For the descendents of Richard Dearie and his son John Russell
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Malayan Collieries Report Accounts and A.G.M. 1936
Malayan Collieries, Ltd.
(INCORPORATED IN F.M.S.)
DIRECTORS' REPORT
AND
ACCOUNTS
For the Year Ended 31st December, 1935.
TO BE PRESENTED AT THE
TWENTY-SECOND ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD AT THE
Registered Office of the Company,
Hongkong & Shanghai Bank Buildings, Kuala Lumpur,
ON
Tuesday the 31st March 1936,
At Noon.
J. A. RUSSELL & COMPANY, Ltd.
General Managers & Secretaries.
Malayan Collieries, Ltd.
(Incorporated in Federated Malay States.)
Directors.
HUBERT HARRY ROBBINS, Esq. (Chairman.) FREDERICK CUNNINGHAM, Esq.
WILLIAM HENRY MARTIN, Esq.
ALBERT JAMES KELMAN, Esq.
ROBERT CECIL RUSSELL, Esq.
General Managers and Secretaries/
J. A. RUSSELL & Co., Ltd., Kuala Lumpur.
Consulting (Electrical Engineers
SPARKS and PARTNERS. London.
Registered Office.
HONGKONG & SHANGHAI BANK BUILDINGS, KUALA LUMPUR.
NOTICE IS HEREBY GIVEN THAT THE Twenty-second 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 Tuesday, 31st March, 1936 at Noon for the following purposes: —
To receive and consider the Balance Sheet and Accounts to 31st December, 1935 and the Reports of the Directors and Auditors.
To Declare a Final Dividend for the year 1935.
To Declare Directors' remuneration for the year 1935.
To Elect Directors in place of those retiring.
To Elect Auditors for the ensuing year.
The Share Registers will be closed from Tuesday, 24th March, 1936 to Tuesday, 31st March, 1936, both days inclusive.
By Order of the Board,
J. A. RUSSELL & Co., Ltd.,
Secretaries.
Dated 13th March, 1936.
Hongkong & Shanghai Bank Buildings,
Kuala Lumpur, F.M.S.
Malayan Collieries, Ltd.
(Incorporated in Federated Malay States.)
Directors’ Report for the Twenty-second Year of the Company ended 31st December, 1935.
The Directors have pleasure in submitting their Twenty-second Annual Report and Statement of Accounts for the year ended 31st December, 1935, together with the General Managers' Report upon the working of the Company’s undertakings.
Batu Arang Colliery. The quantity of coal sold shewed a further increase upon the lowest level reached in 1933, this being due primarily to the improved condition of the tin mining industry.
All plant and equipment, workings and roads were maintained in good order and condition.
Pamoekan Bay Colliery. This property remained in charge of a caretaker and there is still no prospect of a recommencement of operations.
General. The capital expenditure was of a general nature with railway construction and electrical equipment the principal items. The opportunity afforded by the completion of the Singapore Naval Base contract towards the end of the year was availed of to acquire some necessary excavating and rolling stock equipment.
The operation of the subsidiary undertakings was, as in the previous year, according to the demand for the products.
Arrangements for securing to the Company its future timber requirements were concluded.
The position regarding Cement remained substantially unchanged.
Investments. Advantage was taken of a favourable rate of exchange to realise upon the Hongkong Government 4% Conversion Loan and of the proceeds $15,600/- was invested in 3% Singapore Municipal Debenture Stock 1975/85.
Profits. The Profits for the year under
review, subject to the Directors' and Auditors' fees, amount to ... ... $469,970.98
To which is to be added the unappropriated
balance from the previous year ... ... 238,643.92
708,614.90
Deduct Three Interim Dividends each of 2J4%
totalling 7]/2% on 257,505 shares were paid during the year, absorbing ... ... 193,128.75
515,486.15
You will be asked to sanction fees to Directors in
respect of 1935 at the rate of ... ... $20,000.00
Auditors' fees at the rate of ... ... ... 2,500.00 22,500.00
Leaving available ... ... ... 492,986.15
Brought forward ... 492,986.15
Which your Directors recommend should be dealt with as follows: -
A Final Dividend of 5% on the 257,505 shares
making 12 ½ % for the year 1935 $128,752.50
Write off Leasehold Property ... 100,000.00 228.752.50
Balance to carry forward to next year's account ... $264,233.65
Directors. Mr. A. W. Delamore and Mr. J. Drysdale acted for a time during the year as alternate Directors.
