PATEA FARMERS' CO-OP. FREEZING CO.

Hawera & Normanby Star, Volume LXV, Issue LXV, 8 September 1913, Page 2

PATEA FARMERS' CO-OP. FREEZING CO.

ANNUAL MEETING OF SHAREHOLDERS. Hr Walter Powdrell, chairman oJ directors, presided over a meeting of shareholders of the above company held at the company's works, Patea, on Saturday morning. FOURTH ANNUAL REPORT. The following report was presented by the directors :— ■ , The directors have pleasure in submitting the fourth annual report, 'balance-sneet-, and profit and loss account ior the period ending July 31, 1913. Stock Slaughtered:—l9iO: Lambs, 40; sheep, 864; cattle, 1743; 1911, lambs, 18,402; sheep, 9362; pigs, 167; calves, 374; cattle, 567b; 1912, lambs oao9; sheep, 95b6; pigs 7; calves, 632; cattle, - 4799; 1910, lambs, 1f,784; sheep, 29,402; pigs, 29; calves, 752; cattle, 6947. The result of the operations for the period closing July 31, 1913, show a satisfactory profit of £1734 0s ad, of which sum £794 0s 5d is placed to depreciation, and the remaining £1000 to the appropriation account. During the past season the company had many difficulties to contend with which were unavoidable. First, the 'Ss.s. Hawera went ashore at Patea, necessitating the railage of 909 tons of froaen meat at an extra cost of £591 7s 4d; second, the .slaughtermen's strike cost the company a considerable sum owing to the difficulty experienced of keeping cattle in good condition while waiting for a ■ settlement. The increased output has lessened the cost of freezing that we are now on a working profit basis. It is to be hoped that the fanners in Taranaki will support us in a similar manner during the coining season. The erection of a new slaughter-house is becoming an absolute necessity, and the shareholders will have to face the position if we are to cope with the business of this district. Provided the necessary financial arrangements can be made the company will proceed with the installation of a fellmongery plant. TKfe retiring directors are Messrs A. '£. Wills, J. F. Williamson and R. Bremer. The two former are eligible for re-electionn. There are two vacancies on the board caused by the resignation of Messrs O. J. Hawken and R. Bremer. Mr E. C. Homer, your auditor, also retires ancl offers himself for re-election. In moving the adoption of the report and balance-sheet, the chairman said he desired to refer to a few of the disadvantages under which they worked last year as reasons why the profit was not larger. The circumstances he would refer to were absolutely unavoidable, but notwithstanding it was the first time the company had been able to show a profit, and he felt it had now. turned the corner. He had, in the past, devoted a great deal ot. time to this concern and would continue to do so in the future if the farmers gave him proper support, and if this were done there was absolutely no reason why the works should not pay. The reason they had not succeeded in the past was undercapitalisation. In Hawke's Bay £40,000 was raised there in a few months for freezing works, and although the farmers in Taranaki were smaller in numbers ancl on smaller holdings, yet they were not relatively poorer, and there was no 'reason why they should not support freezing works in Taranaki proportionately as well as they did in Hawke's Bay. Certainly the farmers on " this coast had responded well when called upon to sign p.n.'s for £250 each—from 45 to 50 having done so—and although there was not a bad mark amongst them and although the amount this guaranteed gave £12,000 security to the bank, besides 800 shares applied for, the bank refused to make any advance on such security. As the outcome of a conference, he (the chairman) and Mr Nolan had met the bank officials in Wellington and the bank agreed to advance £3500 provided certain individuals put in a like amount. Five gentlemen advanced this sum and so kept the works goiiig, and it was due to them that the company had been able to make a profit of £1794. He should just here mention that since the balance-sheet had been ' made up certain returns had come to hand which I involved a loss of £218 on some joint transactions between the 'company and Messrs Wilson, Canhan and Co. in regard to bull-beef shipped to Vancouver; £218 17s 9d was the company's share of the total loss and must really be "deducted from the profit shown. But this loss was more apparent than real, because they got a better freezing rate on bulls; they had all the bones for manure at a very small price, and they got the tallow and extract at a low rate. This loss was really due to shrinkage or wastage in consequence' of having to hold bulls in paddocks when the strike was on, and it was unfortunate that this was at a time when there was practically no feed —an occurrence so unusual in Taranaki. An item of £182, the last of the three instalments of preliminary expenses in connection with the formation of the company, would not again appear. Another loss was occasioned over a shipment of meat sent by the Mana and for which the boat gave the company bills oi lading that it was in good order. Unfortunately, she was not able to hold it in good condition, and thus involved a loss of between £200 and £300. The liability was disclaimed by the shipping company, and as litigation would have been costly and undesirable, both parties agreed to bear half the loss. It cost the company £591 extra to send their meat to Wellington by rail than it would have done by the Hawera had she not unfortunately gone, on .the beach a week after the works started. flu was satisfied that on . the 47,000 sheep the works put through last year the company lost at least £2000 through not having a fellmongery of its own. It was one of the

