COMPANY MEETING

WELLMAN SMITH OWEN ENGINEERING

THE Twentieth Ordinary General Meeting of the Wellman Smith Owen Engineering Corporation Limited was held on July i ith at the registered offices of the company, Victoria Station House, London, S.W.

Sir Samuel Roberts, Bt., the chairman of the company, who presided, said:—The net profit realised in the year ended March 31st, 1939, after charging all expenses of working and manage- ment, and after providing for depreciation, amounts to £69,365, from which is deducted £6,566 for income-tax and National Defence Contribution, leaving £62,799, which compares with £29,074 for the previous year. Adding the balance brought forward and after allowing for the interim dividend paid in December last, there remains available £72,972 as shown in the balance-sheet. Out of this the directors recommend the payment of a final dividend of 5 per cent., making to per cent. for the year, and in addition a cash bonus of 2f per cent.

STRENGTHENED FINANCIAL POSITION

As I stated when addressing you last year, it is the directors' desire to strengthen the company's financial position, and With this in view it is proposed this year to establish a general reserve fund. The directors recommend setting aside LI o,000 to inau- gurate this account.

It is also proposed to create a special reserve for taxation. A sum of £20,000 has been allocated for this purpose. In these times of heavy taxation this new feature in the company's accounts is one which I think will appeal to you as prudent.

After making thes= distributions and allocations there will remain a balance of £24,030 to be carried forward to the credit of the current year's account.

The past year has been a very satisfactory one from a revenue- earning point of view. The increased profits are directly attribu- table to the large increase in the company's turnover, and though the amount represents a high return on the comparatively small capital of the company, on our turnover last year of considerably over £1,00o,00o the rate of profit realised on contracts executed is manifestly a reasonable one.

OVERSEA OPERATIONS

It is of interest to note that the company continues to be engaged principally on ordinary industrial work. For instance, we have recently completed the erection in Turkey of four open hearth steel furnaces and auxiliary equipment for the new Karabuk Steel Works, which is being built by Messrs. H. A. Brassert and Co. for the Turkish Government, and have also recently delivered two special creeper erection cranes designed and built in collaboration with the Cleveland Bridge and Engineering Company, Limited, for the construction of the Howrah Bridge across the River Hooghly in India. You may recall that we built the large creeper cranes used in the erection of the Sydney Bridge, Australia, a few years ago.

Turning to the balance-sheet, I wish to direct your attention to the marked progress as evidenced by the increased value of the company's assets, and the improvement in the financial position since the reconstruction of the company.

During this period from 1935 to March, 1939, the value of the company's floating assets has increased

by ••• ••••• • ••• £141314 and there has been expended on fixed assets (new

plant and buildings, &c.) 66,935 £208,249 This has been achieved out of earnings to an extent of £111,114 and by the proceeds of the ne,v capital issue of £97,135.

FAVOURABLE OUTLOOK

You will no doubt notice that the valuation of stocks and work-in-progress has fallen from £206,494 to £118;912. This is accounted for by the fact that when the valuation was made last year we had in hand abnormally large amounts of uncom- pleted contracts, including some very large ones, and, as I told you at the last meeting, we had to sub-contract for a considerable amount of work, but although the volume of contracts in hand is less today, our engineering shops are adequately supplied with orders. New contracts are being received at a satisfactory rate, and I have every confidence in the continued prosperity of your company. It may interest you to know that our account with the National Provincial Bank is in credit for the first time for many years, and I want to take this opportunity of thanking the bank for the assistance rendered during somewhat difficult times in the past.

The directors aim at maintaining a steady rate of dividend distribution, and at continuing to strengthen the company's position. They feel, however, that the results of the past year and the present financial position of the company justify the additional distribution of a small cash bonus.

I have once again to express the thanks of the board to all officers, staff, and workpeople for their efficient and loyal service during the year. I propose the adoption of the directors' report and balance- sheet.

Mr. James Foster-Smith, M.I.Mech.E. (managing director), seconded the resolution, which was carried unanimously, and the dividend and cash bonus recommended were declared.