DAIRY COMPANIES.

Taranaki Daily News, 2 September 1919, Page 2

DAIRY COMPANIES.

KAUPOKONUI. TWENTY-SECOND ANNUAL MEETING.

The twenty-second annual meeting of tbc Kaupokonul Dairy Company was held In one of the company's storing rooms yesterday, Mr. 'V. D. Powdrell (chairman of directors), presiding over un attendance of about 100 shareholders

BEPORT AND BALANCE-SHEET. The balance-sheet showed that cheeao sold realised £204,M8 Ids Ed, butter £9123 0s 6d, interest £224 15s, 4d; total, £275,15,1 4s Sid. Tho principal Hens of expenditure were: Repairs and renewals £1952. salaries £11,377 freight £3887 cartage £lßll, firewood, coal, imd coke £4344,' rates, printing, telegrams, etc., A'liOO, insurances £IO6B, delegates re dried Bilk £286, requisites £10,984, cream cartage £BOS, cow-testing £287, veils £317, depreciation ££ool. The sum of £183,475 12s Sd .ud been advanced to suppliers, and there was £51,436 in hand. The store aecount showed that stores sold totalled £73,339, stores in stock £35,138, cash in hand £204, stores in stock to begin the year totalled £33,200, stores purchased £61,73 C, railage and shipping £2518, cartage £1307, salaries £4293. interest £1790, depredation £l5B. There was a balance of £2961.

I CHAIRMAN'S ADDRESS. In moving the adoption or the report and u ilnnce-sheet, the chairman referred to tho part tnkon by New Zealand In the war, the obligation the country was under to our soldiers, and thu influenza epidemic, and paid a tribute to tho valuable help given by settlers and farmers, and to the work done by tho staff, and particularly the general manager, Mr. Farley, who with the help of farmers had run two or three, of the branches In succession. The (iccroos? In whey butter was due to tho fact Dint during the epidemic It was found Impossible to separate the whey. The balancesheet was very satisfactory. The pay-out was » record In the history of the company, being 24d, or, with Interest added, 24-25 d, notwithstanding that they had several drawbacks. During the year they had erected additional storage accommodation for 16,001) crates of cheese, and owing to the epidemic labor got light and they had to utilise tho storage before the carpenters wero out of u<« building. The place was more than half full when completed, and was therefore harder to control with the small quantity of power available than would have been the case otherwise. They could not get the temperature down, and, as Fatea was blocked, they had to Keep tho cheese in the branches longer than advisable, with the result that greater shrinkage took place. When It was considered that one per cent, shrinkage meant many tftousinds to the company it would be seen that this affected the pay-out considerably. Their power was too small. It consisted of two 28-h.p. turbines, not altogether efficient, driven by water from a race erected 15 or 16 y«aii< thu In which there had been slips, and which It rnd not previously been possible to Interfere with. It took 120-h.p. to cope with their Maximum load last year, so the directors had Installed a 80-h.p. auction gas plant, and were now. able to attend to the water race. Fourteen men were at work In the tunnel, which, It was proposed, to concrete from end to end. Th& cost would probably be from £2OOO to £3OOO, but constantly recurring exfttM ttraM.lM MVI 4. Vnt had <UM tfc'J

