Document wgKw3oK0MqGYa5ro8gd68kQ0V

CSR73 Annual Report for the year ended March 31 1973 C 4635 Annual Report 1973 The Colonial Sugar Refining Company Limited Incorporated in New South Wales Annual Report contents 3 2 Results in brief 3 Directors' report 3 Profit and loss statements 7 Statements of assets and liabilities s Notes to the accounts 17 Directors' report cont'd--statutory reauirements 22 Review of operations 23 Sugar activities 23 Materials for building and construction 2s Mining 2s Other interests 27 Research and development 2s The environment 28 Staff 2s Australian sugar industry matters at Senior staff 3 C 4636 Kev to minerals on iront ao^er 1 iron ore 2 Grosum 3 Coocerare 4 Qaujtite The Colonial Sugar Refining Company Limited Incorooratea in New Soutn Wales 9 C 465? Directors Sir John Dunlop Chairman G B Kater Sir James Vernon J M Dixon (to 2816173) B B Riley TJN Foley K 0 Brown (to 28/6/73) R G Jackson General Management R G Jackson Genera! Manager D 0 Brown Deputy General Manager A J Campbell Deputy General Manager B N Kelman Deputy General Manager M G King Deputy General Manager Senior Executive Officers J F Blaxland J G Campbell N L Carter C W Davis R W Harvey A W McAuley R N Seiman A V Shaw Secretary J H Tuckfield Registered Offiee 1-7 O'Connell Street, Sydney Share Registers Sydney (principal register) Adelaide. Brisbane. Canberra, Hobart. Melbourne, Perth and Auckland 1 Results in brief The Colonial Sugar Refining Company Limited and its Subsidiaries For the year Gross saies Group sales 1973 i972 S million S million 676.2 375.6 565.8 349.2 Profit before tax Tax provided Profit after tax Minority interest in profit Net profit for the year 42.7 16.1 26.6 3.3 23.3 39.5 15.7 23.8 3.2 20.6 Earnings per share --on issue at start of year --on issue at end of year Oividend per share Return on gross sales At year end issued capital Reserves and unappropriated profits Shareholders' funds 31.3c 27.9c 27.6c 27.6c 14.5c 14.0c 3.45% 3.64% $ million S million 83.8 18S.9 269.7 74.5 183.5 258.0 Return on shareholders' funds 8.65% 7.96% Gross sales includes sugar sales made as agent: group sales includes sugar sales only to the extent ol group equity therein. Total sales by subsidiaries are included: but sales ot associated cooi- oames. none ot which are consolidated, are not included. Consolidated Funds Statement Source ot funds Consolidated net profit Provision for replacement income tax provided Other non-cash items (net) Minority interests (net) Long-term borrowings Assets sold Application of funds Loan repayments Expenditure on fixed assets Investments in joint ventures etc. Mineral exploration and development expenditure Dividends paid income taxes paid increase in working capital C 46 38 1973 SOOO 23.340 24,116 16.075 10.916 10.969 22.785 3.762 111.963 6.633 18.834 23.978 2.664 10.425 10.517 38.712 111.963 2 118 years of growth CSR has a record of 118 years of growth. Formefl m 1855. as a partnership with unlimited liability. CSR's business was initially sugar refining m Sydney, in 1887. CSR was incorporated as a limited liability company, and since then has paid a dividend to its shareholders every year. Today. CSR is one of the large indus trial and commercial organisations in Australia with widespread activities m sugar, materials for building and con struction, mining and various other interests. )) )) Consolidated net profits D 1) Directors' report fv ^ t <* J r C 4639 The Directors submit herewith the statements of profit and loss and of assets and liabilities of the parent company and the consolidation of the parent company and subsidiaries tor the year ended 31st March 1973, together with the notes attached to and forming part of the accounts. Dividend* An interim dividend of 7c per share was paid by the parent company on 18th December 1972. The Board proposes to pay a final divi dend of 7V2C per share. The bonus shares issued on 31st January 1973 qualify for the final dividend. Subject to the adoption of this report the final dividend.of 75/2C per share will be pay able on 25th July 1973. in respect of share holdings registered at the close of business on 20th June 1973. Profits and appropriation* The profits and appropriations are set out in the profit and loss statements. Consolidated