have been.made if the manager had had the goods to sell. Tlie policy 'followed in this.matter had been a suicidal one and oho result of it was that the mill-was now running overtime, involving .the ';paymont of wages at the rate of; and .a half. That would have to'go on until the' stock was replenished, if the' directors -wished to keep up the business. The question of management was a very sorious one. Tho directors "had taken control of thb:business out of the hands .of the officers, and. the business was now conducted directly from the board. ,-Ho approved the formation of a. small .executive committee - of : the board, but not of the 'committee' taking so much of the management upon itsolf. It was in:thoso two questions—the reductions of stock and the'manageinent—that thedangers of the'company-lay.;: ■In conclusion, he again .•congratulated'

the directors on showing such.afinfj balance-sheet, but-.he-thought the dijf yidend could have, been 8 per cent, in-f stead of 7:per cent for the: year, ,ij : they had had the stock to sell. '•■■:' A Glaim on Support. '■ : Mr. G. M. Kebbell mentioned that the company was paying £41,000 a year in wages. People hardly realised thisj. and he questioned whether 'in view of this grant, the shopkeepers gave .'.-the company the support they ought. (Applause.) ' : , Mr;, J. P. Maxwell remarked that he was glad Mr.'Warburton had been ablij to congratulate the company on having sucli a good balance-sheet. In doing that, he-had supplied the •answer: to his own pessimistic, expressions.: :■ ■..-.'" The Chairman's Reply. v ' Tho chairinan,' in reply to Mr. Maxwell's said the '.reduction of stock: had enabled to savis £1000 in' bank, interest.- It-was right to reduce the slock when wool was atthe top of the market. \ If. it- fell, they would be able to manufacture. more cheaply. The mill had been kept working up to, its full capacity;'■ throughout the year, in fact, .it, had been , .working overtime at certain periods,'- as , it was now. It would' have been : suicidal tb refuse to sell the goods at a prolit lrheii they ..had the opportunity. In regard , to tho question of management, the only interference by the Executive Committee was by. way of inquiry into tlie financial stability of clients,, and. by this means the company .had beeti saved a good.deal .of money.' The. company was'in a sound financial position, and there was nothing to-fear for : the future. .. ;..■.;' ■• > ..-.. ■ ■-. ' , .;. ■;■. If. -.After some further, discussion, thV report and baalnce-sheet were adopted. : Messrs. Kember and ; Soii, : :ind E 'W/. Hunt, IU.A.N.Z., were re-elected, auditors, and their remuneration was again ;fixed at; 75 guineas' for the year, -•'.. Directors Re-elected. ;ri : The retiring' directors',, Messrs.' W., H-. 1 , . Barber, and. W: 6. Foster, : offeree! themselves for -.re-election. ~ j'Mr..-.. Arthur Warburton had also been .. nominatecl. Ballot papers had ..been issued, being made; returnable at the hour of nieei;ing. The auditors were appointed-scru-tineers.- During the afternoon, '"they 'declared the result as follows:—Barber, 2626;/Foster, 2562; Wafburton, ;57fi; informal" vote's, '271. "Messrs..'.: Barberand Foster were thus re-elected. •;>,. ; . : '| ;