GREAT DAIRY COMPANY.

Sun (Auckland), Volume III, Issue 748, 22 August 1929, Page 12

GREAT DAIRY COMPANY.

TURNOVER OF £6,600,000. NEW ZEALAND CO-OPERATIVE ' A SATISFACTORY SEASON. QUALITY AND MARKETING. (Extended report by arrangement.) [IT rXUTrKATH. OWN CORRESPONDENT.] HAMILTON. Wednesday. A turnover of £6,602,646 was disclosed in the balance-sheet of the New Zealand Co-operative Dairy Company, Ltd., which wts submitted to the annual meeting of shareholders held in the Town Hall, Ham'ton, to-day. The turnover showed an increase of £263 797, compai ed with the previous year's figures. Over 600 shareholders attended the meeting The chairman of directors, Mr. Dynes Fulton, pres ded. and associated with him were Mr. W. Goodfellow, managing director, Mr. C. «7. Parlane, manager, and the board of director*.

The directors’ report has already been published. The auditors, Messrs. Chambers, Worth and Chambers, commented as follows on the company’s accounts:—We have completed the audit of your company’s accounts for the year ended May 31, 1929, ard have attached our certificate to your balance-sheet as at that date. The steady growth of your company’s business is very gratifying, indicating as it does the confidence the suppliers of the company have in the remarkably fine organisation which they have, through their co-operation, been successful in building up. Accounts in First-class Order. We have found your accounts in their usual first-class order, few matters calling for comment. Securities.—We have accepted the certificates of the company’s various solicitors and bankers for the securities held by them respectively. Contingent Liabilities.—The company has guaranteed, in addition to the contingent liabilities specified on the company’s balance-sheet, payment of rents and royalties in respect of the colliery leasehold land at Glen Afton. There is little risk from this guarantee, as the royalties are settled up each year. Depreciation.—A slight variation has been made this yeaj in the directors’ policy of writing no depreciation off the milkpowder assets, in that £750 has been written off the Waitoa milkpowder lorries and £250 off the Waharoa lorries. These lorries are no longer in use. In addition to the above depreciation 33 1-3 per cent, has been written off lorry spare parts on band and this item will be fully written off over the next two years. Milkpowder Accounts Milkpowder Preliminary Expenses. Last year the milkpowder market development account was finally written off and this year a start has been made to write off milkpowder preliminary expenses account, £5150 having been written off. In addition the dried milk shareholders have for the first time this year been charged interest on this account. It should be clearly understood that the milkpowder preliminary expenses account is being written off purely out of milkpowder surpluses and the writing-off of this asset affects only r_he milkpowder groups of shareholders. The sama applies to the directors’ policy with regard to depreciation on milkpowder assets—only milkpowder shareholders are affected. A few remarks on the subsidiary companies operating in conjunction with your company may be of interest to suppliers. Glen Afton Collieries.—The colliery reports another successful year, thus enabling the parent company to get its coal at a low figure. This year the system has been adopted of charging all grades of coal at a flat rate and allowing a rebate according to the profits of the collieries based on a tonnage basis on the coal useo. The net cost per ton of the coal this year has been approximately 7s 2d per ton. Finance Company's Good Year. New Zealand Dairy' Finance Company, Limited.—This company records a very successful year. £1749 17s 6d being handed to the parent company by way of dividend. In addition to' the' direct service rendered to suppliers, the company has rendered a very great service by providing the means whereby suppliers may take up loans through the Rural Intermediate Credit Board without the necessity of subscribing for shares. As you will see from the company’s balancesheet, the amount at present borrowed from the Rurai Intermediate Credits under this system is £69.918 18s 7d. Dairyfarmer, Limited.—The Dairy-farmer reports a successful year, resulting in a slight decrease in the price of the paper to suppliers. Challenge Phosphate Company, Limited. —This company is now operating very' successfully, the New Zealand Co-opera-tive Dairy Company, Limited, having received from the Phosphate Company a dividend at the rate of per cent, on 25.001 “A” preference shares and 8 per cent, on 25,000 “B” preference shares taken up in the company. In addition, the Phosphate Company has paid to the New Zealand Co-operative Dairy Company, Limited, the sum of £2450 15s 7d by wav of rebate in terms of the agreement between the Dairy Company and the Phos pbate Company. This is a very satisfactory result for the year’s operations. Address by Chairman. In conclusion we should like to state that every effort is being made to maintain the highest possible standard in your company’s financial records. Each year as the business grows, office systems have to be remodelled to cope with the increased work and credit is due to your office staff for the way in which they cope with this additional work. The chairman, Mr. Fulton, in moving the adoption of the report and balancesheet, said : In dealing with production shareholders will remember when in my address last > ear that 1 indicated that the season of 1928-29, subject to a normal rainfall, would benefit largely by the drought of

