COMMERCIAL

Greymouth Evening Star, 11 December 1939, Page 12

COMMERCIAL

TIN QUOTA INCREASED

[BY CABLE —PRESS ASSN. —COPYRIGHT.]

RUGBY, December 10.

The International Tin Committee announces that, superseding its earliei announcement, the quota for the first quarter of 1940 has been fixed at 120 per cent, of standard tonnages. The quota was fixed a week ago al 100 per cent, of standard tonnages.

BRITISH TREASURY BILLS.

LONDON, December 9

The total amount applied for in tenders for £65,000,000 in Treasury bills was £94,550,000. The average rate per cent, for the bills at three months was 24/6.58d, against 23/10.21 a week ago.

NATIONAL TOBACCO CO.

DIRECTORS’ ANNUAL REPORT.

The directors’ report, to be submit- , ted to the sixteenth annual meeting of shareholders in the Nat bacco Company, Ltd., at Port A , to-morrow, covers the year , ended on October 31, and states:— Never have we passed thiough a period so full of worry and anxiety as’ in this last financial yeai. The economic position has n s ° ne Tn f^ t “ b f or to worse, and it is really a matter for congratulation that we have able to extricate ourselves practically un scathed from all pitfalls and difficulties The burden we manufacturers are carrying has become heavier every year. Recently the tax on tobacco has again been increased by a further 25 per cent. True, as an off set, we were allowed an increase in the price to the consumer,-but no . commensurate with the aM.bonri tax. On every pound of N.Z grown leaf which costs us say 2/-, we have now to par 5/7i.in excise duty alone, besides 2/6 customs, duty on any fo eisn leaf we may want to, use for tending. The combined duties exmse and relative proportion of amount to .7/2 per lb,, or Hd foi a 2oz. tin. ; Add rto this the Sales Tax, aild you arrive at a total o • Smokers, : therefore, realise that every time they purchase a 2oz. tin of N/Z. tobacco, say at a cost of.l/9, ico 12d goes to the Govern ment in the form of taxation leaving the manufacturer 9d to cover the cost of leaf, the processing and manufac turing of this leaf, tins, canisters, containers paper and other packing maJerial freight, distribution, and wholesaAd■ retail pru»U. fprpntlv 55 per cent of the purcnase remaining 45 per cent, mv twppti grower, manufactui er, mei chant and retailer. And last but not least if the manufacturer should man age to squeeze out of this amazing bill' of cost a meagre profit foi i self the Commissioner of Taxes presents him with a demand, for income tav at the rate of 10/- in the £ as appropriate finishing touch to a prosperous financial year. .. Our troubles are not confined to the higher tariff alone. It is the raw materlal necessary tor the of our goods that. IS becoming every day more difficult to procure, /and more expensive, too. The prices we have now to pay tor N.Z. grown lout are out o£ all proportion to-what to bacco of a similar type and descrip ton can be bought, lor Instance in the U.S.A., where leaf of a grade for which we pay here 2/- per lb is se - in«r there on the warehouse floor be ”w M per lb. Of course, conditions here can hardly be compared with those in the tobacco growing districts in the States, Our farmers would not be able to. compete owing to the high er wages here, but there is'a limit beyond which even we manufacture! s here in N.Z. cannot go. We are wiHing to pay tlie' grower well for Qua! ity leaf.' We have been doing this all the time, paying him fancy P£ ices ’ but we find it •' increasingly difficult to ' make use of the lower grades comprising indifferent and faulty leaf, and it would undoubtedly lead to more satisfactory .dealings and better returns for the grower if he would specialise in. quality instead of producing crops that are only partly . fit foi manufacturing. In common with other commercial concerns, we are experiencing difficulties in obtaining the necessary exchange to finance our imports from overseas, and at one time the position took such a serious turn that the leaf tobacco markets in the U.S.A, had. to close down because the British manufacturers had been compelled to withdraw their buyers for want of exchange. The markets remained closed for a month, but opened again upon the Federal Government < undertaking to finance part of the crop with the ultimate object of relieving their own growers. However, we are not only concerned with exchange. It is the high cost of the dollar in relation to the £ sterling, that debars us from operating as freely as, we would like to and sets a definite limit to our purchases. Notwithstanding all our difficulties, the year’s trading has been satisfac- ■ tory and our turnover has grown appreciably. Our tobaccos are fully maintaining their leading position on the'(market and some lines, already

