DAIRY COMPANIES.

Taranaki Daily News, 10 September 1919, Page 7

DAIRY COMPANIES.

&APGNGA. The twenty-first annual meeting was held on Monday. There was a good attendance of suppliers, about seventy being present. Mr. A. V. Tait, chairman, presided. The report stated that the year had not been so satisfactory, as had been hoped, mainly by reason of the fact that the company was hit very hard by the epidemic. It was estimated that the visitation involved the company in a loss o£ a halfpenny in the pay-out, and, following as it did an inclement spring, the result had been a decrease in the output of 150 tons. Payments totalling 3d for the last season lmd been made, and the directors regretted that this must be final as the balance realised was 'below the amount of the estimate by £lii:j Os lid. In consequence the whole of the rebates for storage had to be credited to 1917-18 to close the accounts. There Was available for distribution a Bum of £13,408 13s sd, and the directors recommended a further payment of 4d over the whole year, making a total for the season of Is lOd, absorbing a sum of £13,095 18s 7d, leaving a balance to carry forward of £312 15s Id. The following statistics were attached to the report, those for the previous season appearing in parentheses: Lb milk, 20,215.048 (24,559,984); total lb butter-fat, 785,801 (939,374); lb cheese made, 1,049,011 (2,350,258); lb creamery butter made, 40,716 (23,338); lb whey butter made, 22,730 (30,962); lb cheese per lib butter-fat, 2.00 (2.08) ; lb milk j per lib cheese, 9.88 (10.0); over-run 13 per cent. (14 per cent.); average test for season, 3.89 ( 3.82). Referring to the absence of the chairman, Mr. Tait said that Mr. Death had been forced, through want of labor, to leave the district and take up the work on his farm in the Thames Vallley. He had fully intended, up till a few days ago, to bo present at the meeting, but circumstances necessitated his departure. Mr- Mellow asked if the question of sugar of milk could be discussed. Mr. Guy said that any such questions could be discussed at the meeting, and that there would be an opportunity given later. At present there would he discussion on the balance-sheet only. In moving the adoption of the report and balance-sheet, the acting-chairman said that, although the pay-out was below that of some neighbouring factories, he could show factors which accounted for at least l%d, and possibly more. These factors were the amount lost to this year by the over-payment made in the previous year, which necessitated the taking to credit of two sums, viz., Equalisation Fund ( £258) and rebate on storage (fl&10), and in addition a sum of £7BO for cartage and freight, which should have belonged to the previous year. In addition there was the loss incurred during the epidemic by making butter instead of cheese, a loss of £765, loss through non-manufacture of whey butter ( £600), double wages paid and allowances to families of deceased .employees (£270). Another factor .which should be noted was that the 'average test is higher than other comjpanies, and reduced pay-out'accordingly —every two points' increase in test meant a reduction of %d in the ultimate pay-out. The output was much decreased, making working expenses average much higher, as well as inteieri and depreciation, the total accounted for being thus 2£d. Depreciation on plant and buildings, and transfer to sinking fund, were less than usual, but, in view of the fact that an independent valuation places these at £13,000 above the Übook figures, less reserve, they were considered sufficient. ICaponga topped the list of 30 factories grading at Moturoa. Mr. Mellow asked who was to blame for the over-estimating that occurred? He considered not the secretary, but lie directors most directly. The chairman said it was not the .('/rectors' business to go through all the figures with the secretary and manager. The extra pay-out in the previous year 1 was an estimate only. Mr. Guy pointed out that he had 1 known of another company which had to ■ make a refund. Sometimes more was ' realised than the estimated amount. No 1 one can tell exactly what is to be the 1 result. . Mr. Mellow: The cheese sold is not a • matter of estimate. I Mr. Bentley said it appeared to him ' there had been a clerical error on the I part of the late secretary, not an esti--1 mate of rebates. In one case pay-out ! had been made twice against one ahip- ' inent.

The secretary said it was not the custom to hold the final pa.v-out until the actual figures came to hand. It was possible to estimate almost exactly. In reply to Mr. Robinson, the chairman said there was very little second-grade cheese. Mr. Robinson said that if this were so the company's pay-out should not have been so slow. Mr. Bentley said that what was shown as a gain had turned out to be a loss. Kaponga was S points short in yield of other factories, and this meant 4-Sd to their advantage.

The chairman said that Kapotiga beat several companies and lie considered the yield pretty good. In reply to Mr. Webby the secretary said that the amount received per lb of fat could be found by deducting expenses from the gross amount received. Their expenses were about 5d per lh of fat, which accounted for the pay-out being only Is lOd. Mir. Webby • remarked that Hawera's total expenses were £14,000 for double Kaponga's tonnage, while the latter's expenses were £16,889. The chairman said that their expenses certainly were greater in proportion. Although the milk received was less, the same labor was required to stir halffull vats as full vats.

Mr, Bentley said he had been examining the figures and found that depreciation amounted to only I per cent, off wooden -buildings, and IVL> per cent, off machinery. He assumed the directors could not afford to take off more; but if the full amount wore taken off it would go o*ll to capital. More should be written off for depreciation. Sir. Mellow said it was not honest business by any means. ,

The chairman said it was accurate always. "In the past, in your time (to Mr. Mellow), it was only 2% per cent., or at the most 3 per cent." Mr. Mellow: 10 per cent, was always written off. 1 resigned from the directorate because there was not honest treatment, The depreciation was not satisfactory.