Mr. W. H. Martin and Mr. F. Cunningham retire and being eligible offer themslves for re-election.
Auditors. Messrs. Evatt & Co. retire and, being eligible, offer themselves for re-election.
Kuala Lumpur,
13th March, 1936.
By Order of the Board,
J. A. RUSSELL & Co., Ltd.,
Secretaries.
Malayan Collieries, Ltd.
The Directors,
MESSRS. 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, 1935.
BATU ARANG COLLIERY. The sales shewed an increase of fully 23% on the previous year. The increase was principally in the demand for small coal caused by the additional release in tin quota over the latter half of the year.
Production. The bulk of the production was from underground sources, the Nos. I and 2 districts of the East Mine and Underground units Nos. 3 and 4 being the principal contributors. In all cases the longwall system of extraction continued with modifications where necessary to suit varying conditions. Hydraulic stowage arrangements continued to operate smoothly and enabled the maximum extraction of coal to be effected.
Underground Development. The extension of the main dip and its companion way was proceeded with and good progress was made towards the opening out of No. 3 district. No. 17 level was advanced gradually and a connection with the workings of Underground No. 3 unit will shortly be made.
Nos. 6 and 7 districts have been almost fully opened up and production at the rise side was commenced.
Opencasts. Production in Opencast No. 7 ceased owing to the limit of extraction being reached and work here is now of a cleaning up nature in conjunction with the winning of the coal block between opencasts Nos. 5 and 7.
No. 8 is now the main opencast producing unit and good progress was made with the extensive stripping programme referred to in last years report. The progress will be speeded up considerably when the 2J/2 cubic yard electric shovel recently acquired is put into commission. The effect of the commissioning of the four locomotives and the air tipping waggons also recently acquired is already apparent in the progress being made.
Coal Washery. This worked regularly throughout the year and satisfactory performance was maintained.
Buildings and Plant. These were maintained in good order and several temporary buildings were replaced by permanent ones. Extensions and modifications were also made to effect improvements in working. The power plant met all load requirements and, as in the past, the bulk of the fuel used in the boilers was of unmarketable quality.
The whole of the plant already referred to and acquired from Messrs. Sir John Jackson Ltd. comprising 4 x 30 ton steam locomotives, 30 x 12 cubic yard air tipping waggons, 60 x 6 cubic yard gravity tipping waggons and a 2J4 cubic yard electric shovel-dragline combination, arrived at Batu Arang just after the end of the year and the locomotives and air tipping waggons were placed in commission immediately.
Capital Work. Only necessary items were executed and the work was done within the estimated expenditure. The more important items comprised railway line extensions and yard remodelling, European and Asiatic quarters, general electrical equipment, workshops improvements, water-service improvement and extensions and general mine equipment.
Labour. On the whole the position was satisfactory and the work was arranged so as to keep an ample supply of labour on the property.
Johore Coal Syndicate. In order to ascertain the extent of an occurrence of coal in Johore this Syndicate in which your Company has the principal interest, was formed and boring operations have been in progress since March last year.
PAMOEKAN BAY COLLIERY. The position is unchanged and the property still remains in charge of a caretaker.
SUBSIDIARY UNDERTAKINGS.
Clay Working Department. The works remained closed down throughout the year and sales requirements continued to be met from stocks. Owing to the depletion of stocks, preparations were made towards the end of the year for recommencing operations.
Plywood Department. The production of the works amounted to about 5 ½ millions square feet of plywood, the bulk of which was utilised in the manufacture of rubber chests.
Timber. The pilot sawmill largely met the requirements of the property, in addition to which several parcels of lumber were prepared for the London market. Further extensions of railway lines were made in order to ensure future timber supplies for all purposes.
Wood Distillation Department. Owing to an accumulation of stocks the retorting operations were discontinued temporarily in November. The various products are satisfactory but progress is slow in establishing them on the market.
STAFF. Members of the staff have rendered excellent service and a good spirit of co-operation continued between all departments and individuals.
GENERAL. The general health of the resident population continued to be exceedingly good and the moral of the labour force remained at a high standard.
We are, Gentlemen, Yours faithfully,
J. A. RUSSELL & Co., Ltd.,
General Managers. Kuala Lumpur,
13th March, 1936.
Malayan Collieries, Ltd.
(INCORPORATED IN F.M.S.)
