NEW ZEALAND REFRIGERATING COMPANY.

Otago Witness, Issue 2058, 3 August 1893, Page 23

NEW ZEALAND REFRIGERATING COMPANY.

The twelfth annual meeting of the New Zealand Kefrigeratirig Company was held in the hall- of the Chamber of Commerce yesterday afternoon. Mr John- Roberts (chairman of directors) presided, and the other shareholders present were :— Messrs T. Brydone, J. T. Wright,' W. Stevenßpn (Henley), W. STAdam, E. B. CargUl. John Reid, D. Borrie (Papakaio), Andrew Todd, John Mill, T. Lamb, W.A. Moore, William Brown, T. Ohalmer, and W. Cuningham Smith (secretary).

ANNUAL REPORT AND BALANCE SHEEP. The annual report (which has been already-pub-lished) and balance sheet were taken as read, and in moving their adoption, The Chairman said : I have little to add to what is stated in the report attached to the balance sheet the adoption of which I now rise to move. The unsatisfactory result of our operations for the year is no doubt largely due to the fact ►therein stated-: that prices for fat sheep in tho colony have been considerably above their relative value iniondon,,and that consequently farmers realised much better prices by selling on the spot than by shipping on their own account. After their last year's experience of purchasing, the directors could not consent to risk their shareholders' money in speculation to any great extent; but, in order to give employments their machinery and fulfil freight engagements, they did purchase towards the end of last year some 5000 fat sheep at a cost of 2id per lb, delivered into the works. 1 On this venture you will see by the balance sheet, under "consignment account," we lost £203 os lOd, or nearly lOd per head. With the exception of this purchase the whole of the work for the year was freezing on hire, and you will see by the figures in the report what a lamentable falling off there has been in the number of carcases manipulated 'by the company. The whole tendency of the trade for the past two years has been in the direction of the freezing, companies purchasing from 'the grower right out, and there is no reason 'why such a system should not be carried out profitably alike to buyer and seller, prices being regulated by London values. But it would seem as if the colony were overdone with freezing worksj and we have seen buyers from Christchurch raiding Otago for supplies to be shipped from Lyttelton (not, I hope, to be exported as prune "North Canterbury" mutton), followed by buyers from rival Southland establishments offering tempting prices for Otago sheep to be shipped from the Bluff. No wonder that our farmers' heads were turned, and that for a time they hardly knew how much to ask for their fat 'sheep. Into this competition your directors did not feel inclined to plunge, preferring / (in the interests of the company) to make a comparatively small loss through their works standing idle rather than incur an unknown bjit certain large deficiency by running their machinery on such conditions. > I cannot think that this anomalous state of things can last much ldnger. People can't live on losses, and no doubt a more reasonable state of things will soon preva.il, which will admit of each company getting sufficient stocky to keep them fairly well employed without cutting the ground from under each other's feet. When that time comes we* shall be in a good position to give the highest price for prime mutton, owing to the favourable arrangements we have recently made in London —referred to in the report— details of which for obvious reasons cannot be disclosed here. _ The works at Burnside and Oamaru have been maintained in a stafe of efficiency during the year, and are quite ready to overtake the freezing of three times the number of sheep put through this season. The Burnside machinery only ran 1 94 days and the Oamaru 260 days this season ; and six weeksof that time was occupied m keeping stored a large inumber of carcases for which no tonnage was available. It will be quite evident, I think, to you, after the explanation which I have given, how the loss has arisen, and, under the circumstances, „* n»11y think that we may congratulate ourselves that it is not greater. As regards the future., it is very difficult to prophesy. The vast improvempnt in freezing machinery, on the chemical principle, during tho last few years makes it seem i probable that eventually those chemical .machines will supersede the present coldair ones. w>s ithjS'prospect which led the directors in past years