WELLINGTON WOOLLEN COMPANY.

New Zealand Mail, Issue 852, 29 June 1888, Page 24

WELLINGTON WOOLLEN COMPANY.

The annual meeting of the shareholders of the Wellington Woollen Company was held in the Athenseum Building on Wednesday J night. There were about fifty persons present, and Mr T. Kennedy Macdonald (Chairman of Directors) presided. The anneal report (already published) and balance-sheet were taken as read. The Chairman formerly moved the adop. tion of the report and balance-sheet, and in doing so, he said the Chairman in past years, on the occasion of annual meetings, had a rather stormy experience to go through, and had to expatiate at considerable length upon the affairs of the Company. His duty, however, in that respect, he thought would be exceedingly light. There were one or two items on the balance-sheet which called for special attention. They would see that the item sundry, debtors on the asset side of the account was set down at £4211 14s lid. He was glad to tell them that the Company was now in a unique position amongst enterprises of a similar character in New Zealand, for during the past year they had not had to •write off one single penny in bad debts. (Hear, hear.) This proved to them that the business had been carefully managed, and a considerable amount of discretion exercised in the sales made by the Company. They, would also notice that the outstanding calls had been reduced to a very small amount. That wa3 another satisfactory feature in connectipU'With the Company's business. They would also notice that the preliminary expenses bad been divided into two items.- A sum of £IOOO had been set apart for expenses in connection with the passages and training of a number of the Company’s and thb Board had decided to show the full amount estimated by the manager for these items as a soparate account. Coming to the opposite side of the account, the liabilities, ho wished to call their attention to the fact that their snndry creditors amounted to £23,993 13s Id, and that their stock, their raw material, the money due to . them by sundry debtors (not represented by bills re. ceivable). cash in hand, and small amount of outstanding calls, would pay every penny—with the exception of a few pounds that the Company owed—mortgages, bankers, in fact, everybody in the world—(hear, hear, and applausel —leaving the freehold land, buildings, plant, machinery, and mill ready for business and entirely the property of the shareholders. That position wa3 eminently a sound one, because what was called the liquid assets could be converted," within a limited time, to pay every penny the Company owed. That was the position the Company stood in. He hold very strong opinions that tho Company should, as early as possible, place itself in the position of not owing money to any finance company or bank, and they should square off every mortgage and liability of that kind as early as possible. They were jty jpoei tion,>. but they

should put themselves iii an absolutely safe condition by not owing a copper to a soul, aud he hoped that the shareholders would recognise the necessity of doing this at a very early date. The curse of New Zealand in reference to public companies had been this, that shareholders had established enterprises of great value in themselves with a nominally large capital, but the amount actually subscribed had -been exceedingly small. They had gone to finauoe companies and bankers, and obtained advances, and everything had gone on extremely well until a crisis came, and then the bankers and companies wanted their money, and the shareholders had to pay it at a time when they were pressed for other matters. They could not do it, and the crash came. Having learnt experience in the past, lie hoped they would avoid such a rock in future. They would notice that the balance on profit and loss- account was'£3s77 3s 7d,an amount almost sufficient to pay 1() per cent on the capital embarked. The Directors made a recommendation that the amount should be oarried forward to ne>t year. (Hear, hear.) He considered that an exceedingly wise recommendation. He went on to say that they would, in all probability, pay an interim dividend at the end of the next six months, and go on paying a steady dividend after that. They would notice that the business for consideration at the meeting included the following resolution: “The Company may, with the sanction of the shareholders of the Company, previously given by special resolution in general meeting, reduce its capital.’’ Curiously enough, in going through the articles of association, they had discovered that they had power to increase their capital, but not to reduce it, and the consideration of that question was brought about by a suggestion made by a shareholder, who was supported by another shareholder, whether it was not wise at this stage of their history to write off the whole of their preliminary expenses. They involved an annual charge in each year of l-20th of the preliminary expenses, or in other words about £350 or £4OO. It was carrying forward something that was an incubus on the balance-sheet, and it was suggested that it would bring their shares up to par value. He was not going to discuss that matter then, as there would be an opportunity later on. All they wanted was to put the articles of association gin shape, and when the resolutions had been confirmed, a (fortnight or a month hence, the whole question would be laid before them in detail. The idea had not emanated from the Directors, but from outside sources. He went on to inform the meeting that the trade of the Company had been entirely satisfactory as regarded the volume of its business. The increase during the past six months had especially been very marked and satisfactory. The Directors felt that for the energy and judgment displayed in reference to the positioD of the Company, they were greatly in. debtod to Mr Wood; General Manager, and Mr Hoeles, their travelling representative. These gentlemen had worked with great energy to further the interests of the Company. Referring to the prospects of their trade in future he said these were exceedingly satisfactory. He didnot want to weary them with statistics, but it was somewhat instructive to examine the imports of the Colony during the past twelve months. In 1886 they imported apparel and slops to the value of £208,006 ; in 1887, £169,186; being a reduction of £38,820. That in itself, he considered, satisfactory proof of the successful competition of the colonial - made clothing with the imported goods. Now as to woollen goods. In 1886 they imported to the value of £87,558, and in 1887 £79,806-a redaction of £7752. The imports of blankets in 1886 were £17,325 ; in 1887, £16.827; showing a reduction of £498.' Now, the great bulk of these imports ought not to come into this market at all. New Zealand could now supply itself with every description of woollen goods, with worsted coatings, tweeds, flannels, blankets, as wetland better than they could bo imported, because with the colonial article they were getting absolutely the pure thing. These returns clearly showed this, that the colonists as a whole had not awakened up to the fact that it was their duty as well as their interest to patronise colonial industries to a much greater extent than they had done in the past. A. certain amount of trade had been done by tho woollen mills of New Zealand with Australia, but not to such a great extent as he could have wished to see. It was satisfactory, however, to note a considerable increase in the amount exported. In 1886 the export of woollen goods, the manufacture of the Colony, was £10,997 ; in 1887, £15,760, showing an increase of £4763. These exports were divided between the principal colonies as follows : Woollens. —New South Wales £6507 ; 1887, £9853 ; Victoria 1886, £2193; 1887, £2693; Tasmania—--1886, £1269 ; 1887, £493; Queensland — 1886, £128; 1887, £1767- Now, there was no reason why they sho >ld not do a much larger trade than had been done. In New South Wales there was no duty upon the importation of ■yoollen goods; in Tasmania it was 10 per cent; in Victoria, 7£ to 20 per cent; Queensland, per cent ; and South Australia, 10 to 15 per cent. Their own companies’ enterprise had been extensive enough to open up business relations with the whole of the colonies he had namgd, but he thought the trade could be greatly enlarged. Referring to the tariff now being considered by the House he said it imposed an additional duty of 5 per oeut. on woollen goods and 10 percent, on apparel and slops, and that should bring about a very marked inorease of trade to every mill in the Colony. It had been argqed that the tariff was not going to do the woollen companies any good, that it was likely to bring about competition and tend to diminish profits. He did not think that would be the case. The Colony was exceedingly well off for woollen mills—there were now nine in work, quite sufficient to do the whole trade of the Colony. Ho believed the effect of this duty would be to shut out the shoddy goods, and induce the purchase of genuine articles. If this took place, there was ample room in the Colony for the production of the whole of these mills. He went on to say that industrial development must go on hand in hand

