WESTPORT-STOCKTON COAL CO., LTD.

NZ Truth, Issue 852, 18 March 1922, Page 4

WESTPORT-STOCKTON COAL CO., LTD.

Sixteenth Annual Report and' BalanceSheet.

"Cambist" lias, always striven to 'be quite just when dealing with the affairs connected with coal mining concerns. Of course, the business side of these matters has to take the leading place m the comments due to. the various' situations that obtrude them-' selves, for a balance-sheet and a director's report are all that this critic has to deal with. Nevertheless, some notice has to be taken of the social side of all capitalistic enterprises. With regard to the latter feature, due consideration has to be given to such matters as wages, housing, cost of living and so on. Coal miners, m the past, were housed like filthy beasts, and their surroundings were sordid. The Coal Barons who swayed — through the powers of combination and monopoly—every "point m the game" m the mines, the price of^ labor, the; cost of shipping, have hitherto enjoyed a long run of profitable,'' exploitation "and, therefore, have built up an impregnable position for themselves, as can be seen on perusal of the balancesheets of successful companies and, also, m THE- POWERS 'THAT EMPLOYERS CAN BRING

to protect themselves, and. their profits. The company now under notice «™ «„i y rri^teen ;-af~ "lid; That fact explains why the reserves are so small and, to a certain extent, it also explains one of the reasoris accounting for the .wretched returns for the money invested m the business. It must never be forgotten that' the old established Coal Barons, ln > every way possible, endeavor to prevent and generally succeed, all new enterprises m coal mining. From end to end of New Zealand coal measures lie unworked. So soon as anything is attempted m the way of floating companies to work coal deposits just then the Coal Barons get busy to crush the possible competitor. In the case of the WestportStockton Coal Co., Limited, the promoters of this concern deserve a lot of credit for bringing the incorporation of the company into being. ' They had an- uphill -fight to get it going, and now they have an 4 uphill fight against the shipping ring that stands between the pi'oducts of the mine and the consumers of the "black diamonds;" For several years past the coal miners have done a lot for the Coal Barons; they helped the coal monopolists, to large slices of "public opinion" warmly favorable to the employers, by their boneheaded stupidity of "go-slow" and idiotic attempts. ■at• '■ terrorism. The bosses of the Shipping Ring "got their heads together" and thb results are that the taxpayers of ,-this country were used to fatten the Inchcape transports with coal freights when legitimate imports had fallen to zero, owing to the "slump." . How many millions of the taxpayers', money have been squandered m this manner can only be learned when a new Government gets a chance to "look through the pigeon holes" of the Massey Treasury and then, perhaps, we shall also learn why income tax up to 12s, m the £ has to be paid by every joint stock company m the Dominion. v |

That coal miners are awaking to a sense of their incompetent tactics has been made clear to "Cambist." The other- day he was asked to supply a prominent coal miner with some of the business facts connected with this iridustry. It was suggested to him that if the coal miners "knew more of the coal mine owners point of view from a business outlook, that many mistakes might be avoided m the future." "Cambist" .will, therefore, use the present balance sheet, so far as it goes .',"'■ TO ENLIGHTEN COAL MINERS, and the public m general. In the first, place the paid-up capital of the company is only £197,785, made up of ten shilling shares, of, which the whole of the ordinaries numbering 262,940, have been taken up and paid for, with 132,---631. preference shares, out of the aai-' fhorised limit, for this class (137,060) standing m the balance-sheet as fully paid. On the face of things, the company is undercapitalised, for its assets total £267,037. This position is met by borrowing £40,000 on 6% per cent.' debentures, which, with accrued interest; amount to £40,625 ' at date of the balance-sheet. The reserve . rund is given as £7874, and is probably a more or less book-keeping entry. At any rate, it is not sufficient to make-up for the shortness of capital that attention has been directed to above- Income tax, royalty, etc., stands at £9750. These items should be shown separately. Open accounts owing, is put m at £ 9111, while bills payable amount to £876. From this it will be noticed that outside .liabilities to, the extent of £19,738 are hanging over.fhe concern. If the debenture item be included, as.it should be, then the total grows to £60,363. Such is the story of debt which a small capital has made necessary;'such, too, is the heavy load that sabotage grinds, into the festering greed of both capital and labor. To the mind of this candid critic the conditions disolosed are lamentable. Both capital and . labor have need to be concerned about these liabilities. Both sides have intimate roasonsi for wishing tl}e load of debt to be removed, and the sooner, they, realise this fact the better for us -all.