22
DIRECTORS' REPORT
AND
ACCOUNTS
For the Year Ended 31st December, 1935.
TO BE PRESENTED AT THE
TWENTY-SECOND ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD AT THE
Registered Office of the Company,
Hongkong & Shanghai Bank Buildings, Kuala Lumpur,
ON
Tuesday the 31st March, 1936,
At Noon.
J. A. RUSSELL & COMPANY, Ltd.
General Managers & Secretaries.
Malayan Collieries, Ltd.
(INCORPORATED IN F.M.S.)
PROCEEDINGS
AT THE
TWENTY-SECOND ANNUAL GENERAL MEETING OF SHAREHOLDERS
HELD AT THE
Registered Office of the Company,
Hongkong & Shanghai Bank Building, Kuala Lumpur,
ON
Tuesday the 31st March, 1936, 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 Twenty-second Annual General Meeting of the Shareholders of the Company which was held at the Registered Office, on Tuesday, 31st March, 1936.
Yours faithfully, J. A. RUSSELL & CO., LTD.,
Secretaries.
Dated 31st March, 1936.
Malayan Collieries, Limited.
(Incorporated in Federated Malay States)
Proceedings of the Twenty-second Annual General Meeting
The Twenty-second Annual General Meeting of Malayan Collieries, Ltd., was held at the Hongkong & Shanghai Bank Buildings, Kuala Lumpur, at noon on Tuesday the 31st March, 1936.
The Chairman, Mr. H. H. Robbins presided and the others present were, Messrs. W. H. Martin and F. Cunningham (Directors), W. G. C. Blunn, C. J. Chisholm, L. H. Eastman, C. W. S. Gardner, P. W. Gleeson, G. O. Hovil, L. R. Mackness (Shareholders), J. Ford (representing Messrs. Evatt & Co.) 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, 1935, addressed the Meeting as follows: —
Gentlemen,
At the outset I should like to explain the absence of Mr. R. C. Russell who has been ill. 1 am pleased to say he is now convalescent.
The Report and Accounts having been in your hands for at least the required period, may I assume it is your wish that they be taken as read?
The interests of your Company run on lines parallel to the prevailing conditions of the country, and such conditions having improved greatly during the year, it gives me much pleasure in presenting to you a report which maintains the upward trend which was indicated when I last addressed you.
You will observe a slight alteration in the presentation of the Accounts in that the appropriations of profit have been shown in a separate Profit & Loss Appropriation Account, and not under the Profit & Loss Account in the Balance Sheet as previously, and this, I hope you will agree, is an improvement.
The Share Capital remains unaltered.
The expenditure on Capital Account was wholly upon work necessary to the Colliery undertaking, and it will be seen that the amount has been more than covered by the provision for depreciation.
The amount of $200,000 allowed for "Depreciation" is roughly $21,000 higher than for last year, and under the circumstances, is regarded as adequate.
"Operating Stores and Spares and Trading Stocks" shew an increase of $149,000 due to a larger stock of general stores in keeping with increased activities, and to the inclusion in this account, pending allocation to other headings, of a quantity of plant received just prior to the close of the financial year.
"Sundry Debtors and Debit Balances" after allowing for the Reserve of $135,000 are higher by some $74,000; "Sundry Creditors and Credit Balances" are also higher by some $69,000. These increases, which shew a slight favourable balance, were the normal result of a larger turnover.
"Dividends Unclaimed" are lower by nearly $30,000, the reason being that more time than usual intervened between the payment of the third interim dividend and the close of banking business for the year.
With regard to "Investments", advantage was taken of a favourable exchange rate to dispose of our Hongkong 4% Loan. Your Board's application for the 1935 issue of 3% Singapore Municipal Stock was rewarded with an allotment of $15,600. The value of this and your holding in Singapore Traction Ltd, was at the close of the year $36,429.86, the amount in the accounts being this, less a Reserve of $10,000.
"Cash in Bank on Deposit, in Current Account and in Hand" was up some $86,340 on the year and of the total of $442,908.17, the sum of $400,000 was and is still on fixed deposit with our Bankers. This deposit is earmarked for investment, and in this matter it may be considered that our policy during recent years has been over cautious. Against this, however, the present spell of low interest rates has lasted longer than usual, and though it may continue indefinitely, there are undoubtedly signs of an easement of the pressure of cheap money, and the present trend of world events seems likely to aid rather than retard this. Having waited so long, we propose waiting until the position is clearer before investing these funds, together with any additional amounts that may become available.