with agriculture. That was the gospel of the Protectionist, and he was surprised that men should think in these days we were going to keep this country—so admirably adapted for manufacturing industries—undeveloped in that direction, and look upon it as a mere farmer sheep-walk. He felt confident, howeveb, that better things were in store for the Colony. Although they were told that the tariff was only a revenue-pro-ducing tariff, he welcomed it as a step in the right direction of the industrial development of the Colony. Mr Prendeville seconded the motion.

In reply to Mr Everest, tho Chairman said the business of the Company’s fellmongory had showed a very fair margin of profit for the past year. Mr Cohen asked what the chairman termed apparel. The Customs did not know what was apparel and what were slops. The Chairman said if the Customs could not define it he could not. •

Mr H. J. 'Williams wished to know if it was a fact that a retail house could not deal direct with the Company. The Chairman .said the Company did not deal directly with retail houses. The question whether the Company should be conducted on wholesale' or retail lines, had engaged the attention of tho Directors of every mill in the Colony. They were quite satisfied to continue their present policy of dealing with tho wholesale houses. When those houses ceased to support them, then they would become retailers. He hoped the time was very far distant when that would occur.

Mr Kembor said he had noticed tho item—in the profit and loss account, manufactures account, and forfeited shares account, £8334 13s 9d and he wished to know if the Directors had any objection to telling him what proportion was the forfeited share account of that amount. The Chairman said he did not think it was wise for them to disclose the details of their manufacturing account. Mr Kember must remember that they were in competition with eight other mills in the Colony, and it would not be wise for them to disclose what the profit was on any of their manufactures. Mr Kember, or any other shareholders had a perfect right to inspect the Company’s books. They would only put him on hia honor not to disclose the contents of them. Mr Kember said there was another item on which he wished for some information. The item mill property in the assets was a considerable increase on last year. The Chairman said that wa3 in consequence of increased machinery. He would mention, for the information of shareholders, that certain additions were necessary from time to time. Their business was growing, and that account would naturally swell a little every year. ' After some further disoussion the motion for the adoption of the report and balancesheet was put and carried unanimously. Msssrs T. Kennedy Macdovald and W. H. P. Barber were elected Directors unopposed. The former gentleman returned thanks, and said he was glad to welcome Mr Barber as a oolleague, a 3 his practical experience of an important branch of the Company’s operations wo.uld, he felt sure, prove of great value to tho shareholders. Messrs W, F. Kennedy and D„ T. Stuart were re-elected auditors. Mr Kember moved that their remuneration be fixed at twenty-five guineas.

Mr J. C. Harris seconded this. Mr Everest moved, as an amendment, that the amount be twenty guineas. Mr Egglingtpn seconded. On being put the amendment was carried, the original motion being lost. On the motion of the Chairman, seconded by Mr J. C. Harris, it was resolved unani. monsly that “The Company may, with the sanction of the shareholders of tho Company, previously given by special resolution in general meeting, reduce its capital.” M r Robert Gardner moved that a bearty vote of thanks be awarded to Mr Woods, general manager, Mr Heeles, travelling re. presentative, and the secretary, Mr Brenmer, and in so doing, he assured them a 3 one of the Directors that these gentlemen had done their duty admirably. Hod itnot been for the way Mr Wood had worked he questioned very much whether they would have been able to present such a good balance-sheet. Mr John Martin, M.L.C., Beooilded the motion, which was carried by acclamation. A vote of thanks having been awarded to the Chairman, the meeting terminated.