For the descendents of Richard Dearie and his son John Russell
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Malayan Collieries Report Accounts and A.G.M.. 1934
(Ariel Photograph of Batu Arang) Captioned "MALAYAN COLLIERIES LTD. Centre of Operations, Batu Arang Colliery".
Malayan Collieries, Ltd.
(Incorporated in Federated Malay States.)
HUBERT HARRY ROBBINS, Esq. (Chairman)
FREDERICK CUNNINGHAM, Esq.
WILLIAM HENRY MARTIN, Esq.
ALBERT JAMES KELMAN, Esq.
ROBERT CECIL RUSSELL, Esq.
Managing Directors and Secretaries.
J. A. RUSSELL & Co., Kuala Lumpur.
Consulting Electrical Engineers.
SPARKS and PARTNERS, London.
REGISTERED OFFICES.
HONGKONG & SHANGHAI BANK BUILDINGS, KUALA LUMPUR.
NOTICE IS HEREBY GIVEN THAT THE Twentieth Annual General
MEETING of the Members of the Company will be held at the Registered Office of the Company, Hongkong and Shanghai Bank Buildings, Kuala Lumpur, on Thursday, 29th March, 1934 at Noon for the following purposes: —
To receive and consider the Balance Sheet and Accounts to 31st December, 1933 and the Reports of the Directors and Auditors.
To Declare a Final Dividend for the year 1933.
To Declare Directors’ remuneration for the year 1933.
To Elect Directors in place of those retiring.
To Elect Auditors for the ensuing year.
The Share Registers will be closed from Thursday, 22nd March, 1934 to Thursday, 29th March, 1934, both days inclusive.
By Order of the Board, J. A. RUSSELL & Co.,
Secretaries.
Dated 17th March, 1934,
Hongkong & Shanghai Bank Buildings, Kuala Lumpur, F.M.S.
Malayan Collieries, Limited.
(Incorporated in Federated Malay States.)
Directors' Report for the Twentieth Year of the Company ended 31st December, 1933.
The Directors have pleasure in submitting their Twentieth Annual Report and Statement of Accounts for the year ended 31st December, 1933.
In conformity with the practice of previous years the working of the Company's undertakings is reviewed by the General Managers in their report which is appended.
Batu Arang Colliery. The depression in trade and industry is again reflected in the production figures, the sales shewing a further decrease.
That the year was a difficult one is amply demonstrated by the accounts which we now place before you. The mere statement that 1933 sales were down by 16% on those for 1932 is not particularly impressive and a clearer idea is given by the fact that the 1933 sales represented only 34.4% of the sales during our peak year 1929 and 51.3% of the average sales during the ten years ending 1932.
All this notwithstanding, the plant was not only maintained in an excellent condition but actually added to and improved, the whole undertaking being kept in a position to respond to any increased demand at a moments notice.
Pamoekan Bay Colliery. This property continued in charge of a caretaker and though there is a slight improvement in conditions governing the Eastern Bunker business, there is still no indication of the time when it may be advantageous to resume operations.
General. Capital Expenditure on Colliery Account was largely confined to the transfer of plant and machinery from stores and the labour and materials expended in their installation. Expenditure on subsidiary undertakings comprised the completion of the erection of the Wood Distillation Plant, the whole of the erection of the Tile Plant, and the construction of approximately three miles of railway.
The subsidiary undertakings of the Company were operated according to demand. While the brickworks was practically idle, the plywood works was operated full time throughout and at the end of the year arrangements were in hand to increase further its capacity in order to satisfy a demand, which, though slow in developing, was nevertheless gratifying.
The timber application referred to in our last report was the subject of much correspondence and arrangements are now in hand for a final survey which will enable us to decide whether or not we can meet Government on the outstanding points.
The erection of the Wood Distillation Plant was completed and a trial run of about one month’s duration has been effective in confirming the estimates of yields upon which our acquisition of the plant was based. Of the products all but one have been successfully marketed, the exception being the wood preservative on which final tests are nearing completion.
Cement. A considerable amount of further work was recorded during the year but at present there is nothing definite to report or to submit to shareholders for their views.
Investments. The holding in Hongkong Government 6% Public Works Loan 1927 was converted into Hongkong Government 4% Conversion Loan 1933/53 during the year. The position is being watched for the favourable investment of funds which are now on Fixed Deposit with your Bankers.