The "Trading and Profit & Loss Account" reflects the larger volume of business, the net profit on the year's working being $469,970.98, or some $140,000 more than for the previous year. While this does not approach the figures achieved during the more prosperous years preceding the slump, it marks, I think all will agree, a very definite step in the right direction, with the soundness of your undertaking fully maintained.
The demand for coal within the F.M.S. shewed a satisfactory improvement, the principal influencing factor being the progressive increases in quota authorised under the Tin Restriction Enactment. The allowance for the opening quarter of the year was 40% International and 28.3% Domestic and that for the closing quarter 85% and 62% respectively. For the purpose of comparison, the figures for the current quarter are 90% and 65% and those for the second quarter of the current year 85% and 61%. While the latter are a little below the best, they show a decided improvement upon the figures for the corresponding quarter of the year just closed, which were 45% and 32.4% respectively.
With regard to sales beyond the F.M.S., though we tendered for, and hoped to obtain, the renewal of the contract for the supply of coal to the St. James Power Station in Singapore, this business was lost, purely on a price basis, to Japanese interests. There is, of course, a low limit beyond which we are quite unable to quote in an endeavour to secure such long distance business, and if we, in co-operation with the F.M.S. Railways, should not be able in future to bridge, on a calorific basis, the difference between that low limit and the price of foreign coal, we hope the difference will be so reduced as to justify the Commissioners regarding the amount as a worthwhile payment for the security which Batu Arang, as a source of supply for the coal requirements of their Power Station, would afford. In the meantime, the Municipal Commissioners have our assurance that we may always be relied upon to give emergency deliveries upon short notice.
With the very welcome improvement in the demand for our coal, it has become possible to intensify our stripping operations with a view to building up again our reserves of stripped coal. These reserves were drawn upon severely during the slump years, and the total reached its low point at the end of 1934. The tonnage was increased during the year under review, but it was not until towards its close, that we were able to augment our excavating and rolling stock equipment to make possible the more rapid restoration of the ravages of slump conditions. The General Managers have given in their report details of the purchase of the necessary equipment. The locomotive and wagon rolling stock, other than that used for stripping operations, was
required to augment that employed on other services about the property. When I say that our locomotives haul some 4,500 tons every day, that our own wagon rolling stock conveys some 3,000 tons, and that both figures, when the newly acquired plant is in full operation, will be substantially increased, it will be apparent that railway rolling stock is an important part of our equipment.
In the meantime, with the improved conditions, it has been possible to revert to the normal ratio of underground to opencast production, the object being to regard the latter more as an emergency than as a regular source of supply.
The labour position was easier than during the previous year. A considerable number of men were recruited direct from China, and as these were in excess of the normal quota, the special permits available enabled passages to be obtained at a very much reduced rate.
We have been engaged in investigating an occurrence of coal in North Johore, and for several months two power drills have been in operation. We are not yet in a position to arrive at conclusions in the matter, but so far, the results do not tend to support the earlier indications of a workable deposit. This is the occurrence of coal which is referred to in the report of the Geological Survey Department for the year 1935.
With regard to our various auxiliary undertakings, the year was not a particularly progressive one. The Brickworks remained idle throughout, though with the slight improvement in the building trade, deliveries have so reduced our stocks as to necessitate the re-starting of the plant, and it is now in the process of being brought to full production.
Recent developments in the treatment of "short" clays, such as those of Malaya, have been interesting, and after prolonged observations of the plant evolved, we have placed an order for a small experimental unit which we trust will overcome the difficulties associated with our raw materials. Progress has been disappointingly slow, but it is hoped that our patience and refusal to rush into the purchase of expensive unproved plant, will be rewarded with success from the small plant we have ordered.
Though we can say that the Plywood plant operated practically full time, the stocks towards the close of the year were such as to call for a slowing down of production, and this is still the order of the day. The position is being carefully watched and though the falling off in demand is due in part to the incidence of restriction, the increasing practice of baling rubber for export is also partly responsible.
I should like to repeat that our Malaply chests have stood the test of time, and to say that, never on one occasion in respect of the hundreds of thousands produced and sold have we been called upon to pay as much as a cent in claims on outturn. It is important that this be generally known, because while we have the competition of the alternative practice of baling, many users of chests continue to use a very much higher priced article than which we offer. Malaply chests would seem to be an almost obvious course between baling on the one hand and the use of more expensive imported chests on the other. It can be said, however, that a steadily increasing demand exists for our Malaply panels for building purposes.
