COMPANY MEETING

BOOTS PURE DRUG COMPANY, LTD.

RECORD SALES EXPANDING EXPORT TRADE LORD TRENT'S REVIEW OF A SUCCESSFUL YEAR

THE fifty-first annual general meeting of Boots Pure Drug Co., Ltd., was held on June 8th.

The Rt. Hon. Lord Trent, Chairman of Directors, said: Our trading profit, after providing for contributions to Staff Pension Funds, Management Remuneration, Income Tax and National Defence Contribution amounts to £951,009—an increase of kto,677.

The profits before taxation have only once been beaten and that was in 1936-7, when chemists' trade was exceptionally good. The figures on our Profit and Loss Account emphasise the heavy burden of taxavon which is now being borne by industry.

Repairs and Renewals, whilst less than the abnormally high figure of last year, are well up to our average of the past few years. Depreciation shows an increase of over Li i,000.

CONTINGENCIES RESERVE We used k15,000 from the Contingencies Reserve to pay for special Air Raid Precautions expenditure. As further developments may necessitate an indeterminate additional expenditure, your Directors feel that the best way of facing this contingency is to consolidate the Works Development and Air Raid Precautions Reserves and bring them up to Lroo,000. The Freehold Reserve has Leen increased by our usual allocation.

Owing to the uncertainty of business conditions at the present time, your Directors, while not considering it necessary to increase the General Reserve, feel very strongly that it is prudent to have a substantial Contingencies Reserve which would be available if the need arose.

DIVIDEND PAYMENTS

The net balance amounts to £776,292—an increase of £13,667. After payment of all preference and preferred ordinary dividends, and of four quarterly dividends of 6 per cent. less tax on ordinary shares we have a balance of £295,542 which, together with the balance brought forward, amounts to £642,272 against £598,862 last year. Your Directors recommend the payment of a bonus of 3d. per share free of income tax on the ordinary shares, absorb- ing ao,000. This, together with the allocations to which I have already referred, will leave £248,724 to be carried forward to next year.

EMERGENCY STOCKS

During the past year our total stock was turned over at a faster rate than ever before—and this, in spite of the fact that we felt it desirable prior to the crisis last autumn to increase our stocks of essential drugs, surgical goods and first-aid requisites. Our precautions proved more than justified, for we were sold out of the increased stocks in our branches in a very short time.

The Ministry of Health has advised all hospitals to carry a month's stocks of essential drugs and dressings. It is clear from our experience last autumn that the need is no less urgent for the public to provide themselves with essential medical require- ments. In fairness to themselves, to the manufacturers and dis- tributors, and particularly to the transport services, those who can should lay in a stock of first aid requisites and everyday medicines before a possible emergency, and not wait until too late.

NEW BRANCHES

During the past year we have opened fewer branches than usual, but in addition to zo new branches, which bring the total up to 1,195, we closed five and we have rebuilt, enlarged and improved 5o, and actually our expenditure on shop properties exceeded that of any previous year. There is a perpetual demand for more space in order to store and display the continually increas- ing number of items offered for sale.

RECORD SALES

We are beginning to reap the benefit of our new factories in reduced manufacturing costs, which we have already passed on to our customers in the form of lower prices for a number of articles. In a year of disturbed conditions and heavy un- employment our total sales transactions again beat all previous figures and increased by over four million, while the number of prescriptions dispensed increased by over half a million and was easily a record.

Our figures reflect the great care which was taken and which in point of fact is continuously taken, to control every item of our expenditure.

NEW BEESTON BUILDINGS

The new dry goods factory and the building which comprises the new canteen and the school for juvenile workers were opened at Beeston during the year and have proved a most valuable and highly appreciated addition to the Beeston group. We now possess premises worthy of the school which has contributed so much to the creation of a contented, keen and efficient staff. During the year over 19,000 visitors were shown over the Beeston factory, that has won tributes from so many quarters and is regarded as a model of what a factory should be from the point of view of both the work performed and the workers.

