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Half-year ended 31st December, 1893. THE EASTERN EXTENSION AUSTRALASIA AND CHINA TELEGRAPH COMPANY (LIMITED). Directors. —Sir John Pender, G.C.M.G., M.P. (Chairman), Francis Augustus Bevan, Esq., Sir Albert J. Leppoc Cappel, K.C.1.E., Charles William Earle, Esq., the Eight Hon. Viscount Monck, George Garden Nicol, Esq., John Denison Pender, Esq., the Most Hon. the Marquis of Tweeddale. Secretary.- —F. E. Hesse, Esq. Offices. —Winchester House, 50, Old Broad Street, London, E.C.

Ebpobt and Accounts of the Directors for the Half-year ended 31st December, 1893, to be submitted to the Forty-first Ordinary General Meeting, 18th April, 1894. 1. The usual statements of account for the half-year ended 31st December, 1893, are submitted herewith. . 2. The gross receipts, including Government subsidies, have amounted during the half-year to £251,698 10s. 6d., against £247,766 19s. Id. for the corresponding period of 1892. 3. The working and other expenses, including £21,122 4s. Bd. for cost of repairs to cables and expenses of ships, absorb £76,574 15s. 6d., against £91,768 18s. od. for the corresponding period of 1892, leaving a balance of £175,123 15s. od. From this is deducted £4,015 Is. 9d. for income-tax, and £31,895 for interest on debentures, debenture stock, and contribution to sinking fund, leaving as the net profit for the half-year £139,213 13s. 3d., which, with £81,116 17s. Bd. brought forward from the previous half-year, shows an available balance of £220,330 10s. lid. 4. One quarterly interim dividend of per cent, has been paid for the half-year, and it is now proposed to distribute another of like amount on the 19th instant, making, with the interim dividends paid for the first half-year, a total dividend of 5 per cent. It is also proposed to pay a bonus of 4s. per share 0r.2 per cent., making a total distribution of 7 per cent, for the year 1893. The balance of £107,830 10s. lid. has been carried to the General Eeserve Fund, which, after being credited with interest received on investments during the half-year, now stands at £633,686 2s. 5. The working of the Australian tariff arrangement for the third year of "guarantee," ending 30th instant, is estimated to result in a loss of between £11,000 and £12,000, half of which will be borne by the guaranteeing Governments, and the other half by the associated cable companies, in accordance with the terms of the agreement. This loss would, however, be far greater but for the abnormally large traffic which was transmitted during a portion of the year in connection with the financial crisis in Australia. 6. In accordance with the provisions of the trust deed dated 10th May, 1879, 371 of the company's 5-per-cent. Australian Government subsidy debentures, amounting to £37,100, were drawn by lot on the 2nd instant for payment at par on the 2nd July next. The numbers of the drawn debentures are given at the end of this report. 7. With a view to carrying out the arrangements referred to at the last general meeting for increasing the security of the company's China system, a contract has been entered into with the Telegraph Construction and Maintenance Company for the manufacture and laying of an alternative cable between Singapore and Hongkong, connecting the Island of Labuan and British North Borneo en route. The first section between Singapore and Labuan is now being laid, and the whole work is expected to be completed and the line opened for traffic before the end of the present month. 8. Your directors have the satisfaction to report that the Netherlands-Indian Government have placed at the company's disposal a special wire through Java for the transmission of the international traffic by the company's employes, and a small station has been opened by the company in the Government office at Sourabaya in connection with the same. This special wire gives the company an efficient alternative communication to their Singapore-Banjoewangie cable. 9. In accordance with the articles of association, Francis Augustus Bevan, Esq., and Sir Albert J. Leppoc Cappel, K.C.1.E., retire by rotation, and, being eligible, offer themselves for re-election. 10. The retiring auditor, Mr. Henry Dever, desires to offer his firm, Messrs. Deloitte, Dever, Griffiths, and Co., for election as auditors to the company. Messrs Welton, Jones, and Co. also retire, and offer themselves for re-election. John Pender, Chairman. Winchester House, 50, Old Broad Street, London, E.G. 9th April, 1894.