the previous season 1927-28. This has materialised and the past season has been a reoord one for output for the whole of New Zealand. The South Auckland district, where our company operates, has shown a very substantial increase in dairy products—the increase in butter-fat alone, over the whole of our factories, is equal to the output of another large butter factory-, and clearly indicates the rapid progress the industry is making. Exceeding Good Season. The past season was an exceedingly good one from every point of view as far as the dairy farmer is concerned, the climatic conditions were good throughout the Dominion and the short spell of dry weather in February and March was seasonal and will do a great deal of good. The spring provided an early growth which enabled farmers to shut up their paddocks early, resulting in splendid hay crops. Subsequently much hay and ensilage was made and provided ample supplementary feed for winter. Herds are coming in in splendid condition and the prospects for the incoming season indicate a further increase in our output. The increased use of fertiliser and chainharrowing has made a wonderful difference in our pastures and with the assistance of experimenting and scientific research it is just difficult to forecast what our increase is going to be in the very near future and clearly indicates that we are a long way from saturation point as far as production is concerned, even on our best farmed properties. Just here a word in reference to the part vour company took in connection with the lowering of prices of manure will not be out of place. As a director of the Challenge Phosphate Company, looking after your interest, I have no hesitation in saying that everything possible is being done to supply manures true to analysis promptly and in good order, and 1 would appeal to suppliers to support, the company which is responsible for substantially lowering the price of phosphoric manures, and further to put you? orders through your own dairy company. If our suppliers took an average of nine tons per supplier the rebate on that amount would enable your company to pay a further £d per lb. butter-fat. This simply indicates the benefit that we could receive if we gave our whole support to our company. The value of the dairy company’s efforts in respect to manures cannot be estimated by thß returns to our own shareholders, but our achievement in this respect has been responsible to a very great extent for the increased production over the whole of the North Island, and your directors and management wish to thank our shareholders for their support in this great achievement.

The Finance Company, which was formed in the 1925-26 season, has continued to render great service to many of our suppliers. Tips company is a subsidiary one and is run entirely by the dairy company for the benefit of its suppliers who may require financial assistance. An indication of the extent to which assistance has been extended is given by the following figures:—The advances in the 1925-26 season were £25,000; 1926-27, £67,000; 1927-28, £83,000; 192829, £IOO,OOO, making a total of £275,000. Of this amount £215,000 has been repaid, leaving a balance outstanding of £60,000. The number of suppliers assisted totals 1400, and the average loan was £2OO. Valuable Rural- Credit Scheme. Since July, 1928, to May 31, 1929, 507 applications have been received through the Rural Intermediate Credits, 315 loans have been approved and the total amount loaned up to that date is £96,000. The final figures in the Finance Company’s balance-sheet show that the operations were very satisfactory and this department has been the means of helping many hundreds of suppliers during the financial depression that we have been passing through. Theßural Intermediate Credit scheme has proved a valuable measure, having been placed on the Statute Book over a year ago, and is, in our opinion, the best financial arrangement yet made to assist the producers and we congratulate the Rural Intermediate Credit Board for their prompt attention and successful working. Herd-testing under the group system has continued to progress and in this respect very great credit is due to Mr. C. M. Hume, general manager of the New Zealand Co-operative Herd Testing Association, and secretary of the Dominion Federation of Group Herd Testing. The value of this great work is apparent and does not require further comment from me, other than to show the development from the inauguration of this great movement up to the present time. Under the Farmers’ Union control in 1922-23 th© number of cows tested was 6900. Taken over by the New Zealand Co-operative Herd Testing Association in 1923-24 there were 31,003 cows tested; in 1924-25 there were 58,308; 1925-26, 57,756; 1926-27, 68,732; 1927-28, 76,697; 1928-29, 90,826. These figures show that testing under the group system is recognised by dairymen as essential to successful farming. Duties of Advisory Board. Just recently a central and advisory board has been set up by the Department of Agriculture, consisting of Mr. W. M. Singleton, Director of Dairy Division; Dr. C. J. Reakes, Director-General of Agriculture; Professor Riddett, dean of animal husbandry, Massey Agricultural College; Mr. W. A. lorns, chairman, Dairy Control Board; Mr. P. W. Hill, of Dargaville; Mr. G. R. Herron, of Southland, South Island; Mr. G. H. Bell, of Taranaki, and myself, representing the Dominion Federation. The duties of this board are to direct the policy of the federation and recommend to the department the best methods of distributing any subsidy received to foster herd-testing. I might state here that this board is purely an honorary one, ttye members doing this work gratuitously in the interests of the herd-testing movement. At our last annual meeting shareholders will remember our then general manager, Mr. H. H. Sterling, bidding them farewell to take the important position of general manager of New Zealand railways. Mr. C. J. Parian© was appointed manager and has since carried out the important duties of manager in a manner that has reflected credit on himself and company. Good Outlook for Season. The indications for the present season are quite good, but it is impossible to forecast the future values, because so much depends on circumstances. As Mr. Goodfellow will be dealing with marketing I will not proceed further with this branch of the business. In reviewing the position generally, it wifi be seen by the balance-sheet that your company is in an exceedingly strong financial position, having added this year to our capital a further £31,489 7s 2d, which leaves a very small margin betweeD the paid-up capital and the capital cost. The policy of our company in the future will be as it has been in the past, to continue without ceasing the fullest measure of service to our suppliers, coupled with the best returns that can be obtained from a prudent and efficient consigning policy of our produce. In his address Mr. Parlane said that suppliers to the company had every reason to fee I very satisfied indeed with the results of the past season's operations for not only had the output of produce increased by 3795 tons over the previous year, but the prices returned to suppliers,

