GOLDEN BAY CEMENT

Evening Post, Volume CXXVIII, Issue 104, 30 October 1939, Page 10

GOLDEN BAY CEMENT

YEAR REVIEWED

TAXATION REDUCES DIVIDENDS

A recommendation that a dividend of 7 per cent, for the year should be made, absorption of 60 per cent, of the, profits in taxation, and increased costs already encountered as a result of war conditions were some of the salient points of the address delivered at the annual meeting of shareholders in the Golden. Bay Cement Co., Ltd., at Wellington on Friday, by the chairman of directors (Mr. J. M. A. Ilott).

He said that sales of cement \ for the year under review showed a satisfactory increase. , Net profits, amounted to £17,522 10s sd. After making provision for depreciation of plant and working expenses and after the deduction of dii*ectors' fees. It was necessary for shareholders to 'realise, however, that of that amount no less than 25 per cent, was provided by income from sources other than profit on sales of the . company's own cement — for instance, from farm working, from commission on the sale of other products, from interest on investments, and from rents. The directors had deemed it now advisable to set aside £1000 for insurance on coastal shipments of cement. ■ . "Social Security tax and income tax will absorb £9660," said IVJr. Ilott. "That is to say, 60 per cent, of . our profits will be paid in taxation. The net balance, therefore, is £6862 10s sd, to which must be added the balance brought forward last year, £3304, making a total of £ 10,166 17s Bd. Your directors recommend that a dividend of 7 per cent, should be declared on called-up capital, and that will absorb £5073 13s sd, leaving £5093 4s 3d to be carried forward to next year. "The quality of our product has been maintained at a very, high standard and compares more, than favourably with cement produced, in other countries. EFFECT OF WAR. "Since the accounts closed once again our Empire is engaged in a gigantic struggle for the maintenance of justice and good will in international affairs. New Zealand will do all in its power to help attain that end, and we can but hope that a just peace will eventuate, "The vast struggle will affect our own business very seriously. Already the' cost of a number of our supplies has increased greatly. For instance, the extensive use of jute for sandbags for war purposes will mean a huge rise in this product. alone, apart from the possible difficulties with which we may be faced, in securing stocks. : ' .' : "Obsolescence is one of the problems of the cement industry, and although our plant and machinery are being maintained at the highest standard of efficiency, constant improvement in plant for cement-making is taking place, and we must face substantial expenditure in order to enabje us' to produce cement at the lowest cost and keep our factories up to date. We at-e anxiously awaiting completion of the Cobb River scheme for the production of hydro-electric power, and it is hoped we will be able to draw our own power from that source within the next two years. USE OF CEMENT IN NEW ZEALAND. "There is still room in New Zealand lor much greater utilisation of cement in the building of concrete roads, on farms, and in the replacement of still more wooden bridges and of concrete structures. We- hoped that the comprehensive State scheme ,for 'housing construction would mean that many of the Government houses would be built in concrete, or in a combination of brick and concrete, but there is still much room for development in this direction." * In accordance with the directors' recommendation a dividend of 7 per cent, on uncalled capital was declared. Mr. C. W. Salmon, retiring sharei hqlders' representative on the board of directors, was re-elected. Mr. P. E. Pattrick was re-elected auditor. At a subsequent well-attended meeting of debenture holders another reI tiring director, Mr. Charles McCarthy, who represents the debenture holders on the board, was re-elected.