FARMERS' CO-OPERATIVE ASSOCIATIONS.

Press, Volume LXIV, Issue 13226, 21 September 1908, Page 8

FARMERS' CO-OPERA-TIVE ASSOCIATIONS.

ANNUAL MEETINGS.

N.Z. FARMERS' CO-OP. ASSOCIATION OF CANTERBURY, LTD.

A SUCCESSFUL YEAR.

The annual general meeting of tho New Zealand .banners' Co-operative Association of Canterbury, Ltd., was held on Saturday afternoon in the Association's board-room, Cashel street, mc chairman of directors t-llr J. A. fannett) occupied the chair, and there was a large attendance ot sharenoiuers. A.V.\UAJ_ KEPORT. Tho annual report suited: "During the year oyti snares have boon aUotUju at a premium ot os each to iao peioons, oi whom are now uieuiuei-. «itn a vioiv to placing all the snares of zlio Association upon a uniform ba_i_ und at tiio same time to meet a generally expressod desire ot a Jargo uuiuuci ot shaieuoiuers, your uirecVors proposo io call up x.l per _xiaro on tnc __,<__ snares, upon wuich only £1 per suuiu, uas oecii jiaid. YVicu tho exception oi tho itts luliy-paiu snare., too w„u»o ol the sus_ciiUou capital oi tno A__ucl_uon win uion uo x>axu up to tuo oxteiit ot £_ per siuiio. lno most notonortuy busiiiebS to record during tne period is tne amalgamation or tv« .xoitn Canterbury -.--operative btoiea company, lnmitod, ot -ituigiora, uavvaruon, and tJxioid, witn uus Association, by wnicii tno entire busmen v)t tno tormer nas Deon aoaorued. mo zo,o\tJ new snares created _ibt reoruary last nave all boon allotted to auu taiien up hy, me___er_ ot tno Rangiora Ab&ociation in' tne amalgamation sciieuio. the balance-sheet suo»vs tiiat wie not pronts lor the twelve inonu_> amount to x_o,/oo its bd, to which hat. to no added tne sum oi £oisoti ids ou Drought lorward Irom last year, maltlug a total to :oe dealt with ol £3_,140 jlos id. Tho directors propose to allocate this amount as follows: —'lo pay the usual dividend of o per cent, and a bonus ot ii per cent, on tho paid-up capital (excepting tho capital of tiio late North Canterbury co-operative .stores Company, Ltd., upon which 8 por cent, per annum will bo paid ior tho eight months endiug Maroh 31st, _t»08, m terms of the agreement ot amalgamation, and b per cent, and 3 per cenft bonus as above alter that date); to pay a bonus of 3 por cent. on shareholders' purchases of merchandise during the year (net items excepted); to pay a bonus at tho same rate on sundry salaries and wages earned; to rerund 25 per cent, on all commissions earned (net business and wool excepted); to carry £4762 9s 6d to tho reserve fund, which will then stand at £58,000; to write 10 per cent. oh machinery, office furniture, and warehouse fittings, etc.; to write 20 per cent, dff amalgamation expenses and goodwill account, and to carry tho balance forward." CHAIRMAN'S ADDRESS. Tho Chairman' delivered tho following address: — In moving tho adoption of the report and oalance-sheet, I feel that all things considered shareholders are to be congratulated upon a successful year's operations. Tho profits for the twelve months amount to £26,759, which with £5386 carried over from last year gives a total of £32,145, which your directors propose should _c uealt with as set out in their report accompanying the balance-sheet. Tho earnings for tbe period as compareu with those of tho previous year show a diminution consequent upon the disastrous collapse of the wool market, the exceedingly dry weather during the gre. ter part of tho summer, which materially affected'our auction and stock commissions, and lastly the money stringency, which made its effects felt in our interest account, and more or less throughout every deparment of tho businesSi through tho somewhat generally restricted spending power of our people. In yi|pv of the advisability of strengthening the reserve fund to every reasonable extent, your directors propose adding £4762 to this account and to pay equal to 9 por cent, dividend upon capital, and a bonus of 3 per cent, on purchases of merchandise, as against 10 per cent, and 4 per cent, respectively last year, which under the circumstances I feel sure shareholders will approvo and consider satisfactory. If our present proposals aro carried tho reserve fund will stand at £58,000, equal to about 52 per cent, of tho paidup capital. AMALGAMATION. For some years past it was found that the interests of the North Canterbury Co-operative Association of Rangiora, Oxford and Hawarden clashed to some extent with'those..of this company, and it was felt these districts could bo better and moro economically served by the joining of forces; negotiations werp accordingly initiated, and, as you aro aware, amalgamation took place on 31st March last. Since then the two businesses have been run as one concern, under one Board and one_ management. The acquisition of this business has added about 1300 members to our registers, £13,000 to the reservo fund, and to tho capital account in round figures £40,000 paid up, and £60,000 uncalled. Your directors feel satisfied that this important step will prove a wise and sound investment to the members of both associations. NEW BUILDINGS. During the poriod also the new drapery division of the Christchurch business was completed, and opened in November last. These premises are the finest of their kind in Canterbury, and thoy should answer the needs or our drapery department for many years to come. This spacious addition to the premises afforded a general rearrangement of all departments, which I am sure is appreciated by all those who frequent the stores.. GENERAL RETAIL DEPARTMENT. The records of the various retail deEartments of Christchurch and tho ranches show, with few exceptions, satisfactory results, the aggregate sales totalling £420,110, as against £410,226 last year. CONTEMPLATED IMPROVEMENTS. The exigencies of the business call for further improvements, which your Board have in view, and will carry into effect as soon as circumstances permit. They are: —Extension of tbe grocery and provision departments, with tho addition of a now bulk store, now dairy, with entrance on the Bedford row frontage, rearrangement and extension of the seed department, now offices for .auction, land and grain departments, also new offices for the manager and the correspondents. The new general offices are now nearly at the point of completion, and we hope that within the next tew weeks our clerical staff will he domiciled in these new quarters. AUCTION DEPARTMENT. , This department, so important to our farmer shareholders, is receiving the closest thought of your Board and the management with a view to improving its general efficiency, and it is most encouraging to note that the efforts so far made have borno fruit. Our Addington sales, and those in other centres are increasing, and I am confident they will in the near future assume considerable proportions. At any rate, no (jffort will be spared on our part to attain this end, and to bring this branch of the business to the position it should rightly occupy—in the front rank. Resident agents 'have recently been appointed to watch the association's interests hi the Peninsula, Little River, and Methven districts, and the results so £?r are most encouraging. Other