viz., Is 6.608 d (including cartage and j railage subsidy) for butter-fat for butter- ! making, and from Is 7d to Is 9.20 d at j the various cheese factories (according to ; circumstances and conditions) were reallv ! good viewed from the point that the ! company continued its consigning policy for the disposal of its produce and therefore had not the advantage of the higher ! prices obtained by the f.o.b. sellers. More Attention to Quality. Mr. Parlane pointed out, however, that it was quite evident that the f.o.b. purchasers of New Zealand butter had. during last season, lost money as fancy prices were not offering this season. As' a result there was little doubt that the great majority of the New Zealand companies would this year be forced to adopt the consigning policy. Quality.—Mr. Parlane said that while the company had maintained its position in regard to the quality of butter during the year they were nQt satisfied and would do everything possible during this coming season to raise the standard. He stated j that the average grade of butter turned ‘ out during the export season 1923-24 by 1 the New Zealand Co-operative Dairy j Company, Limited, was 92.61 points, while j the average grade for last export season j was exactly the same, which gave definite evidence that- the company was really marking time in this very important matter. He stressed the necessity for a high grade product if New Zeala*nd was to maintain its position in the markets of the world. Other countries, be said, were fully alive to the necessity of improving the quality of their product and were leaving no stone unturned to accomplish, this. Therefore, New Zealand producers would have to take this matter up seriously if they were to keep in the forefront, a's it was necessary for them to do if their produce was to realise a price in the j markets of the world that would enable | a satisfactory return to be made to pro- 1 ducers. Quality of Cheese.—ln reference to the . quality of cheese Mr. Parlane said that ! there was, unfortunately, leallv more room for improvement in the quality of cheese than in the quality of the butter, the average grade of the cheese during the . export season being 91.68 points. He pointed out that very unfavourable comments had been made by certain importers concerning, the quality of New Zealand cheese during the past* season and it was essential that the cheese companies throughout New Zealand should take the matter up seriously with a view to effecting considerable improvement. He emphasised that the New Zealand Co-opera-tive Dairy Company, Limited, were giving serious attention to this matter during the current season. It was also intended to cany out some experiments in connection with pasteurisation of milk for cheese-making and the paraffining of the cheese with a view to ascertaining whether the resultant cheese is in any way detrimentally affected thereby. In speaking regarding the standardisation of milk for cheese-making, Mr. Parlane said that standardised milk cheese had been made at nine of the company’s cheese factories during last autumn and as the price obtained <3n the London market for this cheese had equalled the price of the “full cream” article the experience must be regarded as satisfactory. In view of this the directors of the company had decided to standardise the milk for cheese-making at each of the company’s 17 factories during the current season. Mr. Parlane added that while their ! initial effort in this connection had proved satisfactory, it would perhaps be as well to withhold judgment until this class of cheese had been tried out for a further period. Nevertheless, he anticipated that it would prove successful, and, if so, the returns to cheese factory suppliers would, comparatively speaking, be increased considerably. London Butter Packing Factory. London Factory.—Mr. Parlane stated that quite an important event during the past season was the setting up of a butter packing factory in London. He stated that, notwithstanding the fact that he purchased a considerable portion of the machinery required for this factory when he was in London twelve months ago, the factory commenced to operate on February 19 last, the reason for the delay being the difficulty in securing delivery of the necessary plant. However, the factory was now operating satisfactorily and they looked forward to a steady increase in the butter patting trade in Britain. During the past season approximately 1150 tons of butter had been put up in pounds and sold under the “ Anchor ” brand, some in cartons and some in the ordinary “ Anchor ** wrappers. He pointed out that as the pat trade was rapidly coming into favour in Britain many of the big retail shops were pat ting their own butter which, of course, they packed under their own brands. This would obviously slow down the development of the “Anchor” trade, but notwithstanding this, it was pleasing to report an increasing sale of our “Anchor” pat butter each year, which has proved to be a valuable means of advertising. Strong Financial Position. Share Reductions.—Mr. Parlane said that on account of the very strong financial position of the company, the paidup capital of which was now £1,087,531, his directors had been able to give consideration to the easing of the share deduction made on account of “butter” shares, and this had now been fixed at one farthing per pound butter-fat, instead of five-eighths of a penny per pound butter-fat as hitherto, this new basis to take effect as from June 1 last, which means that it would not affect the 192829 season. He explained that on all butter-fat covered by contributing or fully paid shares issued prior to June 1, 1929, suppliers would be paid one farthing per pound butter-fat shareholders’ bonus in cash as the contributing shares became fully paid up, in addition to one-eighth of a penny per pound butier-fat for “ coal and timber ” shares, but in regard to either excess supply or new supply, from June 1 onward, the one farth ing per pound butter-fat would be deducted over the full supply, and the total amount of deductions credited in fully paid shares, but a cash bonus would not be paid until the butter-fat under this heading was fully covered by shares. The deduction for “coal and timber” shares will be one-eighth of a penny per pound for six years as previously, but instead of allotting these on a 200-pound butter-fat basis on the first year’s supply as hitherto, they will be allotted at the end of each season as fully-paid shares according to the total amount of deductions. Helping New Suppliers. Mr. Parlane said that this new arrangement provided for the safeguarding of the position of the original shareholder in the company, at the same time making it easier for new suppliers joining up, inasmuch as it woula enable them to get a greater proportion of their total payment in cash right from the date of commencing to supply the company, which would be very nelpful when starting on new farms. Fertilisers. —Mr. Parlane stressed the great benefit that had accrued to the farmers throughout the North Island consequent on the entry of the company into the fertiliser business, and urged suppliers to place their orders for fertiliser through their own dairv company and so secure their shares of the rebates available, which would be paid out on a butter-fat basis. Dealing with the finances of the company, Mr. Parlane said the nominal capital had not been changed during the

