WELLINGTON GAS CO.

Evening Post, Volume CXV, Issue 31, 7 February 1933, Page 8

WELLINGTON GAS CO.

YEAR'S OPERATIONS

SHAREHOLDERS CONGRATULATED

PROFITS AND TAXES

The annual meeting of shareholders of the "Wellington Gas Company, Ltd., was held to-day. Sir Harold Beauchamp (chairman of directors) presided.

In moving the adoption of the report and balance-sheet, which have been published in "The Post," the chairman congratulated the shareholders upon the results achieved, more especially in view of the adverse economic conditions with which all classes of the community had been faced for two years or more. The profits earned warranted. the board in recommending a dividend of 4 per cent, for the last half of the company's year, which, with tho interim dividend of 4 per cent, paid in August, would give a return of 8 per cent, for the full year, and permit of carrying forward £14,394 6s Id. TKANSFEE TO EESEBVES. "You will note," he said, "that substantial funds have been transferred to certain reserves, all of which make for financial strength. Our revenue for 1932 is smaller than that for 1931, but that is accounted for chiefly by the reduction of threepence per thousand cubic feet in the price of gas, which took effect as from August, 1931. That concession in price affected our consumers to the extent of not less than £7800. . , ■ "The gas consumption shows a decrease of almost 4 per cent., but that will not be a matter of surprise to you. Bad debts have been rather larger than usual, tut our staff, in spite -of the difficult times through which we are passing, is doing all in its power to reduce these to a minimum. ''With the exception of coke (for which there is an active demand) our revenue from the sale of residuals, shows a considerable reduction. The manufacture of an improved tar product known as 'Bitural' was undertaken during the latter part of the year. This material -was' first developed at the works of the Metropolitan Gas Company, Melbourne, by Mr. G. H. Broadhead, the chief engineer of that company. It has been fully demonstrated by _ practical tests that this new material compares favourably with imported bitumens. BURDEN OP TAXATION. "The falling off in income from rents and the lower return due'to the imposition of a 10 per cent, tax on interests from inscribed stock, have also affected us adversely; altogether the reduction in income totals £17,485; the expenditure, however, was correspondingly reduced, so that the profit is only £4295 less. "We pay income tax at the rate of 4s 6d in the, £ plus 30 per cent., or 5s 10.2 din the £. The amount provided this year for rates and taxes, including income tax,. was ' £27,952, which is £1420 greater than the dividends paid to the shareholders. Taxes in 1932 amounted to 13.4 per cent, of the total revenue from gas sales, being equal to 10.7 d per thousand cubic feet of the gas sold. ' ■ "As many of you are aware, the Government provided, in the Finance Act of 1932, for the payment of income tax by instalments. Advance payments of income tax are accepted in sums of one pound or multiple thereof, and such payments bear interest at approximately 3| per cent, per annum. Advantage was taken of this provision and. payment of income, tax applicable to our year ended 31st December, 1931, was made by the purchase of income tax certificates. The amount owing by the company, viz., £27,859, included an estimated provision, to cover income tax for our year ended 31st December, 1932. "Following the resolution passed by the shareholders at the last annual meeting, the company has continued to co-operate with the Associated Chambers of Commerce, and with the other gas companies of the Dominion in their efforts to persuade the Government to place municipalities and power boards supplying gas and electricity upon the same footing regarding taxation as companies. It is remarkable that the Government, so greatly in need of revenue at the present time, still hesitates to pass legislation to remedy this unfair condition. A start in this matter could be made by municipal trading concerns and power boards being required to affix stamps on their receipts in the same way as all other concerns. "In connection with our superannuation scheme, it will probably interest you to know that there are now 181 employees' assured. The total life cover is £119,500. The amount paid by the company for premia last year was £2429. .As most of you are' aware, the board established some years ago a Sick and Benefit Fund. The board subsidises this fund £ for £ on the contributions from the employees. This enables members, by paying 6d per week, to receive £.2 weekly for a period of thirteen weeks during sickness. The cost to the company was £229. Both, these schemes are working satisfactorily. The total wage 3 paid by the company for the past financial year amounted to £58,200. The company's policy of making adequate provision for depreciation of plant, machinery, and buildings has been maintained. The amount written off for the year was £21,412. On the 22nd July, 1932, debenture holders were advised that the rate of interest on debentures issued by • the company would be reduced to £5 9s 2d per cent, in terms of the National Expenditure Adjustment Act, 1932, but since then ■ there has been an amendment to this Act, which will reduce the interest - payable to £5 4s per cent. SALE OF APPLIANCES. "Tinder the management of Mr. Frank Kennedy, to whom considerable credit is due, the activities of the distribution and sales departments have been productive of good results. The sales of appliances summarised are as follows:—Cooking, 1694; water heating, 523; heating, 134. Total number, 2351. "The number of new. consumers added, was 714, and four miles of mains were "aid, making the total length 262 miles. During the year many large cooking and water heating appliances were supplied to hospitals, hotels, and restaurants. It is pleasing to record that in many cases these appliances have been installed as additional equipment in kitchens where consumers have previously experienced the advantage of gas as a clean, efficient, and economical fuel. The gas storage waterheating system for supplying hot water at any time, to any point throughout the house, has become . popular, and. is now widely adoptod by consumers. The manufacturing plants, distribution system, and buildings, have been maintained in first-class order. "On behalf of the directors, I would like to express their appreciation of the excellent services rendered by all officers, and the whole of the staff in carrying out their respective ■ duties; To the general manager, Mr. M. J. Kennedy, and our engineer, Mr. John Hungerford, we are especially indebted for the ability, zeal, and energy; they

have displayed. This is reflected in the balance-sheet now before you." Mr. G. FitzGerald seconded the motion.

Mr. F. Dyer congratulated the chairman and the other members of the board of directors upon the very satisfactory balance-sheet which had been presented to the shareholders. It was very refreshing nowadays to have such a balance-sheet and a dividend of 8 per cent. He was pleased to hear tho chairman's appreciative remarks in regard to Mr. M. J. Kennedy, general manager and secretary, and the other members of the staff.

The chairman, in reply, .said that there existed remarkably good team work in the staff, and it waa that spirit which was largely responsible for the excellent results which the company had achieved. The motion for the adoption of the report and balance-sheet was carried. . The retiring directors, Dr. C. Prendergast Knight and Mr. G. F. Pearce, were re-elected, and Messrs. H. A. Gold and E. E. Dymock were reappointed auditors.