Mr. Guy said that if £SOO were written off annually, twelve years would see ft total writinsr down of ,€(1000, If that were paid to a sinking fund it would eventually liquidate the total cost. He lidded that depreciation was satisfactory, because plant and buildings, were well looked after, and as a fact were worth more than the figure appearing in the balanes'.'hfiet, If kept in good order

it was not necessary to writes off such a large amount. m Iu reply to Mr, Webby he added tljat the amount spent buildings Would be paia off in 38 the ordinary terms of a Government loan. Nine years ago the value of the concern was only £IO,OOO, whereas now the value of buildings and plant totalled £2T,QOO. Kaponga factory stood close to any in Taranakl.

Mr. Mellow: What about the loss of milk?

The said that two suppliers left' the factory and went back to the factory from which they came. He considered that Kaponga owed a debt of gratitude to Mangatoki. The directors did their ntmo3t for the factory, and he thought that if all suppliers would be loyal to their own company tliey would get on better. In reply to Mr. Mellow, the secretary said that in 1909 plant, which now stood at £14,000, was in their books at £13,000. They were in a much stronger position now.

In reply to a question concerning the amount owing by the company, Mr. Guy caid that requisites, £0404, loans, .IXOOO, and the money to come from the Government would wipe out all the overdraft.

In reply to Mr. Webby, the chairman said that unfortunately tho supplies who fctuck to the factory would have to pay the quota of those who had gone. Repairs and renewals were, he knew, very Heavy this year. In reply to suppliers, Mr. Guy explained that the commission to Lonsdale's was not paid last year because the statement did not reach them until after accounts had been closed.

Mr. Dagg: We have disposed of two dead horses. Can you assure— The chairnfw: 1 cannot guarantee anything, but to the best of our knowledge and belief all is now in order. He went on to explain to Mr. Gardiner that tlie expense of £SO for water was paid to the ToWn Board for a supply from the new service to Kaponga, , Mr. Guy added that the pipe line and weir were valued at £I2OO. In reply to Mr. Dagg, he said that legal expanses incurred were no greater for ordinary routine, but that extra had been incurred for new articles, while £SO went in stamp duty on supplies' joint pnd several.

Mr. Mellow: The new articles give us the privilege of receiving 3}d leas than ether factories.

Continuing, Mr. Guy said that land end cottages ( £4027) at the farm actually cost this amount, but there wits p. mortgage of £1542, and that the legal expenses (£178) would be paid off at. the rate of £42 per annum. Interest (£901) was only for bank interest and on loans.

The chairman: Unfortunately there is no provision for paying interest on ihares. Referring to the epidemic, he said that the directors took the best advice available, and waited on Mangatoki lo ask help.

Mr. Mellow said Rowan was neglected, and had to go to Riverlea with their milk simply through the neglect of the directors.

Mr. Hill wannly resented this statement, and said that it had been agreed that all their branches should share in improvements to be made. He added that the contract for Rowan factory had been let months before, but that the work had been delayed because of the difficulty of getting men antTmaterials. He understood now it would be completed this week.

,Mr- Hollard said Rowan suppliers were good sensible men, and helped one another, each taking in turn the milk of five others. The delay was the fault of the directors. "AH arc complaining," said Mr. Mellow, "but it is no use complaining to the-directors." Mr. Hill explained that the contract had been carried out on a 10 per cetit. basis, the contractor getting 10 per ot n t! of the total sum paid, similar to the cool storage contract.

In reply to a supplier, the chairman said that the position of the company was absolutely sound, and all plant and buildings thoroughly up to date. "Twenty years ago," ho added, "machinery quickly became obsolete and had to be put out 'Now we have everything of a high stand-* ard, and there are many goad years ahead of Kaponga." "Subject to the same diseascnas in the past," added Mr. Mellow.

In reply to suppliers,, the chairman explained that boxes and crates £1607 all belonged to this year, and that cartage rates were Ss 3d per ton from Kaponga and 12s fld for Riverlaa arfd Rowan. In reference to cool storage expenses, lie Baid it was impossible to get at exact costs, and although the storage had saved the situation during the war time he was not too satisfied with its effectiveness now. Moturoa could do the work more cheaply. 'lt has the advantage," said Mr Mellow, "of having the cheese on hand when you wish to shift them."

In regard to the water power, tho chairman said this was ample, but the difficulty was with the. turbines, t>ne of which was in good order, and tfee other rould be fixed up. "They have cost us," he concluded, "a lot of money." The motion for adoption of'the report and balance-sheet was- carried.

election op directohs.

For two ordinary and two extraordinary vacancies there Were five nominations, and it was agreed by the meeting to take these in one straight-out ballot. On the question of representation of the various branches, Mr. Mellow said that Rowan representatives were working more in the interests of Ivaponga than of Rowanj and had neglected their work considerably. Mr. Hill warmly resented this remark, and said that they werb not to blame tor delays in the completion of contract. The ballot resulted as follows: P. Thouuiine 238, J. H. Bentley 231, .1. Bradford 222, W. E. Hollard Si 10, (J. I!. Hill IST. The first four were declared elected. The directors' remuneration was fixed as before.

Mr. H. A. I.ennon was reappointed auditor at the satne fee as last year. Mr. Rothe moved as a recommendation that the manager have an inspection of all machinery at. regular times to avoid waste. Several suppliers reported that there had been trouble in this respect, ami Mr. Hislop, manager, undertook to do his best to avoid this in future.--Star.