MANUFACTURE OF DRUGS

Evening Star, Issue 20134, 26 March 1929, Page 14

MANUFACTURE OF DRUGS

FIFTY YEARS OF INDUSTRY KEMPTHORNE, PROSSER, AND CO.'S ANNUAL MEETING Inasmuch as the firm of .Kempthorite, Prosser, and Co. is celebrating its fiftieth anniversary special interest was attached to the annual meeting of the company, hold in the Somerset Lounge tltis afternoon. In in's addiess, the Chairman (Mr W. F. Edmond) traced the history of the firm, and remarked that, although the past year had not been considered an entirely satisfactory one as affecting the whole dominion, Kempthorno, Prosser, and Co. had accomplished the greatest volume of turnover in their history. “ It was in the year 1879 that the (inn of Kempthorne, Prosser, and Co. became incorporated as a public company, and during the succeeding halfcentury the history of Kempthorne, Prosser, and Co.’s New Zealand Drug Company, Ltd., has disclosed cue long unbroken inarch of development and progress, culminating in the high position held by the company to-day in the commercial world,” stated the Chairman, in opening his address. “I think the occasion fitting for us to pay a tribute of appreciation to the memory of the late Mr Kempthorne and his colleagues for their courage and foresight in having laid the sure foundation upon which the company’s business lias been built. “ When we look back to a period of fifty years ago and consider the difficulties encountered and overcome in the inception of and in the, carrying on of a growing business in a comparatively young country, we cannot help but realise the lion-hearted determination of those at the holm in the early days to win through—tins when we survey the results of the company’s operations year.by year from the time of incorporation to the present day. Do you know, gentlemen, that this company has not missed its animal dividend since the year 1880—this in spite of trade reverses and hard financial times—which I feel sure you will regard as highly satisfactory. “The drug businesses at Auckland, Wellington. Christchurch, and Dunedin duly became the property of the present company in March, 1879, having been acquired from the previous proprietors. These businesses continued to extend, so that it became necessary at later date to build the present substantial structures in Auckland, Wellington, and Christchurch, and also to erect the pharmaceutical factory in Stafford street, Dunedin. NEW” PLANTS FOR OLD. “ Notwithstanding the large interests in, and the corresponding responsibilities of a growing drug and chemical business, attention was given, in the year 1881, to the question of erection of a sulphuric acid and fertiliser works ab Burnside, Dunedin. For your information, in February, 18S1, the Government offered a bonus of £SOO per annum for three years for the production each year of not less than fifty tons of sulphuric acid of good marketable quality. The Into Air Kempthorne, with characteristic enterprise, decided to erect works so as to secure payment of this bonus. A small acid unit was duly completed, and payment of the bonus named was secured to the company.

“In the subsequent three, or four years the Burnside works were extended to enable the manufacture of artificial manures. ’Phis, then, was the beginning of the company’s interest in the fertiliser trade of New Zealand, which, ns yon are aware, has since grown to very large proportions. We have at the, present time three fully equipped modern fertiliser Avorks in operation, one each ab Auckland, Wanganui, and Christchurch, and in the course of the next few months it is confidently hoped that the iagav Burnside Avorks Avill be so far completed as to enable a 75 per cent, output. Meantime avc are manufacturing at Burnside Avitli the old plant, Avhich is producing sufficient tonnage to cover all business until the commencement of the main season. When finished, these Avorks will be most up-to-date in every department—electrically driven, and will bo operated at a minimum of cost from a labour point of vierv—and. 1 am confident, Avi 11 take care of (he requirements of Otago and Southland for many years to come, and will be ot great benefit to the farming community. FINANCIAL SURVEY. “ A survey of the paid-up capital nl the company from its earliest date to the present Avill give you a clear idea of the development of the company during the half century under revieAv. The paid-up capital on January 31, 1880, was £71.017; 1890. £87.444; .1900, £171,609; 1910,' £200,000; 1920, £334,192; 1923. £400,000; 1929, £529,806. “ I have referred earlier to the Truilding of drug Avarehouses in the various centres, and chemical fertiliser Avorks, but, so that you may have these all grouped together, I beg to advise you that during the period 1890-1929, the folloAving large building operations, as extensions to the company's utilities, were carried out: —New drug Avai-e----houses constructed at Auckland, Wellington, and Christchurch. Pharmaceutical factory at Dunedin constructed; Westfield Avorks, Auckland, reconstructed; Hornby works, Christchurch, built; Wanganui Avorks built; Burnside Avorks remodelled, brought up-to-date, and almost entirely reconstructed. “It affords your directors much gratification to inform yon that, although the past year has not been considered an entirely satisfactory one ns affecting the whole dominion from a trading point of view, your company accomplished the greatest volnme of turnover in its history. As this synchronises Avith our jubilee year, it may be considered a very happy result, and augurs aa-cII for the future. The outlook to-day throughout the dominion is far from unpromising—quite the reverse. It may be considered as entirely satisfactory. There is a general feeling of confidence in the future.