year. The unallotted shares were valued at £132.326, compared with £151,475 last year. The subscribed capital had therefore increased by £19,149. The paid-up capital now stood at £1,087,530 12s lid, compared with £1,056,041 5s lOd, an increase ot £31,489 7s Id. The reserve account had been increased by £4859 3s 2d during tbe vear, and now stood at £59,246 11s Id. The Butter-iat Bonus. The increase included dividends in the Challenge Phosphate Company, £3573 2s 9d, casein and cheese reserves, ,inri an increase in the Dairy Finance Company’s reserve of £SOO. Mr. Parlane said the company’s insurance reserve had not been altered since the amalgamation, and stood at £6306. The sum of £30,000 had been invested iu debentures and the amount was the same as last year. This year there was £125.199 2s 3d due to shareholders for butter-fat supplied in May, as compared with £105,667 7s last ' eai. The increase was due to the greater quantity of fat received. Shareholders' had been advanced Is 5d for butter and Is 5d foi cheese on the May supply, and the total amount of butter-fat received was 2,639.511i,1b., as compared with 2,205,(09316 f O , May. 1928. Mr. p ar . lane said £352, til 3s 5d was due to shareholders ?u the form of a bouus. Last year the amount paid was £472,775 11s lOd. a decrease of £120,064 8s ’sd. lhe difference >n the amount of the bonus was due to the higher advance price and consequently there was a smaller sum left for distribution. The average bonus on butter-fat for butter-making was 1.373 d, which added J“® avela g e advance for superfine of 17.U07d, and plus cartage and railat-e paid as subsidy of ,198 d. made a total pay-out for butter of 18.603 d. Cheese factories had received their bonus in acvordance with their respective groups. Mr. Parlane turmshed the following details relating to tbe amounts paid to shareholders supplying the various lactones controlled by the company:

Dealing with the suppliers' contra accounts, Mr. Parlane said these stood a* £3O, 202 9 S 2d this year, against * ast >' ear > a decrease of £~6.030 Is lOd. The heavy total last year was due to the effects of the dry spell, when a greater measure of credit " as required by suppliers for purchasing goods. An increase of £24,805 8s was shown in the sundry creditors’ account, this year’s figures - standing at £121,734 11s 2d. The principal items were £52,707 due on orders on suppliers' cheques, and £47,567 due on goods supplied and not yet paid for. Sundry depositors had paid in £77,471 Is 2d, compared with £90.528 17s 8d last year, a decrease of £13,057 16s 6d, due'to depositors taking up Challenge Phosphate Company debentures. The bank overdraft accounts had increased by £123,603 Us 7d, and now stood at £257'392 6s 4d. the increase being due to the* fact that there were no shipments of produce in May. There was also £2843 12s 6d standing to the credit of the company in the Canadian Bank of Commerce. New York. Last year the amount was £3869. A credit of £49 stood in the trading department’s profit and loss account. The figure last year was £22. The department was established for service only, and profits were not sought. , The Company’s Assets.