appointments of a similar nature are ■ contemplated in the early future, by which means we hone to keep our headquarters and branches in closo touch with the outlying parts of the several districts by properly organised lines of communication.' WOOL STORES. Additional storage accommodation is being provided to meet the expected increased catalogue through the coming season, and your directors hope by next season to considerably enlarge and improve the equipments of our wool store m Christchurch. LAND DEPARTMENT. This department also is receiving tho attention it deserves. A capable officer has recently been appointed to devote the whole of his thought and services to its needs, and wo havo groat hope* for its futuro success. GRAIN DEPARTMENT. It is expected that tho offices in connection with this department will be completed iv time for tho coming harvest. It is the earnest wish of tho Board and of tho manager, that shareholders and others should avail themselves of the services of this department as a medium through which to dispose of their grain and other produce. We aro increasing our provincial and Australian agencies, and perfecting the general facilities to enable us to successfully cope with a larger measure of this important business. We are kept constantly advised by cablo of the world's markots, and we can see no reason wlvy, with our immense connection of agriculturists we should not soon become practically the Corn Exchange of tho province*. No paius will bo spared on our side to accomplish this aim. GRAIN AND SEED CLEANING. Tho association has gone to considerable expense, both at Christchurch and Rangiora, to bring our dressing plants to a stato of proficiency, and I hope shareholders will take full advantage of their services. Our grain stores at Lyttelton, Christchurch, Rangiora and Ashburton, offer amplo * accommodation for those who desire to take advantage of them, and our rates of storage, etc., aro lower than those charged by tho Government and other warehouse keepers. ARTIFICIAL MANURES. The use of manure applied direct to grain as well as to root crops is gradually being proved by our farmers to'be very profitable, and it behoves them to see that they get the best obtainable." We havo taken great pains to .ascertain tho best possible combinations of manures for these purposes, and wo can confidently afhrm that our fertilisers are better and of greater intrinsic value than those offered by any other firm. Our output having grown so enormously, we have taken over the business cairied on for so many years by tho Provision and Produce Comoany, and in future the whole work of mixing, etc., will be carried on by the association at Belfast. LONDON OFFICE. Our London office is still under th© management of Mr A. D. Henderson, whose personal caro to all shipments of wool, grain, meat, etc., may be relied upon by shippers. W© aro laying out our plans in anticipation of a very large business in these several lines during next season.. ' FINANCE*. Those of you who havo followed the progress of the Association for tho past few years and have studied th© balanoe-shoets covering the same period> cannot be insensible to the need of a stronger capital account. This business, in common with every other concern of any importance in the Dominion, has been riding upon a peaceful wave of prosperity and financial plenteousness, which has encouraged a sort of general staving-off of a certain course of acflfon, which under more stringent conditions would have been absolutely necessary. A strong financial structure is in reality , the bulwarks of every business. This Association is no exception. If.-the developments and the several improvements to which I havo alluded are, to be. carried into effect tho necessity for more Capital is all the more pressing and greater. For tho sake of uniformity, and, as stated in tho directors' report, to meet tho wishes of many 'of our shareholders, we propose bringing all shares into line by calling up £1 upon all those shares on which only £1 nasi been so far paid. The business, however, requires something more substantial than this; and, as no doubt many of yotrwill havo noticed from our adrvertisements, your directors are now. asking shareholders to amend tho Articles of Association to enable tho Board to take the necessary authority to create an issue of preferential shares, which they purpose offering to tho public, and we have every good reason to feel that the issue will bo responded to by existing shareholders and the outside public. 'Tho investment being an absolutely safe ion©, should be attractive to investors. FARM LABOURERS. With regard 'to the so-called farm labourers' dispute* I do not wish to use this meeting as a means Of ventilating my opinion on of political significance, but as this subject was so closely allied ; with tho intorests of farmers, and this Association being exclusively a farmers' institution, I cannot allow the opportunity to pass without briefly alluding to the results of the seven months of wearisome proceedings, and to express the hope that they will not have appreciably interfered with or marred that mutual good feeling and harmonious working together which has in the past been characteristic of the relations between the farmers of Canterbury and their employees. (Hear, hear.) I venture to express th© hope that the legislation now contemplated may be effectual in' preventing tho paid agitators and a fvw discontented spirits from creating isput©3 and plunging important industries liko ours into a state of turmoil and unrest, with its attendant 1 expense and loss of time. (Applause.) FORECAST. With the lambing practically over, and the wool and harvest seasons in view, one's thoughts aro naturally directed with enquiring interest to the 1 market outlook, and it is scarcely possible for mc to throw more light or" to afford fuller information upon those 1 matters than one can gather for oneself through tho medium of tho daily papers and the very exhaustive market reports which are supplied to farmers' through various sources. WHEAT. The local market for wheat is still considerably affected by tho importation of Australian flour, and to give one an idea of what this means to us, in one week only, it may be mentioned' that two cargoes-arrived representing no less a quantity than 3300 tons. Therefore, with .this influence at work unon our market I can see little chance for any very material improvement upon present rates between now and December next, and the consensus of opinion is that prices must ease considerably as we draw in sight of the new crop. There are a number of exceptionally peculiar influences and contingencies to be considered, which render it tho more difficult to forecast tho v"aluo prospects of the coming harvest. Reports concerning ihe American and Canadian crops aro most favourable: on the other hand, Russia hns had three poor harvests in succession, Ronmania's stocks of wheat are exhausted, and India is practically out of the field. Resides this, it must be borne: in mind that America, C«nada, Russia, and Hungary, must considerably replenish their reserve stocks, which have been rather unusually heavily j drawn upon for some time past, thus j minimising tho exportable surplus. Tho future of our market must be more or less influenced, as it usually is, .by.