Profits. The profits for the year under
review, subject to the Directors and Auditors' Fees amount to ... ... $312,823.05
To which is to be added the unappropriated
balance from the previous year of ... 281,468.29
594,291.34
Deduct Three Interim Dividends each of 2%
totalling 6% on 257,505 shares were declared during the year absorbing ... ... 154,503.00
439,788.34
You will be asked to sanction fees to Directors in
respect of 1933 at the rate of ... ... $20,000.00
Auditors' Fees at the rate of ... ... 2,500.00
Donations to F.M.S. Distressed Europeans Fund
and Selangor Asiatic Unemployment Committee 500.00 23,000.00
Leaving available ... ... ... 416,788.34
Which your Directors recommend should be dealt with as follows: —
Final Dividend of 4% making 10% for the
year ... ... ... 103,002.00
Write off Leasehold Property ... ... 100,000.00 203,002.00
Balance to carry forward to next year’s account $213,786.34
Directors. Mr. W. H. Martin and Mr. F. Cunningham being the Directors longest in office retire under the provisions of the Articles of Association and being eligible, offer themselves for re-election.
It was our sad duty to advise you on the 12th April 1933 of the death of Mr. J. A. Russell on 7th April 1933. Mr. R. C. Russell was invited to join the Board to fill the vacancy and now offers himself for election by shareholders.
Mr. H. H. Robbins proceeded to England on business, and Mr. J. Drysdale acted as his alternate.
Auditors. Messrs. Evatt & Co. retire and being eligible, offer themselves for re-election.
By Order of the Board,
J. A. RUSSELL & CO.,
Secretaries. Kuala Lumpur,
17th March, 1934.
Malayan Collieries, Limited
The Directors,
MALAYAN COLLIERIES LTD., Kuala Lumpur.
Gentlemen,
We have pleasure in submitting herewith our report on the working of the Company's undertakings during the year ended 31st December 1933.
BATU ARANG COLLIERY. Sales. The sales per quarter were fairly regular, though as a result of Restriction of Tin Production, the monthly demand was variable, resulting at times in a considerable excess production of small coal.
Production. This was carried out chiefly in the East Mine, coal winning being entirely by longwall methods and chiefly in Nos. 1 and 2 districts.
The first lift of coal in No. 1 district has been extracted to the panel boundary and operations commenced in the second lift. In No. 2 district extraction was carried out in the first lift.
The volume of material hydraulically stowed represented approximately 90% of the coal extracted. Operations throughout proceeded satisfactorily, and the series pumping and settling has proved very successful.
Underground Development. No major development was called for, or is likely to be required for some considerable time, except perhaps in an extension of the main dip by another stage to provide secondary stowage facilities for the No. 2 district. A programme was developed and approved for the gradual extension of No. 17 Level to make possible the handling of all No. 3 Underground coal over the East Mine Screens.
Opencasts. Coal winning was carried on principally in O.C. 7 where extraction at the south end was almost completed and operations at the north end were commenced. Supplies from this source augmented the production from underground and served as a good reserve. Shale stripping was carried out principally as employment for otherwise surplus labour.
Coal Washery. All coal, routine analysis of which disclosed an ash content in excess of the standard adopted, was treated in the coal washery and the plant has functioned satisfactorily.
Buildings & Plant. All buildings and plant were maintained in good order and several additions and improvements in layout and in practice were carried out.
The power plant operated satisfactorily and satisfied all load requirements; the bulk of the coal used for steam generation was of unmarketable quality. The maintenance period of the Turbo alternating plant expired on 31st December and the final certificate has been issued.
Capital Work. This was kept at a minimum and only such work as was necessary in the form of improvements or additions was carried out. These included additions to the power house spray ponds, extension of the general stores, extension of the water services, and some small alterations and extension to the railroad system, all of which were carried out within the estimated expenditure, also the erection of the tile plant, completion of erection of the wood distillation plant, and the construction of approximately three miles of rail road to ensure timber supplies.
Labour. As in the past year it has been our policy to retain as much labour on the property as possible, mechanical plant being displaced to this end. The labour position was satisfactory throughout.
Workmen's Compensation Insurance. The Enactment came into operation on 1st October and the risk has been underwritten by an Insurance Company at current rates.
PAMOEKAN BAY COLLIERY. The property continued in charge of a caretaker and prospects are still against the possibility of profitable resumption of operations.
SUBSIDIARY UNDERTAKINGS. Clayworking Department.
The continuous kiln remained shut down throughout the year and the intermittent kiln was in use for the burning of firebricks, special bricks and tiles.
The erection of the tile plant was completed and a trial on commercial lines was made. A number of alterations and adjustments were necessary and promising results were achieved. It is hoped that the completion of the next burn will represent the commencement of commercial production.
