NEW ZEALAND PAPER MILLS.

Otago Witness, 1 June 1910, Page 63

NEW ZEALAND PAPER MILLS.

ANNUAL MEETING. The fifth annual general meeting' of th< Now Zealand Paper Mills (Ltd.) was held at the Chamber of Commerce on Wednesday afternoon. There were 16 shareholders present, and Mr F. \V. Mitchell (chairman of directors) presided. A summary of the annual report and balance sheet has been published in these columns.

The Chairman said: I am pleased to be able to state that the company has shared • to some extent in the renewed prosperity which has fallen to the Dominion. An analysis of the figures will show the following fluctuations: —Of the liabilities, sundry, creditors are £4OO more than a year ago, a.nd the bank overdraft has increased by N£lßl2. Assets show increases in property and plant of £3594, in bills receivable of £312, with decreases in stocks of £615, and sundry debtors £BO4. There is nothing abnormal in these figures, the only items to which I need make more than passing reference being the changes in our property and plant account and the increased indebtedness to the bank. The increase in the former represents further expenditure upon the Riverhead mill, which more than, accounts for the temporary increase in the overdraft. The net result is that the balance available for distribution (£6537 Is 4d) is some £971 more than at the corresponding period of last year. In view of the fact that during most of the year operations at Riverhead were much retarded by the -alterations going on, and that competi tion from imported light papers has been greatly felt, the directors may be pardoned for feeling some satisfaction with this re-

suit. The directors are of opinion the time has arrived when a reserve fund should be started, and they recommend for your consideration that the sum of £2500 be applied in this direction. From this modest beginning they hope a substantial margin will ultimately grow. An important stage in the operations of the company has been reached in the completion of the alterations at Riverhead mill. Some time ago the demand for our manufactures ueoame so great that the plant wc then had was proving unequal to its task, and after careful consideration the beard decided to order a new paper-making machine of a size that would give a considerabfy increased output* This machine, with the necessary belting and driving power, has cost, with alterations to the buildings, some £12,872, and i. will be seen from the balance sheets thai a large portion of this expenditure has been provided out of earn.ngs. Moreover, a demand has been steadily growing for C light, strong paper to supersede the heaviet and stouter article formerly in general useTo manufacture this quality, and to keej pace with the requirements of the market; sundry changes have been made in the plant, and arrangements made for a regular supply of wood pulp. I feel,it incumbent upon me to point out to shareholders that to manufacture this light quality of paper from imported raw materials doee not allow the same margin of profit as when the waste materials in the Dominion can be utilised, and though we hope by a greater outp'ut and judicious management to make up for some of the difference, it is possible we may not have in the future quite the same balances to deal with Our stocks have been carefully taken and valued, our book debts subjected to a rigorous scrutiny, and ample provision provided foi any doubtful accounts, and the usual depreciation provided for plant and machinery. With these few remarks I beg - to move the adoption of the report and balance sheet, as printed. Mr L. R. Wilson seconded the motion. The directors were to be congratulated on the successful manner in which they had conducted the operations of the company in the past 12 months. The question ot manufacturing light, strong papers had evidently given, them some concern, and from his own experience, together with information he had received, he knew that foreign competition in this respect was very keen, and it wa.s light that the company should endeavour to meet the demand, even though it meant less profit to shareholders. It had occurred to him that, though it was not within the province o 1 the company, something' might be done it the way of experimenting with a view U. seeing- whether New Zealand native timbers could not bo converted into woo<?. pulp. At present the quantity of thi'.. material imported was very considerable. Some time ago there was a move to estab> lish works on the Coast —whethe* with the aid of a subsidy from the Government or not he did not know, —but he had heard no more of it. He wished also k» mention the question of directors. He considered there were too many directors in Auckland and too few in Dunedin. In answer to questions, the Chairman said there were four directors in Auckland and four in Dunedin. Mr Culling, the. original owner of one of the mills and the largest shareholder, removed to Auckland, and it was then felt desirable to make a change, bringing about the present position. With regard to the projected manufacture of wood-pulp on the West Coast, lie believed the syndicate did not go to any extent with its proposal. As far as the directors could gather concerning the manufacture of wood-pulp, very expensive machinery was required, as well as access to a port by water. He did not think the syndicate would find it easy, in the present state of the labour market, to raise the capital necesasry to go in for such a work. At anyrate, it was doing nothing in the meantime. The class of wood wanted appeared to be scattered. The forests were too mixed in New Zealand to give satisfactory results, as compared with thfr Norwegian and other forests, where thi same class of wood was grown in largv tireas and could be easily bandied. The motion was ca.rried unanimously. On the motion of Mr W. Patricia, seconded by Mr J. L. Passmore, the retire ing directors —Mr C. W. Rattrav (Dunedin) and Mr T. S. Culling (Auckland)— were re-elected. On the motion of Mr F. Duthie, seconded nv Mr W. Vivian, the retiring auditors— Messrs Barr, Leary, and Co. (Dunedin) and Mr W. Wallace Bruce (Auckland)— were re-elected, at an annual fee of £25 and £lO 10s respectively. Mr C. W. Rattray thanked the meeting for his re-election as a director.

On the motion of Mr Thomas Brown a vote of thanks was accorded to tho directors for tho care and judgment they had exercised during the year, and to the staff generally. The motion was carried bv acclamation, and the Chairman, on behalf of the board and tho staff, thanked the meetins for the vote.