STANDARD INSURANCE COMPANY.

Otago Witness, Issue 1320, 17 March 1877, Page 10

STANDARD INSURANCE COMPANY.

The sixth half-yearly meeting of the Standard Fire and Marine Insurance Company wa3 held on Monday (12th inst.), in the City Council Chamber. Mr John Reid (Chairman of Directors) presided, and there was a numerous attendance of shareholders. HALF-YEARLY REPORT. The following report and balance sheet were read : — The following balance sheet shows that £28,789 12s 5d has been received from premiums, and £1227 2s 6d from interest and transfer fees ; making a total of £30,016 14s lid. The losses and expenses of management amount to £25,012 17s Bd, leaving a net profit to the Company on the half-year's business of £5003 17s 3d. The balance to credit of Profit and Loss Account is row £19,839 16s 7d, from which amount £13,950 will require to be set apart to represent " unearned premiums," leaving 1 £5859 available for application as the meeting may determine, and which the Directors recommend should be applied as follows, viz. :—'* That a dividend of 9d per share be declared, and the amount thereof (£1876) carried to credit of capital account, and that the remaining £4014 should remain to credit of profit and loss account. The capital would then stand at . . .. £33,125 Reserve fund, aa at present 5,810 And the available balance of 4.014 Would give a total of .. .. £42,919 Or 17s 2d per share. Messrs James Curie and Charles Stewai t retire from the Directory by rotation, and Mr Begg*a appointment as Auditor will expire by effluxion of tune. The retiring Directors and Auditor are elfgible, and offer themselves for re-election. John Reid, Chairman. BALANCE SHEET. Half Tear ending 31st December, 1876. LIABILITIES. & s. d. £ s. d. To capital 30,000 0 0 ■ capitalized Id June, 1876 1,250 0 0 ' , , 31,250 0 0 Beserve Fund .. 5 810 0 0 Sonus for distribution .. .. .. 2,490 0 0 - Balance of profit and loss account ..19,839 16 7 - ' £69,389 16 7 ASSETS. By Investments „ .. ..38,901 6* 6 Value of buildings, farnitrre, &c. .. 1,821 2 5 ' Cash in Bank, Dunedin .. .. 4,896 810 Cash at Branctas, in hands of agents, < and uiicollecwd agencies . at Head ' Office ~ .. .. 13,770 18 10 £59,389 i 6 7 ■ PROFIT AND LOSS ACCOUNT. . £ s. d To fire and marine losses .. .. ... 20,153 14 6 Agents' commission .. ' .. '.. "2,768 13 2 Sauries and charges 1,940 10- 0 Deterioration of property (cay) .. 150 0 0 Balance 19,839 16 7 £44,852 14. 3 £ 8. d. £ c. d By balance, June, 1876 .. 24,385 19 4 Less dividend " capitaliaed , £1250 0 0 Reserve fund 5810 0 0 Bonus fordistribution.. 2490 0 0 ] 9,550 0 0 „ „ • 14,835 19 4 Net fire and marine premiums.. .. 28,789 12 5 Interest and transfer fees 1,227 2 6 £44,852 14 3 I have examined the above balance sheet and profit and loss statement, together with the vouchers and accounts, as also the books ot the Company and securities, and hereby certify that the above is a collect statement of the affairs of the Company. (Signed) Alkx. C. Begs, Auditor Dunedin, 20th February, 1877. The Chairman then said:— lt affords me pleasure in again meeting you, and submitting for your consideration the balance-sheet now in your hands. The gross premiums of the Standard for the half-year were L 33.867, which was reduced by re-insurance to L 28.789 12a sd, and for a small company like ours, I think this was a very fair half-year's work. The business, as you will observe, continues to show a steady increase, but seeing that your Directors continue to pursue the policy of holding comparatively small lines (as enunciated at a previous meeting), this increase is therefore more real than apparent. We have been gradually reducing the amounts at risk on large warehouses, and in thickly-built localities in towns, and at the same time cultivating what may be termed an " outside " business. Our losses, I regret to say, have been rather heavy — no less a sum than L 20.153 having been paid on this account. L2OOO of that sum, however, was incurred during the preceding half year, and was provided for ia the amount then set apart for re-insurances. This reduces the amount of losses falling within the half-year now under consideration to L 18.153. If we cannot control the losses, we can at all events control the expenses of management, and these, I venture to gay, will compare very favourably with those of any colonial company. There is now L 19,839 16s 7d to credit of profit and loss account, of which L 13,950 will have to be *et apart to represent unearned premiums on existing policies, leaving a balance of L 5889 available for application as this meeting may determine, and which your Directors recommend should be applied as follows, viz. : — That a dividend of nmepence per share be declared and carried to credit of capital account, whijh would then stand at L 33,125, or 13s 3d per share, and that the balance should be carried forward to the profit and loss new account. There is, as you will observe, LSBIO to credit of reserve fund. Not a large sum, certainly, but still it is a nucleus which we hope to augment from time to time. Some of the shareholders might prefer to receive dividends in cash instead of the same being carried to capital account ; but your Directors hav3 given . this question their best consideration, and they are clearly of opinion that the Jcourse now recommended will besc conduce to the interests of the Company, i.e., I not_ to disburse dividends till such time as, by capitalising them, the shares shall have reached I the value of 15s each ; and with reasonably i good fortune, another 12 months' work will see