The company’s assets included property and plant, £1,118,938 8s 4d, compared with £1,131,224 2s 8d last year. The sum of £45.369 0s 4d had been allowed this year for depreciation. Additions valued at £31,056 15s 2d had been made to property during tbe year, compared with additions valued at £40,176 7s 8d for the previous vear. The allocation of the recent additions made was:— Butter, £3483; cheese, £14,174; general, £9019; w'orks in progress, £4500. Mortgages held were valued at £1751 10s sd, compared with £1778 11s last year. The milk powder preliminary' expenses account now stood at £32,445 9s, a decrease of £5150 6s 6d during the year. Last year the figure under this heading stood at £37,595 15s 7d and the items contributing to the reduction included coal rebates, £2115 15s 3d, and box factory rebates, £2221 15s sd, while the profits on the milk powder trading account yielded £Bl2 15s lOd toward the reduction of the account. The Glen Afton collieries share account stood at £97,563 6s 7d, a decrease of £528 9s 9d, compared with last year. The amount was arrived at by taking paid-up capital, £99,995, and subtracting the amount in the Glen Afton collieries depreciation fund of £2431 13s sd. Mr. Parlane said the company had advanced £35,319 16s 5d as loans to suppliers, as against £40,921 14s 8d the previous year, a decrease of £6601 18s 3d. The requests for loans the previous year were heavier than usual owing to the long dry spell. Investments made by the company now totalled £117,527 13s Bd, the account being £9993 greater than a year ago. Value of Produce Stocks. Produce stocks were valued at £440,032 13s 2d, last year’s figure being £302,262 17s, an increase of £137,769 16s 2d. The improvement was due to the heavier production during the latter part of last season than in the previous season. Stores held were valued at £96,820 3s lOd, an increase of £4487 19s 4d. The trading account stocks were valued at £3807 8s lOd. Dealing with the butter profit and loss account Mr. Parlane said stocks in hand were valued at £188,704 0s 6d. Purchases totalled £3,646,250 4s 9d. as against £3,170,459 7s 4d for 1927-23. The purchases included : —Milk, £3.538,826 (£3,070,548); whey £14,204 (£11.135) ; manufacturing requisites. £4824 (£4717) : packages. £88,396 (£84,009). The increase in the raw material purchased represented £471,297. Mr. Parlane said the increased production had involved an increase of £939 8s Id paid for railage and £1069 16s lOd paid for cartage, the amounts paid being resspectivelv £14,789 0s 6d (£13.849 12s sd} and £26,814 3s Sd (£25.744 6s lOd). Greater Economy Exercised. Greater economy had been exercised in the operations of the company, for the wages and factory expenses had been reduced by £BO7I 9s during the year, the amount Daid last vear being £137,341 14s 2d. The sum of £10,655 12s 9d had been spent on power and fuel, a decrease of £lOls 15s, or Is Id a ton Freight and cartage cost £51,063 11s lid, a decrease | of £4456 18s 6d, or 5s id a ton. Freezing, grading and shipping charges had accounted for the expenditure of £44.030 6s lid, as against £40.407 13s 3d last year. The increase, £3622 13s Bd, or Is 5d per ton, was due to the larger out-