net profit of the group for the year was $23,339,596, or 13.6% higher than for last year. Sugar activities contributed about $7.2 mil lion towards this group net profit; materials for building and construction about $7.4 million; and mining about $7.9 million. Our other interests accounted for the balance. Operations Information and comment on our more impor tant activifes, including some not mentioned in this section, are provided in the review of operations, which forms part of this report. The Australian raw sugar industry achieved record production in the 1972 season, but in our mill areas both in Australia and Fiji weather conditions were adverse. Our Australian mills made 500,000 tons of raw sugar compared with 566,000 tons in 1971; in Fiji production fell from 317,000 to 300.000 tons. The lower pro duction reduced milling profits. Although the world free market price of raw sugar remained s>f John Ountoo Chairman high, and average prices received by our mills were better, the contribution to group profits of the Fiji mills was only slightly higher than last year, and the Australian mills' was some what lower. Profits from our other sugar activities were much the same as last year. On 1st April 1973 our shareholding in South Pacific Sugar Milts Ltd. and our Fiji lands were transferred to the Fiji Government, in accor dance with the sales agreements previously reported. Our business in materials for building and construction achieved significant growth and higher profit. Activity in the Australian building industry is estimated to have been 7% higher than in the previous year. This growth resulted in strong demand for most of our building materials, and sales were 12% higher than last year. A large new factory is being built to expand production capacity for Gyprock plasterboard, one of our best-selling materials. A modern clay tile tunnel kiln began producing in Decem ber. A plant, half-owned by CSR, for extruding aluminium sections for windows, started up in May 1973. Pyneboard Pty. Ltd. (50% CSR) has ordered a plant, to be in production next year, to manufacture a thin particle board by a new process. The Mt Newman iron ore venture shipped 23.2 million tons of iron ore this year com pared with 19.3 million last year. There has been a strong recovery of world demand for iron ore, particularly in Japan, where cut backs in contract tonnages previously reported were less than expected. To cover commit ments under contracts and in the light of the recovery in demand, the joint venturers have authorised the expansion of Mt Newman's annual capacity to 35 million tons by the end of 1974. CSR's participation in Mt Newman is through its 68%-owned subsidiary. Pilbara Iron Ltd., which has a 30% interest. 3 Directors report conunuea 0t?9t? 0 Prices in Pilbara Iron's export contracts have been expressed in United States dollars. In the main the contracts are long term contracts negotiated up to eight years ago. Obtaining those contracts was of course a matter for commercial negotiation and of reconciling in an internationally competitive environment the interests of buyers as well as sellers. During the year under review the US dollar was again devalued and the Australian dollar upvalued: but the consequential reduction in our group revenues for the year was not great. The foreign currency proceeds of established con tracts for iron ore (as well as sugar and some other products) due in the short term had been sold forward, at some cost. By this means a breathing space was obtained in which to work to protect our revenues tor the longer term. Pilbara Iron Ltd. has since negotiated with its Japanese customers increases in iron ore prices with effect from 1st April 1973. These increases will give substantial relief from the effects of the currency changes, although fall ing well short of restoring the Australian collar revenues to those which would have been re ceived at the exchange rates operating prior to December 1971. In the case of sugar, the `supply commitment price- (explained elsewhere) in the Interna tional Sugar Agreement has been varied to take account of changes in currency parities. Other modifications of the ISA to alleviate the effect of currency changes are being sought in the renegotiation of