Plywood. The production of the works amounted to approximately 4,000,000 sq. ft. of plywood or its equivalent, the bulk of this being sold in the form of rubber chests for which there was an increasing demand. Various alterations and additions were made to the plant as a result of which the capacity of the factory was increased.
Wood Distillation Plant. The erection of this plant was completed and a trial run gave generally very satisfactory results. Various modifications have since been made and the plant as it now stands is in every way ready for commercial operation. In the meantime, markets are being developed for the various products and the results should make possible full time operation when the new pilot sawmill is completed, the object being to utilise waste from the sawmill and the plywood works.
Timber. Arrangements were made for the erection of a pilot sawmill capable of meeting the entire requirements of the property and of dealing with limited export orders, in connection with which encouraging enquiries have been received.
To ensure continuity of supplies of timber for all purposes some three miles of railway was put in hand and practically completed.
General. The general health of the entire resident population remained exceedingly good as also did the morale of the labour force. The Asiatic Club and Sports ground provided by the Company were made full use of and were much appreciated by all concerned.
During the year we had the pleasure of conducting over the property several parties of visitors the largest party being the Members of the Engineering Association of Malaya.
We are, Gentlemen, Yours faithfully,
J. A. RUSSELL & CO.,
General Managers. Kuala Lumpur,
17th March, 1934.
Malayan Collieries, Ltd.
(INCORPORATED IN F.M.S.)
20
DIRECTORS' REPORT
AND
ACCOUNTS
For the Year Ended 31st December, 1933.
TO BE PRESENTED AT THE
TWENTIETH ANNUAL GENERAL MEETING OF
SHAREHOLDERS
TO BE HELD AT THE
Registered Office of the Company,
Hongkong & Shanghai Bank Buildings, Kuala Lumpur,
ON
Thursday the 29th March, 1934, At Noon.
J. A. RUSSELL & COMPANY,
General Managers & Secretaries.
Malayan Collieries, Ltd.
(INCORPORATED IN F.M.S.)
PROCEEDINGS AT THE
TWENTIETH ANNUAL GENERAL MEETING OF
SHAREHOLDERS HELD AT THE
Registered Office of the Company,
Hongkong & Shanghai Bank Buildings, Kuala Lumpur,
ON
Thursday the 29th March, 1934,
At Noon.
Malayan Collieries, Limited.
(Incorporated in Federated Malay States.)
Hongkong & Shanghai Bank Buildings, Kuala Lumpur, F.M.S.
The Shareholders,
MALAYAN COLLIERIES, LTD.
Dear Sir, or Madam,
We have pleasure in reporting to you the proceedings at the
Twentieth Annual General Meeting of the Shareholders of the
Company which was held at the Registered Office, on Thursday, 29th March, 1934.
Yours faithfully,
J. A. RUSSELL & CO., Secretaries.
Dated 29th March, 1934
Malayan Collieries, Limited
(Incorporated in Federated Malay States.)
Proceedings of the Twentieth Annual General Meeting
The Twentieth Annual General Meeting of Malayan Collieries Ltd., was held at the Hongkong & Shanghai Bank Buildings, Kuala Lumpur, at noon on Thursday the 29th March, 1934.
The Chairman, Mr. H. H. Robbins presided and the others present were: —Messrs. W. H. Martin, F. Cunningham, A. J. Kelman, R. C. Russell (Directors) and P. W. Gleeson, John Hands, E. D. Butler, C. J. Chisholm, Lim Cheng Law, L. R. Mackness, H N. Ferrers, A. W. Delamore, J. Ford, C. R. Harrison (shareholders) and S. Brown representing the Secretaries.
The representative of the Secretaries having read the notice convening the Meeting, the Chairman, before moving the adoption of the Balance Sheet and Accounts to 31st December 1933, addressed the meeting as follows: —
Gentlemen,
Before proceeding with the business of the day, I should like to refer to the very great loss which we have all sustained by the death of our late Chairman, Mr. J. A. Russell. Your Directors circularised you on the 12th April advising you of this sad event and placing on record their very keen sense of loss and their appreciation of the valuable advice which Mr. Russell had always so freely given and the vast amount of thought and work that he had put into the building up of your undertaking.
Reference was made recently in the press to the foundation of this Company and the part played by your late Chairman at that time and until his untimely death. The events are well related, but they do not emphasise the vicissitudes through which the Company passed when Mr. Russell and a few staunch supporters, mostly influential Chinese friends, were the only people in the country who had any confidence in the future of the undertaking which is now in its 20th year.