TO -keep on writing down their original machines tp',a very low point, rather than go into a large expenditure on new machinery on the samep'rincipleifwhich might become obsolete after a few years' u|e. They are now, therefore, in a good position toko in for this modern type: but, of course, until there is a fair prospect of doing a regular andi profitable trade there is no object in incurripg any further outlay. . I believe' that some ihareholders think that because the Bu^nside' works were the first erected in the colony they pannot compete with other more recently established works elsewhere, and that the loss; is due in a great measure to our being .tinable to work at a pront at the low ratefevfor freezing now current. This is nbt the"cas&. Given regular employment, the Bumside'works can show a very good m turn at present fates. They are exceptionally well situated as regards coal supply, and have advantages in the wfy of disppsmg of their byproducts" po»seßsed'by few of the other works in the colony. < Beforejsitting down I must just call your attention to'iihe clause in the report ai to the necessity for sending Home only the best class of mutton.' and, Moreover, the class of mutton which findp most' Savour with the Home consumer. Thejday of |he gross heavy carcase of 651b to 801b has gone by, and nothing will meet the requirements "of tHe London market but prime quality mutton of, 551b to 601b. Weights above these are saleable jof course, but at a reduced price, and I f*el Bute that it will not pay gtozier3 to grow the heavy weight carcases of late years but rather to try to produce what commands the highest price in the Home market. The company have always maintained a high standard of qualitj. and were the .first to introduce the grading system, which is now general throughout _ the colony.'and have dpne much towards popularising the meat at Home. If we adhere to our high standard and do our work thoroughly well, and at the lowest current rates, we shall deserve the sup port of the sheep farmers of Otago, and I have no doubt eventually resume our position a* a divid MrK g sa°dTe a bb y ad pleasure* seconding the adoption of the report. , ... Mr Borrie said he did not altogether agree with the report,- nor, unfortunately, did he agree with the balance sheet. , He was aorry to say the company had drifted into the position it now occupied. Being the pioneer company m the Australasian colonies, ifc was not at all creditable, in his estimation, to find it in the position in which it now was. He did not think the reasons for finding the company in its present position were those which ufere referred to in the balance sheet or in the chairman's address. It was agreed on all hands that sheep had gone away, both north

and south, from the doors of thecompany's works. Any remarks which he made on the'subject applied particularly to the' sheep wbicp ,wen| north, for he knew pretty well what, had occurred there. He supposed the same thing had occurred in the south, but he was not so well postedup in what had happened there. His idea was that the reason why sheep did not go to the company s works was on account of the excessive ehargeß there. As a matter of fact, under the present rate of charges, it costsomethinglike2s3£dtoputa 601b sheep f o.b. either at Dunedin or Oanrfaru,' while to put a 601b sheep through the woiKs'at phn&tchurch and f.o.b. at Lyttelton it costf ; ls. 3Jd—a difference of exactly Is. He could rail'sheep.frpm Oamaru to the works at Christchurch; and place them f.o.b. at Lyttelton as cheaply as at. the works at his own door. That was not the only thing. The freezing charge at Christchurch was idperlb, less 15 per cent. ' ' , '-X • . >•„• The Chairman : Not all the year. - '*. ~ ; Mr Borrie said he was alluding to the present time. The charge for the bag the sheep\\Vas t>ut in was 3d, and these were all the charges that were made at Christchurch by the .freezing companies. Then there was a difference evenin-sbe , returns for the fat of the sheep. At -the .present time they could get 2d a pound in Christohurob,^ whereas from the company here, for'the" last two years, they had simply got lid: That, added to the difference of Is between the cost' 1 of shipping at Lyttelton and at Oamaru, accounted for the sheep going away. He was not stating things which he could'not prove* for he had 'documents in his pocket to prove his statements!; Last year, when he believed mote sheep went to 'Christ' church from the Oamaru