put and to the far greater quantity stored ■ for local sales. Bad debts amounted to j £9B 15s, a decrease of £8 2s Id. The company had written off £17,028 4s 7d by way of depreciation. The pre- i vious year £17,542 11s 7d was allowed for depreciation. Advertising and donations had been reduced to a minimum, said Mr. Parlane, and last year's expen- j diture was only £2062 2s Sd. as compared j with £4397 17s lid for the previous General Administration Expenses. Office and general administration ex- I penses had been reduced by £1694 4s 4d. or 2s 4d a ton, the amount expended last year being £55,852 2s 4d. Administration now cost .133 d per lb. butter- j fat, as compared with .166 d per lb. but- i ter-fat m 1926. Directors' fees and • expenses had accounted for £3036 12s sd. a decrease of £3l 9s sd. The sum of £6522 ISs 3d had been paid in the form of a dairy control levy, a decrease of £2B 14s 2d. The rate of the levy was one-thirty-second part of a penny per j pound of butter, and one-sixty-fourtb 1 part of a penny per pound of cheese • manufactured. Mr. Parlane added that £292,423 8s 6cl stood in the bonus account, as compared with £426,981 3s 3d. The smaller amount paid this year was due to the higher advance rate. The bonus paid was at the rate of £d for June to May supply, and .158 d for September, and .658 d for the remaining months. The bonus averaged 1.373 d for the year. Produce Still to be Sold. The company had a large quantity of produce still to be sold, continued Mr. Parlane. Its sales of produce had realised £4.150.595 11s 3d for 1928-29. as against £4,263.089 Is 5d for 1927-28. The j decrease was £112,493 10s. The sum ! of £3938 4s 3d had been received in I rents as against £4074 10s lid last year, j Rebates received from the Challenge , Phosphate Company were valued at £3570. Stocks of butter held were valued at £304.063 11s lid, as against i £188.704 Os 6d last year. There was a larger quantity of butter still unsold this i year thau was the case a year ago. Referring to the casein department, i Mr. Parlane said the figures quoted excluded Te Awarautu The average advance this year was 2.934 d, as against 2.48 d last year. Stocks stood at £2044 10s 2d (£2274 18s 8d), and purchases at £21,105 8s Id (£19.141 11s 9d). There was an increase of 23 tons manufactured. The amount of butter-fat received by the casein department was 2,224, an increase of 78,653£1b., as compared with the previous year. Items of expenditure in the casein department were: —Wages and factory' expenses, £5724 6s Id, a de crease of £1602 16s lOd : power and fuel, £2297 2s 3d, a decrease of £448 2s 6d: freight, cartage and shipping, £4053 3s 9d. a decrease of £lB6 9s Sd : interest, insurance, rates and taxes, £593 3s Bd, a decrease of £457 10s Id : stamps and stationery, £l3, a decrease of £26: advertising and travelling expenses, £2O 12s 7d, an increase of £i7 19s 7d: depreciation. £1379 0s Id, a decrease of £2548 12s 7d. Sales of casein realised £40.682 9s lid. a decrease of £1661 7s, due to the fact that 734 tons was sold last year, as against 684 tons this year. The sum of £354 Is had been charged to the milk powder group for drying casein, as compared with £B3l Is 4d last year. Stocks of casein stood at £3592 13s 4d. an in crease of £1548 3s 2d. In the trading department’s profit and loss account the purchases totalled £15,200 4s, a decrease of £1896 0s lid. A good year had been experienced, although the previous year had been exceptional, said Mr. Parlane, and had shown an increase of £7062 over the 1925-26 season. Wages, rent, office and general expenses incurred by the trading department totalled £5526 lis 4d. as against £5363 17s 4d. Bad debts amounted to £l7 19s 4d. as against £lO5 7s 4d. The department had made j a profit of £49 10s sd, as against £22 3s 8d last year. Sales totalled £14,954 2s 4d. as against £17.379 Bs. The New Zealand Dairy Finance Company, Ltd., was next referred to by Mr. Parlane. Its reserve had been increased by £9OO, and now stood at £I3OO. A profit of £2166 16s 6d bad been made and credited to the appropriation ac- j count. The following details of the opera- i tions of the Finance Company were given i i ADVANCES 1925- £25,000 0 0 1926- £67,000 0 0 1927- £83,000 0 0 1928- .. .. .. £IOO,OOO 0 0 Total £275,000 0 0 Amount repaid . . . . . £215,000 0 0 Amount outstanding . . . . £OO.OOO 0 0 Number of suppliers assisted . 1.400 Average amount loaned . . 200 0 0 The company had received 507 applications under the rural intermediate credit system, and 315 tons, representing £96,000, had been approved. * Success oi Box Factory. The box factory, said Mr. Parlane. had ; had a very successful year and had manufactured 1,233,721 containers of all types, as compared with 1,160,805 last year. The factory had used 5,640,111 superficial feet of timber during the year. Some 86,774 containers had been made at the tin factory', as against 92.938 last year. Mr. Parlane said the company’s laboratory had continued to carry out valuable investigational work in addition to routine of check on factory working in all branches. It had also done certain work for the Department of Scientific and Industrial Research, the expense of which was met by the department. Details • of departmental checkings were:—Butter department: Moisture tests, quality of water, keeping quality, mould, etc. Cheese department: Methods of standardising, check on milk quality. Separators: Constant check on efficiency of factory separators, check on factory test rooms, farm separation tests (important service to suppliers). Casein : quality and yield tests, analyses certificates. Milk powders: Quality and wield tests, fat content. The Insurance Department. Stores.—Quality ot parchment and dairy salt, cleansers. Fertilisers: Regular analysis of all shipments of slag (safeguarding suppliers in regard to quality*). Condensed Milk and Baby Food. Coni siderable amount of investigational work j aDd checks on results, in endeavouring to i produce the best possible article. ° ■ The company’s insurance department | bad continued to render good service to | suppliers, and had arranged for the auto- , matic renewal of policies. There had beer prompt assessments and settlement of claims in connection with the destruction of the Manawaru and Ngaruawahia fac- • tories. Mr. Parlane said 10d.263 copies ; of the Dairyfarmer had been sold at a cost of 4.816 d per copy. Last year’s figures were 100.667 copies and 5.136 d cost. Some 11,046 cows had been tested by the company', as compared with 14,054 the previous year. Concluding, Mr. Parlane said the gross turnover of the company had totalled £6,602,646 last year, as against ; £6.333.849 tci the* previous year. The | main incre-ases were:—Butter. £200.000: i cheese. £10,000; milk powder. £60.0C0 The increase totalled £268.797 Review by Mr. Goodleliow. I A review oi the operations of the

