CO-OPERATIVE DAIRYING

Wanganui Chronicle, Volume 79, Issue 195, 21 August 1935, Page 12

CO-OPERATIVE DAIRYING

THE RAETIHI COMPANY ÜBNGTHY ANNUAL MEETING The thirty-second annual meeting of shareholder* of the Raetihi Co-opera-Hve Dairy -Company, Ltd., was held in the Druids’ Hall on Saturday, when about 80 put in an appearance. The meeting lasted from about 10 a.m. till after 6 p.m. Mr. A. B. Harris, chairman of directors, presided, and Messrs. D. F. Whale,' C. D. Scarrow, L. E. Fetzer, E. A. Voelkerling, Maurice Geraghty and J. H. C. Boyd, other directors, were aswciated with him. The reading of the minutes of previous meetings of shareholders, comprising several large pages, occupied some considerable time. After the motion for their adoption had been proposed Mr. H. W. B. Littlewood said that he had spoken with regard to his qualification to be present at a previous meeting and it was not in the minutes. There were many references to Mr. Littlewood in the records, as read by the secretary, Mr. F. Lee, but Mr. Littlewood contended there should have been another one. It was agreed to make the addition asked for by Mr. Littlewood. Annual Report The annual report and statement of accounts for -the year ended June 30, 1035, had been circulated among shareholders. It was as follows: “Unremunerative prices have been experienced over three-fourths of the season, but the very welcome and substantial rise in the past few montrs has brightened things considerably and made an improvement in the pay-out over the preceding year. Tho amount of butter manufactured during the year shows a decrease of 45 tons on the previous year. However, there is a considerable improvement in grade and the percentage of butter graded finest has also improved. The new plant and tha more frequent collection of cream has no doubt helped in this respect. The board of directors recommend that a further advance of Ijd per lb be paid on all butterfat supplied during the season. This will bring the average paid for all finest butterfat, cartage added, up to 9.73 d per pound butterfat and the average paid for all grades of butterfat, cartage added, up to 9.2 d per pound butterfat. They would also mention that when final realisations cc/ue to hand from London the directors anticipate being in the happy position of making a further and final advance which will be paid out w’ith the payment for November, 1935, butterfat and will come as a Christmas pay-out. Shareholders will be paid the usual 5 per cent, interest on paid-up capital. “During the year a very old friend, a director of long standing, in the person of Mr. E. L. Sommerville, passed away. He gave Sis best services to the company over a long period, faithfully and well —we mourn his loss. “The retiring directors are Messrs. J. H. C. Boyd and L. E. Fetzer, both of whom are eligible and offer their services for another term. Nominees must be holders of not less than 10 shares, and must bo suppliers of cream to the factory.” In moving a vote of condolence and sympathy with Mrs. Sommerville and family, the chairman said that although it was late it was the first opportunity The shareholders had of doing so as shareholders of the company. The motion was carried in the usual manner. The chairman moved the adoption of the report. The season had not been mo successful as it might have been and there were two reasons for the reduced output. The weather had not been very favourable and the district was not so able to stand against that a b some of the old established districts. »Some of those who supplied the previous year had changed over from c-nws to sheep. The outlook was better than it was some time ago, although it was not very bright. He called attention to the improvement in average grading of their butter, which had gone up from 92.9 last year to 93.097 this season. The percentage of finest cream collected had also increased from 63.56 to 75.10. Last month a Government herd tester had visited the district and an attempt was being made to form an association. Mr. Geraghty seconded the adoption of the report, which was then well discussed. Mr. H. W. Littlewood said he was speaking on behalf of a number of suppliers and asked for latitude, which wan given him by the ehairman. Mr. Littlewood was tbv;. the chief speaker our»ng the afternoon. Mr. T. 8. Ward thought the balance sheet was goo 1 and he could not find anything to complain about, but he asked what about legal advice charges. It was explained that they were included in the item “general. ’ ’ Mr. H. Jenkins pointed out that there was an increase in the cost of collection of cream, wages, and renewals, repairs and maintenance. It was stated that cream was now collected daily instead of twice or three times a week and the smaller quantity received daily meant a larger cost per lb of butterfat, and some machinery was included under maintenance.

