FARMERS’ MEAT COMPANY.

Taranaki Herald, Volume LXVIII, Issue 16823, 23 August 1920, Page 4

FARMERS’ MEAT COMPANY.

ANNUAL MEETING. 'A SUCCESSFUL YEAR. The''fifth annual general meeting of tho'Taranaki Farmers’ Meat Company was held at the Workers’’ Social Hall, New Plymouth, on Saturday afternoon, Air. J. T. Quinn, chairman of directors, presiding over a largo attendance or shareholders. CHAIRMAN’S ADDRESS. The Chairman, in moving tho adoption of tho annual report .(details of which have already hoen published) said: — I desire to congratulate shareholders upon another successful year’s operations, The profit for the year, after providing a sum of £6500 for ..depreciation and £5750 as a reserve for income tax, shows at £8919 18s lid.

CAPITAL. A comparison with last year’s figures reveals the fact that the paid-up. capital of the company' increased during the year under review to the amount of £7860, whilst the calls in axrear have decreased by' £685. The amount of calls in arroar ns disclosed in the bal-ance-sheet is considerable, and your directors urge tho imperative necessity of shareholders paying up their calls promptly. Whilst on the subject of capital, I should like to mention that a few transfers have been put through during the year at considerably’ below tho par value of the shares, and althoiigh, of course, I recognise that shareholders are at liberty to dispose of their shares at any price they may think fit, some have no doubt disposed of them in' ignorance of their true value. A sale.by auction recently went through in Wanganui at £5 Is 6d.

INCREASED DIVIDEND. The profit made by the company, in the opinion of the directors, justified an increase in the dividend, and it was therefore decided to recommend payment of an 8 per cent, dividend free' of income tax, as against 6 per cent, last year. In doing so, the directors; apart from the increased earnings of the com.puny, had in mind the hope that such increase in dividend would result in growers who have not already taken up shares, would decide to do so even as. an investment, which I would again remind them, as free of income tax, whilst those who already hold shares would bo induced to increase their holdings. Sundry creditors, including Government advance against moat in store, this year shows £5096 in excess of last year. The amount,'namely £376,102. is a*very hig one, and is represented very largely by advances made against meat awaiting shipment, and will, of course, be reduced as shipment becom.es available, .iintiLifdJultimately vanishes. ■ It will bo noted that this rear .a much greater sum has had. to be placed to “Reserve for Income Tax.” This, of codrso, is owing to the increased profit, and. is unavoidable. The tax is 7a.Gd in the £, after allowing an exemntion of £3OO.

ADDITIONS TO WORKS. Turning now to the assets side of the balance-sheet, it will be noted that during the year some £43,617 has been a tided to land, buildings, plant, etc. It will, I think, be readily recognised by shareholders that with this company, which has been established only four years, it is absolutely necessary that a reasonable amount of money should be expended in addition to buildings, plant and machinery from year to year until the works arc sufficiently equipped to deal with all the stock the shareholders can produce, and also to economically wont the several by-products from such stock.

; STOCKS OX HAND. Stock, stores, etc., on hand have increased, compared with last year’s figures, by £42,047. The shdrtago of snipping. combined with the increase in the number of animals slaughtered, and the extra cost of manufacturing materials, is to a very great extent responsible for the increase. Stocks have been taken in at safe values. SALE OF PELTS AXD TALLOW. Unrealised consignments have decreased by about £40,50!), owing mainly to the fact that we have been able to sell outright our pelts and a'considerable portion of our- tallow at remunerative values, instead of consigning and consequently taking the risk of a fluctuating market, as was the case last year. Tile realisation of consignments open, as shown on last year’s balance-sheet, has, however, turned out most satisfactorily, • The next item on the balance-sheet is sundry debtors, showing a decrease of £11,623, which is encouraging. The sum as disclosed l in the balance-sheet under review, namely £4853, is comprised mostly of storage on meat duo by the Imperial Government for the month of Juno, and has since been paid. The balance, is made up of small items, which are all good, and most of which have since been collected.