Glen Afton Collieries and of the marketing position was given by Mr. Goodfellow. Referring to the collieries he j said the output during the year had been j 169.000 tens The dairy company's | factories had purchased 36.920 tons, and i suppliers had bought 13.132 tons. A | net profit of £24.386 had been made by the collieries, after paying £5511 m- , terest on debentures and fully maintain ing the colliery plant out of revenue. The profit available for distribution had ; been appropriated as follows: —Sup j ; pliers’ rebates, £2989 14s 3d : factory re ! bates. £10.500: depreciation. £4036 13s 3d; debenture reserve. £3000: debenture flotation expenses. £1605 0s 6d; balance i carried forward. £2255 8s 4d. Total. : £24.586 16s 4d. Referring to the capital ‘ position of the colliery. Mr. Goodtellow ; j stated that the total capital cost of the : 1 colliery, including houses, land and j I plant, was £134.367. and when this figure ; was compared with that of the previous ! i years it showed that the company’s asset ; ! had been substantially written down. In | addition a debenture reserve account had j been created with the object of wiping i out the existing debenture issue. Increasing Colliery Output. Continuing. Mr. Goodtellow said the , existing screens at the colliery had a ■ daily capacity of 700 ions. It was pro- j posed to put in additional screens and in- j crease the output to 1000 tons per day. Customers nad suffered some inconvem- i ence during the last year through the inabilitv of the colliery company to promptly supply orders. It was anticipated that when the new screens were installed suppliers and distributors would have no further cause for complaint. Mr. Good fellow congratulated the j j directors and suppliers of the New Zea- ‘ land Co-operative Dairy Company on the ■ strong capital position of the companv. ! and he hoped the directors would con--1 tinue to pursue their present conserva- ! tive financial policy. Reviewing the marketing positiou for | the last year Mr. Goodtellow said that the company had sold during the last | year 197.116 boxes of butter in New . Zealand. 55.166 boxes had been sold to Vancouver. 92.096 boxes to Eastern Can ada. 16,955 boxes to Honolulu, 12.656 boxes to the Orient. 1086 boxes to the Pacific Islands. 600 boxes to the Panama and 200 boxes to Jamaica. A consider able quantity of tinned butter had been sent to the Pacific Islands. Africa and Central American States. Sale ol Butter in Pats.

Butter made up in Anchor brand pats had been sold at the rate of from 25 fo 50 tons a week in Great Britain, and a considerable business was being done in ; Honolulu and Singapore. Definite arrangements had been made to keep a limited quantity of pats permanently on the Canadian market. The pat butter * trade , created a consumer demand tor bulk butter, and greatly assisted in maintaining the price at a satisfactory figure. Practically the whole of the company’s cheese output sent to the United King- 1 dom had been on the consignment sys- j tern, added Mr. Goodtellow, but the company had'made small sales to the Pacific Islands, to the Orient and Vancouver Some 161 tons of casein had been exported to Japan and small quantities had been sold to Canada, the United States | and Java. The balance of casein produc- i

J tion had been consigned to the United , Kingdom and Germany, Dealing with milk powder. Mr. Goodi lellow said 282 tons had been sold to I Australia and 70 tons to Eastern coun- | tries. The balance had gone to Great Britain and the Continent. Since the formation of the New Zealand Co-operative Dairy Company, the whole | of the company’s production forwarded to the United Kingdom had been shipped on open consignment. The produce shipped to other counti'ies had been sold on the ! f.o.b. basis. During the last few years the f.o.b. butter selling factories had had the advantage, but cheese consigning factories had been benefited substantially bv consigning. The directors were firmly convinced that the right thing to do was to adhere rigidly to the existing policy of accepting London prices, less charges. Mr. Goodfellow stated further that the London buyers of New Zealand butter during the last season had lost very heavily indeed. There was ample evidence that there was very little likelihood of f.o.b. buying from London either for butter or cheese during the coming season. Mr. W. D. Lysnar had correctly stated that Mr. J. B. Wright was carrying the whole of the New Zealand dairy producers on his shoulders. There was no doubt, said Mr. Goodfellow, that the methods of selling adopted by the New Zealand Dairy Company in London had an important bearing on the prices obtained by the whole of the producers of the Dominion. Referring to future prices, Mr. Good fellow’ said that it must be borne in mind that prices of all commodities were steadily declining in the world’s markets, and a* substantial fall in the price of manufactured goods had taken place in the United Kingdom during the last year. It- was hardly reasonable to expect that no exception would be made in the case of dairy produce. The drought experienced in Australia and the consequent speculation in butter prices gave strength to the assumption that the prices received for butter during the past season were above normal and would probably be less during the coming season. Better Outlook tor Cheese. The cheese position was more >aiisfactory, as theie would piobably be a considerable shrinkage in the quantity of cheese exported from Canada to th# United Kingdom. This should help to reduce the substantial cheese stocks at present held in the United Kingdom. Mr. Goodfellow spoke of the changing conditions of trade, and stated that whereas in the past it was considered that “competition was the life of trade” the new slogan was “co-operate and combine.” The speaker referred to the operation of the multiple shops in the United Kingdom, and pointed out that the recent amalgamations would have the result of considerably reducing competition among the buyers of New Zealand dairy produce. Other countries were also taking steps to set their houses in order, and if the New Zealand Co-operative Dairy Company was going to obtain fair prices for their butter and cheese in the United Kingdom it was essential for them to get together and eliminate selling competition. It was necessary to meet combined buying by combined selling. Empire Marketing Scheme. Amplifying his point, Mr. Goodfellow referred to the recent legislation in the United States, where £100,000,000 had

