NEW ZEALAND SHIPPING COMPANY.

Otago Witness, Issue 3112, 5 November 1913, Page 6

NEW ZEALAND SHIPPING COMPANY.

CHRISTCHURCH, October 16. The following is a copy of a cable message, dated October 14, received by the New Zealand Shipping Company at Christchurch from its London office: The annual general meeting of shareholders of the New Zealand Shipping Company was held at the London office, 138 Leadenhall street, E.C.. on October 14, when a dividend of 16s per share (of which Ps per share was paid in April last) was declared, free of income tax. The retiring directors were re-elected and the auditor’s reappointed. In the course of his address to shareholders the Chairman (Mr William O. .Dawes) made the following remarks: “ Regarding the proposed scheme for the re-arrangement of the company’s capital, it will be remembered by old shareholders that some 23 years ago the position of the company was very different from what it is to-day.. My father, Sir Edwin Dawes, had then recently become chairman of the company, and he decided on the rather drastic step of writing off the sum of £2 from each ordinary share of £lO, a course of action which, I think you will agree, has been fully justified. Since then the directors have always looked forward to the time when £2 could be replaced without weakening the financial position of the company, and in their opinion the time has now come. In the balance sheet for the year ended June 30, 1912, there appeared for the first time a new item—capital reserve, £209,116. Since that date capital reserves have been increased, and after this capitalisation has been effected sufficient reserves will be left to maintain the company’s strong financial position, and reserve and insurance accounts shown in the balance sheet now before you will not need to be trenched upon. Shareholders will notice that power is taken to create 1,000,000 5 per cent, cumulative preference shares, of which, under the present scheme, only £226,000 will be issued, and the balance will be available to provide for future capital requirements. It is not the intention of the directors to make any further issue of shares at present, but in view of the natural expansion of the company’s business they consider it wise to put themselves 'in a position to raise further capital when it is required. Not so very many years ago steamers in every way suitable for the company's trade could be built for about £75,000. To-day a steamer which will satisfy the requirements of our shippers costs more than £200,000, and shareholders will understand that as older steamers have to be replaced and the fleet increased by the addition of these expensive vessels the capital outlay required is very large compared with what it once was. It is perhaps hardly necessary to say so, but I think I should point out to shareholders that such capitalisation of assets as we propose does not necessarily increase the earning capacity of the company. It simply enlarges the area over which the available profits will have to be spread. ”