most profitable departments in connection with freezing works, and he was satisfied they should go in for it as soon as possible. The directors had recently purchased a suitable building with concrete floors for £425, and another £200 would equip it with dynamo, etc., ready for the work. With ,the necessary additional capital very con-

siderable savings could be effected, as, for instance, a coal generator which they installed last year on the recommendation of Mr Grainger. Although' this was not installed till after Christmas, and although they had frozen over a million pounds more meat than the previous year, the coal generator had effected a great saving over the coke generator*—in fact, it had absolutely paid for itself in a part of the season, besides giving 10 to 25 per cent, more freezing power. During last year they were practically forced by the Government inspector to put in a new boiler at a cost of about £150, but, although they were doing more than twice the work they did the previous year this boiler required six tons of coal per week less than the old one, so that it, too, had easily paid for itsflf in the o"<» year. Thpn aeain, in regard to their "Bovril" extract. By the expenditure oi. t/U the company was able to produce £1000 worth of extracts last year, as against £300 previously, and the directors could see whhere they could effect similar economies all through the works, but the want of capital was crippling them. Last year they paid the Grading Company £363 for freezing meat which the Farmers' Co-op. Company could not hold in its own stores, and this only from February onward. Their three present rooms cost £2050 and if they could spend another £2000 in another three rooms the interest on this would be £110 to £120 a year, as against the £363 they paid to the Grading Company.—Mr Symes : Would your freezer handle •it?— The chairman said. he had the engineer's assurance that it would easily do so. At present they were not freezing kidneys, hearts or heads—they simply had not room. In the killing section great economies could be effected. They had hanging room for only 300 carcases of sheep, 1 and there were times when they were killing 600 per day. This meant double-banking, unnecessary handling, and the payment of overtime to men to clear the space before eight in the morning ready for the ensuing day's operations. One satisfactory thing in connection with the past year's operations was the fact that their tinned meats had sold well, more than one-hall having found a .market in New Zealand. One of the biggest dealers in Auckland had said they were unequalled. The demand for their chemical manures was also increasing, and the whole of«their stock had been sold out with the exception of twenty tons. The frozen meat had a good name at Home in spite of Mr Buxton's references to it and his remark that the second-class meat at Home came from Patea. Thed had not had a single complaint from Home as to quality. By crating any overweight mutton or second-class lambs and sheep they got a better price for it than if they

sent Home the carcases, so that there was no reason why anything but the very prime should be sent. "But we want new works," said the chairman. The present buildings were costing nearly £300 a year in insurance, and probably ' another £500 or £600 a year could be saved if they had up-to-date concrete works, where the sheep would walk up stairs, instead of being carried as present, and where everything could be arranged on a labor-saving plan. But he did not know how they were going to effect these necessary economies and carry on unless they had a great deal more capital. Last, year they were paying out £1500 a week for cows alone and more than that for sheep. They had either to do that or keep the farmers waiting for their money. Last year it was costing the company £11,000 per month to run with only £4000 capital taken up by farmers. The regrettable part of last year's transactions was that the only loss made was in the bwll department, and the dairy farmer who supplied the bulls and who had practically no capital

