THE ASSETS REALISATION BOARD (REPORT OF THE GENERAL MANAGER OF, FOR THE YEAR ENDING 31st MARCH, 1897).

Appendix to the Journals of the House of Representatives, 1898 Session I, B-15c

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1898. NEW ZEALAND.

THE ASSETS REALISATION BOARD (REPORT OF THE GENERAL MANAGER OF, FOR THE YEAR ENDING 31st MARCH, 1897).

Laid on the Table of the House of Representatives by Leave.

GENERAL MANAGER'S ANNUAL REPORT. Wellington, 7th July, 1897. I have again the pleasure of submitting the balance-sheet and Profit and Loss Account for the halfyear ending 31st March, 1897, and am much gratified to be able to report that, notwithstanding lower market prices for our staple products, the year's operations result in a balance to credit of Profit and Loss Account of £52,003 towards payment of debenture interest, as against last year's balance of £52,586 —less reclamations, &c, £3,879 = £48,707. I should here, however, mention that a proportion of this surplus over expenditure is due to an enhanced market value, as compared with 31st March, 1896, of the stock on hand. Still, the enhancement is the result of an improved quality consequent on lighter stocking, heavier culling, and better selection. In terms of the statute, a balance-sheet and profit and loss statement had to be made as at 30th September, 1896, and this was done. The statement, however, is really of no reliable service, and is practically no more than the balancing of the ledger accounts at that date, without any revaluation of stock. It is preferable that our balance should be annual, and that our books should be closed at the 31st March in each year, thus enabling the proper bringing to account of all revenue, stock-taking, &c.; and it would be desirable that, during the next coming session, Parliament should be asked to repeal this section of the statute in favour of the above suggestion. Attached to the balance-sheet are full analytical statements of all accounts shown in same, and giving at a glance full particulars of contributing items. (2.) Statutory Contribution by Bank of New Zealand. The profits of the bank for the year ending 31st March, 1896, were apparently insufficient for the payment to the Board of the full £50,000 as per statute, and we have only received £35,708, leaving £14,292 to be added to the £50,000 accrued due at the 31st March, 1897, or a total of £64,292, which, with our surplus of £52,003, will exceed debenture-interest requirements by £22,485, which will be carried forward. (3.) Eealisations. Attached is schedule of realisations for the year, aggregating £147,992, which, together with last year's sales (£63,219), total £211,211. The special features are the sale to the Land Purchase Board of the Arowhenua Estate at £28,915, and the Albury Estate at £65,174. The latter I consider to be a good sale, but the former, as you will remember, was disposed of against my opinion and advice. Had the auction sale been allowed to go on I am positive that the Assets Board would have benefited to the tune of several thousand pounds. Bushy Park Estate has also been disposed of, and, considering its condition and the poor results we have for years had from its working, I look upon the arrangement as satisfactory. The Messrs. McKenzie are hardworking, conscientious, and economical, and lam very sanguine of their carrying through their engagements. An auction sale of properties was held at Auckland in December. The sales totalled £8,948. Whilst, of course, leaving a heavy discrepancy on cost, it is generally considered the properties realised good values. It is, of course, impolitic to do more than feed the markets gradually, and only a proportion of the properties were offered. These were carefully valued in advance, and reserves fixed by the Board; such reserves were, to a large extent, fairly well covered. In the Auckland District the mining industry then booming gave considerable impetus to the sale, and there is still good inquiry for suburban sections, but hardly so good as was the case in December last. Special effort is being made to clear off sections of an undesirable nature—-namely, such as have on them old dilapidated buildings, which not only produce little revenue, but are a continual cause of expenditure in repairs. Generally I think that the result of sales for the year may be considered satisfactory.

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(4.) Stations and theie Working. The actual profits earned for the three years ended the 31st March, 1897, after allowing for reclamations on previous years' shipments, are as follows :— 1895. ~ , _ „, Equal Per Cent. Equal Per Cent, on .Net Front. on oost _ Mr Foster > s Valuation. 11,442 ... 0-6 ... 087 1896. 54,312 ... ' 2-97 ... 4-44 1897. 60,110 ... 3-30 ... 5-15 Note.—Value of wool and frozen mutton at 31st March, 1897, is estimated. The cost of operations for the same period (omitting Carnarvon, which has been sold) is as under:—

It will be seen that the expenses of management are still kept well within the reduced amount of last year, and, notwithstanding the greater economy, the efficiency and value of the properties are well maintained. (5.) Sales op Stock. The following is a comparison of aggregate values obtained for the three years ending 31st March, 1897 :—

Sheep.

Cattle.

From the above it will be seen that, notwithstanding decline in general market rates, our sale prices for the past year show an improvement on the prices realised for the year ended the 31st March, 1896. This, with the exception of the Waikato properties, which in a measure have obtained the benefit of the mining boom, is due to the better class of stock we have to offer in consequence of reduction in number carried.

Particulars. 1895. 1896. 1897. Permanent improvements Grassing, &c. (20 per cent, of which is charged to Profit and Loss Account each year) Depreciation in implements Turniping General expenses, wages, &c. , including feed * Pent and interest Eabbiting •Grain-growing for sale ... £ 12,015 17,068 £ 3,802 11,826 £ 5,542 11,144 3,273 19,487 59,827 6,865 2,072 5,584 1,203 17,999 41,614 5,365 2,517 3,275 1,054 16,170 45,888 2,574 2,342 1,759 Total cost of working 126,191 87,601 86,473 * Note re Cost of Feed, Waikato Estates. —At March, 1896, oaten shea\ ton higher than the previous year, and in consequence the cost of feed for 3 less than if the 1895 values had been taken. Peed to the value of £1,550 wi 1895, and the profit for the following year benefited by that amount. ■es, chaff, and 1 'ear ending 31s is not shown ai :iay were valu< 3t March, 189i s a station ass ed at 10s. per 6, was £1,500 let at March,

Year. Number sold. Net Proceeds. Average. Number frozen. Net Proceeds. Average. Total disposed of. Net Proceeds. Average. 1895 1896 1897 91,021 98,281 114,822 £ 40,857 25,733 45,197 s. d. 8 11 5 2 7 10 26,869 37,402 19,584* £ 8,083 21,488 7,490 s. d. 6 0 11 5 7 7 117,890 135,683 134,406 £ 48,940 47,221 52,687 s. d. 8 3 6 11 7 10 * Valui of frozen mutton unsold at 31st Ma) rch, 1897, is estimated.