tained two turbines of 125 and 75-hp., respectively. He did not know whether they would hare water power enough to drive both el once, but In any case one Could be a stand by, and they would thus hare a permanent v&ter power. It was pleasing to note that their properties, 'including the various stores, were shown on.the books at £53,439, against which must be' placed the redemption account, made up of depreciation £31,888, and the reserve fund '816,578.- largely built-up out of store profits and profits from the Refrigerating Company. Some companies claimed that their properties were paid for out of share capital, but Kaupokonul would go one, better, and say that theirs were paid for by depreciation and profits earned In 21 years. The sum of £)8,000 hod been expended during the year on rebuilding, building the storage accommodation at Kaupokonnl, rebuilding at Skeet Itoad, Kapunl, and Sutherland Road,, and as soon as rosslble It was proposed to rebuild the other tranches In a permanent way in concrete, and Installing water power wherever possible. As showing the sound position of the company, he chimed that the share capital paid up was £33,961, whereas the properties and plant were north £81,321, so that If they were to realise tbetr liquid assets tho £1 shares would be worthy nearly £3 each to shareholders. The oicrdraft on the factory was £33,780, and; on the store £27,923, a total of £61.704. In addition there, were other liabilities, making a total of £94,564. Some people objected to 0,-erdrufts, but he said If they wanted <to get rid of the overdraft they would have to get rid of their present directors. If they could get money at 5% per cent, and make, 10 rer cent., out of It, It was good business. If they saw a business had a big overdraft they could br satisfied It was doing alright. Turning to their assets, he showed that these without properties, etc., totalled £134,000, so that they had over £40,000 to spare when their debts were paid, as well as having their factories in hand to the good. The deposits at Interest ivere very satisfactory, and showed the conlicence the public had In the concern. A new account was the T share account of £2370, being the amount of store profits allocated as share capital. The amount owing In mortgages was £4300, but on the other ■• -de there was £lO 630 owing to the company In mortgage and sale of farms. The reserve account stood at £19,575, and was made up of store 'profits and share profits. This was a large amount but It was recognised that a company only go* richer by Its reserves. The redemption account stood at £31,889, tho depreciation written off during the last 22 years. Machinery and plant now stood at £17,822. The motor lorries had been depreciated by ,25 per cent., and now stood on the books at £424. The electric lorry had not been depreciated much, as It bad not been utilised greatly, owing to the shortage of power for charging.lt, making It necessary to take it to Auroa, which proved unsatisfactory. When power was available, he considered that the electric lorry would prove tho success anticipated. In fact, the cnalrman of the Bongotea Dairy Factory told Mm they had only spent 5s during the year on their four lorries, and that was to replace a lost spanner. , They had had considerable difficulty over cartage At present Kaupokonul had Space frr 10,000 crates booked, and required a number of waggons to cart these In a few days. The railway curtailment hsd caused great dtmonda for motor lorries for Other osrtlng, and the company found It difficult to hire waglions, nt.d so had been forced to purchase two niore motor waggons In the meantime, and these would arrive in a few weeks. Requisites i £19,347) appeared, a large amount, but this was due to the prices having Increased so much. Stores in stock (£35,223) was about £2OOO in excess of the previous, yesr, but this was nothing considering that they had opened a fresh branch at Kapunl, having paid £520 for the store and an acre of land. Results at this branch had not been satisfactory owing tc so many changes of manager, but It was hoped for better results in the future. They had a large amount of money Invested In concerns ultimately associated with the great oalrylng industry. In tho Kgmont Box Company they had £5584, and In tho near future this would probably require to he doubled. He knew companies had written the Box Company's shores down, as they did not expect to get the money back, but since the company had secured a new bush, and 1000 acres of other hush he was satisfied there was no need, to depreciate the shares, for with good management there was no reason why they should not get cheaper boxes, and also get their money back at the end of the term. In the West Coast Refrigerating Company they had £5133. They put about £3OO cash In the concern at the start, and the balance had accumulated out of profits. They had £BB6 In the steamer account, which was also a good investment. In the Now Zealand Farmers' Bacon Company they had £3782, which bore interest at 6. per cent. had done very well, only that hy,production had fallen off, some 54,000 having bctn killed m t! o whole of New Zealand, of white their coaisny had killed 30,000. Some) Idea of the failing off might be gleaned from the fact that the Dtmock Bacon Company hadj Itself previously killed 34,000 pigs. The/company had extended its operations, and hist year killed 11,000 calves and 45,000 sheep. Killing 30,000 l <ks would not have paid axle grease, so t-s directors were forced to go In for this new policy, and shareholders had no cause to regret It, as they got 6 per cent, interest, and also secured Increased competition for their stock. Some rcople, he regretted, were doing their best to limit the supply of pigs to the company, and so were cutting their own throats. A supplier stated that they had difficulty in obtaining any information about the company. Mr. Powdrell went on to say that the company had also Invested £250 In the Pates Ireealnc Company, and ho considered that when thev realised the benefit this company had been to them In providing competition no one would regret that Kaupokonul had been one of the four or five companies which had assisted the Freezing Company when It sadly needed assttance. The Paten Pressing Company was new endeavouring to get permission to export two days' old calves, for which he understood there was a demand at profitable prices. At present they could not export a calf under 1i) lbs. If they could get permission It was h- port to open up a trade that would prove leneflclal to the farmers of the Dominion. It must, however, be remembered that the Imperial Covernraent had purchased the. meat for (he next two years, and had seven million carcases In stock, on which they were paying immense sums In storage—£3s,ooo per month. Until this was shipped they would hardly exvect to be able to ship calves. Still, as a Freezing Company was allowed to Rhlp 5 per cent, of offal, they could keep back livers, hearts, etc, so as to send tbe experimental shipment. ,

