NEW ZEALAND DRUG COMPANY

Otago Witness, Issue 2923, 23 March 1910, Page 53

NEW ZEALAND DRUG COMPANY

ANNUAL MEETING. The annual general meeting of shareholders of the New Zealand Drug Co. (Ltd.) (Messrs Kempthorne, Prosser, and Co.), was held in the board room at the Agricultural Buildings on the 21st. . There were present—Mr William Brown (chairman of directors), Mr Alexander Bathgate, Dr F. Ogston, Mr William F. Edmond (directors), Hon. J. B. Callan, M.L.C., Messrs J. W. Henton (general manager!, D. Barron, A. Hill Jack, F. Williams, J. Sparrow, W. Sligo, E. Roberts, H. W. Mitchell, A. James, A. Kvle, E. E. C. Quick, A. Black, W. Patrick, T. R. Fisher, D. Crawford, D. Wilson, C. Duke, J. Craig, and Captain Sundstrum. ANNUAL KSPORT. The thirty-first annual report and balance sheet was submitted to the meeting. The report was as follows: "The stock has ocen taken with the usual care, and also re-checked. The outstanding accounts hare been also carefully examined, and full provision has been made fdr all known losses. The buildings and plant have been maintained in a state of thorough efficiency, and the cost charged to revenue. The unappropriated balance brought forward from profit and loss account last year was £7484 os' 3d. add the net profit for this year, £16,607 8s 7d—total, £24,091 8s lOd. Less interim dividend for half-year to July 31, 1909, at 7 per' cent, per ' annum. £7000; leaving to be dealt with, £17,091 8s lOd. Which it is proposed to apply as follows:'—To the payment of dividend at 7 per cent, per annum for the second half of the past year, £7000; to the writing off Westfield Works, £1000; to placing to general reserve (which •will then stand at £30,000), £2500; and to carry forward to next vear, £6591 8s lOd; total, £17,091 8s lOd. " Dr Ogston and Mr John Mill retire from the board by rotation, but are eligible, and offer themselves for re-election. During the year Mr George Sievwright resigned his seat on the board, and the directors filled up the vacancy bj' sappointing Mr William F. Edmond. In accordance with the articles of association. Mr Edmond's appointment continues till the annual general meeting, and being eligible he offers himself for election. The auditors retire "in the usual course, but are available for re-appointment, and offer their services accordingly. A dividend is now recommended at the rate of 7 per cent, per annum on the shareholdings on the register on March 8, and, if passed by the meeting, will be payable to shareholders in the Dominion on and after March 30, 1910, at the Union Bank of Australia (Ltd.), Dunedin, and at its branches throughout the Dominion, and to London shareholders at the Union Bank of Australia, 71 Cornhill, London, on receipt of advice." The auditors' reports and the balance sheet were attached to the report. ADOPTION OP P.EPOP.T AND BALANCE SHEET. The Chairman, in moving the adoption of the report and balance sheet, said : The capital (all" paid up) stands, of course, at the fixed sum of £200.000. The general reserve stands at £27,500 in the present sheet, inclusive of the. sum of £2500 transferred from profit and loss account by the allocation at last annual meeting, and j-ou will observe that your directors recommend in this year's appropriation that a further sum of £2500 be added to this account, which will then stand at the respectable figure of £30,000. Your directors feel assured of the cordial support of the shareholders in the building up of a substantial reserve. The fire insurance reserve of £Bl5 represents fire premiums on the margin of uncovered risk that the company is liable for. Next year- we propose to transfer this amount to general reserve, •where it will he equally available. It has served its purpose as a temporary record, and we do not consider it advisable to add to the number of separate reserves. The reserve on customers' accounts (£2657) is a floating reserve equalling 5 per cent, on the amount of the book debts and open accounts due to the company, standing on the opposite side. This year they amount to £53.145. Last year the book debts were larger, as also this reserve. The staff fund (£3195) is slightly less than last year's figures, owing to a payment to one of our oldest servants, who was temporarily laid aside by a serious illness. We are glad to report that he is now in a fair way to recovery. Open accounts and liabilities, standing at £47.728, are a considerable decrease on last year, when the item stood at £61,356. This reduction naturally fol-. lows on a reduction in the value of our stocks, and a change in the method of dealing with certain consignments, to which I shall refer when dealing with the assets. Bilk pavabl© stand at £11.533. as against £14,299 last year. About £12.000 may be considered an average amount for this item. The open accounts and liabilities and the bills payable represent a total _ of £59.262 of floating liability, and- referring at this ■point to the book debts on the other side, you will find, that they and the - cash in bank taken together represent £57 ; 518, enough to pay our entire current liabilities and nearly 85 per cent, of the bills payable. We turn now to the assets side of the sheet. Stock stands at £149,622. as against £181.347 last vear—a reduction of £31,725. This is mainly due to very conservative indenting during the period under review. It must be remembered, too, that during the two years prior to this there was a" considerable alteration in the tariff, and it was deemed wise to lay in heavier stocks of some lines than usual. Normal conditions now prevail. Besides this it has be n n practicable to eliminate lrom the amount anv items of consignment stocks formerly involving a contingent liability for fire risk, which during the year has been clearly defined and put upon a basis which is within our cover. The open liabilities are, of course, correspondingly affected. The properties of the company stand this year at £103.192, as against £103,005 last y-ear. It will be remembered that last year we wrote off £IOOO from the Burnside' (Dunedin) plant, but as against this, during the present year we have had to spend nearly £I.OOO on the Westfield (Auckland) plant. This expenditure was drawn attention to at the last annual nesting. The freehold in Stafford street stands an the books at £7B more than last year, because of the erection of a retaining wall on the south boundary. The May-Oatway ppparatus has bean installed at Auckland during the past year, and brings up this lecount to £478 in lieu of £304. as, in last

