MEAT TRADE.

Taihape Daily Times, Issue 220, 26 April 1917, Page 2

MEAT TRADE.

AMERICANS IN NEW ZEALAND,

TRUSTS AND TAKINGS

In view of the frequent references made in public speech in the press of the Dominion to the operations of American meat firms in New Zealand, the following particulars published by the National City Bank of New York, may be of interest to those concerned in the frozen meat trade. It should be mentioned that the information published by the National City Bank on the face of it, is as trustworthy as it is well handled and digested before being made public:—

"It is characteristic of the business," reports the Bank, "that the percentage of net earnings upon gross business is small, but th e aggregate profits of the leading companies are large, because the volume of business is enormous. . . . The percentage

of net earnings to capital is larger, of course, because the capital is turned over several times during the year. Moreover, all the packers are large borrowers, and because of the quick moving, staple character of their product are able to borrow at low rates, and the profits upon the borrowed capital are included in the earnings s-hown on their own capital." Mr. E. A. Cudhay, president of the Cudhay Packing Company, .Chicago, is quoted as reporting the sales of his concern for the 1916 year as 133,960986 dollars, and the net profits were 3,011,415 dollars or 2.2 per cent, on th e turnover. Of the sales 24,000,000 dollars were of products dealt in and not derived from animals slaughtered and such included eggs, cheese, glycerine, soap, cotton seed, oil, and other articles. He calculated that of every dollar of 100 cents taken in from the sale of animals for slaughter the farmer received 80 cents., wageearners 7 cents, freights 5 cents, i other costs such as manufacturing, packing, and materials, preparation .for sale 4 cents, interest, taxes, insurance, repairs, and similar items, and net profits have to be paid out of the remaining 4 cents. The proportion of this 4 cents which went to the company as net profits was under 2 cents of the whole dollar. Swifts' sales for last year amounted to 575,000,000 dollars, and the profit was 24,465,000 dollars, or about 3£ per cent, on the turnover. On the company's own capital, including the surplus fund of 120,000,000 dollars, the profits would have amounted to 16 2-3 per cent. The amount of borrowed capital employed by the company at the close of its year was 70,000,000 dollars. The following are 1 vifts' figures: Cattle slaughtered, live weight, 1,7G4,000 pounds; the dressed weight, 953,000,000 pounds; net profit realised, 2,342 >) 702.29 dollars; net profit per cwt. live weight, 0.132 S dollars; net profit per ewt. dressed weight, 0.2457 dollars. Armour and Co. 's sales amounted to 20,100,000 dollars, or 14.7 per cent on the capital and surplus aggregate em- ' ployed, which amounted to 137,000,000 dollars; borrowed capital/ by the turnover was, however, 3.S per cent. It was

reported by Armours that the greater percentage of profits was due to the handling of inedible products, such as glycerine, soaps, pharmaceutical produetsc, manures, not to edible meats, arid made by subsidiary concerns.