district than had 62ne this year, the difference wa3 even' gfeater. ,; The charge for freezing in Christchurch last winter was id, less 20 per cent., and it was' arranged, moreover, that anyone could get freight .at.fa instead of. as was the case with tihw,;cora*pany, at la c, pound. He thought 'that anyone going into these figures would see" what a very great- difference they made 'in' 1 the actual cost of landing the hheep in London.' First of all, there was a difference of something like 16d a-head on the colonial charges, and then there was a difference of about 7Jd on,the freight. ,'Tha^ was last year. Of course the freight -was thiß year the same all over— ld a Ib4-but 'still there was a difference of 16d a-head in favour of putting sheep through the works at Ohristchurch. '..lt'wa.s a strange thing that people should be'able to rail sheep 160 to 200 miles and get them put. on' board at Lyttelton for less money than,, they could get them put on board at the ports at their own doors. He did not think it at all creditable to the management— and he said it advised^y^that the affairs of the company should h^ve 'drifted on in the Way they had. There was one other, item which he had protested against time and again, and that was the port charge "of Id' a : head made by the company. He thought that^hisiemarks on this subject, probably, did not apply to Dunedin, but they certainly did apply to Oamaru. . The port charge of the Oamaru Harbour Board was jd a carcase, and this company charged. Id a-head. He asked the meeting what they would think of an agent", employed to do their shipping, charging'to them double the port dues.be paid to the Harbour Board. He thought they would call him by a very ugly name. 'He -maintained 'that the company had no right to charge double' the amount of the port dues which it actually paid to the Harbour Board. As a matter of fact, taking the 57,665 sheep and lambs shipped at Oamaru last year, the port dues charged by the company at Id a-head amounted t,O £240; 5a sd, but the money actually paid to ' the Harbour Board was £120 2s BJd, so that' there was a profit of £120 2s BJd. ffe asked anyone present if that was a creditable way of doing business. He maintained that no company bad a right to charge any more for dueß tha'h the amount it actually paid. It had been stated that there had been reckless buying by outsiders.' Well, > he wished they had a little of this reckless buying in thiß company. ' - " * The Chairman : I daresay youdo. - ; Mr Borrib said he would give the results of this reckless buying in Christchurch. The Belfast Company last year wrote off £2750 depreciation of plant, paid a dividend of 8 per cent., and carried £95 forward to a new account. If that was the result of reckless trading, he would like a uptla o^ it here. ' ' '' „ Mr Brydone : They never buy a sheep. \ ■■ Mr Borrie : They work~on the same princrpla as this company. . '„'.' The Chairman said Mr Borrie was rot very generous. He was talking about reckless trading, and he was quoting the figures of a company which did not buy at all. > >' Mr Borrie: This company only bought in ,one or two instances, and had been working on practically the same lines as the Belfast Company— freezing sheep for the fanners— and the Belfast Company was doing work at as low a rate as possible, and was fully employed all the yeas round. He was up there about this. time last year, and the Belfast Company was doing as much work as it could, while their own company s works were practically closed, -and" sheep were going away in thousands from the Oarriaru district. Then, take $he case of the Islington Company. They were all aware that - the Islington Company bought, and he supposed it was one of those referred to as buying recklessly. A s it was a private company, he could not get hold of a balance sheet , ; '".*" The Chairman : It would be very instructive reading, if you could. v ' Mr Uorrie knew that a few yeaM, ago the shares were very low in the maiket, and that three yeare ago they were worth about 7s ocl to the pound. ' . '-"/'. v< Mr Brydone : Five shillings one year ago. ■> Mr, Borrie weuld come to that period. By;and« j byetheßharesrosetolosintheppund.'.Oneyearago one of the principal shareholders,* Mr John Watt, died, and in the realisation of his estate the share.*., were sold and brought 15s in the pqugd. . r, /, • • Mr Brydone : That was less than;ftjyear t a]go... v - Mr Borrie said they saw [what red^eßs;bu*fag had brought them to. Very, recently 6n(j;ofjthe clearest-headed men and one of the beat nnancieta in.the colony, a man who occupied S^ingtiosltionin the Legislature— Sirjilohntliall.