America, and although an attempt is pretty, sure to bo made to force down local'rates, I would advise our farmers to be cautious, as it is quite on the cards that the speculative element of America will, reflect its influence hero, and give our market a certain amount of buoyancy. WOOL. Nothing in tho nature of a revival of this trade is expected until America gives a strong lead, and that is not likely to occur until tho Presidential campaign is over, and its generally disturbing influences havo settled down. All authorities seem to incline to the opinion that the worst is over, andthat thoreis bound to bo an improvement in the near future, even though it may only be slight and very gradual, and, speaking for my own part, I can see no apparent reason why a steady improvement shotdd not tako tho place of the unsettled order of things which we have been experiencing of late, MEAT. It is satisfactory to note that tho demand for our lamb has remained) very steady. Mutton, however, excepting the small-weight Canterbury class, has been slow of sale, and it i3l a matter of regret to learn that fairly genoral complaints have been received! here from Home that our shippers have not paid sufficient attention to tho matter of quality in their mutton shipments. Perhaps the dry seasons aro in a measure answerable for this, at any rate farmers must do all in theirt power to uphold the reputation of "Prime Canterbury." Looking at the near future from a general point of view, I think our outlook is healthy and encouraging, and that a prosperous y*ar is beforo us, in which case I think we may reasonably expect a revival of confidence which will reacb favourably upon tho money market, and do moro than anything elso to restore tho conditions oi ther Dommion! to a normal stato again. The balance-sheet, a copy of which has been furnished to all shareholders, practically 6peaks for itself, but if anyone present would like any further information upon it I should be glad to afford the same, os far as I possibly can. I now'have pleasure in moving tho adoption of the report and balancesheet. THE DISCUSSION. Th© motion was seconded by Mr T. W. Adams, who said that the position disclosed must bo considered satisfactory by the shareholders. Mr D. Bates said that he agreed with the chairman and Mr Adams that the Association had reason to congratulate itself on the balance-sheet. The oiily thing ho desired to refer to was tho chairman's remark about increasing the amount of capital. It was evident to anyone who examined the balance-sheet the amount of liabilities and assets, the volume of business done, and. tho capital available, that an increase of capital wos necessary. H© woujd like to make a suggestion for the consideration of the directors, which might bo rather novol, but which ho thought was sound. This wes that the Association should consider tho question of issuing a not© currency. Tho Association had' an uncalled capital of £200,000, and ho suggested that a restricted issue of note currency, say £20,000, should be issued. There were, h© admitted-, difficulties in regard to a note currency which wero apparent to those who had studied the question). On© difficulty was whether notes would bo received in payment for accounts?- They could not compel the public to accept the notes as legal tendor in payment of debts, but the iar-. mere were now an extensive and 1 influential body; and would bo justified! in seriously considering th© question. They could agree among themselves th_t the notes should be current and accepted as legal tender. ,It could easily be found out who would, not accept- the notek and thoy could be reported! to the shareholders., who would be guided by that fact. H© thought that, this suggestion was worthy of consideration. - ' . The CQrairnran. said that the directors would consider the question j He nob thin>k they would interest themselves in it very much duo consideration. (Applaue.) " - . ■Mr. Hiawikin- said that he intended to throw cold water on the suggestion. A.note currency had' to pay a. 2J per cenJb. tax, and it would only add to their liabilities. There were liabilities at call of close on. £100,000, and) to meet these tbe Association hod cash, to their credit of. about sixpence! He agreed that ,more capital was an absolute necessity. Th© balance-sheet ,he did not consider very satisfactory. The liab-ities at g call were £100,000 at least, and they would bo extended by from £200,000 to £250,000 of further) liabilities. /There was no cash whatever to meet them, and a note currency would only add to their difficulties..The speaker next referred to the. item "sundry debtors £90,270" on the assets side, and said that he presumed that these debts were for goods'.'purr chased, on which the purchasers were irecoiving a bonus of 3 per cent- .Ho contended that under the present system tho Association was losing 9. perl cent, on from £90,000 to £100.000 per annum by allowing hon-nsea .in. these cases. Tti© Association, should, If possible, alter their day of settlement, so that th© bono- would only be given, to purchasers who paid their accounts beforo a. certain day. "

