MEETING OF THE WELLINGTON GAS COMPANY.

New Zealand Mail, Issue 55, 10 February 1872, Page 5

MEETING OF THE WELLINGTON GAS COMPANY.

A meeting of the members of the Wellington Gas Company was held on Monday afternoon, at the company's offices, Courtenay place, at which only a moderate number of shareholders attended. The first business done was the reading ot the report and balance sheet by the Secretary, Mr J. B. George. The following is the directors' EEPOL.r. The directors, in presenting the balance •■sheet to 31st December, 1871, cannot but congratulate the shareholders on the satisfactory progress of the company. The private •consumers are now 108, and the number of lights about 2070, including those in use by the General Government and the street lamps. The mains have been extended on Te i4ro Hat since last report, and upwards of 3| miles are now laid. A further quantity of three miles has been ordered from England for fr'ther extensions, and also an assortment of gas fittings. The directors do not recommend the payment of a dividend at the present time, but propose paying interest at the rate of 10 per cent on all calls, from the date on which they were paid, to the 31st December, 18! 7 !. The interest so calculated will amount to £1166 7s 9d j of this sum £666 7s 9d will be charged to cost of works as interest accrued daring construction, and the balance of £SOO will be charged to profit and loss account, leaving an amount of £325 15s 3d to carry forward. With the approach of winter a greatly increased consumption is anticipated. Every •care is taken to manufacture gas of good quality, and it is hoped that consumers will so appreciate the endeavors of the company as to lead to a greatly increased business. Of the new issue of shares, 477 out of the 500 authorised have been taken up by the original shareholders, and twenty-three remain at the disposal of the company. Two of the directors retire in accordance with the articles of association, viz., Messrs F. A. Kruli and E. Pearce. They are eligible for re-election. 0. J. Phaeaztn, Chairman. Balance Sheet (made up to 31st December, 1871.)

shares of £lO each 5000 0 0 Audited and found correct. J E Nathan, | Ad{ W. H. Levin, > u " iuuvD The Chairman, in moving the adoption of the report, said it afforded him great pleasure to be able to refer the shareholders present to the very satisfactory statement of figures just presented to them by their secretary, Mr George. On reference, to the balance sheet they would see that their profits represented a per centage of 8 per cent per annum. He felt convinced the shareholders would be perfectly satisfied with the working of the company; speaking for himself he must say the results far surpassed his expectations, for although he was very sanguine as to their ultimate success he did not expect the profits would exceed 5 per cent, at least for some time to come. The report was of so flatttering a character that he thought he wa3 warranted in saying chat the time was not far distant when the price of the gas would be so reduced that the general public would avail themselves of its benefits. It must not be forgotten that a great deal of the credit of this success was due to the exertions of their secretary, Mr George. Although a good deal of Lis time had been taken up by his duties in connection with the Patent Slip Compauy that had in no way been allowed to interfere with the proper discharge of his duties to the Gas Company, pud he could testify to the fact that those duties had been most satisfactorily performed. Mr George had the interests of the company at heart, and it was entirely due to his judicious regulation of the expenses and keeping the works of the company in proper control that the directors were enabled to announce the favorable position which the company occupied at the present time.- If any shareholder chose to compare the balancesheet with that of any company in the other provinces he would find that their system of expenditure had been organised upon a most economic footing. As some of the shareholders were already aware the directors had decided upon sending for another receiver. Under the present arrangements there was the possibility of being unexpectedly left in a state of darkness, and they thought it much better to be on the safe side. Before moving the report he would call upon the auditors to certify to the correctness of the balance-sheet. Mr J. E. Nathan, one of the auditors, then read the report, which expressed satisfaction with the state of the accounts. The report was then adopted by unanimous consent. The Chairman said that consequent upon the adoption of the report cheques to the amount of £llO6 7s "9d would be drawn forthwith for distribution amongst the shareholders. The next business he had to announce was the election of two directors in the room of E. Pearce, Esq, and E. A. Krull, Esq., who retired by rotation, but were eligible for re-election. Mr D. Andebson proposed that the retiring directors be re-elected, which was carried nem. con. The Chairman said it would now be necessary to fix the date for the next general meeting, and it was decided that the next general meeting should be held on the first Monday in Februa:y, 1873, in accordance with clause 73 of the articles of association: Mr Schttltze proposed and Mr D. Anderson seconded the re appointment of Messrs Nathan and Levin to the office of auditors. The Chairman, in answer to a question from Mr Anderson, stated that the new gasholder was expected in the ship England. Three miles of pipes would also shortly arrive, one mile being expected to arrive with the gasholder. Mr Bannatyne said he did not rise for the purpose of making any proposition of a specific nature, but the off-hand manner in which the business had been got through proved the efficiency of the directors and also of their manager, Mr George, and he must say it was to their exertions the success of the company was due so far. He merely rose to add his meed of praise to the directors for the energy displayed by them on behalf of the company, and he was sorry to have heard so little said when the resolution was put to the meeting; however he supposed he must accept it as proof that the shareholders were perfectly satisfied. Eor himself he was satisfied by expressing his entire satisfaction with all the steps that had been taken, and he did not think there could be much doubt that with the directory as at present they would see, if not a large increase in their business profits, at least some increase on the present satisfactory position of affairs. Mr Nathan quite agreed with all that had fallen from Mr Bannatyne. At the same time he thought they should adopt some other method of showing their appreciation of the steps the directors had taken in carrying out the business of the company. Although they had not made a large profit they had made a great deal more than was received by many by other companies in the first year of working. The directors had necessarily given much time to the carrying out of the affairs of the company, and they should mark their appreciation of the endeavors of the directors by some more substantial token ; and with that object ho would move that the sum of £SO be set aside as an honorarium to the directors: When they were making larger profits he would be very happy to move that the sum should be increased. Mr Levin seconded the motion. Mr Schtjltze thought as there were so few shareholders present the consideration of such a matter should be postponed to a future meeting. The Chairman said there were sufficient shareholders present to conduct all ordinary business, so that there was no necessity for postponing the matter, particularly as the meeting had been called in the usual manner. Those shareholders who felt interested in

