WELLINGTON GAS COMPANY

Dominion, Volume 9, Issue 2696, 16 February 1916, Page 7

WELLINGTON GAS COMPANY

THE ANNUAL MEETING. Mr. "W. Ferguson presided at tho annual meeting of the Wellington Gas Company, held yesterday afternoon. In his opening remarks, the chairman said that iii common with every,other industry their gas businesa had been materially, affectcd 1 through tho difficulty, and, in some cases, 1 through tho inability to obtain supplies, and tnc increased cost thereof; also through the reduced. spending powers of the public, producing economy in the uj>o of and militating against fresh installations of gas appliances; through the absence of available labour and. its increased cost, and through the increased rates? of interest which the board had found it desirable to give in order to reasonably secure its finance from possible serious disturbance during the next twelve, to eighteen months. Notwithstanding these adverse circumstances, the working of the year had been on the -whole satisfactory. An unfortunate and not to bo foreseen accident occurred in April last, involving the loss of the lives of five men. There was a considerable sum that had to bo mot by the company iu settlement of claims, apart from the public risk policy. After a reference to the company's con* tributions to the Patriotic Fund, and for tho support of it£ employees who volunteered for active service, the chairman proceeded to deal with tho balance-sheet. An item additional to the expenditure of previous years arose through the necessity for carrying a larger stock of coals. Had. it not been for this the balance-sheet would have sliowu a larger margin by nearty £7000. To provide for the obsolescence of tho old plant at the city "works, "Immovable Property" had been written down by tho sum of £50,CCti. Tho land had been taken at tho Government (1914) unimproved values, £61,411, a considerably higher figure" than that at which the land previously stood in the books of the company—£l7,279. ' Plant and other fixed assets had been ) valued prudently, and there was no allowance for that valuaoic, but ill-denned, asset that might be described as "goodwill," or as tho value of the franchise held by the company. It wen not considered that tlus writing-down of assets should affect the market value of the shares, which should depend upon the earning-power of the business. The formation in the past of various reserves provided funds out of . -which this revaluation could be met. "tn order to form tho nucleus of the j fund to provide for this- obsolescence or ' iho old works, at the ond ot the year 1905 the amount of the premium capital account arising from the shores isued in . 1903, and amounting to £12,306. wa car- , .ned to a reserve fund, and the identity ot that sum bccamc lost. On the shares issued in 1908 a premium also was received which has appeared in your ixilonco- > sheet as tbe < sum of .W0.693 10fi. 7d. Tour diror'.tors, being of the opinion that both sums should appear premium capital, recommend that the £12,306. of 19M, should * be brought back from reserve to the prcmiiun capital account, raising that item to £42,999 10s. 7d.; .the balance-sheet before ' you bus been prepared on that basis. "My doing tMs there is a sum of £12.694 ; left, in the 'r ojrve fund.' which it is proi posed to write ofl' with the amount 6f i 'works extension reserve* £30,0D0, the 'old % works dismantling account' ,£4219 ss. £d.. ulm) a sum derived during 1915 from profit > on sales of material from the old works I of £174 19s. Id., and to take from.the profit and loss account of this year the sum . of £2311 15s. 5d., making in all the sum , of .£50,000 to be written • down from the value of the 'immovable property.'" Tho works at Mini mar had been in use 5 during tho whole of tho year with satisfactory results, but owing to the continued i- increase in the cost- of coal and other ma- - tenuis, and of labour, the savings which j- had obtained from the adoption of the vertical system of carbonteatiou had been * largely absorbed. It. was estimated that, i notwithstanding the economies gained by s the adoption of modern machinery for > coal-handling, and by the abolition of d cartage, the increased cost of the coal and . labour during the past eight years had ' been such as to amount to a charge of ; 6d. per 1000 feet- of gas sold; and there I appeared to be every prospect of a still * further increase. f The report * and were t adopted. Di\ C. P. Knight and Mr. J. D., Nathan v7cro re-elected <is director?, and Messrs. V\. Wilbcrforce and 0. S. Watkins were appointed auditor* for tho ensuing year. The meeting wa-s adjourned until next Tuesday.