A PROGRESSIVE CONCERN

Te Awamutu Courier, Volume 53, Issue 3791, 5 August 1936, Page 5

A PROGRESSIVE CONCERN

TE AWAMUTU CO-OPERATIVE DAIRY COMPANY, LTD. ELEVENTH ANNUAL MEETING. There was a muster of well over 350 shareholders and suppliers (many of them with their wives) at the eleventh annual meeting of Te Awamutu Co-operative Dairy Company, Ltd., at the Town Hall on Monday, and the chairman of directors, Mr C. M. Alexander, presided. The directors’ annual report and comments by the ehairman (already publishecj) were Head, and greeted with applause. As made abundantly clear in both statements, the company has again made rather remarkable progress, and it now stands as a monument of careful and capable administration, with progress year after year as its outstanding feature. The company’s average payment for the past season for finest-quality cream, including cream cartage was Is 1.13 d per lb. The average payment over all grades, and not including cream cartage, was 12.54 d. Unsold stocks had been taken into account at figures which the directors are confident are well below current quotations. The auditor’s report showed, incidentally, that the weight of butter made from each pound of butter-fat used for the manufacture of butter was 1.218, and that no unsalted butter was made and no cheese manufactured. Sales of export butter represented £175,604 10s 2d (last year it was £118,000), local sales £3122 16s 5d (last year £2200), and sales to suppliers £2703 8s lOd (last year £2300), making a total of £181,436 15s sd. Sundry receipts brought the aggregate to £181,685 9s Bd. Much of this increase was due to higher prices ruling. The cost of cream collection was £2843 2s 3d, and butter-fat advances to suppliers totalled £135,357 18s 6d. Manufacturing charges totalled £9142 19s Id, charges to f.o.b. £6002 Is, and general charges UE2250 4s 2d. Before the luncheon adjournment Mr Alexander asked for the appointment of scrutineers for the election of two directors. He added that there were five candidates, and all were admirable men. It was a matter for some regret that all five could not be elected this year; but he sincerelyhoped that the three unsuccessful candidates would view the matter philosophically and offer their services again when opportunity offered. (Applause.) The secretary-manager next proceeded to explain some of the items of the balance-sheet for the fuller information of shareholders and suppliers. A PIG FARM. Mr Sinclair said the directors had been investigating the possibility of starting a pig farm to absorb the available butter-milk, for which there had not been a keen demand; but a contract had been arranged by which the company’s butter-fat would yield an appreciably better return to the company. Referring to cream cartage costs, Mr Sinclair said that though the quantity carried was much greater the cost was less than the previous year. However, next annual meeting would spe costs under that head increased greatly, owing to wages being higher and running costs, etc., also being on the up grade. Butter-box costs would go much higher this year, and Mr Sinclair quoted comparative figures in explanation. Manufacturing costs dropped from £5 18s lid per ton to £5 12s 3d for the year, and f.o.b. charges also showed a variation. Storage charges were £1 8s 9d pef ton, as against £1 14s. The DairyBoard levy fell from 7s lid to 7s 6d, and motor lorry maintenance from 3s 10s to 3s 6d. Under the heading, “ general charges,” Mr Sinclair said depreciation £6OO was included this year instead of including it in the overhead charges—a practice followed by most companies. Office salaries were all included in £7lB, and he said he could name several companies which placed a part of the salaries under the item “ trading expenses.” To obtain a clear comparison, Mr Sinclair said the item “ average payment for finest-quality cream, including cartage, Is 1.13 d per lb,” was in conformity with the practice of other companies; but, he added, very few companies declared the average payment over all grades, not including cream cartage. Te Awamutu’s figure was 12.54 d. The new Government regulation required all companies to show their position on the one basis 2 and then accurate comparisons could be made. He was confident Te Awamutu company would be up near the top of the list. “We have paid 20s in the £ on share capital redeemed, and also paid 5 per cent interest,” said Mr Sinclair, adding that the position was a very good one, for the investment in shares was “as good as money in the bank.” The item, “share reserve, £2311,” was built up by suppliers who would not take up shares. The interest reserve, £776, was explained in detail, and it was pointed out that it was built up gradually as a reserve to recoup the company against any possible loss incurred from advances to suppliers. It was shown that at 31st May the company had nearly 20,000 boxes of butter unsold, of which over 10,000 boxes were in cool store. “ Happily,” said Mr Sinclair, " we were on a rising market, and the value is appreciably greater than when the year ended on 31st May.” ELECTION OF TWO DIRECTORS. At this stage the result of the postal ballot for two directors was announced as follows: W. F. Woodward 283 Hamilton Allen 255 Chas. Howcroft 216 B. C. O’Connor _ 176 S. N. Verity 117 The declaration was received with applause, and the two successful can-