“ Primary products are bringing excellent prices, and crops and production are likely to good. This being the ease, your directors look forward to good and profitable trading for the year now with us, so that plans and preparations have been made accordingly to secure to the company a fair proportion. “ The report and balance-sheet having been in your hands for some time, I presume you will, as usual, take them as read. I will now give a brief review of the main items comprising the balance-sheet and the profit and loss statement, comparing same with the figures of the previous year. INABILITIES. The capital is- practically unchanged at, Jj529,5G6. A lew calls were antstanding at the balance date, but these will shortly he cleared up. As no addition was made to the general reserve at our last annual meeting, the figure £1X7,000 is the .same as presentee! to you at that time. If the

proposals now submitted meet with your approval general reserve will be augmented by the sum of £IO,OOO, and therefore increased to a total of £153 000. “In order to give effect to the resolution of'the board regarding the issue of 26,500 bonus shares, your authority to make them fully-paid up to £2 each by the transfer of £53,000 from general reserve will enable the board to carry out this intention, and as ii result the balance at credit of general reserve will then bo reduced to a round figure of £IOO,OOO. To this may be added the amount to be carried forward in profit and loss account a£2G,516), giving a gross sum in reserve of £126,510. “ Although the customers’ hook debts show a marked increase over the figures submitted last year, it has nob been deemed necessary to provide any further sum under this heading, as all customers’ accounts are considered this year to be of exceptional and undoubted soundness. Bills payable and other liabilities, £205,886, are greater than last year by the sum of £52,495. This group pf accounts, as you can well understand,'in a large and growing business, fluctuates considerably from year to year, comprising as it docs all outstanding liabilities for shipments and oilier engagements, including full provision lor income tax. ASSETS. “ Stock values show an increase of £15,010. This in the opinion of the board is quite a nominal increase. It has been found that adequate stocks J of all kinds must be carried to retain the support and confidence of the company’s many clients, so that prompt deliveries may be made. Increased stocS is also necessary to provide for the expanding business of the company year by year. Where deemed necessary duo allowance has been made to depreciate fully any stock requiring such treatment, with the result that the stocks of the company are quite representative, well , kept, and of good value on the stock sheets to carry forward to next year’s trading. The aggregate value of the company’s properties as at January 31 was £467,048. as against£43s,9l3 at the balance period last year, the difference being mainly represented by expenditure at Burnside works already referred to. Capital expenditure at other points has been comparatively small. It will be seen that Wo have ttys year provided the sum of £20.000 for depreciation, your directors ( taking the view that an ample allowance of this nature should be made, with which view 1 trust you are in full agreement.

“ Necessary repairs and maintenance have been undertaken throughout (he year coverin'/ all buildings, plant, and machinery at the various Avarehouses and works of the company, and 1 take pleasure in advising yon that these assets are in first-class order for the carrying on of business during the current year.

“ Customers’ book debts and bills in hand, taken together, amount to £177,253. This total is £47,523 in excess of the figures stated last year. In explanation of tin's yon wili be pleased to learn that the closing months of the year provided very heavy sales, and these excess sales, of course, arc largely reflected in the book debts as at January 31 Inst. All accounts hare been closely scrutinised, and 1 assure you that full ’provision lias been made' to cover all bad and doubtful accountsPROFIT AND LOSS STATEMENT. It av ill be noted, as set out earlier in the report, that the net profit for the year amounted to the satisfactory figure # of £72,809 Tos 7d, the largest in the history of the company. To that, sum lias to to added iho carry-for-ward last year £26,18', 7s pel, less the interim dividend or L\ per cent, paid m September last, £23*833 19s 4d, thus leaving to bo dealt, with at this meeting the sum of £75,157 Is Bd, Avhich your board recommend be applied ns foll.oAvs:—To the payment of a dividend of 3\ per cent, and bonus of 2 per cent, (making, with the interim, 10 per cent, for the year), £29,140 13s 6d ; to add to general reserve, £16,000 ; to contribute to the staff provident fund, £3,500: and io cany fonvnrd to next year, £26,0il 8s 2d ; total, £75,157 Is Bd. “ Your directors have suggested the sum of £3,500 to be contributed to the staff provider) I. fund, which I feel sure you will cordially agree Avith. “ Before moving the adoption of fho report and balance-sheet, I should like to call the attention of shareholders to the very satisfactory manner in Avhich the staffs of the company throughout the dominion have carried out their duties during the year, also to say that. ! consider the very satisfactory result of the year a’s disclosed by tho balance-sheet is largely due to the close attention given by the staff to the company’s affairs, and to much hard work The thanks of shareholders are therefore duo to the staff for their loyal support, and it affords mo much pleasure to inform yon that the. staff have been awarded a jubilee bonus in recognition of their excellent service. I noAv formally move the adoption ot tiio report and balance-sheet, and your acceptance of this will carry with P tie recommendations contained therein.”