INCREASED KILLING. "With regard to the operations of the company last season, it is indeed gratifying to be able to report to shareholders that killings have increased by approximately 20 pier cent, over the foregoing season. The actual figures showing the increase are given in the printed .report, and I desire to take this opportunity of expressing the directors’ thanks to growers for their loyalty during the past season. The quality of the stock treated showed an appreciable improvement compared with previous seasons, but-there is still considerable room for further improvement, and I would impress upon farmers the necessity of exercising greater care in finishing stock, especially as our meat will, in the future, he sold on the open market. This, company, with its efficient plant and staff, combined with its situation as regards railway and port, is in a- position to treat stock with equal advantage compared with any other Now Zealand freezing company. As you will sec from the report, directors recommend an increase in tho dividend of 2 per cent, over last year, and wo have been able to do this by reason of the fact that our products, over which we had con-‘ tvol, namely, tallow, pelts and hides, during the season just ended, reached top values, and we availed ourselves of such values. For this reason T desire to point out to shareholders that we were ablc # ,to pay approximately 15 per cent, more for stock than the previous season, representing an increased payment to growers of £24,392, calculated

on the number of animals slaughtered during the season 1018-19.

INCREASING THE FREEZING CAPACITY. You will notice in the printed report that directors propose to increase the freezing capacity at the works by approximately 30 per cent., owing to tho fact that it was found impossible during last season to deal with all the stock offering, and during the busy mouths of the year we were reluctantly compelled to curtail shareholders’ deliveries. AVe hope, however, to have the necessary freezing plant installed in good time for next season’s operations, which wo hope will enable us to accept promptly all stock offering from shareholders.

BY-PRODUCTS. Increasing our freezing capacity naturally means increasing our various by-products departments, and this fact has by no means been lost sight of. Wo are at present making extensive additions to onr tallow, manure and preserving departments, and hope, by tho time next season commences, to have a fully equipped oleo plant. Inquiries arc also being instituted concerning a soapmaking plant and phosphate grinding plant, tho latter in anticipation of heavy arrivals of rock phosphate direct to Now Plymouth from Nauru Island. Wo am also making inquiries as to the cost of a. machine for extracting seed and “bidi bldi” from wool. We aro advised that a similar machine is working most satisfactorily at Waingawa at a low cost. To successfully carry out all these proposed extensions, it will, of course, be necessary for tho company to have more capital, and I take this opportunity of appealing to shareholders to increase their present holdings. Tho company has proved by the balancesheet placed before you to-day that it is a profitable concern, and anart from the fact that it has considerably enhanced : the value of stock in the district in j which it is operating, an 8 por cent, j dividend free of income tax is a sound j investment.

FERTILISER MIXING PLANT. With further reference to the extensions of the company’s operations, yon will no doubt remember that in my last annual report I mentioned that we proposed to install a complete fertiliser mixing plant. I am pleased to be able to report to shdrchoklcrs that this machine is now erected and working most satisfactorily, and we have taken great pains by consulting an analytical chemist who specialises in fertilisers to ensure that our various mixtures are suitable to the Taranaki toils. The prices we arc charging for these mixtures leave only a small margin of profit to the company, ns we do not lose sight of the fact tiiat the company is essentially a farmers’ company, and therefore the policy of your board of directors is to give shareholders iTicir fertilisers at tlio lowest possible cost consistent with efficiency.