-rbQtignii into the company and paid.SW^in jthe^poundjrfor hi* shares. The value in the market of the Bh>reß of a private company was all; the indicatfon,.the. outside public got as to whether itjwa>: successful or not ; and if the shares game frp]»"6B'jn?tbe pound to 20a. he wished th«re>as a-littlo;moreof the same reckless buying in this company. , . * Mr Mill said he hoped tjse' last -speakei •jud riven to tho company the support ,1$ < ought to. have given. If he was a iarmer-Tr' ', -•• ' 3 ;. . Mr Borrie ; I am. ■>' ' S&' .'-./:- Mr Mill auppused he (Mr Borrie) wanted the company to buy sheep right and. left and sacrifice the interests of the poor shareholders, who, liko himself, had joined the company in.the :J<opa of participating in a dividend^' He 'toad not- the slightest doubt in his own mmd that, at no distant date tho directors would 'be thatflfed for-;thoir cautiousness not only by the' last,.speaker pM% by all tho shareholders in the provinces Otago. ', ; JHe held that the farmers had their liijiinigs. dunng the last four or five years, s when' foolish people had been giving such prices as 2|s apd- 24s for , sheep which were worth only about 10s.' , He regretted very much that there was no: dividend to be declared, but caution was the- great thing, but he had every confidence— tod ho was sure that all the other shareholders he had met bad great confidence— in the directors. Ho hoped they would go on with a cautious policy,' jnndthat they would carry the thing out successfully, _ ,- .> *. . The Chairman : Am I right, ~Mr t ßome,- in talons y>" un ns saving that yon,OOUia>BJUP ap JdfromChristchurch.? ', > SPSSSMeJ? 1 ! think I can^y that/you could not -(Hear, hear.) I think you are wrong. The conditions of shipments from Christchurch are that if you ship during the summer season at lid you have the right of export during the winter at |d, making a uniform rate of Id. • • V" Mr Borrie (handing up a letter) : ,1 think;- that will satisfy you, Mr Chairman. ; , . ",.\ The Chlirman : May I readlhis? (Mrßorrie signified his assent). It is a letter ,to Mr Borne from Mr Weymouth, of the Canterbury .Freezing Company. " There is no liability vto. shippers to ship an equal quantity of meat in thejsumm? r>" Mr Borrie : That meets your statement; > ' t The Chairman: There is .nothing' here about the freight. ' '•■ - ' ' "* Mr Borrie: The freight -is mentioned, iln a circular. \: " v *- -s "' "' , The Chairman : Well, it is news for us. . „ I Mr Borrie: Here is the printed circular say<

ing the freight is 3d a lb. The question I asked was whether a person had to ship in the summer The' Chairman': You can ship in the winter only!. .' . MrBoRRiE: Yes. The Chairman : And in the summer 7 Mr Borrie? You need not send sheep, I believe- . The Chairman : Well, that is information for us. Then, in reference to the farthing : The freezing charge of id a lb at Christchurch is admittedly a non-paying rate. That, I think, I am righti/rn saying. MrjBORRiE said the balance sheet showed the contrary. The Chairman: They make it during the summer.- We say we won't freeze at a loss. We prefer to shut the works up rather than waste the shareholders' money,— (Hear, hear.) Mr MoOju? interposed to Bay that he thought Mr Borrie's'statement as to the freight was both right and wrong.', There was a hard and fast contract for Id right through the year between the shipping company and the freezing company, but ' last year r ,|he shipping company did not enforce the id. ' J The Chairman (reverting to the freezing charge) Baid the director preferred to Bhut up their works rather than ke^p. them open for the accommodati<?n of people who sent their sheep at one time and not at^nother, The reckless buying to which reference had been made was done last year by a large.number.of speculators who came down here and bought up sheep, which they sold to Islington and elsewhere at certain prices. Mr Borrie must not think he was -making special reference to Islington. » r The reckless buying was not on the Sart "of the' Islington people, but was done by ealers, and he knew there were many cases in which large losses had been sustained by speculators who'had bought at rmces which they could not make out of tha freezing companies. Mr Moore: Mr 'Gould mentioned in a letter to me that there were speculators