COLONIAL SUGAR COMPANY

Dominion, Volume 18, Issue 191, 8 May 1924, Page 7

COLONIAL SUGAR COMPANY

NEED OF PROTECTIVE DUTY TO KEEP INDUSTRY GOING (BY TELEGRAPH.—PRESS ASSOCIATION.) Copyright. (Rec. May 7, 9.50 p.m.) Sydney, May 7. Addressing a meeting of shareholders, Mr. Knox, chairman of directors of the Colonial Sugar Company, said a large production of sugar was expected during the coming season. The price to be paid manufacturers has not yet been fixed. As a result of alterations to the plant, the company could now provide easily for the present consumption of Australia and New Zealand. The 1923 crop had turned out better than expected, and 16,1)00 tons had been exported during the past nine months. This season the export trade would be larger. Referring to the Auckland refinery. Mr. Knox said there was no chance of maintaining business if there was a reversion to former free trade conditions. These latter obtained up till about four years ago, when sugar was first handled by the Government, but when the Government relinquished control last year a small protective duty on competing white sugar was imposed and this enabled the company to carry on. The duty would expire in September, but the company hoped that it should be recognised that refining on a free trade basis was impracticable without incurring a serious loss, and that the necessary protection would be granted to avert the closing of the industry.—Press Assn.

(Rec. May 8, 1.5 a.m.) Sydney, May 7. At the annual meeting of shareholders of the Colonial Sugor Company, Mr. Knox submitted accounts covering the year to March 31, the. first to be presented since the reversion of the assets of the Fiji Company to the present business. The net profit for the period amounted to £673,639. Of this the sum of £392,410 was contributed by the Australian mills and refineries, and £109,090 by investments subject to Federal income tax, while the earnings of New Zealand and Fiji and from other investments not subject to Federal tax amounted to £172,139. The balance brought into the accounts was £4326,716, making a total of £1,000,355 available. The interim dividend at the rate of 255. per share to September 30 absorbed £203,125, and it was proposed to pay a final dividend of 20s. per share, taking £243,750, the sum of £250,000 to be transferred to reserve and the balance of £303,480 carried forward. In March last it was decided to increase the authorised capital from four millions to seven millions by the creation of 150,000 new shares of 20s. each, and also to increase the paid-up capital from £3.250,000 to £4,875,000 by. capitalisation of £1,625.000 received on account of the liquidation of the Fiji Company. The latter sum wos distributed in the proportion of one £2O fully paid-up share for every two shares held for the half-year ended March.

The Australian comnanv showed a net profit of £2sl,39s*—Press Assn. VALUATION OF THE ASSETS.

By Telegraph—Press Association. Auckland, May 7. The report presented at the annual meeting of the Colonial Sugar Company in Sydney, a copy of which has been supplied locally, states that the profits in Australia, including investments subject to Federal taxation, were £501,500, from which was paid a half-yearly dividend absorbing £203,125. The directors propose a final dividend of twenty shillings per share, amounting to £243,750, which leaves £54,625. To this is added earnings in New Zealand and Fiji and other investments, £172,139; also tlw balance from the previous year, £326.616; a total of £553,480. The board proposes to transfer £25,000 to the reserve fund, leaving £303,480 to credit of profit and loss. Advice has been received that the report was adopted. Referring to the valuation of the assets of the Fiji Company, now reverted to the parent company, the chairman said that it was not easy to value the fixed investments in New Zealand and Fiji. The former consisted of the Auckland ■ refinery, on which about. £400,000. had been spent, and the difficulty with this lay in tho fact that in consequence of the enormous increase in working expenses and coastal freights during the past nine, years, there was no chance of maintaining the business if there be a reversion to the former free, trade conditions. The duty would exP.’re in September, and tho directors still hoped that it would be recognised by Parliament that refining on a free trade basis was impracticable without incurring very serious loss and that the necessary measure of protection would be granted to avert closing the refinei-y. In the meanwhile the directors had put the asset down at its cost, such being much below the amount for which it could now be erected. The Fiji business, however, could not be valued in this way, owing to the prohibition of the engagement of labourers in India which was still the governing factor in the company’s affairs in that colony. “So far as we .are aware,” said the chairman, “nothing has yet been done bv the British Government to have this prohibition withdrawn, and thus give us the same opportunity as the Crown colonies of Malaya and Ceylon to carry on a venture that depends on such labour. Till this is effected we must regard, our investment in Fiji, carried on in every detail, as to labour, under the strict regulations of the Colonial and India Offices, as one which cannot be replaced in our books at a sum approaching the original cost of more than £3,000,000. We have accordingly written down the investment by £1,625,000. and hope to he able to maintain the assets on this basis. Such will lie. possible even with the wages of Indian labourers at about double the rates paid in Java, as is now the case, provided that the value of sugar keeps up to a‘level very much above that of 1923. Should prices recede to the rates then in force, the abandonment of the enterprise must be considered.