NORTHERN COMPANY.

New Zealand Herald, Volume LXVIII, Issue 20886, 30 May 1931, Page 9

NORTHERN COMPANY.

REDUCTION IN EARNINGS. CURTAILMENT OF EXPENDITURE, DIFFICULT YEAR EXPERIENCED. " It is many years since the directors were forced to present a record of such unfavourable results," said Mr. Charles Rhodes, chairman of directors of the Northern' Steamship Company, Limited, in moving the adoption of the 50th annual report and balance-sheet at tho annual meeting yesterday. Details of the company's accounts were published in tho Herald on May 25. Unfortunately, the company's operations .. had been seriously handicapped by tho general trade depression, continued Mr. Rhodes. While it had to maintain and run a half-loaded fleet it had no chance to do much more than cover overhead expenses. Not only had outward cargo de- . creased by 21.308 tons, but country products in the form of flax, gum'and maize had fallen off heavily. The actual weight of butter and cheese had substantially in-" creased. • The net reduction in' freight carried by the company's vessels during the year amounted to 25.540 tons and as the. company looked for its profits ip that last 20,000 tons of freight it had suffered a most serious curtailment of earnings. These for the year amounted to- only £4518, but with the carry forward from last year of £9848, tho directors recommended payment of a final dividend of 3 per cent., which with the 4 per cent."." interim dividend already paid made a total of 7 per cent, for the year. That would absorb £11,298, leaving only ' £3068 to be carried forward. " Depression Will Pass." "We were compelled to adopt this course by the belief that it is our duty to assist shareholders at this time as much as possible and because we deliberately in; the past made some provision in our v carry forward for such contingencies as_. are now upon us," said Mr. Rhodes.'-"' He explained that the dividend reduction"' from 8 to 7 per cent, represented a-cut' of per cent., but the directors were'' hopeful that with the active co-operation - 1 of their staff they should not be forced' to further reduce it. .They also desired to 1 avoid undue pessimism fpr the depression, like all others, would pass in clue time, The directors had been forced to makeretrenchments in the company's employees; ;uid had made a cut of 10 per cent, in' staff salaries and -directors' honoraria, which would operate immediately. ■ Several" ships had been laid up in the effort to make income meet expenditure. In the. fierce competition practically all freight rates had been reduced and in the carriage of fertilisers the directors felt the.' company must assist even at an actual loss, for without adequate top-dressing the; output-of dairy companies would soon falloff. - Unprofitable Services. In the meantime there had been little or no relief in the maintenance of the company's vessels and the directors feared it would be some months before it could feel the benefit of any action by the Arbitration Court.. Operations during the year had not been marked by any serious.nautical loss. As the passenger trade to" the northern ports had become- unprofitable it was decided to abandon that portion of the service and to maintain a' weekly cargo trade only. The company's? steamers were really better off. without the passenger trade xiow that motor traction had reduced it to' unpayable. limits. Excursion trips, wore still run, but the' / number of excursionists had been reduced by fully 10 per cent. After expressing appreciation' of the efforts of the staff during very trying times. Mr. Rhodes said the company's small profits for the year had prohibitect any provision for depreciation on its ves-* sels, which in view of the laying up of some of them might seem to be all the more necessary. A critical examination and estimate of the. value of the existing fleet had been made and after making proper provision for those unlikely to run again, he assured shareholders that the book, value was fully represented by their ships, wharves, buildings and working plant.

Tho report and balance-sheet were adopted. The retiring directors, Messrs. E. R. Davis, N. A. Nathan and A. B. Roberton, were re-elected