the agreement which is taking place this year. Gove Alumina Ltd. (51% CSR) is the Aus tralian joint venturer in the Gove project. Alumina shipments commenced in August 1972. For the year. Gove Alumina Ltd. exported on its own account 80.000 tons of alumina and 1.073.000 tons of bauxite. Construction of the Gove alumina plant second stage, to take annual capacity from 500.000 to one million tons, is virtually complete. In March 1973 Gove Alumina Ltd. acquired a 10% shareholding in the Mitsui Alumina Co. Ltd. which has recently begun to produce alumina in Japan using bauxite from Gove. Mineral exploration continues through the Pacminex group of subsidiary companies. Re cent exploration for copper in previously un tested areas near Mt Gunson in South Australia is encouraging. CSR Chemicals Ltd. (50.3% CSR) had a diffi cult year, ending with a ioss. Results from CSR distilleries improved. Aus tralian National Power Alcohol Co. Pty. Ltdacquired in April 1972, made a useful contri bution to profits. The Carba group of companies reported improved results. Protection of the environment receives the continuing attention of management and re quires substantial capital expenditure. Greater capital outlays and higher operating costs are anticipated in line with higher community ex pectations and standards. Accounts The presentation of the accounts has been changed considerably. As explained in Note 1 to the accounts, this has been done both to com ply with the changed requirements of the law and in the interests of clarity. The increase in non-current liabilities and provisions is due mainly to further debenture issues by Gove Alumina Ltd., to an unsecured bank loan raised by the parent company, and to a substantial increase in provision for deferred tax. Stocks, debtors and creditors relating to the companys contractual arrangements with the Queensland Government, in connection with the marketing, handling and financing of the Australian sugar pool, which were previously included under their respective headings in the accounts, are not so included this year. Only the net balance with the Queensland Government is included. This rearrangement is 4 directors' recort contmuea the major cause of the substantial changes shown for current assets and liabilities. Note 22 gives information to enable a comparison to be made with the corresponding figures for last year. The accounts of South Pacific Sugar Mills Ltd. have been consolidated notwithstanding that procedures for confirmation of the final audit thereof laid down m the agreement scheduled to the Sugar Industry {South Pacific Sugar Mills Limited Shareholding) Act 1971 of Fiji have not been completed, as referred to in Note 2. No material change in the group results is anticipated on completion of those procedures. The provisions previously made for the loss on sale of Fiji-assets have been reduced, as set out in Note 11, due to currency devalua tion by Fiji. The reduction is incorporated in the detail of overall losses due to currency devaluation shown in Note 8. Change of name The present name of the company has stand ing and a proud tradition. Under it our com pany has been able to carry on with success a diversity of business, despite being in name a sugar refining company. Nevertheless the name falls short of being evocative of the business carried on, and it has other limitations. A search for a more appropriate name has not indicated a new name which would be better than CSR. by which the company increasingly has become known. Shareholders will be asked to approve at the annual meeting that the name of the company be changed from The Colonial Sugar Refining Company Limited to CSR Limited. Board Before the annual meeting Mr. J. M. Dixon and Mr. K. 0. Brown will have retired as directors under the provisions of Article 88. The directors have given much thought to the most desirable future composition of the board, in the light of the company's increasing diversification and planned growth. It has been decided to recommend to shareholders that Article 88 should be amended so that the board will have power to appoint as directors under that Article from among the officers of the company a maximum of five (including the general manager) instead of three as at present. The