LOYALTY OF THE STAFF ACKNOWLEDGED. During the year under review various labour demands have been made, and at a • conference of freezing companies’ delegates held last February, it was agreed to concede a bonus of 10 per cent for hourly men and 7$ per cent, for piece-workers over and above the rates agreed upon in April, 1919. This, of course, has resulted in a considerable increase in working costs, and the profit and less account has suffered accordingly. Whilst on this important subject of tile labour question, t should like to state, however, that as far as our works arc concerned, the relations existing beta eon employer and employees have been most amicable', and nc- serious disputes have arisen. I take this opportunity of expressing the thanks of the directors to those employed at the company’s works for tlieir . loyal services during the year. The standard of quality of the various by-products has been more than fully maintained. Reports from the various buyers of our products have been most satisfactory, and in many cases flattering, and 1 feci .sure that our manufactures compare favourably with those of any other freezing company in Now Zealand. 1

SHIPPING. I am pleased to be able to etate that the shipping problem has greatly improved since I addressed you last year and I anticipate that though there will bo some little difficulty in fully clearing out freezing stores before next season commences, the congestion will : not be nearly so. acute as it has been! during the past two years. Our advices j indicate that the. shipping available will j be sufficient to so clear our stores that j it will be unnecessary next season to restrict our slaughtering in the same |

manner as we had, to some extent, to do last season. Various factors contributed to the shortage of refrigerated shipping space dnring the year just ended. ' Owing to the Imperial Government demanding high prices for frozen moat, consumption was considerably reduced, resulting in serious congestion in the? cold stores at Home, which in turn delayed the discharge of frozen cargoes, and cf course the prompt return of the vessels to New Zealand to pick up further cargoes. CONDITION OF MEAT IN STORE. With regard to the condition of the meat in our freezing stores, shareholders will no doubt have read in tho newspapers reports indicating that the meat which has been held lor a considerable time in some of the New Zealand freezing works is in an unsatisfactory state. I have made careful inquiries ns to tho condition of tho meat in our cold stores, and can assure shareholders that wo have nothing to fear in’ this direction.

THE FUTURE. And now regarding the future. Tho outlook is mucli brighter than it has been fof some time past, and I think wo can confidently look forward to a good season and satisfactory prices for our fat stock. By the time the now season commences," 1 trust matters on tlio Continent will have been peacefully settled, and this will no doubt result in a big demand from that quarter Tor pur products, more particularly foodstuffs. The United States of America arc also going to bo big customers, so that i anticipate an unprecedented demand for our primary products, and it is the duty of the growers of Taranaki to see that tho demand is fully mot. Tho Dominion is by no means producing all it is capable of, and it rests with the New Zealand farmer to • pursue a vigorous policy of increased i production. I

ARMOUR AND CO. I Much has recently appeared in the daily press regarding the refusal by the Government to issue a license to | trndo in New Zealand to Messrs. ArI mour and Co., and an agitatiop is on i foot from some quarters to endeavour ! to force the hands of the Government. | Whilst I admit that no one can take j exception to the business methods ns j practised in New Zealand up to the j present time by Messrs. Armour and I Co., I would impress upon you the "danger of letting them get a fooling in New Zealand either as buyers of stock or proprietors of fretwing works. The firm is so financially strong that for a few years they would probably be prepared to lose large sums of money if by so doing they could crush, at 'any rate, tli’o smaller Now Zealand freezing • companies, and more especially the j farmers’ freezing companies, thereby j creating for themselves something in 1 the nature of a monopoly. Growers, i I of course, might benefit during the j [comparatively short period of this un-j j healthy competition for their stock ox- ! ’ isted, but ultimately competition would practically cense, with the result, of; course, that prices for slock would drop ; in a truly disastrous manner. I wish ' to impress upon farmers tho necessity , of remaining - loyal to their own company, and would-remind them that any , profits made hy our company out of j stock purHiasod from shareholders go ■ back unto the shareholders’ pockets. In conclusion, Mr. Quinn emphasised 1 one or two points already touched upon | in his address, and strongly urged share- j to see that all shares in arrears were paid up. The company! needed more capital, and bo expressed j the hope that those who had not come 1 in would do so, and that existing share- ( holders would increase their holdings i also, pointing out that it was not a j fair thing that tho directors should j. have to go guarantee to the bank to ' the extent of £46.000. Sufficient capi- 1 tal should'he found to release tho di-j rectors of this responsibility. Hy talc- , ing shares in the company, or incrcas- i iug the number of shares already hold, J they would be helping themselves., tho district, the port, and the Dominion 1 generally, and further would be making a good sound investment. He referred with regret to the resignation of Mr. W. A. M'Cntcbnn from the directorate,; ho having left to take up his residence in Auckland. Ho then formally mnv-! ed; "That the report of the directors produced, toaethpr wit.lv the statement of tho company’s accounts as at Juno AO, 1920, duly audited, be received, approved, and adopted.” Mr, W. J. Gray (Okato) seconded the motion. i I DISCUSSION BY SHAREHOLDERS: I Mr. F. W. Sandford asked if the ;

