AWATUNA DAIRY COMPANY

Hawera Star, Volume XLVIII, 25 August 1924, Page 4

AWATUNA DAIRY COMPANY

ANNUAL MEETING. Sixty shareholders were in attendance and twenty-five were represented oy proxy at the 3t)tii annual <>eneral meeting of the Awatuna Co-op. Dairy haetory C 0... Ltd., held on Saturday at ^ ln - Vlr -E* A. Collins, chairman or directors presided. ANNUAL REPORT. The directors’ report stated, inter aha The quantity of milk handled shows a- considerable increase, over the previous season. August, September, and October make of cheese was sold to Messrs A. J. Mills and Co., Ltd.. London, and tin? balance cf the season’s make was forwarded to them on open consignment. Payments were made during the season as follows: •July Is 6d, August-October 2s, .November Is 3d, December Is, January Is 3d, Eebruary-J une is. The balance lirom the working account, After allowmg d per cent, interest on paid-up share capital, will represent a payment equal to is did per pound ot butterfat over the season. 1620 crates of ciieees unsold have becMi conservatively valued. The retiring directors are Messrs H. McCanrison and M. Bourke, and who, being eligible, offer themthemselves for. re-election. Mr li. A. Lennon again offers his services as auditor.

Statistics were as follow; (1922-23 ligures being given in parentheses) : Totol pounds milk received, 19,758,249 (18,553,012) ; total pounds butter-fat, 770,126 (723,587)• average test, 3.897 per cent. (3.901). Used for cheese-making.—Pounds of milk, 19,157,220 (12,376,259); pounds of butter-fat, 743,358 (479,913); average test, 3._880 per cent. (3.877); pounds commercial cheese made, 1,909,837 (1.237,733); lbs of milk to 11b cheese, 10.03 (9.99); pounds of cheese from lib butter-fat (gross), 2.635 (2.645); pounds of wliey butter made, 47,801 (19,813 j. Used for butter-making. —Pounds of milk, 601,029 (6,176,753); pounds of butter-fat, 26,768 (243,673); average test, 4.453 per cent. (3.945); pounds butter made from lib butter-fat, 1.1780 (1.1743); pounds butter made, 31,544 (286,152); proportion of unsalted butter made, 56.80 per cent, (nil.); pounds milk to Ilb butter-fat, 19.05 (21.58). The weight of butter made from each pound of butter-fat used for the manufacture of butter was 1.1780 lbs. The percentage which the weight of unsalted butter manufactured bears to the total _ weight of butter manufactured was 56.80 pei; cent. The weight of cheese made from each pound of butterfat used for the manufacture of cheese was 2.635 lbs. CHAIRMAN’S ADDRESS.

In moving the adoption of the annual report and balance-sheet, the chairman congratulated shareholders on another successful year. In the early part of the season a portion of the output had. been sold to A. J. Mills ard Co. at a price aggregating 2s per lb butter-fat, a contract being made for three months. After this the remainder of tiie output had been forwarded on open consignment. For the earlier shipments 100 s had been realised, but within six weeks 11150613 had fallen to 82s. This had been followed bv a rise, oat prices had subsequently dropped. These fluctuations might be 1 scribed principally to irregularity of supply, and if shipments could be regulated to coincide with demands prices would be stabilised. The matter was receiving the attention of the Dairy Control Board, three of whose delegates had been appointed to investigate conditions in the Home markets. He personally anticipated that the Boaird would be able to effect a great deal in bettering conditions, but of course that yet remained to be proved. There had been a great deal of talk concerning a federation of co-op. dairy companies, which was now an established fact. Much comment by various authorities had appeared in ithe press concerning the alleged lowering of the quality standard of New’ Zealand daiiry produce, particularly butter. This vas an important question, which could be considered by the federation. There was also the question of selling butter and cheese. At present buyers were able to canvass the various factories, and as the result of effecting a good bargain in one instance, were in the position to offer better terms when making subsequent purchases. By securing concerted action in dealing with such matters, the federation could render a highly beneficial service to those engaged in the dairy industry. Another direction in which the federation could be of great use in making contingencies arising through strikes. Quite recently a strike had inconvenienced many of the factories, some of which had had difficulty in maintaining fuel supplies. Fortunately the strike had not been a. lengthy one. Had it been maintained for a much longer period, its effect on the operations of many factories might- have been very serious. If joined together in the Federation, they would be in a much betteir position to grapnLe- with the situation.