Mr. Russell died in April which was probably the worst month of the slump from which we all hope we are steadily emerging. He guided this Company through slumps and booms from a very modest and precarious beginning, and the Board and its executive officers have his example as a stimulus and guide for the future.
I will now return to the matter before you, and the Report and Accounts having been in your hands for the prescribed period I will, with your permission, take them as read.
The Share Capital remains unaltered. With regard to the 61,120 surrendered shares, your Directors are considering the advisability of arranging to transfer the value of these shares from Share Capital Account to a Capital Reserve Account. This contemplated action if put into effect, would improve and strengthen the appearance of our Balance Sheet without affecting the shares in circulation.
The Pamoekan Bay colliery continued in the hands of a caretaker, which is the melancholy position of so many erstwhile prosperous Collieries in the Netherlands East Indies. There are indications of an improvement in the bunkering business, but this is merely comparative, and the further improvement necessary to any serious consideration of a resumption of operations is, I fear, still a long way off.
The demand for our Malayan coal fell to a figure which necessitates our turning back over a decade for a parallel. Our monthly sales at times fell to a little more than one week's full production of the Batu Arang Colliery, and the problem of keeping our overheads within a reasonable ratio to our total costs was one which was ever before us. It was only with the co-operation of a staff and labour force of which we are justly proud, the aid of a plant which has been kept in pace with the times, and a policy under which we accumulated large reserves of developed coal with which to level up our costs, that the results which we now place before you have been possible. With an improvement in general conditions in Malaya, this Company must benefit, but results comparable with the actual capital invested in your business are quite obviously not possible without the existence of demand. Given a normal demand and a fair field, we have every confidence in our ability to continue to show satisfactory results.
After making due allowance for the inroads into the demand for Malayan coal, to which reference was made in the late Chairman's speech last year, the falling away in our sales may be accepted as a fair indication of general trading conditions. The tendency is for consumers to improve the efficiency of their plants and practice, and though this has the effect of reducing the consumption of coal, whether it be per train mile operated, per unit of electricity produced, per yard of ground treated, or per ton of stone crushed, it is our constant endeavour to aid this achievement in every way in our power. As against the reduction in the demand for our coal as a consequence of these improvements in efficiency, it is certainly a fact that in the production of tin today, power is used to a much greater extent than ever before. Man power has had its day and the succeeding stages have been the direct application of the steam engine, the oil engine, and now the electric motor.
In an article in the press since our last meeting, reference was made to the replacement of the portable steam boiler and engine by oil engine power, the inference being that the change over was primarily due to the high cost of coal. Actually, for one reason or another, and quite independent of the price factor, we were never able to profitably secure any considerable share of the portable boiler fuel business. The replacement of portable steam engines by oil engines has, to some extent, been due to the more economical operation of the latter; but factors other than this have influenced the position. The introduction of the oil engine made possible much deeper working, and the employment in deep opencast mines of much larger power units, than was ever possible with independent steam engines, whilst the handling of fuel, whether coal or wood, from the nearest railway station to the bottom of the mine represented a considerable item of costs. The evolution is not yet complete, the electric motor is being adopted as an improvement upon the oil engine, and this is where this Company should benefit, immediately, in so far as consumers linked to the Selangor power stations are concerned, and ultimately, we hope also in the case of the potential Perak demand.
As sales of small coal during the year were not sufficient to absorb the natural production, it became necessary to accumulate considerable stocks. Though our capacity for storage of coal under water is large, it was evident that we could not continue accumulation indefinitely, and by securing the contract for the supply of the fuel requirements of the St. James Power Station of the Singapore Municipality, made possible by the helpful co-operation of the F.M.S. Railways, —the position has been relieved. The contract calls for the supply of some 3,000 tons per month, and as in the case of other large consumers, the contract is on a calorific basis.
With reference to the accounts which are before you in their usual form the expenditure on Capital Account was approximately half as to work of a general nature, the balance being on account of railway construction and the completion of the wood distillation plant and tile works, all of which I shall refer to later.
The amount allocated to Depreciation is $180,000, which is approximately the same as for the previous year. Owing to the policy of retaining as much available labour as possible on the property, much of the mechanical equipment was operated rather less time than even the low tonnage figures would suggest, and so the wear and tear on plant was very considerably less than would have been the case in a normal year.
The item "Operating Stores and Spares and Trading Stocks" is higher than the figure for last year, principally due to the purchase of further railway
materials, to the large coal stocks as a result of demand being insufficient to absorb the natural production of small coal, and to the larger plywood stocks in consequence of the much increased turnover of that department. The figure of $641,215.65 is made up as to $374,857.18 of mine stores and spares, $92,797.20 of railway materials and $173,561.27 for coal brick and plywood stocks.