buying at ridiculous prices,who re-sold at a loss. Mr BrVdone : I could name one man who is supposed to have lost £5000 last year. The Chairman said a great deal of that had been goiDg on,'but he was certain it would not go on this year as last. The fact of the matter was that the trade had drifted away from them. Instead of their being supported by the shareholders, the opposite was the case. ' Mr Borrie :, There is a reason for it. The Chairman: The shareholders go where they get the-best prices. Mr Borrie : Certainly. The Chairman did not object to that, but if the shareholders exercised their freedom they should not < grumble if they did not get their dividends, . - Mr Todd observed that the Wellington Company had made a loss, and asked if they charged only id for freezing. The Chairman thought the balance sheets of some of the companies would be an eye-opener for shareholders. ' At the present time the prospects were very poor, the whole tr%de seemed to be changing. With reference to the fat, Mr Borrie might have done the company the justice of saying that they bad done a great dual better in Otago than in Canterbury. For the whole term of years since the works were started till last yearhe thought he could say with confidence— the returns from tallow were better here than with any other company he knew of. It was rather unfair to pick out a single year. ■ Mr Borrie said he alluded to two years. _ Last year the, price was 14s a cwt, and this year it was 14s 3d. ', The Chairman, said it waß a great deal better worth 14s 3d this year than it was worth 14s last year. He thought Mr Borrie must have been served sd'well by some of the speculators, that the sweet taste of the profits, had been too much for him. Mr Borrie had also taken exception to the balance sheet. Mr Borrie remarked tbat when he said he did noli agree with the balance sheet he did not mean to infer that the figures were wrong, but he did not. agree with not getting a dividend.— (Laughter.) The Chairman said that unfortunately that made less difference to Mr Borrie than it did to the speaker. He thought it was more by his interests as an owner than by his interests as a 'shareholder that Mr Borrie was prompted, when bespoke., Mr Borrie: Certainly. I quite agree with you there.* * Mr Mill : -That is r " Man, mind thyself." * The motion' was then put and carried unanimously. ■ , BLECTIOIf OF DIRECTORS AND AUDITORS. On • the 'motion of Mr Reid, seconded by Mr MiiX-Messrs James. Smith (of Greenfield) and J. T. Wright were re-elected, directors of the company. •t , ' / The re-election of Mr Thomas Callender as auditor, at a remuneration of 20gs, was proposed by Mr Mill, seconded by Mr MAdam, and carried. . ■

GENERAL.

The Chairman said he might state with reference to the general working of the company, that the- directors had endeavoured to keep the expenses' down as much as possible. The meet- - ings of the board were being held only once a fortnight, and when the works were shut down , labour was economised as much as possible. Indi- - cationß, he thought, pointed to a decided improve- ° ment, because the competition in the south had pretty well ceased, and the competition in the north had also ceased ; evidently the business was too hot for them. , It was a very pleasant thing for shareholders to get enormous prices for their stock, "but if the prices were beyond the fair value the recoil must 'take place sooner or later. The company's freight engagements were at an end so ■ far as the old contract was concerned, so they had noobligationtobuy. meat in order to fulfil their freight engagements. Still, there was an under- - standin&itp purchase on a joint account which wasjatufactory to the company, and would go a long y?Pyl if necessary, to keep the works employed, a The directors were quite prepared to freeze at' fd.bW 1 rather than follow other companies.' to the. tqjnous price of Jdthey preferred, in the -interest ßTo.f shareholders, to shut down. They regretted/Very much the unfortunate position they were placed in, but at all events the largest Bijareholdera were on the directorate, and if they ■jwere making a loss for others they were making a bigger;Jps3 for themselves. Mr MjLL'inoveJl a hearty vote of thanks to the directoH'dnd officers of the company. He had . not the 'wfghteajjrjdoubt they had done the very beßt.~ ' .'■ ' ' y'fi Mr Moore, seconded the motion, which was carried/I. :?r.' s fr A vot? of 'thanks to the chairman terminated the proceedings^