universally popular, have made still further headway. The recent increase

in the price to the smoker has not affected the sales to any extent, and the public has accepted the new position as an inevitable effect of the higher tariff. Although it is only a little more than two years ago that we have taken up the manufacture of cigarettes, we have already in this relatively short time built up quite a substantial business in this line, and sales are steadily increasing. Unless all signs fail, our cigarettes will in the near future become as popular as our tobaccos. Looking at the figures of the balance-sheet, it will be seen' that there are little changes in the fixed assets- of the company, except for the amounts written off for depreciation, and which aggregate £5162. Stocks are down by £18,500 —at £100,860, and debtors up by £576 — at £49,748. Financially the company is in a very strong position, with highly liquid assets, the total amount ing to £337,688 against liabilities of less than £25,000, exclusive of share capital, of course. Cash on fixed deposit and in hand amounts to £88,593, an increase of £31,256. Though we .have done a larger business this year, our earnings are again they are in no proportion to the tremendous efforts we have been making. Staff and machinery have been kept going at top speed all year round and the quantities of tobacco that have passed through our hands is

demonstrated by the amount of excise duty we have paid during this period, and which amounts to more than £250.000. Compared with this figure, how insignificant our profits must appear. £16,454 is all we can show, and of this we have to hand over moie than half (£8900) to the Commissioner of Taxes, leaving us £7554 as the net profit for the year. Disappointing as the result may be, it is an improvement on last year’s, and in view of our large reserves and the decidedly brighter prospects for the current year, directors recommend the distribution of the same dividend as last year, namely 8 per cent on the preference shares and 10 per cent, on the ordinary shares, and as this will absorb £9229/18/10 in excess of the available profits, to draw for this deficiency upon the Reserve Account. STOCKS AND SHARES. WELLINGTON, December 11. Sales: Bank of New South Wales £3O/10/-, Southland Frozen Meat ord. 31/-. Sales reported: Consolidated Brick 8/9, Mount Morgan 9/10. CHRISTCHURCH, December 11. Sales: E. S .and A. Bank 98/Broken Hill Proprietary (rights) 87/-. Sale reported: Zinc (ord.) 64/- (3). NATIONAL BANK. WELLINGTON, December 11. The National Bank of New Zealand has authorised payment of an interim dividend of 1% per cent., less United Kingdom income tax at in the £, for the year ended . March 31, 1940 payable in New Zealand, on January 9- . f. PROCERA BREAD. WELLLINGTON, December 11. The Stock Exchange Association has received advice that Procera Bread Process, New Zealand, Ltd., has recommended a dividend of 4 per cent, for the year. mining. . t MURCHISON-MATAKI. WELLINGTON, December 11. The Murchison-Mataki Junction retun for the week ended December 7 is 36 ounces of smelted gold, for 13 hours and 19,000 yards. DIVIDENDS DECLARED. WELLINGTON, December 11. Blackwater Mines have declared an interim dividend of 1/- for 1939, and Consolidated Goldfields 6d on account of 1939, both payable on December 19 in the equivalent of British currency. BLACKBALL CREEK. The Blackball Creek dredge return last week was 50 ounces in 82 hours. The directors of the Blackball Creek dredge have announced a dividend of 20 per cent., payable on December 20. MAORI GULLY. An extraordinary general meeting of the above company will be held in the Wesley Bi-Centenary Hall, to-night at 7.30, followed by the annual meeting. \.