In connection with the coal stocks, I should like to explain that, as these are carried under water, the coal will keep indefinitely without deterioration. All coal as it is recovered from storage is sent to the washery for treatment before despatch and in valuing such stocks full provision has been made for process losses.
"Sundry Debtors and Debit Balances" are somewhat down on the years trading, this, of course, being in keeping with the reduced turnover. The reserve against Bad Debts remains the same at $135,000, adjustments having been made for any debts considered definitely bad. Sundry Creditors, including Bills Payable and Credit Balances, are also down, as is to be expected in the transaction of a smaller volume of business.
The item "Unclaimed Dividends" varies according to the time given for clearance of the 3rd interim dividend before the close of the financial year, and this year the amount is larger than usual owing to the intervention of a week-end.
"Staff Leave and Passage" is rather less, but this being a calculated figure calls for no comment.
"Investments". In August, the Hongkong Government repaid the 6% Public Works Loan, at the same time offering conversion facilities to those who preferred a 4% investment to cash, and as the rate of exchange was adverse to a return of funds to Malaya, the offer of conversion was accepted. Apart from this, the investments remained unaltered.
"Cash in Hand and at Bank” was slightly up during the year, but when read in conjunction with the item "Unclaimed Dividends" the position is approximately the same.
The "Trading and Profit and Loss Account" does not, I think, call for any comment, the figures being in keeping with the volume of business represented.
In recommending the payment of a final dividend of 4%, making with the interim dividends already paid, a total of 10% for the year, your Board are agreeing to the distribution of a larger proportion of profits earned than has been usual. This has been done in an attempt to equalise as far as possible the payments during the depression, but only after due regard to the estimated cash requirements of the company.
Such is the result of the working of your undertaking during another difficult year. I will not describe the year as disappointing, because I fear we did not expect from it a great deal more than we have been able to achieve. Conditions during the first half of the year can best be described as appalling, though when regarded in retrospect one has the satisfaction of realising that those early months of 1933 may be recorded in history as the dark before the dawn of better times. The approach of the second half of the year brought with it a definite change for the better in the market prices of the two principal commodities of the country. Though this resulted in the average price of tin for the year bearing comparison with the highest average recorded in any year, the sacrifice of the producer to achieve this should not be lost sight of, the degree of restriction being such that the average mine was able to produce its quota in little more than 25% of possible working time.
Your Company is less directly affected by the fortunes of the rubber industry, but the indirect influence is, of course, very material and I follow, with very keen interest, the present course of prices, but, with perturbation, the trend of statistics. It is to be hoped that both can be reconciled in a manner equitable to all.
The labour position is one which is causing considerable anxiety. At the moment the supply in the country, if not actually short, is at best very delicately balanced, and to meet any steady improvement for which we all look, the reopening of channels for a reasonably natural ebb and flow of Chinese and Indian labour would seem desirable.
The Workmen's Compensation Enactment came into operation on the 1st October 1933 and your Directors deemed it wiser to insure the liability under the enactment rather than that your Company should carry this itself.
While in principle the legislation must be applauded, there is at least one condition which will inevitably operate very seriously against the Chinese labour force of this country. I refer to the fact that the dependants of a Chinese workman killed in an accident are not entitled to compensation if they are resident in China, and we are indebted to the Hon'ble Mr. Shearn for referring to this matter at the last meeting of the Federal Council.
Your labour force has already experienced the incidence of this condition, and 1 have no hesitation in saying that the lack of provision for compensation in such cases will, to a great extent, nullify the benefits to labour which the Act intended. The difficulties in making such provision are obvious, and it is realised that proof of identity would, in many cases, be difficult and perhaps in some cases, impossible; but even with the onus of proof with them, dependents of insured persons killed in the course of their employment would at least have a reasonable chance of obtaining that which should undoubtedly be regarded as theirs.
Before referring further to the subsidiary undertakings of your Company, 1 should like to outline your Boards policy in the matter. Briefly this is to spread your interests at Batu Arang where economically possible and to consider any project the adoption of which might aid the main operation, namely, the production of coal. It has been our practice to proceed with any well considered development which could be met by available funds without in any way interfering with the paying of a fair dividend. Any project calling for capital outlay beyond the resources of the company and for the raising of such capital by the issue of shares or by other means, is investigated with the object of placing any resultant recommendations before shareholders.