They bad Invested £156 In the Bonnet Com[i.ny, which, under the management of Mr. Cooper, appeared to be a success, and would aupplv rennet In proportion to the veils. They had Invested £lllOO In thevManala Loan Comrnny. v.hlch had lent £IIO,OOO to £115,000 to suppliers of the factory, for which purpose it was formed. The high prices ruling for land, hi" considered, were largely due to the opportunity thus given to people to buy land, who would assist the company by supplying milt

A supplier considered that' the tendency wan to give too high a price for land.. The chairman aald that In his opinion even at the high price land was a safe InvosftaeM, provided tho land was first-class, but lrMbe land waa second-clasß there was a .danger. Years aEo, he points out, butter realised Sd, and was all the milk produced. Then started etieeso. followed by whey butter and casein, now there was milk powder. There were Innumerable uses for casein. If found suitable plants could be established for tho manufacture of tiried milk Instead of milk. He therefore did not think there was the same risk of land falling with six or eight avenues of production. At suv rate, tho chances were not near.r so »<•• nc when they only manufactured butter. They need no> fear, as long as they got the best land, howhlgl the price went. Salaries (£11,377) showed an Increase, but be pointed out that Kaupokonul ware sticking to the national scale. After touching on other items In Jthe balance-sheet, ho reverted to the alore account, contrasting Its drat year, with a turnover of £253, with the present one. Not a penny of the shareholders' money, had gone into the store, yet a reserve of £15,000 had been built up out of profits, and but for the big Cre It would havo been much larger. Kach ytar the directors had to face bullets made by storekeepers In other towns; A supplier deprecated the overdraft being so large \ Continuing, the chairman pointed out that cool storage accommodation, had earned £4OOO. Tt had already earned £OOOO, and would have earned more but that owing to the .difficulty of embroiling the temperature they did not got advances from the Government for some months, and In order to pay out to suppliers as usual, lind git an overdraft from the hank up to £IIO,OOO. It was considered that It would ret be fair to suppliers to pay the Intereat, so this was deducted from the storage account, and suppliers did not lose. At the end of next year he expected the whole cost (£11,000), would be paid for out of earnings, and not out cf share capital, and tho company would have buildings available so that If It was luutio, that there waa a good thing In dried milk they would be the first off the mark. He pointed out that this year there was a large Increase in milk of about two million pounds, as compared with last year, or, If they included the amount received from Rlverdale lust year nearly 1,500,000 lbs. Their factories were up-to-date. They were putting In tiled whey tanks, so that all whey could be sepitr-' nted, and they Bhould during the coming year have even a more successful season than the present, particularly as tho shrinkage this year, for reason* that he had outlined, had been greater than at any tune in Its history. He showed how the%>mpany had got richer by about £14,573 out of various profits, and said that even If It were not Strong now they would soon have a strong company. He expressed regret that statements, had been mad* by suppliers tbat some of the cheese had gone rotten and had to he thrown into the river. Such statements wete very disheartening to the directors, who had done tbetr boat In tie Ir-tereH* of the company, and It must be admitted they Had done setae big things. Mr. Bennett considered lit would have been better had- the directors taken su»U*r» net* !&<» thtll 4HMJUM, - Trr: - ?*?—■■

Mr. Powdrell pointed out that thtf Kid . earned considerable turns by th* erectloaof the cool storage Had they not btittt fhfe at the factory they would hare hem vmM* to get the cool storage accommodation, a* I'atea could not bav* taken their produce attar tliis year. When the building was paid for th* ' supplier would get the benefit of the whol* profits. By doing this they could hare oomfortably paid out another W per lb. They had arranged for the Government tester to do all the testing, eo that there was no oppw.«nlty fnr the manager to make good at the expense of the suppliers.