Year. Number sold. Net Proceeds. Average. 1895 1896 1897 4,503 3,953 3,678 £ 24,456 22,538 21,021 £ s. d. 5 8 7 5 14 0 5 14 3

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(6.) Stock on Hand at 31st March and Valuations. ■;-■■.'. The following are statements of Sheep and Cattle Accounts, showing valuations as affecting Profit and Loss Account. The valuations are as made by the respective station-managers, and, whilst in individual cases I do not quite agree with them, in the aggregate advance of Bd. per head I fully concur, as representing a value derived from better selecting and grazing.

Valuation of Sheep on Hand.

Valuation of Cattle on Hand.

(7.) Wool Clip.

From this it will be seen that, although our numbers have been reduced, our clip has not shrunk to any appreciable extent, and in fact on the average we have shorn earlier. This supports the higher valuation of sheep.

(8.) Lambing.

(9.) Mortality.

1895. 1896. 1897. Number on Hand. Manager's Valuation. Average. Number on Hand. Manager's Valuation. Average. Number on Hand. Manager's Valuation. Average. North Island South Island* 258,934 212,336 £ 115,415 56,150 s. d. 8 11 5 3 222,339 188,510 £ 80,877 65,025 s. d. 7 3 6 10 203,183 149,071 £ 87,793 48,798 s. d. 8 7 6 7 471,270 171,565 7 3 410,849 145,902 7 1 352,254 136,591 7 9 * South Island, 100,000 merinos are carried.

1896. 1897. Number on Hand. Manager's Valuation. Average. Number on Hand. Manager's Valuation. Average. 21,410 £ 71,421 £ 3 s. 6 d. 8 21,351 £ 71,039 £ 3 s. 6 d. 6

Year. Sheep Bhorn. Average per Fleece. Net Weight Greasy. Net Return at Port of Shipment. Equal per Pound. Net Weight Scoured. Net Return at Port of Shipment. Equal per Pound. 1896 1897 Lb. oz. 378,670 7 1 343,330 7 4 Lb, 2,222,043 2,111,680 £ 70,365 61,503 d. 7-60 *7-0 Lb. 227,464 199,785 £ 9,273 7,483 d. 9'78 *9-0 * Estimated.

1896. i 1897. ■™ l -o ~ Lambs cut and Ewes to Ram. taile(J Percentage. ! Ewes to Ram. Lambs cut and tailed. Percentage. 152,258 117,073 77 128,241 101,089 79

Sheep. Cattle. 1896. 1897. 1896. 1897. Dead and missing. Per. Cent. Dead and missing. Per Cent. Dead and p c I Dead and p fi missing. missing. 39,892 8'44 27,183 6-61 1,205 5-39 787 3-67

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(10.) C omparison of Operations for Years ending 31st March, 1896, and 31st March, 1897.

(11.) Prospects. The prospects of the oversea produce markets, which control our profits, are certainly discouraging, and it is difficult to conceive the means to a better result. Steps, however, should be taken, and I propose to do so, to obtain reductions in freight on our wool and frozen meat or any other produce which can be carried at lower rates. Dependent upon the possibility of revenue is of course the strength of inquiries for properties such as we have for disposal. I am sanguine that, with judicious cutting up and placing on the market, we shall shortly clear off some of our Waikato properties, for which so far demand has been limited. Arrangements are being made to offer Eangiuru, Eangiatea, Karapiro (part Feneourt), and Manawaru in farms by auction at early dates. (12.) Balance-sheet. In addition to his statutory certificate, the Colonial Auditor has handed in a report upon the business of the year and the accounts. As regards the former, comment is unnecessary. As regards the latter, however, there is one point which cannot be allowed to pass without remark: Permanent Improvement Account. Having had a good many years experience both as a station-manager and as inspector of stations and properties, I may fairly lay claim to a knowledge of these matters which, possibly, is not the case with the Colonial Auditor, who merely throws out an obscure remark of a hearsay nature. As, however, in his concluding remarks he has not deemed it incumbent upon him to call for alteration, it is reasonable to assume that he concurs in our practice. I shall, however, now be glad of the Board's ruling as to the propriety of our system in this connection. (13.) Staff. I must not conclude my report without referring to the efficient manner in which the work of the year has been carried on. My efforts have been very ably seconded, and the comparative success of the year's operations is in large measure due thereto. Walter G. Foster, General Manager.

Approximate Cost of Paper. —Preparation, not given ; printing (1,435 copies), £2165. 6d.

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Price 3d.]

Year. '3 U Grass iing. Oats. Oate: Hay. 60 a '3 '5 u Q .2 3 to a _ 1 5 _ a 'o 9 With Plough. Surfacesown. Acres. Bush. per Acre. Acres. Tons per Acre. .896 .897 Acres. 14,606 *13,750 Acres. 14,867 13,465 Acres. 1,160 2,023 2,667 1,425 29 20 1,385 1,312 1* 14 Ch. Acres. Acres. 680 ... 1,390 262 557 1,347 Ch. (1,947 ' 664 * Includes sown with grass 3,283 acres.