It might be fitting to very briefly describe the sequence in which this policy has developed.
The company's operations normally call for large quantities of bricks, in the production of which considerable power and coal are required, and when it became necessary to replace the original brick plant, the question arose whether a small plant, capable of supplying our own requirements only should be installed, or whether the installation should be of several times this capacity so that outside sales could be made. We decided upon the latter course and though the plant was not ready for production until after the peak of the last building boom, it will be in a position to benefit to the full when interest in building revives.
Considerable quantities of timber are used in the course of our mining operations and in extracting this from the forest, roads and/or railways have to be constructed and a forest staff employed. This being so, the way was paved for the extraction of all timber instead of just selected kinds and this gave rise to the acquisition of the plywood manufacturing plant. We have always had a sawmill of small capacity; and when the opportunity arose to acquire larger and more economical plant upon very attractive terms, this opportunity was taken. Plywood and sawmill plants inevitably produce a considerable quantity of solid waste which normally is destroyed. The avoidance of this destruction and the conversion of the waste into marketable products suggested the wood distillation plant. The felling of timber for the supply of the Company's general requirements renders available land suitable for agriculture, and in an endeavour to utilise such land experimental work has been carried out with various crops. In the meantime, we are doing nothing in the field, as our attitude is one of watching developments elsewhere.
The Cement Works, the possibilities of which we have investigated, would utilise for power and kilns very large quantities of coal, considerable quantities of shale—which is a waste product in the stripping of coal—and large quantities of limestone which would consume power in production. All these undertakings being grouped provide an excellent spread for those overheads and charges which are fixed whether one department or many are involved, and all the products, when transported over the F.M.S. Railways, represent an increase in traffic which in turn has the effect of increasing consumption of our coal.
I have already referred to the co-operation of the F.M.S. Railways in enabling us to resume the sale of your Company's coal in Singapore, and it is hoped that this mutually helpful policy can be strengthened and extended along the lines at present under consideration, and that further benefit will result not only to the Railway Administration, but also to your Company and to the country as a whole. Indeed, the full and orderly development of our proposals will not be possible without the consummation of this hope, or the putting into effect of alternative proposals which, though still of benefit to the Railways, may not utilise to an extent otherwise possible the railway facilities which exist.
To return to the year under review, the Brickworks were practically idle throughout, the only activity being in the production of firebricks and special shapes. The erection of all essential plant to make possible the commencement of small scale production of roofing tiles was completed, and the first tiles are now being produced.
Local clays are not easy to work, and the amount of investigation and experiments preliminary to manufacture has been very considerable indeed. However, capital outlay has followed investigation and the present plant, though laid out for a production which it is considered the market will be able to absorb, contains only those machines which are necessary to prove the product on a commercial scale.
The demand for the products of the Plywood department increased considerably and we can now claim to be established as a generally recognised producer of standard rubber chests which have fully withstood the tests of time. The introductory work on both the technical and sales sides has not been simple, but the results achieved during the year have fully supported our estimates of the possibilities. Prices have been very keen, but with the general improvement in commodity values which would seem to have set in, this position may soon right itself, especially as prices have not to appreciate very greatly to show us an entirely satisfactory return.
The increasing use of alternative means of packing rubber must inevitably continue to effect the consumption of plywood chests, especially where shipments are made direct from the producers of rubber to its consumers. This notwithstanding, it is thought that a demand for chests will continue, especially as it is unlikely that the cost of these in Malaya will ever again approach the prices which were demanded up to two or three years ago.
So that we may not be found unprepared in the unlikely event of rubber chests being entirely superseded, we are paying due attention to the development of alternative outlets for our rotary veneer. As a second string, we hope shortly to enter into the production of sliced veneer for general building and cabinet work both in this country and in export markets.
The erection of the wood distillation plant, to which reference was made last year, has been completed. A trial run of approximately a months duration, checked by a further run which has only quite recently been concluded, has produced quite satisfactory results and it is hoped to put the plant into regular commercial production at an early date.
As a matter of interest, I should like to mention that to facilitate the utilisation of the liquid byproducts of the distillation of wood, we have adapted part of the plant to the low temperature carbonisation of Malayan coal. To commence with, the throughput is small, but the oils produced will save the importation of similar products and we hope that this will be the forerunner of more important production.
The small pilot sawmill to which I have referred, has been erected from materials purchased with the large mill mentioned last year, and this will be used to prove costs and the suitability of products before further capital outlay on the larger mill is incurred.