been placed at the disposal olTuT' for tha purpose of finauchlprimary products. There IrerTv, t! farmers’ marketing associations ; erica, which last year handled ‘l*' valued at £400.00D,000 With of doing something in the war j proving the marketing of Xew" * .**' ; produce, Mr. Goodfellow said a had been entered into with tm-rJ®*' I '' , operative interests providing fZ*® *• setting up of an Empire organ**!. V the selling of dairy produce -7° ** ; United Kingdom. J t*t Mr. Goodfellow said the schema meeting with considerable suceeJ paid a tribute to Mr. W. Ground 7* the assistance he had given the^* 5 \ in connection with the scherr* I Goodfellow said a good deal of : emanating from Taranaki and i ' vtl ° hat' been opposed to to, scheme had beer circula'ed ; proposal. ti. In conclusion, Mr. GoodieUow and Mr. J. E. Wright aimed in seven years to build up an Emprr, „ keting organisation, which at the’ ; that period would be carried on tv £ i co-operative dairy companies of . ; Dominion. The object wr, to g v j producers of the Empire' a marketing organisation for theii prod. I to enable them to obtain fair orie*T.• ■ their goods and a reasonable -e'nC. i their labours. ** The report and balance-sheet adopted. The remits parsed by the Uttm* , conveners yesterday and published C ! yesterday s Sun were approved Manufacturing Costs Reduced. In answer to a question. Mr. said that the cost o: manufacturing jl. ; ter to free on board during the lait «• was £l3 17s 4d a ton, as against £ls*-* ; lid the previous year. A series of motions proposed on ben of the Shareholders' Association for further information concerning affairs of the company was withdrar. The chairman of the association, M- r A. Forsman. and the secretary’ jj* • G. Wynyard, thanked the jl : the information they had given then; * \ day before. The association, tbev u “ r * ; was now quite satisfied, and cong-a; j lated the company on a successful 4 j son's operations and on reducing nj- | tacturing costs. A motion proposed b\ Mr, R. * Noble (Tauhei) that the share Kuu ! reduced from one share for every 7(JJb - butter-fat supplied to one share "for ev* 1001 b. of butter-fat supplied was descri*as impracticable, and was stated to b, matter for the directors to deal *;:• The motion was rejected. Messrs. F. C. Hansen, S. H. Judd it; F. M. Strange were appointed a cce mittce to devise ways and means c raising funds for reimbursing the Wj kato guarantors to the Bacon and Me. Packing Company. Limited {in liouio* tion). Messrs. Chambers, Worth ahd Cfcaa bers were reappointed auditors. Votes of thanks were passed to Mesjrj J B. Wright, the London manager, M: Goodfellow. Messrs. T. C. Blackett «r: J. M. McKinney (the. retiring director? and the staff. A very successful and harmony meeting then closed.

Aka Aka East Tamaki Eureka G ordontoD Hairini Hikutaia Huirau Road Advance. - 18.13d 18. Sod . lS.12d . 18.24d . 15.15d . 18.02d lS.OSd Bonus. 1.31a -.35 d 1.41d 1.36d 1.58d l.lSd 1.32d , Total Advance. 19.94d 21.20d 19.53d 19.60d 19.73d 19.20d 19.40d Kiwitahi -Manawaru Matamata Matatoki Orini Rukuhia Shelly Beach Te Puninga . \\harepoa V'aitakaruru 17.95d . 18.02d lo.Ood . IS. 13d . 18.04d lS.15d • IS.OOd 17.63d . lS.OSd . 27 3Sd 1.44d 1.92d 1 -96d l.S7d 1.59d .Sid •2.07d 1.6Sd '2.16d 2.G9d 19.39d 19.94d 20.Old 19.99d 19.63d 18.96d • 20.07d 19.31d *20.24d 19.6Sd