NEW ZEALAND IRON AND STEEL COMPANY. LIMITED.

New Zealand Herald, Volume XXIII, Issue 7799, 19 November 1886, Page 6

NEW ZEALAND IRON AND STEEL COMPANY. LIMITED.

The annual meeting of the New Zealand Iron and Steel Company was held yesterday, at the offices of the company, Fort-street, Mr. J. Chambers presiding. There was a good attendance of shareholders. The secretary (Mr. Maofarlane) read the advertisement convening the meeting, and also the minutes of a special meeting to consider the resolution that the company be voluntarily wound up. The minutes of lasG meeting were read and con firmed. The following report and balance-sheet was then read :— It Is our unpleasant duty to hare to meet you and to report that the company, of which we expected suoh great (hinge, has not been the success anticipated. The manufacture of bar iron from the sand has been aocompliabed, bat the till in the price of all raeUls since this company was started hoi been such that the margin of profit expected has been swept away. The manufacture of steel direct from the sand, of whioh we expected so much, has been accomplished, bat the cost of fuel exceeded expectation!, while the melting-pots ordinarily uaed would not stand the aotion of the melting iron sand. Your directors believe th»t a payable industry could bestablished by carrying on the works as a scrap Iron works or rolling mills, working at the same time puddled bars from the iron stud, whioh oan thus be turned into the finest crucible cast steel. But to carry this out «ould en all an additional outlay of about £3600. and then there would be required, say, £3000 as working capital, making, with the amount owinp, £20,000. Your directors cannot see their war to raise this money, even if the mortgagees were to allow the amount to stand as it Iβ,—a large portion of this amount to remain over (or a time. Your directors reluctantly submit the following proposal (or your acceptance, of which duo notice has been given, "That the company be voluntarily wound up." BALANCE-SHEET. Assets,—Buildings, property, and plant account, Including buildings and sheds, machinery, and tools, c*nal and railway eiilinx, etc., £34,329 Oβ 7d ; patent rlghti, concessions, and lease account (paid for in 2280 shares paid up to £4, balance in cash), £13,620 ; scrap iron, £1875 14s 4d ; brick-maulnx account — stock of bricks (fire) on hand, £226 18e Id ; sundry debtors, £1311 Ss 2d ; unpaid calls, £176 ; cash in hand, £114 12s lid ; profit and lose account, £7045 111 7<t : total, £68,647 15s Bd. Liabilities—Oapital aocount— 40,000 shares at £5 (£200,000), less unallotted shares, 30,897 shares at £6 (£154 485), £15,515 ; John Chambers, £31 14s 2d: bills payable, including advances made by directors (£450;, £12,476 10s 2d ; sundry creditors, amounts guaranteed by Messrs. T. and 8. Motrin and Co., Limited, £626 11s 4d : total, £68,64715 a Bd. PROFIT AND LOSS ACCOUNT. Balance from 1885, £1512 5s 4d ; railway carriage account, £71 Iβ 9d ; wages account, £1397 7s ; coal and fuel account, £263 '2s 4(1; rent, omee expenses, interest, and ohar«es, £876 6s 4d : total. £7120 2s 9d. Cβ. -Discount account, £18 17s 8d ; transfer fees, 7s 6d ; Insurance account, £55 6s ; balance, £7045 11s 7(1 : total, £7120 2s 9d. The Chairman then moved tbe adoption of the balance-sheet, and eaid : In proposing the adoption of the report I will make a few remarks about tbe position of the company and the difficulties we have had to contend agaitst during the last year. At the laat meeting it was decided to carry out some trials, and to submit the results aa soon as they were proven. These trials were carried out with an amonnt of success that warranted their continuance,but not sufficient for ns to recommend you to carry out the process on a large scale. In the meantime the creditors of the company were pressing, and to prevent the company being foroed into liquidation while there was yet a prospect of success, Messrs. Morrin and Co. advanced the money to pay off all creditors, taking a mortgage over the property. The making of bar iron from scrap is now being carried on in both Sydney and Melbourne successfully. Of the eventual financial success of this industry I have no doubt. All we have learnt by our expenditure of time and money has made this quite olear, and my wish now ie, and all along has been, that the present shareholders may reap the benefit of the outlay. Thelast trials proved that the sand can be reduced in a few minutes as well as it could be done previously in twenty hours, buc mechanical difficulties arose as we went on, which were overcome one by one, bat we decided to atop because we considered that these trials should be carried out on a much smaller scale, as other mechanical troubles might arise, and which might take some months to perfect, but of the prinoiple we have no doabt. All this can be done at a very trifling cost when the works are going. The outlay for completing the works will enable the company to turn out from forty to seventy tone per week. The difficulties we have had with our managers you all know about. The Chairman further remarked that the making of ironeand from scrap iron was successfully