DALGETY AND COMPANY.

Otago Daily Times, Issue 20290, 24 December 1927, Page 9

DALGETY AND COMPANY.

ANNUAL MEETING. NET PROFIT OF £282,052. (From Cue Own Correspondent.) LONDON, „ November 19. The Hon. Edward W. Parker, chairman of the company, presided at the annual meeting of Messrs Dalgety and Co. Ho had a rather discouraging story to tell if the conditions in Australia.

“ The position in Queensland,” ho said, “ was, and still is, very serious. Large tracts of country suffered from the severe drought, which has lasted now for over two years, and very large losses of stock occurred, despite the desperate efforts which were made to save them. The losses of sheep in Queensland are reported lo amount to no fewer than 8,000,000, but I have no means of confirming this number. This figure may not actually represent dead sheep, ns a certain proportion wore removed to agistment country in New South Wales, but nevertheless the figure is an appalling one. lam glad to be able to report that partial rains have since come, and the situation has been somewhat alleviated, but much more is needed, and you will understand that it will be a long time before pastoralists generally are able to regain their position. The season in New Zealand was, in the early part of the year under review, only fair in places, and on the whole may be termed but later it improved. Land values in the Dominion have not yet reached their true level, and until that time arrives we cannot look for great prosperity in this field of our operations. I .am glad to say, however, that the results for the year from this quarter exceeded our expectations and lead me to take a more hopeful view of the of tlhe 100,000 new ordinary bare- of £2O each, continued, the Onair man, would not participate in the dividend and bonus for this past _ year, but . would participate in any interim dividend which might be declared next year, the ohainm.an indicated many directions in which the new capital would be required. It would give them all they required m the meantime. If it did not suffice they had as a result of the new issue, increased their debenture borrowing powers to the extent of £1.500,000. and this could be offered on the market as and when the directors deemed it advisable. KENYA COLONY BRANCH. “A new departure,” said Mr Parker, “is the opening of a branch of the company in KtSnya Colony. We have, .for the past three years, had as agents in that part of the world the widely respected firm of Messrs W. C. Hunter and Co., and we have found, as the result of this experimental trading, that expectations of increased operations, backed by sufficient capital, warranted the purchase of Messrs Hunters’ business. Our policy will be a cautious one, and we have no intention of locking up capital in advances on land, etc., in the* meantime. We have found that trading in the merchandise available for export from Kenya fits in with our operations on the same lines in Australia and New Zealand. We have not found it necessary to increase our staff at this end to deal with this new field, and consequently our overhead expenses are relatively decreased. I have every hope that the new venture will succeed, but it will take time to prove it.

OVER-BORROWING IN AUSTRALIA. “ I do not, as a rule, touch on politics in my remarks, but the trend o£ legislation in Australia to-day is, to say the least of it, bound to cause any thinking person anxiety. There is great prosperity in Australia to-day; but is it not artificial prosperity? Lund values in the cities are, in my opinion, too high, and pastora values also are on the high side. We all know what a painful process it is, in the event of a financial set-back, to get properties of this description back to their economic value. , . , . , “ I am bound to say that when a country over-borrows —and it is generally recognised that Australia has over-borrowed—-serious consequences loom on the horizon. Over-importing has naturally followed, and, as a result of this, an increase in retail prices and wages and general cost of living. All this may not mean much, while good seasons prevail and wool and grain exports show no signs of diminution —given, too, the maintenance of present prices for the primary products. But we all know Australia is subject to droughts, and droughts, as you are aware, can set aglcy the host-laid plans of mice and men. I do not want to appear in the role of a pessimist, but I do want to sound a note of warning. Labour troubles, too, are always in the offing, as witness the recent Queensland railway strike a situation, if I may say so, admirably handled by the present .Queensland Prime Minister. In that State I am hopeful that the Government will assist the hard-hit pastoralist by introducing legislation which will provide for an extension of those leases shortly falling in. STEADY WOOL PRICES.