MEDICAL SPECIALITIES

Our medical specialities are increasingly prescribed by the medical profession as their worth becomes better known.

Two years ago I mentioned that we had sent representatives to Toronto to obtain the earliest information about protomine insulin (with zinc) suspension. This step has been fully justified since the product has become of increasing importance. That the manu- facture of this product is not controlled in this country by foreign interests is due solely to our action.

AGRICULTURE

The sales of our agricultural products are steadily increasing. During the past year our veterinary department in conjunction with official bodies have carried out a great deal of research, and two of the resuits which have proved very successful have been for the treatment of black-head disease in turkeys and sway-back disease among sheep.

HORTICULTURE

Our research department have done a great deal of investigation on rooting stimulants in association with high authorities on the biological side of the work. Whilst we are actively pursuing what I might term "long range " scientific work, we have also taken steps to cater for the hundreds of thousands of amateur gardeners in this country.

You wiil recall that a year ago we appointed Mr. C. H. Middle- ton of broacasting fame as our horticultural consultant. During the past year we have organised a series of public meetings for garden-lovers in eleven cities and Mr. Middleton has addressed large and enthusiastic audiences.

EXPORT TRADE

It is especially gratifying to be able to report a steady increase in our export trade during a period when the general conditions for foreign trade were deteriorating. Export trade is a matter of such vital importance to the country that we intend to develop energetically all possible openings in this direction, either on our own account or possibly in co-operation with other pharmaceutical manufacturers.

STAFF PENSION FUND

The first valuation of the general staff pension fund, which was inaugurated on April 1st, 1935, has now been completed. It shows that while the surplus was somewhat less than had been pro- visionally estimated, the fund is established on a sound basis. The two chief factors affecting the result were, firstly, the rate of mortality was considerably lower ittan that expected from the official tables, and, secondly, practically the whole of the funds were invested in gilt-edged securities, which, whilst providing a sound foundation, gave a low yield.

TRIBUTE TO STAFF

Once again I stn delighted to put on record our keen apprecia- tion of the contribution make by the staff to the success of the firm and to the high esteem in which it is held by the public. The knowledge that the staff can be relied upon to do their utmost for the company in all circumstances is a source of great strength to us and provides ample justification, if justification were needed, for all the schemes of staff welfare to which I have referred again and again in my annual speeches.

We have special reason to be proud of the splendid way in which they faced the many problems which confronted them last September.

NATIONAL SERVICE

For many years we have granted full pay to Territorials whilst in camp, and given them their full holidays with pay in addition to the fortnight spent in camp. When the scheme for training women for the Civil Nursing Reserve was announced, we decided to place those attending their hospital course on the same footing as the Territorials, namely, to grant full pay in addition to their paid holidays. This applies in peace time, both in the case of men and women Territorials and Auxiliary Nurses, but does not apply to the men called up under the Military Service Act, whose places will, of course, be kept open for them.

A.R.P.

During the past two years we have been training volunteers for our own A.R.P. requirements. In addition, we have a large number trained for Local Authorities' schemes. Altogether in the Defence Services and trained or under training for A.R.P. in either our own or local authorities' schemes, we have 5,20o people.

FUTURE PROSPECTS

He would be a rash man who would venture at the present time to hazard any forecast of the coming year's results. In normal times the affairs of this country are conducted on the assumption that there is no danger of war in the next ten years. Until it is once again safe to make an assumption of that sort, it will not be possible to look ahead with any degree of certainty. But with this proviso it is perhaps permissible to call attention to the brighter side of the picture.

At the present time trade as a whole is good in spite of bad patches in the country, and we are fortunate in having branches situated in districts where there has been a great improvement in unemployment figures, as well as in places where trade is not so good. We have a great and growing goodwill both on the Professional side of our business and also with the Public at large. We look ahead, therefore, without complacency but with complete confidence in the knowledge that we are prepared, as far as it is humanly possible to be prepared, for anything that the future may bring