the business of the company should have made it their business to attend.

Mr Schultze as a shareholder objected to the voting of the amount. Even the 10 per cent to be paid to the shareholders was not being paid out of profits accruing from the operations of the company; in reality they were paying a dividend out of the capital, end he did not think that was the course usually adopted in public companies. The Cha- 3*mw said the divided was not paid from the capital. In reality they were paying interest for money advanced by the original shareholders, and they would have had to do exactly the same had they borrowed the money from a bank. Mr Schultze said as far as he could see they had merely added to their capital and were now paying a dividend out of it. He would move as an amendment that the matter be considered at the next annual meeting. Mr Pearce explained!; hat Mr Schultze was not altogether correct in his supposition that the whole of the ten per cent, was chargeable to the capital account, and further that the cost of conetrujtion was completed in April Since April there had been a profit made at the rate of eight por cent, on the capital. Mr Green took the same view of the question as Mr Schultze as to the payment of the ten per cent., and making it a charge on the capital. It was a proposal that would not be justified in the affairs of any ra'lway company in England, and he would like to put the question to the auditors whether they were satisfied that no single item had been charged to the capital account that should have been borne by expenditure, because the favorable position in which the company appeared to be by the report might have been disturbed if the auditors had been of a more inquiring turn of mind. He quite agreed that the directors should have some remuneration for their services. In the accouuts he observed an item of £325 for profit on goods sold, and he would like to know on what goods the profit had been made. Mr Geoeg-e, speaking from memory, said it was the profit made on the sale of about £2OOO worth of fittings.

Mr Green said that was a profit of about 20 per cent on the goods sold. He would ask, was it politic to make such a charge on the consumers. He thought not, and would much prefer to see the fittings given to the consumers at cost price ; it would be better even to go out of their way a little to induce people to use the gas. There were one or two churches in the city in which the gas would be laid on if the company would give credit for the fittings ; they were perfectly willing to have the gas if the company would accept payment at a future time. He had also expected to hear a recommendation from the directors that the price of gas should be reduced ; and if some move in that direction were not made, it was quite possible they might hear by that time next year that the shares were at a discount. He thought they should at once devise some means to increase the number of consumers, but he would not move any other proposition, contenting himself with supporting Mr Schultze's motion.