In reply to a shareholder, the Ohairmam saw- that tiro reservo fund was invested in the business. Tho shareholder asked if it would not -©'better to make a call on ordi-n-ary shares instead of issuing pre-ferential-hares?' (Hoar, hear.) The issue of preferential shares meant that the dividends on ordinary shares were mortgaged to preference sharehciklers. Tho Chairman replied that it; would not ho good policy to adopt that course. The uncalled capitaf was a valuable asset on which to borrow fori trading purposes- He considered that it would" be an additional security to tho preseni shareholders to have the issue of preferential shares, boeauco the capital and assets wculd be increased vory much, and that portion of the capital not participating above a certain fixed rate of interest would leave a larger rate of profit to be divided among tho ordinary shareholders. It was not proposed to d-'iecon'tin.ue the sale of ordinary shares. Ho considered that it would be better from tho point of view of security and profitable working, to issue preferential shares, or money borrowed in that way, at a fixed lower rate of interest, tihan to call up the ordinary uhar© capital. Mr G. Bow-ron. "said that it would depend on the condition of the money market whether tho preferential shares could bo issued at a lower rate of interest. They would'probably_ not be issued' until the market was high, and then instead of a lower rate the Aseociation wotdd have to pay a, higher rate of interest. _ The chairman replied that the fact that the rate of interest was secured as a first chorgo on the profits of tbe year was a sufficient inducement for "the preferential shares to bo taken up at a lower rate. Reverting to come remarks mado at an earlier stages ho said that it might be desirable to point, out that although the liabilities of the Association were growing the assets. were also growing, and the position or the Association was a perfectly safe one. The whole of tit© Association's liubilitk-, in round figures, amounted to £300.339, but before tinyone could losj a penny of that amount the Association would have to suffer a.!o._ of no lea* than £43U,UUO, made up of capital, reserves, and accrued profits. Tho Association was thus in a splendid position in regard to assets against liabi'--ties. It'was admitted that they should have a very considerably increased.capital to work tho business to moro advantage, ar.d the directors, thougbtthat