“ I will now deal specially with the commodities in which we are primarily interested. ' “First and foremost comes wool. The strong demand for wool, to which I referred last year, has continued, I am glad to say, throughout the 12 months under review, with surprisingly few fluctuations in values. With a world-wide market for an article of general use like wool you expect a constant movement; prices are nearly always either advancing or declining, seldom stationary, but since the opening of the 1926-27 selling season in Australasia we have not seen a difference of more than 10 per cent, in prices either way, and the average value per bale for 1926-27 in Australia is only 13s 8d above that of 1925-26, or, in other words, £d per lb. In New Zealand wools the appreciation is rather more, viz., £1 2s 5d per bale,'or Jd per lb. The average value per bale for the 1926-27 season worked out at £22 8s sd, or per lb for Australia, against £2l 11s 9d, or 163 d per lb in 192526. For New Zealand the averages wore £l7 18s Bd, or 12Jd for 1926-27, against £l6 16s 2d, or lljd, for 1925-26. Those advances in value, however, must be a matter of satisfaction to the grower, although ho will undoubtedly reflect on the fact that only two years ago wool was worth £l2 per bale more than it is now, but at the present level it is on a much sounder basis than when prices were so high, and the way in which the catalogues were cleared in the primary markets last season, leaving practically no carry-over to the present selling one, speaks well for the stability of the market, “With regard to production, the 1926-27 figures create a record. It is estimated that Australia alone produced 2,712,483 bales, against 2,377,866 bales in 1925-26—an increase of 354.572 bales. New Zealand m 1926-27 produced 587,000 bales, against 585,910 in 1925-26, so the increase here is only just over 1000 bales

SHEEP STATISTICS. “ As regards sheep returns, the figures for Australia for 1926 show an increase of 6,500,000 over the 1925 figures, and this in spite of a decrease in the Queensland returns of over 3,500,000, the total for Australia for 1926 being given as 102,963,868 bead. As was generally expected, the sheep numbers in New Zealand only show a very slight increase, the returns giving 474,000 head more in 1926 than in 1925, the actual figures for 1926 being 25,379,071 head, “The amount of wool (hat the company handled in Australasia and London from the beginning of July. 1926, to the end of June, 1927, reached the fine total of 499,537 bales. These figures, of course, are not as largo as last year’s, which wore swollen by the carry-over, but I am glad to be able to say that tho company continues to hold its premier position in the wool-selling world. ’ _ After quoting statistics regarding the production of dairy produce and frozen meat in Australia and New Zealand, the Chairman said: “At this time last year it appeared to me that the prospects for frozen meat, wore not favourable, aim this has been borne out, for 1 retrret to say that prices for nlf classes of frozen meat have substantially declined; but in most eases prices are still maintained at a higher level than in pre-war days. The total value of frozen meal exported from the Commonwealth was £3,685,414. and from the Dominion £10,20(L495. as compared with £ 4,104,638 and £9.316.786 respectively hast year.” THE WHEAT TRADE.

“ Our branches maintained their position in the wheat trade, and their turnover shows an increase on last year's figures. Apart from shipments of fun cargoes by tramp steamers, they were also able to provide a considerable quantity of freight for the vessels for which this company acts as agents throughout Australia. "It is pleasing to notice ihc remarkable expansion of wheat-growing in Western Australia, where the acreage under

wheat has increased very rapidly of recent years, and resulted this season m a yield of 30,000,000 bushels, showing an increase of no less than 30 per cent, compared with their previous best crop. “ New Zealand increased its yield from 4,592,000 bushels in 1925-26 to 7,496,000 bushels in 1926-27, and did not require to draw supplies from Australia to the same extent as in the preceding year or two. The Australian yield for 1927-28 will probably show a falling off of about 35 per cent, as compared with last season, since, although Western Australia again expects a big crop, conditions in South Australia and Victoria are fair only, while New South Wales, which has suffered from lack of rain, is unlikely to have much to spare after providing for domestic needs.” NET PROFIT OF £282,052.

Tlie chairman, after comparing the figures of the balance sheet with those of the previous year, said that, after making provision for all contingencies which it was possible to foresee, there remained a net profit of £282,052, to which had to be added the amount brought forward from last year, £211,412. The board recommended the payment of a final dividend on the ordinary shares for the year ended June 30 last of 3s per share, free of British income tax, making with the interim dividend, 10 per cent, per annum, and of a bonus on the ordinary shares of 7s per share, free of British income tax, being at the rate of 7 per cent, per annum. After appropriating £25,000 to writing down cost of premises, £25,000 to' the staff provident fund, and £25,000 to bonus on salaries of overseas staff, there was left £223,465 to be carried forward. It was gratifying to the board that they were able to maintain the rate of distribution for both the dividend and the bonus. In conclusion, the chairman moved the adoption of the report and accounts. Mr Stephen Fairbairn seconded the resolution, which was unanimously carried.

The retiring directors and the auditors having been re-elected, the proceedings terminated with a vote of thanks to the chairman and directors and the local boards of advice and the staff for the services rendered to the company during the year.