J. AND P. COATS, LIMITED

Otago Daily Times, Issue 22023, 4 August 1933, Page 11

J. AND P. COATS, LIMITED

IMPROVED PROFITS BUSINESS WITHIN THE EMPIRE. (From Oue Own Correspondent.) LONDON, June 23. Mr J. 0. M. Clark, chairman of Messrs J. and P. Coats,' Ltd., presiding at the forty-third annual meeting, held in Glasgow, remarked;— “ For three successive years it has been your misfortune to listen while I have enumerated the difiiculties with which we have been confronted in almost every part of the world in carrying on our business, and which have contributed to the substantial reduction in our profits in recent times. Prohibitive tariffs, quotas, exchange restrictions, and almost every other conceivable obstacle to the free flow of trade still exist —indeed, in many cases to an accentuated degree—but I am going to take it for granted that our stockholders are by this time fully cognisant of the situation. . . . “ High hopes have been set upon the result of the Economic Conference, and there can be no doubt that the recent improvement in business sentiment has been largely founded upon these same hopes. If these expectations are disappointed and the conference is no more successful than the many other international conferences that have been held since the war, we shall be faced, I fear, with a sharp reaction in opinion, and a serious impairment of confidence. EMPIRE TURNOVER MAINTAINED.

“ On the other hand, our turnover in the British dominions and colonies has been maintained. We had looked forward to the Conference at Ottawa last year and to the possibility that we might derive some benefit by a reduction in the high tariffs levied on our British manufactured goods in many parts of the Empire, but I regret to say that our hopes were disappointed, and no reduction of any importance in the rate of duty was conceded. I think I am expressing the opinion of textile manufacturers generally when I say that the conference did little to widen the opportunities of trade within the Empire so far as the textile business is concerned.” COTTON PRICES.

The prices both of Egyptian and American varieties remained at a low level during the entire year, though the fluctuations within that period were considerable. The spot price of Sakellaridas Egyptian cotton at the beginning of January, 1932, was 7d per lb; by June it had fallen to almost Sid, the lowest figure on record. By September the price was over DAd, while at the end of December it was 7|d, or only slightly above the figure at which it stood in January. It is interesting to compare that with the high figure of 99d touched in 1920. The course of prices in middling American cotton followed very much the same lines. It is too early to form any serviceable estimate as to the cotton crops that may be expected during the current year, but it certainly does not appear as if there will be any shortage of supplies. BONUS OF 2* TER CENT. “The profit,” said the chairman, “Is greater by about £200,000 than that of the previous year, and with the carry forward amounts to £2,440,103. At the risk of incurring the criticism of the stockholders, your directors have decided to recommend a bonus of 24 per cent, in doing so they have sought to avoid a policy of over-caution while still conserving the stability of the company. “ In 1929 I told you that any bonus which we recommended would depend largely on the results of the year’s working, and I suggest that you should consider this payment as being merely in keeping with that policy rather than as an indication that the board is unduly optimistic in regard to future prospects. Though our profits for last year show an improvement on the previous year, this was partly duo to a gain in exchange on remittances from certain countries owing to Great Britain going off gold. “ Our sales for 1932, taken as a whole, were no greater than those for the previous year; in fact, there was a slight contraction in our export business, which was only to be expected seeing that almost every country wag trying to decrease imports while increasing exports. In the home market the volume of business has only just been maintained at the 1931

figure, in spite of the fact that last year our goods were protected by a 10 per cent, duty.” RESEARCH. The firm has given considerable attention to the question of technical research within the last few years, and has endeavoured to apply what science can teach to the improvement of the various processes comprised in the manufacture of its articles. A special research with laboratories under the direction ot a Research Committee, has been established at Paisley, where excellent work has been carried out. “All our foreign connections,” he continued, “ are encouraged to co-operate in this work, and any individual employee who contributes something of value is suitably rewarded. As a result of the combined efforts, I consider that substantial progress has been made both in the improvement of quality and in the reduction of costs. We have also had the benefit as members of the Shirley Institute of the advances that have been made in regard to cotton research at its very excellent experimental laboratory near Manchester. “We have recently prepared plans lor the renewal of a considerable part of the machinery at many of our mills. The replacement of machines as they wear out is naturally always going on, but it is felt that from several points of view the present is an opportune moment for renewal on a larger scale. THE FUTURE. “Never has there been a moment when it was more difficult to discern amidst the confusion of contemporary events (lie main trend and tendency of trade. People who are well placed to judge tell me that there are visible signs which suggest that business as a whole has now entered upon an ascending curve. I hope this is so, although our own figures as far as the present year has gone dp not bear it out. Recovery is, in my opinion, certain to be slow, and there are sure to be very considerable fluctuations. These matters lie outside the ambit of our control. The most that we can achieve is to meet as efficiently as wo may each emergency as it arises and constantly to endeavour to better tlu organisation of the company. By this means alone can we hope to secure that when prosperity returns we shall bo in the best possible position to avail ourselves fully of our opportunities.”