to issue preference shares would betnis| best way to accomplish that end"."-.vS-^J! A shareholder enquired whether thlriS was any mortgage on tho property, and the chairman that there was non© '■-'■'•'^ The shareholder said that ho menial tioned this as suggesting a possible?!? means of raising capital whhouti_3i£%t ing preference shares. g .>iM Another shareholder drew to tho fact that there was a debit '©f)P £32,000 at the bank, while last: there was a credit of £18,000. 'Dkfcst that mean tliat the Association. h*dl| increased its liabilities by £50,000? .^| The chairman said that that so, but it was justified by tho ed business and the largo additions t*-fi tho Association's premises. Tbo bttsjS§| ness was all increasing and they would'| require a good deal moro money thi_fl year than last year. It was to pro-.*! vide for this increase that they weoi : s| proposing to increase tho capital. >,Gif Another shareholder asked why thV%i bonus on shareholders' purchases hafio been reduced to 3 per cent? ; 4|l Tho chairmen replied that tho reasos-P was that tho profits had been less the- year, and it was thought to cany « considerable amount to ■&&§ reserve fund instead of paying i*x£si much in bonuses. ■. r ; '-" ! ?SJ3s Tho motion for the adoption of : tlipt report and baknce-_hoet was thettjK; agreed to. '•- : ';;^Ji ELECTION OF DIRECTORS AND'#I AUDITORS. %g| Their© were seven nominations for "&&M seats on the" directorate. The pdlu» : 4 resulted in tho return of the six ing directors, the voting being as -falM lows:—James Gaxmdohael 1498, Chamberlain 1481, J. G. A. klau 1457, J. Gough 1404, S. S. man 1377, T. D. Boag 1371 (rc*elecW)pi A. R. Bloxam 535. There wore 40iifc;«r formal votes. Messrs H. A. Bruce ia&&W. Jameson were re-elected for tho ensuing year, at a wsnwxsrtwl tion of £100 each. It was pointed ©u^« that tho work of the auditor- wouldfq©;S considerably increased during the yeiiy-p and an increase an their remuneration;-!! was proposed by this, resolution. The,*' vote, was carried! with some dissentients. §i The Chairman ruled that th© rcsnhjfe|| tion was carried, and declined to call for a show of hands, which was"asked M for by a few objectors. v 'ggj| This concluded tho buaine-B of thei'l meeting. ' i-il^H