The directors h:id given much consideration to the activities of proprietary concerns in catering for homo separation. Analysing the position, he said he felt certain that individual suppliers stood to lose through home separation. Though in some cases separation might be done as well on the farm as at the factory, the majority of farmers did not possess the expert facilities afforded at the factories, and were likely to lose a good deal by separating, personally. The fact that some of the proprietary concerns were enabled to pay very high dividends indicated plainly that their suppliers were not receiving the same benefits from cream supplied as would be the case with' co-op. companies. At the same time, he admitted that in isolated districts where factories were not available, the proprietary concerns were serving a very useful purpose in collecting cream, but where the cooperative factories were operating, suppliers were blind to their own interests if they sent their milk or cream elsewhere. The Awatuna Company iiad made provision to take cream from those suppliers who wished to separate for themselves, but lie would strongly advise any who were able to do so to send their milk direct to the factory, and in any case not to go past the co-operative factories. Speaking of the resolution adopted at the last annual meeting to the effect that the general manager lie; ;requested to again exhibit cheese, the chairman said that exhibits had been shown at the Hawera Show with excellent results. Mr Flavin had secured the Clement Cup, and had tied for the Shaw. Savill Cup. Also he had secured first prize in the Factory Managers’ Association competition, "besides other second and third awards. The branch manager (Mr ll.' Clements), considering it was his first attempt, had also done exceptionally well, gaining second, third and highly commended awards. The general manager had been very modest over his successes, for which he largely credited the suppliers, saying that the results could not possibly have been obtained had t not

been for the good quality of milk sent to the factory. The grading pemts obtained throughout the season elso reflected great credit upon both managers. Of 4752 crates of cheese sent from the Awatuna factory only 19 had been second grade, and the average trading for the whole was 92.045. At Tauugatara there had been 29 second grade out of 7368, the average grade being 91.969: These matters indicated tjiat their managers W’ere rendering excellent service? and he could not speak too. highly of their work. The pay-out, continued the chairman, was perhaps not brilliant, but w r as in keeping with most of the neighbouring factories and would compare. more than favourably with most. If present prices were maintained it was anticipated that when cheese as yet unsold was disposed of there would be a sufficient balance to finalise at about Is old. He suggested that the whole of the balance—approximately £6O0 —be added to the reserves. In order to provide for any possible demands on the company's resources, it was essential that the reserves should be kept as strong as possible, and in his opinion, the balance referred to provided a favourable opportunity for adding to it. In the event particularly of any of the subsidiary companies failing, demands upon the company could be met from the reserve if kept sufficiently strong without seriously affecting the particular season’s finances. Illustrating this point, he instanced the failure of the Bacon Company during the past year, the amount of shares held in that company —£984 —having been written off from the reserve account. The company’s proportion of the guarantee to the three Taranaki directors of the Bacon Company had been met from butter-fat.

The plant values shown on the balance-sheet were considered to be absolutely sound. As indicating this, the chairman stated that, whereas the general manager’s valuation, estimated on a conservative hasis, had been £lßl4 at Awatuna and £2646 at Taungatara the values actually shown on the balance-sheet were £1228 and £2163 respectively.

It would be noticed that the amount owing to the bank according to the balance-sheet was high, but stocks in hand and afloat were sufficient to equal the amount. The present position was that instead of owing £II,OOO the company was in credit to the extent of £4OO, brought about by the last of the season’s output having been shipped. Repairs and renewals had been exceptionally heavy, being approximately double the previous year's figures. Special additions, to plant totalling £4OO accounted for the difference. In answer to an inquiry, the secretary reviewed the working account, giving the cost per lb of butter-fat calculated to the third decimal point in respect of each item. The total charges showed an increase of ,3d on the previous year, this being attributed to the much longer period of cheese-making. In conclusion, the chairman said that the past year had been a very difficult one for the directors. The varying prices had occasioned a great deal of worry. The directors, however, had worked faithfully throughout and had done everything possible in the interests of ..shareholders. COMPANY STORE.'

In seconding the adaption of the report and balance-sheet, which was subsequently carried unanimously, Mr. S. R. Farquhar suggested that the anticipated balance spoken of by the chairman should be used in connection with the company’s store at Awatuna to enable purchases to be made on a cash basis. Savings which would benefit shareholders who bought from the store might be effected if sufficient capital were available.

Mr. T. J. Mildenhall thought that' the store operations should not in any way interfere with payments for butter-fat. He drew attention to the auditor’s previous recommendation that a separate banking account for the store should be kept. He did not wish to criticise the working of the store, which he thought was very well managed by the secretary, but considered it should be kept separate. Mr. R). Jones reminded the meeting that the store had no* been instituted as an ordinary trading concern, but to purchase farming commodities in bulk on commission as a convenience to the company shareholders.