Mr. Geraghty said the increase in the cost of collection was more than j met by' the better grading marks and j thus bigger pay-out to suppliers. !A discussion took place regarding the advantages of daily collection of | cream. Mr. Littlewood contended that j it suited those suppliers handy to the • factory but was not much good for • those far away. ? Tn reply to questions of whether it paid and if it was worth the cost, Mr. L. E| Fetzer replied that the Dairy Board laid it down that cream had to be collected every day. That was the end of it . | 4 ,; . In reply to Mr. Gardner, tho secretary said the percentage of finest cream collected had risen from 63.35 to 75.2. The manager, Mr. A, Paulger. saidtho Government Department had set up a higher standard for cream and this was th© reason why some suppliers did not receive as high grading as they expected. Mr. Littlewood declared that the directors should give more information and statistics in the balance-sheet. He produced a balance-sheet from another company and said Raetihi Company should give the same information. The audit fee was much less than was paid by Raetihi. The chairman replied that the bal-ance-sheet referred to was one for 1933. It was unfair to compare that year with the present season. The audit fees were now fixed by regulation. The National Dairy Association was preparing a standard balance-sheet and Raetihi Company would use that sample next year if it was ready. Mr. Littlewood spoke at length about the item “depreciation” in the balance sheet. He complained that there was not a depreciation fund shown and insisted that the amounts set down year after year as depreciation of buildings, machinery, plant and motor vehicles were cash received by the company. This money, he declared, should be kept separate and placed on deposit until new articles wer© required and then there would be money to buy these things. He quoted from previous balance-sheets and asked where the money had gone to, seeing it had not been kept in a separate fund. Th© Government insisted that other institutions placed a certain sum of money in the hands of trustees every year as depreciation and he deviated that the Companies Act imposed that duty on the company. Mr. L. N. Ritchie pointed out that the “institutions” referred to were local bodies and he explained that the Government, as the largest lender to local bodies, had to protect as far as possible the security given to it in the shape of waterworks, etc. Some local bodies had not been keeping up these securities. The company was in a different position from these local bodies. Mr. Jenkins said it was absurd to say that the company had received bank notes as cash for the amounts stated as ”depreciation” on the bal-ance-sheet. He explained the usual book-keeping method of dealing with depreciation. Mr. Littlewood insisted that the company had received cash to the amount of the depreciation. The chairman said this was not time to be stacking up funds. It would be bad business to place the amounts shown as depreciation year after year on deposit at the bank and get say a P to per cent, interest and have to pay 6 per cent, on an overdraft. Mr. Littlewood replied that the company should not need an overdraft. At was the agent of the suppliers to receive their cream, turn it into butter and sell it and divide the proceeds. Mr. Geraghty referred to the sinking fund endowment policy in the A.ALP. Society. He thought that was quite enough sinking fund. After others had spoken a motion was proposed and carried that the discussion be stopped and that the meeting proceed to the next business. Ihe balance-sheet and report were adopted. Directors Mr. J. H. C. Boyd and L. E, Fetzer were re-elected directors. Auditors Messrs. C. Masters and J. Jones were nominated for position of auditors. Messrs. Jenkins and W. Jack were asked to act as scrutineers for the ballot, which was in favour of Mr. Masters, who was appointed auditor at the fee fixed by the regulations. Proxies Before the ballot was taken Mr. Littlewood raised the question of voting by proxy. Jy, was a most unpopular thing and should not be allowed. • Mr i !4 tchlc P t,in ted out that if a shareholder had given a proxy to another shareholder to exercise his vote it would be wrong for the meeting to deprive him of his right. The articles of association provided for proxy voting and until the articles were altered proxies would have to be allowed. Several spoke on the subject and a motion was passed requesting proxy holders not. to exercise them. Mr. Littlewood proposed a motion asking the directors to take steps to

introduce postal voting and the abolition of proxy voting. The chairman said this would be a costly business and would require an alteration to their articles of association. The motion wilk carried. Capital Levy Mr. Littlewood proposed that all money received from the capital levy or from other channels for capital be used for capital expenditure only. He spoke in support of his motion. Mr. Ritchie said that as a “dry” shareholder sin h a motion would increase the value of his shares but it would not be to the advantage of the suppliers. Air. Charles Lynch expressed surprise that such a motion should come from a supplier. It would largely increase the value of dry shares. On a vote being taken, the motion was declared lost on the voices. The majority of those who had attended during the afternoon had loft the meeting by this time.