The Chairman would explain the whole matter in this way. When they started they had a certain number of shareholders who had advanced a considerable amount of money for the purpose of obtaining the necessary material, and with the object of putting them on an equal footing with the holders of the new issue it was necessary to declare a dividend of 10 per cent, on the terms stated in the report, else the new shareholders would have been in a much better position than the old ones. As he had before stated, if they had borrowed the money from a bank they would have had to pay as high an interest for it, but if Mr Green would point out any other mode of getting over the difficulty ho had no doubt the directors would adopt it. Mr Green thought it would have been much better to have made the dividend 7 per cent, because it was injudicious to pay a higher dividend unless the concern could afford it. Captain Johnson seconded Mr Schultze's motion, stating that he came quite unprepared to discuss such a proposition as that of Mr Nathan's. The Chaieman called attention to the circumstance that the subject of remuneration to the directors had been brought up at the last annual meeting, but the directors then declined to accept any recompense for their services, preferring that the matter should be postponed till the affairs of the company were in a flourishing condition. Mr Schultze pointed out that the company was not yet in full working order, and a little delay in the matter would be beneficial. The Chairman said he considered they were now in full working order, The motion of Mr Schultze was then put and carried. The Chairman said he wished to express his own opinion and also that of his co-direc-tors by stating that they accepted the decision of the meeting as a vote of censure. The proposition came as unexpectedly upon them as it did upon the shareholders present, and they certainly looked upon the feelings expressed by the majority as not very gratifying, They were, nevertheless, satisfied that they were doing their best for the company, and if it succeeded that would be considered by them a sufficient reward. Mr Schultze disclaimed any idea of attempting to throw blame upon the directors. By his remarks he merely wished to point out that it was indiscreet to announce a dividend at the first meeting. Mr Bannatyne hoped the chairman would not include him in his sweeping condemnation. Having expressed himself so favorably of the action of the directors he did not think the remarks should be made to apply to him. Captain Johnson endorsed Mr Bannatyne's remarks. He merely desired that the absent shareholders should be informed of the intention to vote aa honorarium.

The Chairman regretted that the question had been brought forward at' all. The directors had now worked two years gratuitously and were perfectly willing to work two vears more, although he believed in the doctrine of payment to directors, for the shareholders could not expect to get the'r work done so well where no recompense was made for time spent in their service. Mr EhtjliTi thought thero was no company in New Zealand that could show so favorable a result as it had done for the short time it had been in existence. As to Mr Green's remarks about the dividend being placed to capital account he thought that gentlemen was entirely in error. Moreover, the original shareholders were entitled to some such acknowledgment. Their money had been advanced and employed in the cost of construction, and, as had been stated by the Chairman, they would have had to pay exactly the same amount had they borrowed the money .from a bank. He thought outside opinion on the payment of the dividend need not affect them at all. The shareholders were the proprietors, and as long as they were satisfied that was aH the meeting had to study. Mr Bannatene begged to move a cordial vote of thanks to the directors for their exertions during the past twelve months, and if he might be allowed to do so he would add the thanks of the shareholders to the general manager, Mr George, for his services, without; which the company could not possibly have reached its present good position. On behelf of the shareholders he would request the chairman to put the motion " That the thanks of the meeting be given to the chairman, the directors, and the manager, for their united exertions on behalf of the company. Mr Green seconded the motion, which waa put and carried unanimously. The meeting then broke up.

De. £ s. d. To Capital, viz, 1000 shares of £10 each, (fully paid up) ... 10,000 0 0 „ Debts for coal, for which acceptance has been given... 146 16 9 „ Debts for goods, for which acceptance has been given 75 9 0 „ Other debts,—C. J. Pharazyn, on loan ... ... 3000 0 0 „ C. J. Pharazyn, interest due 226 13 4 „ Advance from Bank of New Zealand 238 15 8 „ City Corporation 33 6 8 „ Profit and loss balance ... 825 15 3 £14,546 16 8 Ce. £ s. d. By immoveable property— Freehold land, say ... 700 0 0 Plant, freehold buiidings, mains and services ... 11,703 9 7 „ Moveable property — Plant, tools, meters, and sundries 974 7 6 „ Stock of coal and products . 228 13 8 „ Stock of good3 594 6 11 „ Debts due for goods 267 11 1 „ Debts due for gas and products 52 14 8 „ Cash in hand 25 13 3 £14,546 16 8 PEOTIT AND LOSS ACCOUNT. Db. £ s. d. To cost of coal, purification, and wages 1254 15 6 „ Less stock of coal and pro« ducts , ... 228 13 8 1026 1 10 „ G-eneral expenses— Salaries, engineer, inspector, &c. 239 0 0 Taxes and insurance 11 15 0 Stationery, printing, and advertising 47 14 6 Petty charges 61 19 5 „ Balance , 825 15 3 £2212 6 0 Ce. £ s. d. By profit on contracts 44 18 11 „ Profit on goods 312 17 3 „ Fees 8 15 6 „ G-as rates, meter rent to 30th Nov., and street lamps to 21st December 1712 15 n O „ Products 80 4 5 ,, Outstanding accounts, gas, and products ... 55 14 8 „ Less amount written off as bad 3 0 0 52 14 8 £2212 6 0 CONTINGENT 1IABHITIES. £ s. d. Collingwood coal, and freight on same ... .,, ,., 66 O 0 Hill, for lime 9 15 0 Sundry small accounts 55 0 0 Stuart Brothers & Co—plant, goods, &c, in order 1600 0 0 Interest on calls paid in advance 49 10 5 ASSETS EECOVEBABLE. Gas rates for December 153 0 0 New issue of shares, viz, 500