. On the assets side of the balance-, sheet, propei'ty account stands :.. at £224,335. How this valuation is arrived at "Cambist" is unable to say. Coal mine companies should he made by their own shareholders or by' law to- furnish a properly set put account of pi-operty; The 'depreciations should be dearly shown, also the additions for each year. Further, from time to time a working plan of the mine should be supplied. In the case under notice £3500 stands for depreciation, while the sum of £4229 is put down for "additions during 1921." Tools and stores, £11,185, seems to this writer as a heavy amount for these items, for they do not include coal stocks. With regard to the latter there is nothing, m the accounts for that line- Evidently, the bins were empty when the accounts were closed. Sundry debtors, £.14,493. js. owing to the* company as trade debts, while for house purchases the sum set down is £.7562. In the latter line we get a glimpse of the efforts made by the mine 'owners to 'help the coal miners to acquire decent homes for themselves. One wonders how many "homes" , are covered by this sum; how long it will take to liquidate and -whether the

PATERNALISM IS WORTH WHILE from 'the employers', point of view; also from the workers' point of grumbles, which is the same thing, anyway. War loans and deposits, £4064, heeds to be dissected m order to show the' proportion of each item m the total. Cash at banker's, £ 5158, has a pretty look about it, even though one cari see many calls hanging . over, the sum, which, look like a cloud m a summer sky. •'..-.' ..-.■■ .■•":

The profit and loss account does' not disclose the real position of- the company's income and, outgo. The wages item is kept out of sight, for that is buried m the "balance from the coal

account." Evidently th9fs is not a. single coal mining company m this country willing to let the,' public know what it costs to 'work tffcfese properties and what this class 6t enterprise iff capable of earning on the capital used m the business. On the income side of this account it will- be seen that the year commenced with £2064,. .brought over from the previous year; J:hat the shareholders received: 8 pep cent, on the preference shares and € per. cent, on the ordinaries, while £3500 was written, off for deprecia- '■■ tipns. Up to the end of 1920 things looked promising, profits, were being accumulated and distributed. For the year under consideration; only 104/257 toris of coal were produced as against' 130,750 m the previous year, and instead of having £18,250 to play .with, there is a horrible loss of £1112 to deduct from carry forward (£2064). The net result is that there is nothing to distribute amongst the shareholders— prefs. or ordinaries— and only £951 is left to carry over to next year's accounts. Looking over the few items on the debit side of this account, "ma- r rine freights, £53,766," nearly knocks one's .eyes out. What a savage cut into a paltry 180,000 tons of coal? Are you listening, Mr. Inchcape, or is it 'Mr. „ Scrape- every-lnch? Certainly; nearly, the whole output, has been scraped y up by the shipping ring., Roy-' a tY costs £2695, but, then, that splendid institution is "so established" that' it would be a pity to ••abolish" it. liU' terest and exchange, £2007; is over 4d' per .ton, , This heavy overhead comes from insufficient capital, and is taken out of the pockets of the consumers." Naturally it increases the" price of coal but it does not 'fdo any good"' to tha-' coal miners.' Income tax, £ 7990, is a remarkable Item. What does it mean'? Have .we come to a time when the Massey Government collects income tax frbm concerns WHICH MAKE A " LOSS " OF • £1200 ..... m the. year? The question naturally arises, .had the company lost £20,000' would it have had to pay about £84,---000 to Bill Massey? Bad as Bill Massoy's Government is,' it could not demand income tax unless a real profit is shown m the books of the company. The point is, whether £69,802 is the actual balance, left- in the coal account, and the question arises,. how did that sum arrive? Without details it is impossible to unravel the mystery. So far as this scribe is concerned, he entertains'no fear about this concern. It seems to him better off "behind the < scenes" than ,'dri "its face valuation." If only ' 'it were free." That is the rub. However, do not forget the debentures; that is a real risk, should ever the earnings fail to provide the 6 & per cent, at due date.