The secretary .stated that in controlling the store, he had been insJril 110 mi to stoc ks in excess ot £ooo. That limit provided for all requirements, settlements being made monthly by deducting the amounts of shareholders purchasers from their cheques. Under its present system the store was quite successful, excepting that Taungatara suppliers did not receive the same benefit as those supplying the Awatuna factory, as delivery to the former was not so regular It an expeditious delivery to tara could be maintained, the store would receive more custom there, and in consequence of the increased turnstnrA t ie n h °i e °f the Wers at the store would benefit. The store reserve was ample for requirements, and h . 6 dld jot think that the transference of the butter-fat balance to the store as suggested, would enable improved buying arrangements. 1 The chairman said that if a light tiuck were secured for the store work reft ° U d °r reo ™ € the difficulty of' timel g t g °° ds t 0 Tami S a tara. The 7 big tiuck at prestnt in use had a great deal of other work, and could not maintain a daily goods service. Besides makmg trips daily if required, the light- truck could also act as an auxiliary m other work. It was not intended to rush into big things in connection with the store, hut merely of eiTw on f ' V,t l 1 1 the o, dginnl intention nlimc ‘rU f °‘- u 'l con venience of supplier. He wished to see the Taungatara suppliers receiving its benefits equally with those at the main factory ofThJTi h ° Wevei / to the disposition of the balance under consideration he again advised that it be credited to tne reserve account. After further discussion it was decided, on the motion of Messrs M W f ld Ml,denhall < that the final aknee from cheese and butter sales n im iwi ,led amongst shareholders immediately on receipt. i a - SO decided that a separate stoie banking account be opened. BUTTER-FAT PAY-OUT. AflW R ‘ Ff i ;p so .n asked if immediate effect would be given to the resolution adopted at the last meeting of directors which provided that the final payment be distributed immediately the crecht was available at the bank. Replying the chairman said the directors realised that suppliers wanted -heir money as quickly as possible, and had decided that when Itvailahle it would be distributed as quickly as possible. As, however, advice that themoney was at the bank had been received only on the day previous to the meeting, it was unreasonable to expect the pay-out to be made at the meet- . . e thought that an expression of opinion could be taken as to whether the pay-out should be made im-

mediately or held over until the next ordinary pay day. Mr Ferguson objected to taking the opinion of the meeting, and again referred to the directors’ resolution. Mr "VY. W. Lonsdale said that the chairman’s explanation was correct, but did not now think it necessary to put the matter to the meeting. Mr Barker suggested that the matter be left to tne directors, with the recommendation that the pay-out be made as soon as possible, a resolution to that effect being finally adopted. ELECTION OF DIRECTORS. Five nominations were received for the positions on the directorate vacated by Messrs H. McCarrison and M. Bourke, the result of the noli being as follows: For Awatuna—S. R. Farouhar 3/5 votes, M. Bourke 356. For taungatara—H. McCarrison 336, T. J Mildenhall 300, A. R. Stevenson 119. Messrs Farquhar and McCarrison were therefore duly declared elected. Suitable responses were delivered. Messrs H. A. Lennon and J. Flavin officiated as scrutineers. • The chairman’s honorarium and the directors’ fees were fixed in accordance with the previous scale. Mr H. A. Lennon was reappointed auditor at the same remuneration as previously. GENERAL. A. J. Marshall’s suggestion that the test figures exhibitetd at the factory should be accompanied hv numbers instead of suppliers’ names, so that the latter would not necessarily be disclosed, created considerable comment. No action was decided upon, the matter being referred for further consideration to the directors. On the motion of Mr Mildenhall, a recommendation to the directors that the annual meeting should in future be held on a week day other than a or Monday, was recorded. After a lengthy discussion Mr Hartley s motion that the company cease to pay interest on shares was negatived by Mr R. Holland’s amendment that no alteration in the present procedure be made. * In seconding Mr Mildenhall’s vote of thanks to the secretary (Mr W. R’. O. Spooner), the chairman paid a tribute to tne excellence of the services rendered, saying that in Mr Spooner the company had a secretary second to none. The vote was carried by acclamation. Votes of thanks _ were also accorded the directors, auditor, managers,' and staff. ’ Luncheon and afternoon tea were P, ro y. ld «d by a committee of ladies, including Mesdames E. A. Collins, W R.O. Spooner, R. Clements, F. Tindle and R. Ferguson, to whom the meeting accorded a special vote of thanks. A vote of thanks to the chairman concluded the meeting.