in the concern received £500 more for his bulls than he should have done. Last year their wages were £887 per fortnight in the season, and this meant that, as they were so short of storage, the meat had to go out as quickly as possible—they conld not keep the butchers waitAs an instance of one loss through want of more storage, he mentioned that a few days after one farmer's meat was sent forward there rame an order which would have meant 4s or 5s per hundred extra had it been held in the cool stores. Their freezing was costing l-14d against id paid to the Grading Company. This was due to the cmantities put through.—Mr Br°"ier complained that selling the manures to Auckland merchants did not give the local farmers much of a chance.—The chairman reri'ied that if the farmer ordered the fertilisers would be held for him, but the company would not hold stocks on the off chance if it could dispos" of them in the meantime.—Mr Bremer complained thnt fnr"ipr= rlid not get nearly such •:«os for their stock at the works as they •»«t in the saleyards. The works were a very cnod thing for "the auctioneers, who had their hards on half the- stock in the district. They were now able to run all the old cows and bulls in th» yards and get good nrices for 'horn from-the company's buyers.—The chairman, assuming for t*» saVo of argument that hirrhor prices were obtained by the farmer in t of t,b* ronipnnv'R huvprs, rrnuW irto st anoq« pinoAs jaauoypnc am qcq? of every £1 of such extra price and the fnrmer about ]9s! Consequently, it was a benefit to "v»rv ffrm^r on thp coast,—Air Hawkfn, the comr^nv's buyer. said that it was ouite imShi^tobuv diroot from the farmer They had to buy at the saleyards. but they had their W« "f rSc»l fixed by the dir»ctors.-Th P rhairman pointed out that the works had to be J

kept going, and if they waited for. stock bought day by day from the farmer the men at the works would be idle half their time. They ; had to buy at the sales and they had to hold stocK as well.—ln seconding the motion for the adoption of the report and balance-sheet, Mr McKenna. paid a high tribute to the energy and capability displayed by Mr Powdrell, and trusted he would give the company as much ot ms services and advice as possible in the future.—ln acknowledging the compliment, Jlr Powdrell said this freezing company was an intricate and responsible one to manage, and whilst he did not want the work he would his very best for it It had been abundantly proved in Taranaki that co-operative enterprises could be made eminently successful if they had sufficient capital to work" with, but in the case of the Patea works he did not want to be hampered for the want of cash if he took a more active part in its management in the future. ■ In reply to a question by Mr McKenna, the chairman" said the company's buyer was on a commission at 3d per head for sheep and 4 per cent, on cattle delivered. His buying had been most satisfactory.—Mr Hawken explained that it cost him nearly £200 last year for paddockino- fees, besides drovers and another buyer. Out of £900 odd commission which he earned last rear he received only £450 as his own salary. It was absolutely necessary to buy at the sales, and it generally cost a great deal more to buy single animals- from farmers than they earned. It was only, in buying lines at the sales that helped out these other losses.— Mr Nolan said -that if they knew the farmers as well as he did they would know that it was impossible for the company's buyer to buy direct. For the most part they did not know values and preferred the open competition at the sales.—Mr Dickie thought their present buying system was wrong in principle, and that they should have a man straight out on salary. Their system was weak in so far as that there was no" means of checking the stock delivered at the works.—After a little further discussion the matter dropped.

: ELECTION OF DIRECTORS. Five nominations were received for the five vacancies on the board of directors, and the following were elected :—Messrs B. O. Lysaght, O. J. Hawken, E. Parsons, A. T. Wills, and J. F. Williamson. THE JOINT AND SEVERAL. Mr Bremer asked the chairman whether the new directors were prepared to sign the "joint and several" and release him. —Mr Dickie at once replied that he was willing to sign. A few further remarks drew the chairman and Mr Bremer into a very heated discussion, the upshot being that >fr Bremer intimated that if he were not released by the directors he would take steps to force the company into liquidation. —Mr Nolan threw oil on the troubled waters by explaining the misconceptions under which Mr Bremer was laboring, and mentioning that he was acting in good faith in what he had done and said. APPRECIATION. In reply to a vote of appreciation, Mr Powdrell said he had taken a great interest in co-opera-tive concerns, otherwise he would not have taken on the many obligations he now carried. He was hopeful that in two or three years the dairy companies would assist the freezing company along the same lines that they had done in the Bacon and Box Company. It was all for the good of the district and for the benefit of the individual farmer. JOTTINGS. Mr Homer was re-appointed auditor at the same salary as last year. On the motion of Mr Nolan the meeting approved of the principle of the appointment of a managing director, and sanctioned the appointment of same. "There was not a single man's stock shut out from the freezing works last year who booked his requirements in time," remarked the chairman. . "Only one man ever sent his stock direct to the works, and that was Mr F. J. Gane, of Normanby." "Considering our. turnover and the fact that we have not got a fellmongery, our balance-sheet compares favorably with the balance-sheet of any other company." Patea was most advantageously situated for freezing works, and the chairman saw no reason why the Patea Farmers Co-op. Freezing Comnpany should not make £10,000 a year profit if they had a sufficiency of capital to work on.