carried on in Sydney and Melbourne, but owing to lack of funds they oould not at present carry it on here. He stated that any trial made with tbe sand could be carried on at the same time aa the other operations, and it would only involve a nominal cost. That the aim of the directors had been to overcome that diffitulty, and their best efforts had for some time been to reduce the expenses of production. The price of iron had fallen so much that no profit was left upon iron sold here. Samples had been sent home for testing, and the answer was that the samples were not large enough for a satisfactory trial. They had sent larger samples to England to be tested,, but had not yet received an answer. Some time would be required before they could submit that to a meeting of the shareholders. The difficulties they have had with managers had cost the company a large sum of money, and for some time their experiments had been carried on at the expense of the directors only. If there were any questions the shareholders would like to ask, he would be happy to answer them. He had looked upon the undertaking as a thing almost certain of success, and he was still of the opinion that that would be successful, but, as in many other instances, those who spent their money in proving the practicability of the operation might not realise the profits. If the shareholders could form another company, and buy the interest of that one, he was authorised by Messrs. Morrin and Co. to say that they were prepared to deal with them. He would, at a subsequent stage of the meeting, propose that the company be voluntarily wound np. Mr. J. M. Clare seconded the adoption of the report and balance-sheet. Mr. Sidwbll asked what conditions the mortgagees proposed to offer the shareholders. The Chairman said as mortgagees Messrs. Morrin and Co. had no right to make any arrangement at this stage. They would simply wish the money to be paid off. In reply to further questions, the Chairman said the pig iron they had in hand was not utilised, because it had been obtained to work with the sand, and before they oould carry out that operation they would require furnaces and rolling mills to be completed, which would cost about £3500. Mr. J. M. Clark said the iron could be sold aa scrap, but would simply go against the debt of the company, and would not provide money to convert the scrap into bar iron. For that purpose they must spend about £3500. Hie own faith and hope in the work was very muoh shaken when he found how terribly far out their manager had been in his estimate ae to the cost of the manufacture. On one oooasion he had visited the works, and on making inquiries about how things were going on, he found that they were spending £27 a ton iu fuel for a ton of steel. When he heard that, he sat down upon a log of wood, and felt poorly ; and he still felt poorly with regard to the prospects of the oompany. Mr. Leahy said the shareholders oould hardly form a fair opinion after just hearing the balanoe-aheet read. It seemed to him unusual to call a meeting to consider the winding np of the company at so short a notice. He had joined the oompany with much faith, and the prospectus seemed to indicate that there was a process for successfully producing the commodity. He aaked for further information before they resolved to wind up the company. What would become of tbe patent rights and leases ? The Chairman said the patent rights and leases would not go with the property. In reply to a further question be said the mortgagees would be pleased to transfer the property to a oompany or syndicate who would take it off their hands. He believed the business would prove a great success in the end, but they could not go on as they had been doing. Mr. Leahy asked if the shareholders oould not oarry on the business profitably, how oould other people conduct it with success ? The Chairman said they wished to show that they could treat this sand successfully, and when once they were able to do that, they would be able to raise money in England, but until that time no one would go iuto it. If they oould state that it was a genuine suooeao, no doubt they would get the money. Messrs. Morrin had advanced the money simply to protect the estate* Mr. Clark said the question was, how was the money to be raised ? The direotors had found soma out of their own pookets, but that oould not go on indefinitely. If the shareholders would like to purchase the i property they oould do it, but if not, it

would have to be sold at a sacrifice, and those who bought would be the parties to reap the benefit of their experiments. The report and balance-sheet were then adopted* SPECIAL MKKTINO. A special meeting of the company was then held. The Chaibman moved, "That the company be voluntarily wound up." Mr. Clark seconded the motion, etatinq that he did so pro forma, as he agreed with an amendment which he understood Mr. Compton was about to propose, to adjonrn, in order to give the shareholder! a fuller opportunity of studying the report and balance-sheet. On the motion of Mr. Compton, seconded by Mr. Sealey, it was resolved that the special meeting be adjourned for a fortnight.