didates were warmly congratulated by those unsuccessful. Mr Woodward, in returning thanks, said he would do his very best in the interests of the company. As he was the largest supplier to the company naturally be was keen to assist in every way the welfare and progress of the company. Mr Allen, in also returning thanks, appealed to suppliers to be patient in their criticism of the directors’ decisions, for the new year would bristle with difficulties. However, he would do his very best, and if at the end of the term he was held to have failed, “ you can fit the running shoes on me 1 ” (Laughter.) QUESTIONS. To Mt Verity, the secretary said the assets (land, buildings, machinery, and plant) £16,997, represented an increase of practically £3OOO due to teh installation of new machinery. To Mr J. Turney, the chairman said interest on advances to suppliers was charged at 5 per cent. Mr Tumey said another company conducted a co-operative store, and charged only 5 per cent interest. Mr Alexander said the 5 per cent was decided upon to insure the company against loss, for the borrower was not asked to give security. The assessment was not on the basis of quarterly rents, but a straight-out annual charge. Mr Verity commented that the returns for butter-milk did not compare at all favourably with Shannon and Levin companies’ returns. The Levin company conducted its own piggery, and made a very good profit from it. Mr Sinclair said he had investigated the position in the southern part of the North Island, and on his report the directors decided to dispose of the butter-milk instead of embarking on a pig-raising enterprise, involving an outlay of perhaps £3OOO. A WINTER BONUS. To Mr R. A. Grace, who asked would there be any bonus at the end of the year, the chairman said one company in the King Country had recommended its directors to withhold one penny per lb throughout the season for pay-out as a bonus in the winter time. Mr Sinclair said he was glad the subject was introduced. It needed a recommendation to the directors. Continuing, Mr Sinclair said many farmers preferred to do without a little of the summer advance for use in the winter.. Happily, most of Te Awamutu Co-operative Dairy Company’s suppliers could budget without assistance or reliance on a winter bonus; but there were others not so well situated. He added that the directors rather favoured withholding a reasonable amount for paying out as a bonus, but they wanted a recommendation from the annual meeting. Mr Alexander asked for a resolution. He added that the banks would doubtless prefer the companies to pay out the fullest advance month by month. Mr J. Philp said it was obvious the suppliers had very great confidence in their directors. He suggested that the decision be merely an instruction to withhold any amount deemed adequate by the directorate. Mr J. C. Flay proposed that the directors be recommended to withhold one penny per lb for payment as a winter bonus.—Mr W. G. Adams' seconded. Mr Barnett supported, but asked that the winter bonus be paid out on 20th July. Mrs C. Crook asked that the amount withheld should not exceed one penny, thus leaving suppliers as much as possible in the summer months for improving their farms. Mr G. Spinley suggested that the ‘ directors be left to determine the exact amount withheld, Suggesting that ft very dry summer or autumn might cause hardship if a hard and fast figure were stipulated. The motion to withhold one penny per lb, throughout the summer months, and pay it out on 20th July, was carried by a very substantial majority. To a question as. to what effect the guaranteed price would have on the share capital, Mr Sinclair said it would have no effect at all, as whatever price was guaranteed there would have to be deductions to pay share capital. Mr G. O. Jourdain, A.P.A., was unanimously re-appointed auditor, and his honorarium was fixed at £4O per annum.

DIRECTORS’ HONORARIUM. The meeting decided that the chairman’s honorarium be £lOO, the present chairman telling the meeting that he could not accept a proposed increase to £125. The fee for the dierctors attending meetings was fixed at the same amount as last year, the travelling allowance being slightly altered. Hearty votes of thanks were accorded the retiring directors, Messrs C. S. Mexted and T. Hastings, the chairman paying a warm tribute to them for the good work they had done on behalf of the company. Mr W. G. Adams moved to alter the articles of association to provide for elections of directors to be conducted at annual meetings instead of by postal ballot. Thus candidates could be heard before voting took place. Mr B. C. O’Connor, seconding, said candidates could then declare their respective policies. ■ At the chairman’s suggestion Mr Adams undertook to lodge notice of motion for consideration at the next annual meeting or at a special general meeting. Mr Hastings, thanking the meeting for the vote of thanks on his retirement, said he had thoroughly enjoyed his service as a director, and his services or advice would always be available although he was not on the directorate. Mr J. Philp pointed out that the Dairy Board levy in the new year would be approximately half last year’s figure, £6Bl. Replying, Mr Sinclair said he had not made that point clear because he was more concerned with the esti-

mated increased cost of approximately £6OOO for the new year. THE COMPENSATORY PRICE. Mr J. C. Flay moved that the meeting declare its support of the National Dairy Conference and the Farmers’ Union for a compensatory price for dairy produce, and contribute pro rata with other dairy companies towards the cost of the campaign to secure this. The mover claimed that the compensatory price was fair and sound, and all dairymen should work unitedly for it. This provoked a question as to what was meant by the compensatory price. The chairman said he felt that the Farmers’ Union could best deal with, and advocate, the matter of compensatory prices. The vote, on the voices, was adverse. Mr P. Calder stated that the dairy farmers were now the servants of the Government and the secondary industries. The farmers must unite. The Farmers’ Union had a membership of 17,000, and thus it could give a lead to all primary producers. Te Awamutu could start the campaign, and soon win support throughout the Dominion. He suggested that Mr Sinclair be appointed organiser at £lOOO a year and expenses paid. Mr J. Pearte voiced the sincere thanks of himself and his wife for the practical help afforded them by Mr Sinclair and the company during Mrs Pearte’s continued illness. The meeting terminated with a hearty vote of thanks to the staff—carried by acclamation.