A supplier said that building up the r*. serves would be appreciated by tbe newcomer. "A little more to us and less to him," would be a better policy.

Mr. Powdrell said that never In the history of the company had their employees hid such a strenuous tunc He knew that during the trouble Mr. Farley, general manager, only bad his clothes off three times In three weeks Mr. Forbes, the engineer, also had dona great work. He thought the company should show" Its appreciation of the services rendered by Messrs. Farley and Forbes,

Mr. Bennett, referring to tbe smaller supply of veils, urged the directors to pay (a per veil. He knew of suppliers that wan taking veils elsewhere on account of the higher price. He did not save veils, snd considered thai th* price should be increased, and the man who did not save veils should be prepared to pay a rule towards the man that did, as b» got the benefit of the rennet, and better prices for the calves lie told. He moved that th* prld* be ss.

Mr. K. R. Hastlo Seconded. Tho chairman regretted that shareholder* had not been loyal to their own company. IOM was only supplied In proportion to th* tftt supplied. In the event of a shortage «t rennet, the man who sold bis veils to Other companies would have his milk mads *UW butter. The resolution could not b* taken till the report and balance-sheet were-adopted. Mr. Hair seconded too adoption.

DISCUSSION. In reply to Mr. Sandford, the chairman stated that the only Interest that wwt to the reserve fund was that of th* West Coast lie.rlgeratlng Company, as the coarsenr had only paid £230 Into that company™^ Some discussion took place ntndtnt' th* store management, and In reply to a mddUv the cholrman stated that the directors wS wen satisfied with the manafimrat Mr. ' Parkinson was very much overworked, and the directors were considering giving him extra assistance. * , " Mr. Burke congratulated the dfrtcton m mltted b,lll,ce - sl,eM Uut &«db»w whin reply to a question regarding th* tmnoaad amalgamation with Karrpokonuland JtftsVth* chairman stated that he bad offrrJdtJ 111 .foils suppliers come In provided Uur Cam* in on the same basis as Kaupokonul suppliers rt~ gardlnir share capital. Jolls' supWsrtwen given the opportunity o( having a KrTof' Knupokcnurs splendid reserves, bat tho £ ollned the opportunity, and would not be grrtn another similar opportunity, u was not th* mention of the company to stop payment of ! rt «2"t- v In fact, be had always toughl hard for the principle of payment Of htMtjL, Tn reply to a suggestion that mattan In connection with the factory were Wit *nd stating that he had never endeavoured In, an* way to Influence the election of directors. *E I articular supplier had, he sold previously Mid £?.' J',!*" 8 ■» 1 »« that "fellow Powdrtfl. he gets £IOO a year; what does he do for IW" Mr. Robertson: I'm against that fellow Powdrell now I """*'

Mr. Dunn said that a. question asked hr'sv previous speaker as to whether the ccMnuy was prepared to buy back the T shares wB»» ruppller left the district. The chairman ssld that he did not advooau buying hack these shares at tbe nreaent tin* ai It was the Idea of the me capital, in a year or two the cottntS would be In a position tt uuy back th* that** LJ'h d ? ew r ■ ut » 4 1 « h -*t. <*eso share* were worth only ss, but there were people prwared to Rive much moro than that., •™»™ u Mr Hsstle said that it bad been an under- ' standing from the directors that wbea th* store got over the effect* of the fir*, th* bcaM advisable to pay out the profits In cash. The chairman slated that nothing was btad- ■ Ir,g regarding cash bonus, and In proof (h*r*ot tho shareholders passed an article prortdtttt for the Issue of capital for the profits In Uw of cash The store tlod up a lot of capital, ana with probable extensions it would not M oovtsablc to pay out the profits In u.n. The report and balance-sheet was flm adopted SUCTION OF DIRECTORS.

When nominations were called for th* eltetlan of three directors, Mr. Robertson said that It was a "one men show," snd that Mr Powdrell should realgn. This Mr. Powdrell *JN«I U do If Mr. Robertson would contest thTStat. but Mr. Robertson declined to do so. Messrs. E. T Burke, F Mourle, and A. tfoinn, the retiring directors, were nomlnaWd, »s weru also Messrs S. J Bennett, B. J. Dnnn. hnd (!. .Tones. Several of the candidates 1-rlefl.y oddresscd tho meeting. The election resulted: R T. Burke 251, A. Oamlln t*». F. Mourle 208 ceded); R. J. Dunn 181, a J. Eennott 121, C. Jones 50. Mr. H. .\. Lennon was re-elected auditor at the same remuneration.

