CO129-473 - Individuals - 1921 — Page 368

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of its large turnover that the Company is enabled to attain so satisfactory a result as is shown by the present Report and Statement of Accounts, and to thus continue to supply the Company with fresh milk, dairy produce, meats, etc., at prices which could not hold sway if the Company placed restrictions upon the expansion of its business. You will observe from the accounts that during the course of the past year a sum of over $22,000 has been spent on general repairs and improvements at the Company's Pokfulum property, in, for example, clearing sites for putting up cattle sheds, preparing pig runs and cultivating land for grass growing. In addition to the above, the expansion of the Company's business during the past year necessitated the expenditure of approximately $94,000 on additional dairy cattle, new buildings and land at Pokfulum, in order to enable the Company to cope with the growing demand for its products. It has also been deemed essential by your Company's board of directors that a building should be erected on the ground (acquired some years ago) adjoining your Company's present depôt in order to provide extra accommodation which was especially needed in view of the rapid development of the Company's business in recent years. The building in question is now nearing comple- tion, and it is proposed that, when it has been completed, that branch of the Company's business which relates to the bottling of milk, sterilizing, etc., shall be conducted exclusively in the new building thus granting additional and badly needed space for the conduct of the butchery depart- ment in the present building. Taking into account the excellent results achieved by the Company during the past year, your directors have granted to the members of the Company's staff a bonus of 10% on their respective salaries, and have no doubt that this step will meet with your ready approval. Your directors have also during the past year made a donation of $2,500 to the Hong Kong War Charities in the certain knowledge that this step will also meet with your commendation. There is another matter to which- at the risk of being met with the enquiry Is Saul also amongst the Prophets?' I would like to refer, viz.: the support which has been accorded by the Hong Kong Government to the Company during the time of stress which the Company has had to face since the commencement of the War. I can assure you that during that period there have been occasions on which it was vital to the Company's interests that it should secure Government support, and I can recall no instance wherein such support was withheld save for a legitimate reason. In conclusion I may remark that, in accordance with their usual custom, your directors have written off from the working account profits, the sum of $31,601.08 for depreciation, bad and doubtful

debts and losses on share investments as on the 31st July, 1917--thus leaving a balance of $130,102.69 which they propose, with your sanction, to appropriate as follows:

To pay a dividend of $2 per share ..

To place to the credit of the Fire and Typhoon

Insurance Fund

To carry forward

$120,000.00

6,000.00 4.102.69

$130,102.69

Sir Paul Chater having seconded the adoption of the report and accounts, which was carried, an extraordinary meeting followed when the chairman submitted a resolution providing for the calling up of the unpaid balance of $1.50 per share in respect of the 60,000 shares of the face value of $7.50 each representing the capital of the Company. The chairman explained that during the past two years the Company, in order to place itself in a position to cope with the increasing demand for its products has had to spend various sums aggregating as follows:-

On Land and Buildings On additional Cattle

---

$47,000.00 60,000.00

3107,000.00

and, on top of this, had to carry approximately $90,000 worth of stock in excess of its previous carriage thereof on account of its increasing turnover and the lack of shipping facilities. In order to meet the position created by the above expenditure and to place the Company in a position to further increase its earning capacity, your directors deem it advisable, in the interests of those who have invested their money in the Company, to adopt the policy of calling up the Company's unpaid capital with a view to utilising such unpaid capital for the purpose of securing the expansion of the Com- pany's business as happened in the case of the amount which accrued to the Company by the issue of new shares last year, instead of incurring an overdraft with the Company's bankers for such a purpose.

Sir Paul Chater seconded, and, as was expected, a little opposition was met with.

Mr. M. K. Lo, representing the opposition, made a long speech in which he submitted that one of the objects of a trading concern is to assure a fair return to the shareholders and it should do this before embarking on any ambitious scheme of expansion. He moved that seventy-five cents per share be called up and the other seventy-five cents, say, in six months time, and Mr. Grose seconded.

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