BRUCE WOOLLEN COMPANY

Otago Daily Times, Issue 24777, 29 November 1941, Page 2

BRUCE WOOLLEN COMPANY

ANNUAL MEETING OF SHAREHOLDERS RECORD GROSS PROFIT The annual meeting of the Bruce Woollen Manufacturing Company, Ltd., was held yesterday afternoon. The chairman, Mr F. L. Nicolson, paid a tribute to Mr Peter McSkimming, who died on June 6 after being connected with the directorate for 13| years. Mr McSkimming had joined the board of directors of the company in November, 1927, and had been appointed to the position of chairman in August, 1933. Under his enthusiastic guidance the reorganisation of the affairs of the company had proceeded apace and with a thoroughness that only those who knew him personally and were directly connected with him in the business of the company could appreciate fully. His passing was an irreparable loss. The meeting stood as a mark of respect. Moving the adoption of the report and balance sheet, the chairman said the year had been a record one as far as turnover was concerned, this being reflected by the increase of £26,222 19s 8d in gross profit when compared with last year's figures. The net profit shown in the profit and loss account, £20.149 6s 7d. showed a decrease of £3566 0s 9d, this being accounted for by the increased provision of £61,500 for taxation and £12,150 for depreciation allowance, compared with £36,000 and £6OOO respectively for 1940. Payment of instalments of social and national taxes in advance accounted for the difference in the amount of income tax reserve as shown in the balance sheet. Dividends for Year

The amount of £BOSB lis 7d brought forward from last year, together with the net profit of £20,149 6s 7d for the year under review, made the total in the profit and loss appropriation account £28.207 18s 2d, • which the directors recommended to be dealt with as follows:—Payment of dividends on cumulative preference shares £2BOO, payment of dividend on ordinary shares of 6 per cent. £6OOO, payment of bonus on ordinary shares of 2 per cent. £2OOO. transfer to reserve account £3OOO, carry forward £9407 l ßs 2d - The distribution to shareholders recommended was the same as last year, while the amount to be transferred to reserve would bring the reserve account up to £30,000. The maintenance ■of the dividend on ordinary shares at last year's figure would be welcomed by shareholders and bear out the confidence the late chairman had in the future success of the company when he advised shareholders to retain their shares. The bank overdraft had disappeared, the chairman added, and after the 12 months' trading this item, which stood at £2303 7s lOd last year, had now changed to a credit of £17,027 10s--5d Deposits also showed a reduction of £470 7s 7d when compared with last year. The satisfactory position of these two items accounted for the reduction in the interest group shown in the profit and loss account, which was less by £2274 7s Bd. Taxation Burden Taxation in the form of income tax, social security and national security taxes, the chairman said, was a very heavy load on the finances of the company. The total amount reserved for payment of taxation during the past three years had been £107,500, and from this a clear perspective could be gained of the drag taxation had been on the finances of the company, with the resultant retarding of its normal expansion. "I draw your attention to this," the chairman added, *'as it is my firm conviction that when the soldiers return after their participation in the war for the destruction of Hitlerisrri, that the first line of their rehabilitation will be in our secondary industries. If the present import restrictions are to remain in force expansion will be necessary in our Industry, and this, incidentally, will absorb additional labour. To carry out expansion in any industry, however, it is necessary to have funds available, and while we fully appreciate the necessity for funds to prosecute the war, we have to realise that we have a duty to perform to those who are depending on us when they return. If industry is crippled with taxation internal funds will not be available for expansion, and the- difficulties that we have experienced in the past regarding the rehabilitation of returned men will be in grave danger of recurring." The necessity for additional depreciation allowance to cover the wear and tear on machinery due to long hours of continuous running, in many instances with inexperienced operatives, had received due consideration, he said. During the past two financial years attention had been given to the installation of efficient up-to-date machinery to the extent of £25,360 to cope with the additional demands for the manufacture of both defence and civilian requirements. While the company had undertaken its full quota of defence materials, it was regretted that only portion of the civilian demand could be met. This position was common to all New Zealand woollen mills. Shortage of Labour

It was regretted, the chairman continued, that the shortage of labour, more especially female, had prevented the company from reaping the full benefit of the additional new plant. Owing to the shortage of suitable local boarding accommodation premises were purchased, and after renovation were handed over to the Y.W.C.A. to run as a hostel for girls in the hope of improving the labour position in the mill. The full benefit was not being derived from the new plant, and it appeared that' unless the factory could obtain the necessary hands to operate this to capacity, military requirements both in New Zealand and abroad would be curtailed to a certain extent. The chairman also referred to the death during the year of Mr John P. Little, who had served the company faithfully for 30 years as hosiery manager.

The motion was seconded by Mr James Gray. Mr A. H. Allen, supporting the motion, made reference to the high taxation provision, and stated that the company did not cavil at extra amounts required for war purposes. Expansion of the industry was necessary, arid this could only be effected by retaining the funds for this purpose. Taxation provision during the past three years was £7500 more than the ordinary share capital of the company.

Mr F. L, Nicolson was re-elected a director, and Mr Peter Pelling McSkimming was elected unopposed to fill the vacancy on the board caused by the death of his father. Mr John J. Lane was i*e-elected the company's auditor at the same remuneration. Votes of Thanks Mr W. H. Hitchon moved a hearty vote of thanks to the directors, management and staff for the past year's work, and stated that a spirit of cooperation was evident throughout the organisation. The chairman responded on behalf of the directors.

Mr R. J. Lamb, general manager, returning thanks on behalf of the management and staff, stated that the year had been a difficult one, not a little due to the departure of many skilled mill employees with his Majesty's Forces overseas.