directors would consider,the advisability of allowing people to take up less than five shares. Hu pointed out that he, and ha had no doubt there were many other small shareholders similarly situated would he prepared to tako up one or two additional shares but could not manage to take the minimum allowed of five. The chairman said tho minimum had been fixed at five because the coat of clerical work, and postages, etc., was so expensive when only one or two shares were involved. Air. A. Morton urged the necessity for increasing tho capital of the company and said that unless this was done it would be impossible to carry out very desirable and profitable extensions to tho works. For instance some little time ago the directors got some fnforniation irom Mr. Cooper, who was well known to most of them, in regard to a seap-making plant. From this it was found that whilst not an expensive plant it was an exceedingly profitable one. It meant that all the lowest grade tallpw was converted into soap, and so great was the demand for the soap turned out by the Wellington Farmers’ Meat Works that they could not satisfy it. This was one tho reasons why tho directors were anxious that tho capital of the company should be increased. In regard to manures, the directors had done their best to meet the wishes of the shareholders and had installed a mixing plant, but they wanted to go still further and instal machinery which would enable them to handle

| Nauru Island phosphates provided the expense was not too great. They were obtaining all the information they could in regard to the question. In any case a largo amount of capital Would bo required before they could embark on the project, and it was up to the farmer to see that it was provided. The land wanted manure and more manure. It had been very much impoverished during the last lour or live years, not only because manure had been so expensive, but also because it had been very scarce. They .-wanted to put the farmers beyond doubt in regard to supplies of manures. Tho company, he continued, had for the first two or three years of its existence paid a dividend of 6 per cent., and it had been increased this year to 8 per cent. Apart altogether from the tremendous advantages of tho works they also offered a sound and profitable invests ment. The dividend was free of income tax and he questioned whether they would find a more remunerative investment throughout New Zealand. He confidently appealed to the shareholders and to tho public to support the works.

In reply to Mr. C. Bnrnitt, the chairman said it was not possible in a meat works as it was in a dairy factory to compel a shareholder to lake up shares in accordance with tho quantity of stock put through tho works. On the one hand a dairy factory supplier was compelled to supply one factory, but with a freezing works they could not tie, a mail down. They bad to depend on the loyalty of the shareholders. Mr. W. J. Gray expressed the hope that the directors would make arrangements for a systematic canvass of the district on similar linos to that which was carried out some time ago. Tho chairman said tho directors had the matter in hand. Tho company had three buyers and during the off season they ■ would-canvass tho different districts and also collect calls in avrear. Mr. G. Colson asked whether arrangements could bo made for shareholders to purchase meat at the works. The chairman said ho knew this was being done in some places and the directors would consider tho matter.

In reply to Mr. Kurth, the chairman said tlie company was- not delivering manures. They would undertake to put manure on trucks and load it on to shareholders’ vehicles at tho works.

