T. J. Edmonds rises to defence of Article

Press, 1 September 1977, Page 18

T. J. Edmonds rises to defence of Article

Some shareholders reacted strongly to a resolution put before them at the annual meeting of T. J. Edmonds, Ltd. The resolution concerned was a requirement by the Stock Association of New Zeaiand that article 26 of the company’s Articles of Association be altered by deleting the sentence — “Before approving the transfer of any share or shares the directors may, if they think fit, call upon the transferee of such shares to satisfy them, and if necessary by statutary declaration, that such transferee would be the beneficial owner of the said shares if such a transfer was approved.” He was putting the resolution to the meeting with reluctance because “we should have the right to know who is the beneficial owner of the transaction,” said the chairman (Mr C. W. Evans). “We find this offensive, but we have no alternative but to put the motion.” The seconder of the motion (Dr D. L. Cropp) said he was also reluctant to second such a motion. “The Stock Exchange Association has no mandatory right to insist on this, it can only recommend,” said a shareholder (Mr A. M. Satterthwaite) speaking to the motion. He wanted his objection noted and said that they

1 were being pressured by a t “group of academics in Well--1 ington” into changing the , company’s Articles. “Though the board is 1 strongly against this, if we > don’t pass it we run the risk 7 of being delisted,” Mr Evans > said. ’ Mr Satterthwaite drew , attention to the “Gazette” of L November 17. 1974, which r stated that share transfers i must be completed within ten [ days, and said he had known i such transfers to take two I months. He was opposed to . the Stock Exchange being . able to tell him what to do I as a shareholder, when these • things could occur. It was in the interests of the shareholders that they carried the motion in ques- ’ tion because there is no al- , tentative, said Mr Evans. The motion was put to the I meeting but very few share- , holders affirmed it with a show of hands. Mr Evans then pointed out that a 75 per cent show of ' hands was necessary to see 1 the motion carried or he would have to hold a poll, which would take some time. The motion was put a second time and was carried —that the company’s Articles would be altered as the Stock Exchange Association had requested. Other resolutions passed at the meeting were those permitting a one-for-eight bonus issue and the raising of the directors’ fees from $BOOO to $12,000 per annum. The final dividend of 12Jc a share (12J per cent) was approved, making a 17 per cent dividend for the year. The bonus shares do not participate in the dividend.

“Since balance date at March 31, our figures have shown an encouraging increase,” Mr Evans said in his address. “A further devaluation of the New Zealand dollar within the next few months, which seems inevitable, should give us an added advantage in the export drive. It would seem on facts to date that the company would more than hold its own during the current financial year,” he said. “One would have expected that with the vagaries of the market and the changing cooking habits of the community, there would have been a decline in the demand for the company’s original products. But, the reverse has proved to be the case.

“The company’s basic products, baking powder, custard powder and jellies increased over the last five years from SI.2M in 1972 to $2.4M in 1977, while the total value of the company’s own manufactured products more than trebled.

“To support the increased sales volume, last year the manufacturing plant at Christchurch was extended by the acquisition of new equipment including a high speed packaging machine. “This year the company’s Auckland property is in the process of being developed to include two new buildings at a cost of about $400,000.”

Mortgage funds are being made available through T. and G. Life Society. It is hoped that after today the bonus shares will carry the increased rate of dividend. Inflation and the exceptional growth in the company’s trading during the year have created problems, and to achieve the additional business it has been necessary to increase debtors about $900,000 and stocks by $455,000. To finance this has involved the retention of a portion of tax paid profits, said Mr Evans.