NOKOMAI COMPANY

Evening Star, Issue 22688, 30 June 1937, Page 8

NOKOMAI COMPANY

NEW PLANT WORKING SUCCESSFULLY ANNUAL MEETING Although the balance sheet would be in a sound position at the cud of next year tho chairman of directors (Mill. L. Gill) said at the annual meeting of the Nokomai Gold Mining Company Ltd. last night that there would he no possibility of a dividend declaration during tho year. It was also stated that the expenses could not bo any loss than those of the past year. Other directors present were Messrs H. M'Dowell Smith, F. Y. Milnes, and F. Goodwin. There was an attendance of 12 shareholders. CHAIRMAN’S REMARKS. “ Operations were temporarily suspended at the beginning of the new year,” the Chairman said, when moving the adoption of the annual report and balance sheet. “ The new_ machinery arrived at the claim early in January, and a start was made to erect the gravel pumps, all the installation being completed and trial running commenced at tho end of May. The pumps are erected on a barge 30ft by 25ft, and are of tho direct-coupled type, each pump being driven by an independent motor of 175 h.p. These pumps were guaranteed to lift 12 heads of water 120 ft, and they are actually lifting more than 20 heads 90ft high, taking on average loading only 290 h.p. “ During the testing period the highpressure nozzle was turned full on,” Mr Gill continued. “ Tho maximum water was used on both the nozzle and the elevator, which delivered capacity holding of water and solids to the sluice boxes emptying at the gravel pumps. On several occasions the sluice boxes were overflowing with solids and water, but at no time during tho test did the peak quantity prove too much for the pumps. Throughout the trial these kept the delivery sump clear, and proved that, if required, they could have handled considerably more material if called upon to do so. These pumps are of massive construction, and appear to he a very workmanlike job.” Mr Gill said the gold won during the year amounted to 1,0300 z 19dwt, valued at £7,217 12s 9d, which represented only nine months’ work. During the year a considerable amount of work had been done on the company’s races, involving the expenditure of approximately £1,700. The company had to purchase 2,000 ft of 9in and Ilia new pipes, as well as several valves. The bulb of this would not be of a recurring nature. Had it not been for this extra expense, the year’s earnings would have shown a credit balance of about £I,OOO, instead of a debit of £628. Taking the year as a whole, it had been the best the company had had for many years. The races were now in first-class condition, and should serve tho company for many years to come, Mr Gill added. Race maintenance was much higher during the past year, and this was accounted for as explained. Naturally, it had adversely effected the year’s showing, but the directors considered that this additional work was immediately necessary so that when the new pumps started operations there would be no hold-up by the races. In conclusion, he thanked the shareholders and the contributors to the debenture issue, which had made possible the erection of the gravel pumps on the company’s claim. The directors looked forward with confidence to the company’s future. The Chairman added that during: the past week-end he had visited tho claim, and a small wash-up from an area 35ft or 40ft square had yielded 640 z 15dwt. The motion was seconded by Mr H. M‘Do well Smith. Mr T. R. Coutts said he had recently visited the claim. The size of the area was all that had been stated, as there was enough ground to be rained under the present system for more than a lifetime. The plant and gear were in good order, and there was a fine set of workmen. A good deal of the plant was of considerably more value than might be thought by some shareholders, and it had been found possible to use a fair proportion of the old plant. Mr Milnes assured the shareholders that as much as possible of the old plant was being used, and waste was being avoided. * PROSPECTS FOR FUTURE. Replying to a question by Mr A. M'Millan, the Chairman said the boring values of the ground, on a basis of £4 an ounce, were about £7,000 an acre, and it was hoped to turn over at least two acres in the coming year. When the recent wash-up was carried out, 50 or 60 feet of the top ground had been thrown on one side, and the actual wash-up was taken from 20 or 25 feet off the bottom. Mr Milnes said the original sinking paddock was put through from the top to 30 feet from the bottom for a return of 50oz, showing a value of about 2id a yard. It would be seen that it would be cheaper to blow away the top soil. The average bore value was Is 5d a yard. Replying to Mr A. C. Cameron, the Chairman said that at least two acres should be turned over in the coming year, barring accidents, and at £4 an ounce that should return about £14,000. Taking gold at its present price of approximately £7 an once, and considering all factors, the year should yield £15,000 or £20,000 worth of gold. Mr Cameron: If you got a gross return of £15,000 t most of it might be used up in paying off the debit balance and in other ways. . Will there be any dividend? The Chairman: I can see no chance of a dividend for the next year at any rate. Mr Cameron: But the balance sheet should be in a sound position at the end of the year? * The Chairman: Yes. Mr M'Millan said the expenses in the coming year could not bo any less than last year, and tho outlook did not appear very bright. He asked whether the directors could give the shareholders any hope. “ We have had our hard times,” Mr Milnes said. “ On tho average tho Nokomai ground will produce 400 oz of gold to the quarter-acre, and it is known to be improving. I think that for the next two years we should get about 2,5000 z at about £7 an ounce. I am sure there will be no dividend this year. We have liabilities to pay off and we have to consider our deben-ture-holders. If we can get our liabilities cleaned up this year, there is hope for dividends in the future, and pretty good ones, too.” CAPITAL ADJUSTMENT SUGGESTED. Mr W. F. Titchener suggested that the capital should bo written down. A considerable proportion of the money had been lost. The shareholders appreciated that fact, and he thought ft would be advisable to write the capital down. Mr Milne; 1 would like to see a six or 12 months’ run witli tho new plant licfuio we decide anything about that.

The plant has not had much of a trial yet. Mr Goodwin said the old shareholders had had their capital written down, and would not like it being written down again so soon. He suggested that the plant should be given a chance. “ It would be a retrograde step to write the capital down,” Mr Cameron said. “ If, as the directors say, there is a reasonable prospect of good returns in the future, I do not think there is any reason to be depressed about the outlook.” Mr Titchener said he did not intend by any means to suggest a lack of confidence in the directors, but the capital had gone, through no fault of the directors or the company, and writing it down would clear up the balance sheet. The retiring director, Mr Milnes, was re-elected. The meeting closed with a rote of thanks to the directors and the staff, accorded on the motion of Mr M‘Millan.