In reply to further questions the chairman remarked that tho prices .quoted were not cash. There was no discount, only od for bags if returned in good order. \ A town shareholder asked it small quantities snob as one or two bags would bo supplied. The chairman said this was so, and jocularly added that a shareholder could carry it away in his pockets so long as he paid for it. Mr., Gatrnby (Tataraimaka) ,asked whether the directors had considered the question of establishing woollen mills in connection with the works. The chairman said the matter had been'discussed, but they wore so short of capital to carry on even what they had now that it ( was impossible to launch out and provide woollen mills. In reply to a further question from Mr. Gatenby the chairman said he believed the cost of woollen mills would bo in tho vicinity of £40,000 and of this amount £2O,(XK) would need to be paid up. Tile company was quite prepared to move in the matter provided tho

necessary capital was forthcoming or would be agreeable to work in with a subsidiary company. He would be glad to get an expression of opinion from the meeting at a later stage. In reply to Mr. A. Hooker the chair--1 man said they had to comply with the Companies Act, and therefore it would not bo possible to save expense by sending out one notice giving, the dates on which all calls fell due if less than five shares were allowed to be taken up. However, the directors would go irito this matter. In reply to another question the chairman said the cbmpariy had three buyers permanently employed and allowed two other , auctioneering agents also to buy. Ho noted the query as to whether it was a wise procedure to allow any hut the company’s own buyers to purchase stock and said that the matter was one which was to be discussed by the directors. Mr. AY. R. Wright said that a fanners’ concern in the Waikato had 34 buyers, and all were authorised to act on behalf of a proprietary meat concern. The motion that the report bo adopted was then submitted to the meeting and carried.

DIVIDEND OF 8 PER. CENT. DECLARED. On the motion of the chairman it was decided to pay a dividend of 8 per cent, on paid-up capital. ELECTION OF DIRECTORS. The retiring directors, Messrs. E. Marfell. W. R. Wright, A. Morton and J. T. Quinn were re-elected, and Mr. E. R. Robertson (Tahora) was elected to fill the vacancy caused by the resignation of Mr. W. A. M'Cutchan. Air. E. P. Webster was re-elected auditor, his remuneration being increased to 100 guineas. EXCLUSION OF ARMOUR AND CO.

A discussion was'raised by Mr. W. R. Wright with reference to tho operations of Armour and Co., and ho moved to the effect that the meeting express its approval of tho action of the Premier in refusing Armour and Co. a license. Ho felt strongly, he said, ■That tho Meat Trust should not be allowed to operate in the Dominion. They wore a very wealthy concern, and whilst they would no doubt pay good prices for a year or two, even though they lost money thereby, the time would come in all probability when tho position would be reversed, and in the meantime other concerns which were not so strong financially and particularly farmers’ companies would be squeezed into a tornei. Mr. E. Marfell seconded the motion, which was carried with only one dissent. APPRECIATION OF STAFF. Tho chairman proposed a hearty vote of thanks to the manager and staff for the loyal services rendered on behalf of the company during the past year. The motion was earned with acclamation, and Mr. H. B. Gray, general manager and secretary, in response, said ifie company had a most elucient staff, all taking a very great interest in the works and the company generally. DIRECTORS’ HONORARIUM.

A motion that the chairmain of directors be granted £2OO and the directors £3OO to be allocated as they think tit was withdrawn and the chairman was voted £250 in recognition of his services during tho past year. Mr. Quin declined to accept an amendment that lie receive £3OO. The directors were voted £1 10s for each meeting they attend, exclusive of expenses. t Hearty votes of thanks were also accorded the chairman-and his co-direc-tors, eulogistic reference being made to their valued services* in the interests of the company. A special vote of thanks was accorded Mr. W. A. M'Cutchan, general regret being expressed that he had resigned his position on the directorate,' ami it was decided to place on record the shareholders’ appreciation of his services. WOOLLEN MILLS. Mr. Gaienby proposed “that it is desirable in the interests of-the distrjet that woollen mills be established in connection with the works .should sufficient capital be forthcoming. The motion was carried, and tho meeting terminated with a-hearty vote of thanks to the chair.

At the close of the meeting those present were handed their dividend warrants.