balance sheet. By the increase of £423 in warehouse fixtures certain specialties have been removed into the adjoining building in Stafford street, and much more accommodation secured for the general stock in the main warehouse, there. The item bills receivable, £363, is small, and represents the bills in hand at the close of the year. The book debts are £3,145, as against £55,964- last year. This is a satisfactory feature, and is one evidence that the accounts are well looked after and collected. During the period under review payments have been made with commendable promptness, and the amount under this head is regarded as sound, but as already referred to, a floating reserve of 5 per cent, has been maintained against it. Passing dm to the profit and loss account, vou will note that the gross profit stands at £53,023—a slight increase on last year of £153. The expenses, £36,426. are slightly in advance of last year. The income tax accruing on "the present figures, although not payable until 1911, is provided for in the total. To summarise: The-un-appropriated balance from last year was £7484; adding the net profit for this year—£l6,6o7—gives us £24,091. to deal with. Of this amount we paid an interim dividend to the shareholders on September 30 last of £7OOO, so that the present balance to be dealt with is £17,091. This amount your directors recommend the shareholders to appropriate as set forth in the annual report, leaving a balance of £6591 8s lOd to be carried forward to next vear. The necessity of making provision for the Westfield plant, at Auckland, is brought home to your directors from the fact that the plant is extensive, is very heavily and continuously worked, and from the nature of the work subject to considerable wear and tear, and in spite of being kept up to date out of revenue, a considerable amount of depreciation is constantly aroma: on. I need hardly tell you, the experience, is general, that each year the competition becomes keener, but with ample stocks carefully bought, our manufacturing plant in excellent working order, and a well-trained and loyal staff, we have been able to increase the volume of our business, and are in a position to secure a fair portion of the trade of the Dominion in the various lines dealt with. Before moving the adoption of the report and balance sheet. I should like to call the attention of the shareholders to the very satisfactory manner in which the staffs of the company throughout the Dominion have carried out their duties during the year. It will be a graceful act on the part of. the shareholders, if they think fit at the close of the meeting, to record their appreciation of its energy and care by a special resolution. I now beg to move the adoption of the report and balance sheet submitted, which, if carried, will include authority for the payment of the dividend, as recommended in the printed report.—(Applause.) Mr T. R. Fisher seconded the motion. The chairman, he said, had carefully reviewed every item on the assets and liabilitj'side of the- balance sheet, and had given the shareholders information which must be particularly gratifying to them. He was glad to note that the directors vvere writing off an amount for depreciation. This was a course that most.of the-shareholders would cordially endorse. The machinery was continually subject to heavy wear and rear, and proper provision should be made -in that report year by year. It was also gratifying to shareholders to know that the directors were this year in a position to strengthen the reserve fund.' This was a point which was important to a company. It gave it a sound and reliable position. It was very satisfactory, also, to know that the outcome of the year's work enabled the company, after making, these provisions, to pay to the shareholders the usual dividend. Probably there were some shareholders who would like to receive a larger dividend, and the time might come when, owing to the cautious line of policy the directors were pursuing, they would be enabled to give a still better dividend than that recommended this year. —(Applause). The motion for the adoption of the report and balance sheet was carried unanimously. ELECTION OF DIP.ECTOBS. On the motion -of Mr H. W. Mitchell, seconded by Mr D. Wilson, Dr Os;ston and Mr John Mill were re-elected directors. The Chairman said that during _ the year one of the directors —Mr George Sievwright —left for England, resigning his seat on the board, and the directors, after careful, consideration of the share-list and of the qualifications of various members of the company, came to the. conclusion to offer the vacancy to Mr .W. F. Edmond, who accepted the position. But. according to the articles of association, Mr Edmond's appointms.it onlv continued until that meeting. Mr Edmond was eligible, for reelection, and offered his iservices to the shareholders. Captain Sundstrum moved, and Mr Josenh Sparrow seconded, the re-election of Mr Edmond. The motion was carried unanimously. Mr Edmond. on behalf of Dr Ogston and Mr Mill, thanked the shareholders for re-electing those gentlemen to the board, addine that Mr Mill was at nresent absent from Dunedin. He also thanked the shareholders for re-electing himself to the directorate. - GENERAL. - On the motion of Mr Mitchell, seconded by Mr E. Roberts, the following auditors were rennoointed: —Auckland. W. R. Holmes: Wellington, Charles P. Powles: Christchurch, George W. Hulme; Dunedin, William Brown and Co. Mr A. Hill Jack supported the chairman's remark that the company oossessed a careful and reliable staff. «nd moved—- " That this meeting recognises that the results shown in the balance sheet are largely due to the care and efficiency with which the .general manager, the branch managers, and the staff generally in its several departments have conducted the business of the company, and desires to record its appreciation of and satisfaction with their efforts."— Mr H. Isaacs seconded the motion, which was carried unanimously. Mr W. Tavlor (tna.nft.eer of the Auckland branch) and Mr R. E. Wood (manager of the Wellington branch) responded, and the meeting terminated.