Negotiations with Government regarding the area of some 25,000 acres of Forest land North of the Selangor River have proved rather more protracted than was expected. Final surveys are now in progress, and we trust that the outcome will make possible the acquisition of the area applied for upon mutually satisfactory terms.
The three miles of railway construction to which I have already referred as one of the capital works performed during the year, is an extension of our existing system into the Rantau Panjang Forest Reserve. While its primary object is to serve our current timber requirements, it is along the surveyed route of the line which we hope will eventually connect the proposed 25,000 acres of forest land with the mill at Batu Arang.
A considerable amount of further thought and work was devoted to the matter of the proposed Cement works at Batu Arang. Under the conditions which existed throughout the year, your Board were not disposed to place before you a recommendation to proceed with the installation. With most industries of the world, both primary and secondary, over provided with productive capacity, or at least with productive capacities considerably in advance of demand, it seemed unsound to advise the installation of this new plant. Added to this position, which will probably right itself in due course, was the trend of industrial development in Japan, or, to quote a Japanese authority, "the change in Japan from a negative trade policy, calculated to protect home industries, to a positive policy designed to systematise exports and to assist producers to overcome foreign suppressive measures against Japanese goods/'
The development of Japanese exports has been truly amazing, and while it is evident that the ravaging of the markets of the world, with the combined aid of low wages, direct and indirect subsidies and heavily depreciated exchange cannot go on for ever, the Japanese manufacturer, while he enjoys the unstinted support of a steady and vigorous people, accustomed to and for the time satisfied with extremely simple conditions, must inevitably set entirely new standards of values in manufactured goods at least here in the East.
In all your Boards deliberations this aspect has been very prominently to the fore. While it is agreed that, subject to demand for Cement within Malaya, the proposed manufacturing plant could be expected to give an entirely satisfactory account of itself, the conditions ruling and the low visibility which throughout the year frustrated attempts to take a normal and legitimate commercial view of the future, did not ensure those auspices for the establishment of a new industry which the undertaking called for.
While the matter was still under consideration, we were asked to consider a proposal for the transfer to Batu Arang of a British plant which was quite recently installed not very far distant from Malaya. A proposed basis for negotiations was drawn up for the consideration of the Company concerned, and this provided for the ultimate abandonment of production at the present site, and the supply of the requirements of the territory which the plant thereon was designed to serve, from the plant as re-erected at Batu Arang.
Though your Board were attracted by a proposal which might reasonably be described as the transfer of production from a less economical site to a more economical one, thus avoiding a nett increase in productive capacity and competition between British interests, and at the same time definitely increasing this Company's prospective demand, it was finally decided not to develop the proposal for recommendation to shareholders for adoption by your Company alone.
Feeling that the principle was sound, and having regard to the fact that the primary object of your Board was to develop a demand for coal which is the main product of your undertaking, your Board have indicated to the Company referred to, a way in which we might co-operate with them in arranging for the transfer of their plant to Malaya. If this proposal should develop, each shareholder will be given an opportunity to participate according to his own wishes in the matter, while the Company's contribution and liability will be strictly limited to that which can be safely undertaken without resorting to the raising of capital, or in any way interfering with its dividend paying capacity.
In conclusion, I should like to say that your General Managers report very full support from the staff at Batu Arang, and your Board are fully appreciative of their services.
You will not wish to hear from me any reference to world economic conditions and I have no views to express, except that the year under review deserves credit for being one during which the world began to recover in spite of disorganised economic conditions, financial collapses, conference disappointments, political uncertainties and the one hundred and one minor adverse conditions which have prevailed. This I suggest is a most heartening achievement.
I will now formally propose that the Balance Sheet and Accounts to the 31st December 1933, and the Reports of the Directors and Auditors, be received and adopted, which resolution I will ask Mr. Martin to second.
Mr. Martin, in seconding the proposal, said: —
In seconding the proposal that the Balance Sheet and Accounts to the 31st December 1933 and the Reports of the Directors and Auditors be received and adopted, I should like to refer to the great loss which we have sustained by the death of Mr. J. A. Russell. The Chairman has set out our feelings in the matter, and I should like to associate myself very closely with the sentiments expressed.
The results which we are able to shew on the years working of your undertaking reflect the times through which we are passing, and I hope you are not disappointed. I now have much pleasure in formally seconding the resolution before the meeting.
Mr. Lim Cheng Law, on rising to support the adoption of the Report and Accounts said: —
I would like to associate myself with the remarks made about the late Mr. J. A. Russell whose death has been such a loss to Malayan Collieries, and his name will be ever fresh in our minds.
