YEAR’S OPERATIONS

Wairarapa Times-Age, 8 October 1941, Page 5

YEAR’S OPERATIONS

W.F.C.A. ANNUAL MEETING SATISFACTORY FINANCIAL POSITION. BURDEN OF TAXATION. At the fiftieth annual meeting' of the Wairarapa Farmers’ Co.-operative Association, Ltd., held in Masterton yesterday afternoon, the results of the year’s operations were fully reviewed. It was the expressed opinion of several speakers that the financial '

position was satisfactory, but all agreed that the incidence of taxation was assuming alarming proportions.

In seconding the adoption of the annual report and balance sheet Mr T. Jordan stated that the past year had been a trying and most difficult one. The directors had worked harmoniously and as a whole. It was interesting to see how the company had fared over the past four years. In 1937 it had OAved £112,000 to the bank; today it owed £78,000 and the assets were undiminished. Regarding stock, it stood at £150,000 in 1937 and at £168,000 today. The directors had, in recent years, started out to build up a reserve; but times were exceedingly difficult to set aside reserves. In 1937 there was no reserve, today the reserve stood at £lO,OOO. Referring to taxation Mr Jordan said that a taxation reserve —unfortunately necessary —stood at £4,000 in 1937 Avhile today it Avas nearly £17,000. In 1937 book debts were £75,000; today they were £61,000 —in exceedingly difficult times. That was an indication of the type of business, the type of customers and the way the business was run. Out of a total merchandise turnover of some half a million pounds bad debts amounted to under £5OO, or one tenth of one per cent.

SHAREHOLDERS & EMPLOYEES.

“As directors we would like to do as much as we can for the shareholders,” said Mr Jordan, “From time to time we have considered giving them a rebate on purchases. The ordinary shareholder is our most loyal supporter. However it could not be done as it would be too great an inroad into the company’s profit against the heavy increase in taxation and the directors could not give effect to their desires.” Mr Jordan urged all shareholders to continue giving their loyal co-opera-tion as it would help themselves. Of the company’s staff of some 290 over 100 lived in Masterton. It was. a big wages bill and the company was worthy of the public’s support. In conclusion Mr Jordan said that all could be satisfied with the company’s operations last year. TURNOVER MAINTAINED.

Mr C. M. Bowden said that it was satisfactory that the turnover had been maintained despite factors which the chairman (Mr Donald) and Mr Jordan had mentioned. The curtailment of the building programme had had an adverse effect on the hardware section and the import restrictions — necessary in some cases —had played havoc with the stocks in some departments. The trend of increasing prices was not a dominant factor in the increased turnover, as, apart from some lines, they were on a level and were not as high as in the last war. The increase in turnover, was, however, an indication of the measure of satisfaction customers felt with the service and a creditable reflection on the management. Overhead costs had been kept down. He referred to the time when the company owed £190,000 to the bank and stated that the present position showed that the bank’s confidence in the company had been well justified. Over the last eight years the profit had been steadily growing. It was satisfactory to know that all branches had shown a profit over the past three years no small feat. A constructive scrutiny was being made of departments and it was hoped to be able to announce that all departments had made a satisfactory profit. Referring to the incidence of taxation, Mr Bowden said that the Government got twice the amount the preferential shareholders received while the ordinary shareholder received nothing. “Taxation is necessary but it has its serious side,” said Mr Bowden. Continuing he added that it was extremely difficult to put aside reserves. Most of the large and successful companies in New Zealand today .owed their present position on account of their having set aside reserves in years past. Yet difficult times would have io be faced—difficulties associated with rehabilitation and the gearing down from the war effort to peace. Companies with reserves would be better off than those without. The same applied to individuals. In conclusion, Mr Bowden expi’essed the opinion that the preferential shares would reach a more satisfactory stabilisation.

WORK APPRECIATED. Mr D. Caselberg expressed his personal satisfaction with the results of the past year’s operations and stated that all interested in the company would join with him in wishing that the good work would be carried on. Mr J. G. Brechin stated that he could appreciate the work the staff had accomplished in the past year. The staff had been asked to carry a great weight of work. For instance they had been asked to bring in £13,350 profit for the Government before the company got anything. They had been asked to bring in £1650 for land tax, and £740 for rates in Masterton alone. Mr Jordan: “The rates are less than last year.” Continuing, Mr Brechin said that he sympathised with the staff and the work it had to do. It would not be so bad if the money taken by taxation was actually required and not diverted. It was. Of the £15,000 paid to the Government in taxes only £5,000 was used for war purposes. The staff was in difficulties in other matters, too. Its members were circumscribed in the range of goods available and when they could buy them they were tied down to prices which bore no relation to costs. In addition, the prices were fixed by people who had had no commercial experience. It was all appallingly wrong. However, confronted by all those difficulties, the staff had

carried oh and had given loyal and efficient service. A vote of thanks to the staff was carried by acclamation. DIFFICULTIES FACED. The general manager of the company, Mr J. H. Cunningham, briefly returned thanks on behalf of the staff. He said that he appreciated fully the many difficulties referred to by the previous speakers which had to be faced in successfully running the business, but it had to be remembered that other companies faced the same conditions today. The war had added to the difficulties. It was pleasing to note that 38 members of the staff were on active service. The number of men serving in Territorial camps tended towards dislocating the service. The Government was the company’s best shareholder, continued Mr Cunningham. It took 60 per cent of the profit without having the risk of trading. Stocks were well placed and varied in nature. Apologies for absence owing to indisposition were received from Messrs G. W. Sellar (auditor) and Mr T. A. Cunningham (legal adviser). • It was decided to send a letter to Mr Sellar expressing regret in his illness and wishing him a speedy recovery. Messrs J. G. Brechin (representing the preferential shareholders), T. Jordan and W. Howard Booth (ordinary shareholders) were declared re-elected to the directorate. Messrs Sellar and Sellar were reelected auditors.