The directors' remuneration was fixed at £1 W day. The chairman was TOtod »n ■ honorarium of £l5O. The chairman was alto * voted a bonus of 100 guineas'ln recognition of bis services during tho past year, mew and seconder speaking in high terms of hn excellent work In the Interests of the company. .w r, .i. Po, " h !' ll ' ln »eanowl*dflnt, rem*r*ed that the work was a labor of love. E* Mid n tribute to the assistance rendered by hH «•• directors. «»■»••

INCREASE OF CAPITAL Tho chairman moved n special roMlnUoh In £',, S. M,l °", of ln<w»*"i« the capital from £45,00(1 to £60,000; seconded by Mr .jobtrtson and carried. „. A J u " n6r P'OP o " l ' altering the Article* in the direction of providing that unless * fbjrehoidler applies for the than* allotted to blm ill the store by way of bonus within threa " ; mnths, he be debarred from participating In that bonus. This wn* proved by Mr. L Hem. dig and aecondod by Mr. Dahl. Mr. Bridge moved, as an amendment, that the director* allot the aald shares In the ordinary way without application being received from the shareholder. Mr. Buthorlond seconded. The chairman said tint he did not mind* which way the voting went, but the director* did not wish to fotjco any one to take (bare* they din not want to. The amendment was carried.

PAYMTBNT OP TOLLS Mr. Bennett moved that It be a reetmr.iendatlon lo tho directors to pay shareholders Cs for first-class veils, Is 6d for lecond grade, and 8d for third grade. Mr. Muggerldgo seconded. Mr. rowdrell questioned If It would V*T the company to purchase rennet from the Bofttiet Company If It had to pay *a for So * vela. It might be better to allow iharehclders to take their veils elsewhere than pay 100 much for them, and veils were worth lavlliß at a prlco. He appreciated the Idea ' of prnf.lislng Hie man who would not'pay A supplier said that the wrataieaa was that the different factories did not arrange « uniform price. • Mr. Long said that If Ms were paid for roll* for n Benson It would bring nutters to a head. It only meant taking from one pocket to nut Irto another. The motion was carried.

THE STOItE MANAGEMENT. Mr. Dahl complained of the wav In whit* the store was managed, nnd moved' that It be a recommendation to the directors to dispense with the present manager (Mr. Parkinson), and call application* for :i iter manager Tim chairman considered that such a motion v.ns tantamount to a vote or no confidence lr. the directors, who were satisfied with the nnnngement. He strongly defended the maniicer, whom he considered hard worked Re held that goods were sold as cheaply at Kaupokonu' as at Hawera or elsewhere Voices: No! Mr. Tarklnson said that there waa great difficulty In getting goods at present, and alee in getting them carted frofc Huweri. They carried a very assorted stock

The motion was lost, only two voting In Its favor. ■ ■

AN APPRECIATION. Mr. Berry told that while favoring econonr thcy must not economise In the wrong place and he referred to the splendid work done by Mr Farley, their general manager Ho therefore moved that It be a recommendation to the directors to increase the general manager's salary to £SOO. The chairman Bald that an recognised Mr Farley's splendid work: la fact. It wu -enora'ly considered he worked too hard. Mr. Muggeridge seconded the motion, which waa carried,

A suggestion was made that the services should also be recognised by a bonus Mr. Wells considered that this wu a matter for the directors,

OENEItAL. Mr. S. J. Bennett objected to the store prom* lelng taken into account when working out the annual pay-out, as the man who did not'' purchase from the store wu placed In an ta> fair position. "• r Complalnta were made as to the poor Quality of the butter supplied to ahai^older. Tho chairman stated that this waa due to shortage of freealn* power during part of the season, and,the manager stated tbat dnrntc June and July It was due to supplier* S u" dived fMtWy * MOft *"« a, »«W« A hearty vote of thank* wu accorded the ladles who disponed the lunch. w "™" ""