board recommends that Article 87 should also be amended so that the number of directors, other than those who may be appointed under Article 88. should become seven instead of five. Further, as will be seen from the agenda for the annual meeting, it is being recommended that the fees payable to non-executive directors should be increased by an amount which will enable each individual director's fee to be raised, and also provide for two additional non executive directors. The board also considers that it is proper and desirable that retiring allowances should be payable to non-executive directors on re tirement or death after appropriate length of service. Shareholders' approval, in the form of an alteration to the Articles, will be sought at the annual meeting. A letter giving details of the proposal accompanies the notice of that meet ing. If approval is given, consideration will be given to making corresponding arrangements where appropriate for some non-executive directors of subsidiaries. Statutory requirements This report is continued commencing at page 17. 5 The Colonial Sugar Refining Company Limited Profit and loss statements for the year ended 31st March 1973 4642 6 Profit from trading Add dividends from Subsidiaries Other corporations See Note 4 23 Consolidated 1973 1972 $000 sooo 37,933 35.278 4,768 _ 4.222 Parent ] 1973 1972* SOOO SOOO 12,898 11.321 6,830 4,630 ,J 4.111 Less: Provision for income tax Proportion applicable to minority interests Net profit for the year Add: Unappropriated profits brought forward Adjustments to unappropriated profits 42.701 39.500 24,368 22,445 6 16.07S 15.729 3,922 4.130 3,286 3.228 -- -- 23,340 20.543 20,436 18.315 23,667 19.657 7,101 JV 5.627 7 799 1,892 1,032 1.584 Less Appropriations: Transferred to revenue reserves Dividends to shareholders of CSR Interim dividend paid Final dividend proposed 8 Unappropriated profits carried forward Profits ana losses on the sale or revaluation of non-current assets have not been dealt with m the orofit and loss statements above. These profits and losses on non-current assets arise largely from revaluations oue to currency changes. (See Note 6.) Profit from trading as shown above m the orofit and loss statements s alter making tne orovisions referred to m Note 4. Motes on and forming part of the accounts for 1973 are annexed 47,806 8,256 42.092 8,000 5,213 6,283 5,213 5.212 28,569 8,000 25.52.4 8.000 5,213 6,283 5.213 5.212 28,055 23,667 9,073 7,101 Statements of assets and liabilities as at 31st March 1973 See Note Authorised capital. 125.000.000 shares of $1 eacn Capital issued. 83.775.917 fully paid SI shares (1972 74.467.482) Reserves and unappropriated profits 8 Equity of outside shareholders Exchange fluctuation account 9 Provision for replacement of fixed assets 10 Provisions for loss on sale of Fiji assets 11 Bank overdraft: N.Z. sugar price stabilisation account 12 Non-current liabilities and provisions 13 Current liabilities and provisions 14,22 Contingent liabilities 15 Consolidated 1973 1972 sooo SOOO 125.000 125.000 Parent 1973 1972 SOOO SOOO 125.000 125.000 83,776 185,931 50,269 1,695 160,461 6,841 2,844 171,860 83,369 74.468 183.494 39.299 156 143.000 9.414 -- 144.670 141,935 83,776 164,697 -- -- 85,883 117 -- 32,087 67,782 74.468 165.674 -- -- 79.315 709 -- 23.803 109.680 TOTAL FUNDS AND LIABILITIES Fixed assets Interests in joint ventures and partnerships Investments Term debtors N.Z. sugar price stabilisation account {see contra) Mineral exploration Current assets 747,046 736,436 434,342 453.649 16 17 18 19 12 20 21, 22 313,430 220,743 61,428 12,371 2,844 -- 136,230 307.371 199,025 58.300 13,470 -- -- 158,270 189,840 682 148,963 -- -- -- 94,857 185.435 751 136.629 -- -- -- 130,834 TOTAL ASSETS Notes on ana forming part of trie accounts for 1973 are annexed 4643 747,046 736,436 434,342 453.649 7 Notes to the accounts Note 1 Changes in treatment and presentation Changes have been made this year in the treatment ano pre sentation ot the accounts in order to make them easier to read and to comply with the 1971 amendments to the N.S.W. Companies Act. There is a material change in the treatment of stocks, deotors ano creditors items in the statements of assets and haoiiities relating to the company s