The Wood Distillation plant ran somewhat intermittently, halts being called at intervals to make it possible for stocks to be cleared or reduced. While this is unfortunate, and continuous operation is aimed at, the overheads during stoppages are negligible. The plant is in charge of an experienced Research Chemist, who is always able to employ any respite from routine production, in the further investigation of various problems which it seems reasonable to assume will ultimately give ample reward.
The negotiations with Government for the securing to this Company of timber supplies for its various requirements for some years ahead, principally of course those for the Colliery, have been brought to a satisfactory close. In the meantime, the only further expenditure in this connection continues to be in the extension of our railway sidings into the selected area.
With regard to the proposed Cement works, the position remains much as it was when I last addressed you, though the matter has not been dormant in the interval. Nothing, however, will be done which is incompatible with your Board's present policy of consolidating the Company's existing interests and of building up its liquid position.
The staff at Batu Arang has rendered loyal and efficient service through a year which has called for the close application of all.
While I trust that I have dealt with everything that is expected of me, you will observe that I have refrained from any prediction regarding the outcome of the current year's working. The year in Malaya has opened in a promising way, and though there continues to be in the International situation more that is obscure and threatening than is clear and promising, we would seem justified in looking forward to the future with a greater degree of confidence than has been possible for several years.
1 now formally propose that the Balance Sheet and Accounts to the 31st December, 1935 and the Reports of the Directors and Auditors be received and adopted, which resolution I shall ask Mr. Martin to second.
Mr. W. H. Martin. I have pleasure in seconding the resolution before the meeting that the Reports and Accounts as presented be adopted.
The Chairman. Gentlemen, 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.
Mr. C. W. S. Gardner enquired whether it was necessary to reserve annually the amount of $135,000/- as provision for bad and doubtful debts. The Chairman stated that this reserve had been created over a period of years out of profits. Part of this reserve was primarily created against debts incurred some time ago which were considered doubtful but which were now being repaid, and the Board would review the position when repayment in full was effected.
Mr. Gardner stated that as the results of the past year's working had been very satisfactory and the position as disclosed by the Report and Accounts was sound, he had hoped that the Directors would recommend a larger Final Dividend than 5%. The Chairman replied that this matter had received the careful consideration of the Board but that it was deemed prudent not to recommend a dividend larger than 5%, thereby strengthening the liquid resources of the company.
Mr. Gardner asked whether it was possible for the company to publish its monthly outputs, as shareholders were not in a position to know what happened during the year. He believed that the figures appeared in the Government statistics.
The Chairman said that the matter would be considered although it had not been thought advisable to publish this information in the past.
The Final Dividend of 5% was unanimously approved on the motion of the Chairman seconded by Mr. W. H. Martin.
The Directors* remuneration of $20,000/- was unanimously approved on the motion of the Chairman seconded by Mr. P. W. Gleeson.
Mr. W. H. Martin was re-elected a Director on the proposal of Mr. H. H. Robbins seconded by Mr. F. Cunningham.
Mr. F. Cunningham was re-elected a Director on the proposal of Mr. H. H. Robbins seconded by Mr. W. H. Martin.
Mr. C. W. S. Gardner proposed and Mr. C. J. Chisholm seconded that Messrs. Evatt & Co. be re-elected Auditors for the ensuing year.
Mr. W. H. Martin then addressed the Meeting as follows: —
The Chairman in his speech referred to the loyal and efficient services rendered by the staff at the mine. You will appreciate, as your Board does, how this spirit of co-operation contributes materially to the benefit and success of the Company, but while that is so, I would also like to add and record our appreciation of the invaluable services given by our General Managers. I therefore propose a hearty vote of thanks to them and to all associated with the Company.
This motion was seconded by Mr. Chisholm and carried unanimously.
The meeting terminated with a vote of thanks to the Chair.
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., Ltd.
Ag. Colliery Suptd. F. Bellamy
Staff at Batu Arang in Alphabetical
Order.
C. W. Atkinson
J. Darlow D. L. Morgan
F. Gradon W. Prentice
G. Hinchcliffe J. A. Porteous
H. E. Marnie R. Scott
T. Marstrand E. G. Spall
R. G. Teale
J. H. Tubb