Rangiwahia-Ruahine Dairy Company

Manawatu Times, Volume 70, Issue 192, 15 August 1945, Page 6

Rangiwahia-Ruahine Dairy Company

The annual report of the directors of the Rangiwahia-Ruahine Dairy Coy. reads:—The output for the past season was 176£ tons, showing an increase of 20 tons on the previous year. The increase has been due in part to an increase in the number of suppliers and also largely to the favourable climatic conditions experienced during the season. The output is still considerably below the output prior to three years ago and the Directors again urge suppliers to increase their supply of cream, not only for the material advantage in reduced costs and increased payout, but also to ensure increased butter production so urgently required for the effective prosecution of the w r ar and the relief of distress overseas. The costs of manufacture per pound of butterfat for the past year show at 2.779 d. reduced by the factory costs allowance received from the Marketing Department which, on the year’s production, is equivalent to .269 d.. per lb. of butterfat, reducing the cost of manufacture to the Company to 2.510 d as compared with 2.726 d in the previous year. The reduction in costs of .216 d is due principally to the effect of an increase in output reducing the cost per pound of constant or fixed charges. The cost per pound of the manufacturing wages charge remains almost at the same cost as the previous year, and some considerable increase would have resulted under this heading as a result of increased rates of pay, had it not been for the increased wages cost allowance being granted by the Marketing Department in respect of production from November 1, 1944. The financial position of the Company continues in a sound state and the decision of the directors last year to rearrange'the company’s finance by repayment of the debenture to the State Advances by raising a bank overdraft, has resulted in a further reduction in the amount of interest payable amounting to £42 as compared with the previous year. The interest charge this year is over £IOO less than the amount paid prior to two years ago. The plant and equipment have continued to be maintained in an excellent state of repair. The charge for repairs and maintenance while still not high, is greater in this year’s accounts than it has been since the purchase of the new factory. Appreciation is expressed of the work of the staff in running the plant economically and efficiently and in producing high quality butter. The estimated season average payout per pound butterfat (all grades) quoted in the report for last year was 16.137 d and that payout was actually made. No export stocks of butter were held at the close of the year and stocks for local sale were valued at the wholesale price, due allowance being made for accruing charges. It is estimated that the season average payout which should result from the disposal of unsold dairy produce will be 16.591 d per lb. butterfat and giving a total payout of 16.619 d per lb. for finest cream supplied during the season. In connection with the above stated estimated season average payout, it should be noted that the farm costs allowance of 2.887 d per lb. on all butterfat used for buttermaking which has been paid to the company on behalf of individual suppliers in respect of butterfat supplied from August I, 1944, (prior to which date the allowance was .767 d per lb.) is not included in the estimated season payout quoted. The claim on the Marketing Department for farm costs allowance has been made on 322,762 lbs. of butterfat supplied during the year and this allowance has been paid to suppliers with the advance payout and the season average for this farm costs allowance amounts to 2.881 d per lb. butterfat. The estim--ated season average payout per lb. butterfat is therefore increased to 19.472 d if the farm costs allowance is included and giving a total of 19.5 d for finest butterfat supplied during the season. The total of cream cartage costs incurred by suppliers individually is £2l 14s 6d, representing .016 d per" lb. on the total butterfat received by the company from all sources. Shareholders will have no cause to regret the decision made last year to take over the Rangiwahia store from the satisfactory results which are disclosed in the first complete year’s trading of the store. After providing for taxation amounting to £225 on the store profits, the directors transferred the sum of £350 to store general reserve account partly to enable the store operations to meet their obligations to the bank for the reduction of the overdraft and also to ensure future stability of this department. It is proposed that the surplus from store trading profits shall be rebated to customers of the store but at this stage the directors consider it inadvisable to follow this course .until sufficient reserves have been created to meet any setback which may arise. The balance of the store profit for the year, £97 4s lid, has been carried to the general appropriation account and it is proposed that the dividend on share capital should be met from this source. Tho directors express appreciation to the store manager and his staff for conducting the store operations in such a creditable manner. The surplus from the manufacturing and marketing of butter together with the balance brought forward from last year and also the transfer from the store gives a total of £5604 9s 7d, out of which amount the directors have set aside the sum of £IOO to plant and machinery reserves, leaving a balance of £5504 9s 7d. available for distribution and the directors recommend that this amount be distributed as follows: (1) To pay a dividend of 3 per cent on paidup capital, such dividend to be declared payable out of profits from store trading and other activities during the year ended June 30, 1945. (2) To make a deferred payment of 4d per lb. butterfat supplied during the season. (3) That the balance of approximately £6O be carried forward. Messrs A. J. Martin and T. M. C. Smith retire by rotation from the directorate and being eligible have offered themselves for re-election. The directors place on record appreciation of the services rendered to the company by Mr. J. E. Oakden as secretary, not only in stepping in to fill the vacancy until the return from overseas of Mr. J. R. McNeely, but also in ably carrying out his duties during that period.