I feel confident that I voice the cordial opinion of shareholders present in stating that we have to-day listened with extreme interest to the reports and speech the Chairman has given us. In the circumstances, they display no mean achievement on the part of the personnel of the Malayan Collieries. It does not need much insight to observe the growth of public opinion on all vital matters that concern the welfare of such a great enterprise. These healthy signs point to the great pains and good efforts of the directors.
With these few remarks 1 have much pleasure in supporting the adoption of the report and accounts as presented and trust that the recommendations for the appropriation of the amount available for distribution be carried into effect.
Mr. John Hands then addressed the Meeting as follows: —
First of all I should like to express my appreciation of the kindly thought of the directors in placing $500/- at the disposal of the Malayan Unemployment Committees. Another item in your Report is that you refer to the visits paid to the Collieries, the largest party being the Engineering Association of Malaya. I was fortunate to be one of those visitors and I should like to say how much I was impressed, not only by the entertainment that the Board provided for us, but by the condition of the whole plant as it appeared to a mechanical engineer. I was also pleased to see that the Board has provided amenities for their staff and labour force, and I wish to congratulate them on that.
The Chairman. I thank both Mr. Lim Cheng Law and Mr. John Hands for their remarks. Before I put the motion to the meeting 1 shall be pleased to answer if I can, any questions bearing upon the Report and Accounts which shareholders present may care to ask.
No questions were asked and the Reports and Accounts were unanimously adopted.
The Final Dividend of 4% was unanimously approved on the motion of the Chairman seconded by Mr. F. Cunningham.
The Directors remuneration of $20,000/- for the past year was unanimously carried on the motion of the Chairman seconded by Mr. E. D. Butler.
Mr. W. H. Martin was re-elected a Director on the proposal of the Chairman seconded by Mr. A. J. Kelman.
Mr. F. Cunningham was re-elected a Director on the proposal of the Chairman seconded by Mr. R. C. Russell.
Mr. R. C. Russell was elected a Director on the proposal of the Chairman seconded by Mr. W. H. Martin.
Mr. H. N. Ferrers proposed and Mr. P. W. Gleeson seconded that Messrs. Evatt & Co. be re-elected Auditors for the ensuing year.
Mr. C. R. Harrison addressed the Chairman and stated that he was a shareholder resident in England, and that he would like the Board to consider the advisability of remitting dividends to shareholders resident in England in the same manner as some Tin Companies registered in this country. He would like to receive Dividend Warrants as soon as possible after they were declared without having to wait about a month while the warrants were in the post. He did not consider that this would entail much trouble and it would be convenient to receive the dividends as early as possible after declaration. The Chairman thanked this shareholder for his suggestion and promised to go into the matter.
Mr. W. H. Martin then addressed the meeting as follows: —
Gentlemen, I wish you to join with me in a hearty vote of thanks to the General Managers, Secretaries and the Staff at the Mine. I can assure you we are indebted to them for the services they have rendered the Company. We have had their unstinted co-operation and it gives me much pleasure to move this vote of thanks.
This motion was seconded by Mr. Lim Cheng Law amid applause.
The meeting terminated with a vote of thanks to the Chair.
Printed by Kyle, Palmer & Co., Ltd., Kuala Lumpur.
MALAYAN COLLIERIES, LTD.
(Incorporated in F. M. S.)
Head Office- Hongkong and Shanghai
Bank Buildings, Kuala Lumpur.
Telegraphic Address-"Arang"
Kuala Lumpur
Codes—Bentley’s, Boe, Shipping and
Acme.
Telephone No. 4265 (2 lines), with
private line to Batu Arang Colliery
Directors:
H. H. Robbins (Chairman)
W. H. Martin F. Cunningham
A. J. Kelman R. C. Russell
General Manager & Secretaries:
J. A. Russell & Co.
Colliery Suptd. F. Bellamy
Colliery Undermanagers:
R. Scott B. Harold
A. Knight
Gen . Assistant J. S. Gay
Traffic Supt. K. Jorgensen
Plant Suptd. D. Tooms
Electrical Engineer W. B. Joiner
Mechanical
Engineer F. Gradon
Do. J. A. Porteous
Draughtsman J. J. Gibson
Surveyor D. L. Lawrence
Civil Engineer H. E. Marnie
Works Accountant
& Stores Suptd. J. H. Tubb
Brickworks Supt. E. G. de Muschamp
Plywood Works
Suptd. E. G. Spall
Wood Distillation Works Suptd. E. G. de Muschamp
Forest Engineer E.L. Jorgensen
Resd. Med. Officer Dr. Kirpal Singh Sodhi