this object accomplished without having to make any further calls on the shares. With our increasing business, it is necessary to have a larger capital than at present ; and by allowing dividends to be used for this purpose, the labour^ and expense Jof paying dividends and collecting calls are obviated. The accounts are very clearly expressed; but should there be any items on. which explanation may be reel aired, I will [be glad to afford it. Mr James Curie and Mr Charles Stewart now retire from the Directory ; and the appointment ef Mr A. C. Begg, as Auditor, expires by effluxicn of time. These gentlemen are all eligible, and now offer themselves for re-election. With these remarks, gentlemen, I now beg to move the adoption of the report and balance-sheet. The report and balance sheet were then adopted. Mr Tame said that if the shareholders would turn to the profit and loss account, they would find that interest and transfer fees amounted to L 1227 2s 6d, and the dividend received last year was L 1250, which was very nearly the same amount as th«j interest. Consequently, the shareholders got as a dividend simply the amount the Company received in the way of interest. Now, he thought they were entitled to something more than that. They were running the whole risk of losses to the Company, without getting any compensation whatever for the risks they ran. He thought that, considering the Directors had distributed a large amount amongst insurers, some alteration should be made in that respect. He thought they should recommend # the_ Directors to take the Articles of Association into consideration, with a view to erasing that clause which restricted them to a 10 per cent, dividend, and nothing more. The Chaibman said that last year was the first time they had p<rid anything to the insurers according to the Articles of Association. They could not do otherwise than carry out the promise made to insurers. Mr Tame said that of course they must do that until the Articles of Association were altered and amended. The Chaibman said time might arrive when the Articles of Association would require amendment ; but in the meantime he hardly thought it was desirable to do so. Mr Boro said th?t from the Chairman's statement it appeared the shareholders could have no hope of receiving a dividend until 15s per share stood to the credit of the capital' account. The Company had now been in existence for three' years, and had been making money during that time. It was rather unreasonable and unusual to keep shareholders waiting so long. I % The Chaibman pointed out that during that time the Company had been making capital. The question was whether it was good or bad policy to pay dividends and make calls at the same time. That would be rather inconsistent, and was costly besides. As it was desirable < that the capital should be increased, it was con sidered easier and more judicious to capitalise the dividends. - Mr Boyd said that did not appear to be the opinion of the public. Shareholders could not I get a dividend, and if they took their shares I into the market they must accept something below, par. . The Chatsman said the best plan was to hold the shares. - ' , ' •*■- r ' Mr Tame said he had been assured by good ' authorities in other Provinces that the shares would be easily saleable if the profits were not divisible amongst insurers. . ELECTION OS DIBECTOBS. _\ '„, The retiring Directors, Messrs James., Curia and Charles. Stewart, were reflected, .i 5 < ELECTION OP AUDITOB". - j ' '■'<> Hi< Mr A. C. Begg was re-elected Auditor. A vote of thanks to the Chairman closed the proceedings.