THE BLACKWATER MINES.

Greymouth Evening Star, 27 September 1917, Page 2

THE BLACKWATER MINES.

AA NI All AlJiliTiNU

At the annual meeting ot the lilackVV ;i!,'■[• Mater;, Jamu-cd. mid in J.omum July -AUli, the Chairman (Sir W. 1C i’eiceyal) said, inter alia: i should like to explain that the acting general manager’s reports, both tor this company as well as lor the J’rogressi Mines or Mew Zealand, ana the Consolidated Gold Fields of Mew Zealand. as received by the Hoard, contain full details as to the companies 'operations, lint having regard to the duty and importance at me present moment of restricting the use of paper, and of saving labor and expense- in printing, the Board has thought it. right to omit certain portions. The monthly output, published about the fourth of every month, will hhvc prepared you for a less satisfactory statement of operations for- the year under review than I was able to. submit to you at our last geneial meeting. I need hardly explain to you that this temporaiy set-back in our output and profits is entirely due to the war, add is the direct result of the shortage of labor, especially of skilled miners through enlistment, and the increased cost of all supplies. As far as the position of the mine is concerned, the development woik carried out during the year has been necessarily restricted by war conditions, and much of the available labor has. had to he concentrated on extraction for milling requirements. He development work, however, which, ha,; been done ha s , -shown satisfactory results, as you will see. later. The total revenue from gold won, sale of concentrates., and interest, etc., amounted to ,£B-‘?,990 l-lsi -Id, its against Z\ 15,212 for 1915, and FIOO,-IS6 for 1911. I give the figures for both these years, because the year 1915 was: an altogether abnormally good one for the company, clue to s iecial circumstances, and the extraction of unusually high grade ore during that period, as explained at our meeting last year. Ihe total expenditure for the same period, exdu rive of development and plant, was £5(1,272 Os Id, an compared with, ifii. ioc, 2d, a decrease of ,1*5,191 19s Id, leaving a balance of .£27,718 11.-; 2d. From this amount we have written off £1.190 to gold reserve in-mint £9.255 .‘is 8d for development iuid ,£5,001 10s for depreciation of plant, machinery, and buildings.' Mill. -Milling operations have, of course, suffered from shortage ot labor and whereas in 1915 the tonnage put through was 5-1,(Mo tons, lor the past war only -10,217 tons were crushed, i! falling off of ll,o9(i tons, or over 221 per cent; a serious drop, when it is not possible to make a corresponding reduction in standing charges, which necessarily remain more or less stationary. Working'Costs.—The- working costs for the year, including mining, millinn-, treatment, office and general expern ea, amount to 22s 4.5(u1. an increase of 2s O.dOd per ton over 1915, owing to the large tonnage milled that war, but of only B.:i-kl over

I!)I |. Tl l im increase is made up of increased cost of paining' 2s O.TGd, and milling 9.10 d, less a decrease of U.oOd on office and general and bullion charges, leaving a working profit of lUs 2.9(id per ton —the increased cost of working and the smaller tonnage milled being the factors respon-

sible for the decrease. Unfortunatelv, owing to the standardisation of the [nice of gold, we in the gold mining industry are debarred from recouping our increased costs by raising the price of the gold we produce. This increase in cost would, I may slate, have been much greater but for the care and foresight shown in purchasing considerable stocks of stores in. advance, and great credit is due to

our New Zealand management for so zealously looking after the company’s interests in this respect.

Ore Reserves.—Considering tlie acute shortage of labor from which eve have been suffering, it is a. matter for some congratulation that the ore reserves have been maintained in

value and width, as well as within a few thousand tons in quantity.

Dividends. —Dividends Nos. 10 and 11 each of Is per share and free of income tax, were paid on. the 3rd July and 30th December of last year, and in the ordinary course of events we •should have declared the usual July dividend payable thisi month. This, however, the board has decided would be unwise until the directors are in a bettor position to gauge the effect on the company’s labor supply and consequent output, of the introduction of compulsory military service over the period of the whole year’s working. An additional reason is that the company’s financial resources have been •severely taxed in defraying the cost of the new plant. This plant has cost the company roughly about .£25,000 in the last two years, and as the small original working capital of the company, of ,£50,000 ,was exhausted before milling operations commenced, all subsequent expenditure upon capital account and plant lias necessarily to be defrayed out of working profits, which otherwise would, have been available for distribution amongst, shareholders. In the early days of the company, in order to reach the milling stage with the small working capital at its disposal,' it was necessary to purchase only such machinery as wo cmdd see our way to pay for, although in some cases it wag not altogether up-to-date or economical in working. The new plant lias all been paid for, and is of the best design and quality, and, I am glad to say, is not only running satisfactorily, but D, also effecting a considerable saving in our working expenses!, and should

last for many years. For-the-reasons 1 have given_ it will certainly be impossible to pay more than one dividend of Im for the, current 7 ear » iXnd oven that is subject to existing odndinot getting worse than they are now. In conclusion, it is only right to impress upon shareholders! the unpalatable truth that the carrying on of mining in New Zealand, and in fact in most other places, is attended with very great difficulties at the present. time; but shareholders can rest assured that everything 'possible is being done both in lam don and New Zealand to safeguard the interests of shareholders, and to safely pilot the company through the anxious and difficult times which we are experiencing. Mr. A. 11. Holland said he was sure it must be a matter of great satisfaction to the shareholders to hear from the chairman that the material falling off in the profit lor the year 1016 was not owing, a« far as could be seeii, to any impoverishment in the ore extracted from the mine. He thought, from a gold mining point of view, future prospects all centred around that fact, and he would go away more satisfied than ho had reason to anticipate he would be when he critically looked through the report and accounts, because one could not lose sight of the fact that the profit for the year 1916 was only half that for 191"), and in spite of that, the directors having confidence in the future, had distributed a dividend in 1916 equal to that of 1015. He was quite sure of this, that, as men of business, if they could have foreseen what was going to happen, they would have hesitated before they did it. However he was glad to hear that they had decided to adopt the only possible and prudent course under the circumstances, namely, no 1 ' to distribute any dividend in July. The whole matter, in his humble opinion, should be left over until they had sufficient information as to the entire twelve months’ trading, in order to enable them to form a. proper and businessbke conclusion. 'Flie report and accounts were then unanimously a dopted,