contractual arrangements witn the Queensland Government. This is referred to in Note 22 where information is given to enable this year s figures to be compared with those of last year. In certain other esses to permit comparability, figures in respect of 1972 have been restated. This applies particularly to current and non-current liabilities and provisions and to current assets. // The parent company is a company of the kind specified in the order dated 20th Decemoer 1972. made by the Commissioner for Corporate Affairs permitting the rounding off to the nearest S000 of amounts'in accounts and directors' report. ' Note 2 Consolidation of SPSM The accounts of South Pacific Sugar Mills Ltd. have been consolidated notwithstanding that the procedures for confirma tion thereof laid down in the agreement scheduled to the Sugar Industry (South Pacific Sugar Mills Limited Sharehold ing) Act. 1971. of Fiji has not been completed and consequently the accounts have not been signed by the SPSM directors or formally reported on by the SPSM auditors. No material change in the group results is anticipated on completion of such procedures and the accounts are acceptable to the auditors tor consolidation. Note 3 Currency conversion The value o! all overseas assets and liabilities has been con verted to Australian currency at the rates ruling at balancing oates. except for investments in non-related companies which have been shown m $A as at the date of acquisition or valuation. The resulting deficiency in respect of non-current assets has been charged to reserves (see Note 8) Surpluses from the conversion of non-current liabilities have been taken to Exchange Fluctuation Account. All overseas items in the profit and loss statements nave been converted to Australian currency at exchange rates ruling at balancing dates. Note 4 Profit from trading includes Interest received from subsidiaries and is arrived at after charging Provision for the replacement of fixed assets Other provisions Mineral exploration Losses in subsidiary mining companies Long service leave Accrued annual leave Doubtful debts.-Trade Other Pensions Sundry costs Directors emoluments received or due and receivable -- Directors engaged in the full-time employment of the company or its subsidiaries tother than fixed salaries) Non-executive directors of parent Other directors interest paid, to subsidiaries to others Consolidated 1973 1972 $000 SOOO 24.116 1,004 -- 1,522 768 456 137 1.695 401 21.221 2.433 -- 1.408 702 267 -- -- 1.049 1 35 28 -- 10.943 1 35 28 -- 9.658 Parent 1973 1972 SOOO SOOO 123 100 9,506 9.083 1,004 261 1,085 764 97 137 1,500 119 2.439 819 1.258 847 121 -- -- 588 -- 35 -- 346 3,270 -- 35 -- 296 3.719 8 Notes to the accounts conrmuea Note S Auditors' remuneration Amounts received or due and receivable by auditors: For auditing the accounts Other services The auditors received no benefits other than the amounts snown. Consolidated 1973 1972 sooo SOOO 110 98 30 9 Parent 1973 972 SOOO ;.000 24 16 74 Note 6 Provision for income tax Provision for income tax for the year Provision for deferred income tax 6.780 9.295 7 747 "982 3.922 -- 4 130 -- > 16.075 15.729 3.922 4 130 The amounts set aside for taxation m me attached accounts differ by more tnan 15% from tne income tax which wcuid be payable if me taxable income of the company was equal to the profits snown m me accounts This note explains the maior items responsible for the difference. Tax payable if taxable income eaual to profits m accounts Amounts set aside for payment of tax 20.283 16.075 11.570 3.922 Difference 4.208 7,648 Difference due to: Rebates on dividends received and included in profits 2.265 Deductions allowable for share moneys subscribed to mining companies Investment allowance for expenditure on plant and machinery 4.607 837 Overseas tax rates Losses in subsidiaries Other items 309 304 204 Less: Increases in provisions for future costs and losses--not allowable as tax deductions r this year (1.643) Amount provided for replacement being in excess of depreciation allowable for tax purposes (1.920) Additional provision for deferred tax resulting from Section 77D declarations made by mining companies in favour of their shareholders Dividend withholding tax In respect of dividends frqm