WELLINGTON NOTES.

Hokitika Guardian, 10 December 1924, Page 1

WELLINGTON NOTES.

A PROSPEROUS .MEAT COAIPAXY (Special to “Guardian”.) W EI.LIXGTOX, December 8. Wellington has reason to he proud of many of its joint-stock eomnanies, and it is particularly proud of’the Gear -Meat Preserving and Freezing Company which is without an equal in Xew Zealand. It was registered in Xo vein her 1882 and was formed for the purpose of acquiring tho butchering and meat preserving business of tho late James Gear. Tho slaughtering capacity at the start was .700 sheep and 40 head of cattle per day. The capacity is many times that now. The company was well managed from the outset, lor the directorate had always consisted of sound, far-seeing, business men. The management all through lias been of tho highest character, and every forward movement was well considered from every point of view before being taken, and the outstanding feat are of Ihe Gear Company lias been its steadily increasing liunnein! strength. At lio time were the full earnings distributed. Ihe building up of adequate reserves was an early effort of tho directors and the wisdom of that has been proved in recent years. The Gear ( oinpany is subjected to the keenest competition in all directions. Jt pays lull prices—the highest prices—for stock. Jt pays as high wages as any other company, the employees receive the greatest consideration and many of Hie employees can show many years of

service. '1 he secret of the Gear Company's success is simply sound, prudent management. The creation and niniuloimiice oi reserve funds lias lieen n particularly strong leaiure of the company and the investment of these lunds has helped the conmany alone. These reserve funds have crmvn unwieldly and the directors have decided to return a. portion to the shareholders. In the latest balance sheet which covers the period to November •’’(•. the directors sa.v. “ Dump; the year l!l|N and 1010 I lie company tv as compelled by latv lo subscribe lo certain loans raised by the Oovennnent for the purpose of providin'; the Dominion’s efforts in the Groat War. As the company has now adequate funds of a more liquid character for the conduct of its business, it is proposed to proportion a part of the Inscribed Stock, If per cent tax free loans referred 10, amongst the shareholders by way of special dividend, in the proportion of Cl face value of Inscribed Stock to each share in the company.” 'This is the biggest distribution ever made in New Zealand by a joint-stock company. As the share capital is ClfiO.nOO iii Cl shares it means a refund to shareholders in Inscribed Stock of approximately (MOO,OOO. Naturally there is great juhilialion among the shareholders who get the stock worth C 0“ 10s in the open market for every 100 shares held. TIIK PENALTY OF SUCCESS.

This t'minnoiis distribution by the flour Comnany will provide :i text for iho disgruntled to preach noon monopolies. combines, moat trusts, etc. The management will get no credit for prudence and business perspicacity, nor will the shareholders receive any consideration for foregoing prolits. The reserve funds of the Clear Meat Company were built out of prolits and those profits were earned in clean and open competition with a steadily increasing number of competitors. This means that the dear Company has paid as high prices for fat stock as any other company in its zone of operations and it may lie c laimed that in many instances it has paid a e;real deal more. It has taken many years and very careful investment to brill" the reserve funds to their present magnitude. The directors now recognise that those reserves are more than is required lor the successful operations of the Company and they are very properly returning a portion ol the accumulated undivided prolits to the shareholders. If all our freezing companies were as strong and as sound as the Gear Company there would be very little to complain about. Unfortunately pareehial patriotism has burdened the country with a number of freezing companies, many, if not most ol them, financial weaklings, a source of constant worry and anxiety to those .associated with them. It should be staled that besides the special dividend in Inscribed Stock the shareholders of the Gear Company receive a dividend of ds ner share of which bd was paid as an interim dividend. A commendable feature of the special distribution of Inscribed Stock was the remarkable secrecy observed. The market did not even guess that any such thing was pending and consequently those who sold shares can have no complaints. DULL CHRISTMAS TRADE. Retailers are complaining that trade is dull. It is admitted that in the firstweek of December there is invariably dullness, but this year it is more marked than usual. This seems singular in view of the high prices ruling for produce'of all kinds. It must he remembered that many people have still past obligations-'to meet and if these are heiii" discharged one ean understand the dullness. It is very probable, however. that the dullness is merely the

calm before the storm, and presently the Christmas shopping will become strong and pronounced to satisy all retailers.