overseas subsidiaries (601) (154) 4.208 V S.443 4.607 427 9 -- 128 (1.444) (1.368) -- (154) 7.648 Note 7 Adjustments to unappropriated profit (after allowing for the amount applicable to minority interests) Overprovision of income tax for previous year Provision surplus to requirements for diminution in value of stocks Provision no longer required for replacement of port facilities Sundry Less: Reduction in balance of unappropriated profits brought forward due to currency changes Increase in provision for long service leave--award change for orior years service Provision created for compassionate allowances to former employees in Fiji in respect of past service Adjustments to unappropriated profit 90S 1.204 -- 98 2,207 1.587 -- 247 58 1.892 337 -- 901 -- 170 799 1 892 836 967; -- 98 1.902 1 584 -- -- 1 584 -- -- ' 870 -- 1.032 t 534 C 4645 9 .,:ss ; :-e 2CCC Note 8 Reserves and unappropriated profits Reserves: Snare Dremium Capital Revenue Unappropriated profits Movements m Reserves: Share premium: The issue to shareholders of bonus snares at the rate of one for every eight held Capital: Surolus on sale of non-current assets: Sale of freehold land Sale of investment Less dividend paid to parent Loss on sale of non-current assets (being loss on sale of investments) Surplus on revaluation of non-current assets: Reduction in provisions for toss on Fiji assets (see Note H) Excess of net tangible assets over purchase price of a subsidiary Loss on revaluation of non-current assets: Loss on New Zealand and Fiji assets due to currency devaluation Loss on revaluation of investments Consolidated 1973 1972 sooo SOOO 39.686 26.719 91.471 48 994 27 661 33.172 157.876 159.827 28.OSS 23.667 185.931 183.494 Consolidated 1973 $000 (9.308) Parent 1973 972 SOOO SCOO 39.686 26.798 89.140 43.994 23 439 SI 140 1S5.624 153.573 9.073 7 101 164.697 165.674 Parent 1973 $000 (9.3081 203 203 2.573 301 (4,558) (225) 1.048 (81) 2.874 2.573 301 (4.258) (225) 39 )) 71) 2.874 Revenue: Transfer from profit and loss account Other transfers Note 9 Exchange fluctuation account This item represents unrealised gains arising from loans to subsidiaries raised in United States dollars. (942) (1,641) 8,255 44 8.299 8.000 8.000 to in the 1972 accounts the amount was included in reserves and is now restated. Note 10 Provision (or replacement of fixed assets The method by which the replacement of fixed assets is dealt with is: Provision for replacement of all fixed assets, other than freehold land, is calculated by applying appropriate rates to the book values of the assets, or by applying appropriate rates per unit of throughput. The total amount so calculated is a charge against revenue and is credited to the Provision for replacement. The cost of renewal or replacement of fixed assets is Note 11 Provisions for loss on sale of Fiji assets Provision for loss on sale of shares in SPSM Ltd. Provision tor loss on sale of Fiji land C- 4646 10 charged against the provision to the extent of the book value of the assets renewed or replaced after deducting therefrom any sales proceeds of such assets. Other than for land, and in exceptional circumstances for other assets, no surplus or deficiency is recorded on the sale or disposal of fixed assets. This provision includes provision for replacement of the fixed assets included in joint ventures in the consolidated accounts. Consolidated and Parent 1973 $000 1972 SOOO 6,724 117 8.705 709 6.841 9.414 'otes tc me accounts continued Note 12 N.Z. Sugar price stabilisation account "he items New Zealand Sugar Price Stabilisation Account and contra :consondatedi relate to an agreement between re New Zeaiano Sugar Company Ltd. ano me New Zealand Gov ernment. maoe unoer the provisions of me Finance Act 1972. wnereby me comcany agreed to maintain for a limited period me domestic selling prices of sugar and sugar products m New Zealand at me prices for those products existing on 3ist "arch 1972. The difference between the actual ourchase price of raw sugar and the notional price for domestic oncmg purposes is me figure appearing in tne New Zealand Sugar Price Stabilisa tion Account, and represents a deferred cost. The recovery of this cost is met from a special barn? over draft. the repayment of which is protected by the agreement. The profit of New Zealand Sugar Company Ltd. for the year has been arrived at m accordance with the terms of the agreement with the New Zealand Government. Note 13 Non-current liabilities and non-current provisions Term liabilities: Cebentures neid by other persons issued by CSH (1974-1980) Pubara iron Ltd. (1974-1983) Gove Alumina Ltd. (1975-19861 Carba Australia Ltd. 11974-1984) Secureo loans reoayaoie later tnan twelve months M973 bariK Si 114000. other S2 353 000) Unsecured loans repayable later than twelve months 11973 consolidated bank S5.300.000. other S2.061 000. parent bank S5.000.000. other mi) Provisions: Provision for non-current long service leave Provision for non-current accrued annual leave Provision for non-current pensions Provision for deferred income tax Sundry Consolidated 1973 1972 $000 sooo 17.382 52.907 53.593 795 3.467 17.439 60 574 37.900 336 3.503 7,361 1.316 9.135 1,690 1.118 24.235 177 7.131 1.031 -- 14.940 -- 171.860 144.670 Parent 1973 1972 SOOO SOOO 17.382 17.439 :5.000 7.069 1.686 950 5.357 1.007 32.087 23.803 Note 14 Current liabilities and provisions Bank overdrafts (secured 1973 consolidated SI .375.000. parent S24.Q00) Loans repayable within twelve months (see below) Trade creditors Other creditors Amounts owing to subsidiary companies Provision for current income tax* Provision for final dividend Other provisions (see below) Loans repayable within twelve months: Sank loans--secured Bank loans--unsecured Other loans--secured Other loans--unsecured Debentures--;Ptlbara Iron Ltd. $6.680.000. Carba Australia Ltd. S157 000) Other provisions: Provision for uninsured losses and future claims Provision for overhauls, renewals and repairs Provision for current long service leave Provision for current annual leave Provision for current pensions Provisions sundry "Provision for income tax includes the liability for dividend withholding tax on unaopropnated profits of overseas subsioianes. 2.279 23.479 35,876 4,889 4.572 38.654 69.308 6.954 7,416 6.283 3,147 12.201 5.213 5.033 83.369 141.935 983 116 99 15.444 6,837 ___ -- 2.970 31.919 3.765 23,479 38.654 673 1,079 528 149 550 168 3,147 769 2.349 1.184 372 -- 359 5.033 24 11,921 21.992 1.627 20,310 4.008 6,283 1.617 78 18.303 59.270 4.248 11.729 7.796 5.213 3.043 67.782 109.680 11,921 18.303 11,921 630 52 300 85 550 18.303 560 1,255 856 372 1,617 3.043 11 ';o:es to :ne accounts contmuea Note IS Contingent liabilities and capital expenditure contracted for Contingent liabilities: Sundry liabilities--ail unsecured Liability as self-insurer--the parent company is authorised to act as a self-insurer in New South Wales ana South Australia in respect of Workers' Compensation Insurance against which it is considered adequate provision has- been made. Liability under a covenant by the parent company m respect of Gove Alumina Ltd. to pay to Gove Alumina Ltd. the amount of the deficiency m the event of its being unable to meet its agreed share of construction costs of the Gove bauxite-alumina project, it is considered unlikely that any such deficiency will arise. Contracts for Capital Expenditure Sundry contracts in respect of buildings, plant and equipment for wnich no provision has oeen made m the accounts for the year Liability for capital uncalled on shares held in subsidiary and other companies Consolidated 1973 1972 $000 SOOO 2,934 3,157 8,319 8 14,943 408 Parent 1973 1972 SOOO SOOO 3.490 5.023 1,897 $.029 1,613 13,697 Note 16 Fixed assets Freehold land, office and residential property as under: 1955--Officers' valuation 1956--Officers'valuation 1959--Officers' valuation 1962--Officers' valuation 1964--Officers' valuation 1965--Officers' valuation 1966--Officers' valuation 5967--Officers' valuation 1967--Independent valuation *969--Officers' valuation 1971--Officers' valuation 1971--independent valuation 1973--Officers' valuation At cost Machinery, plant, equipment and factory buildings as under: 1955--Officers' valuation 1956--Officers' valuation 1959--Officers' valuation 1962--Officers' valuation 1963--Officers' valuation 1964--Officers' valuation 1965--Officers' valuation 1967--Officers' valuation 1970--independent valuation 1971--Officers' valuation 1971--independent valuation At cost C 4643 12 2641 104 $3 r 10,846 612) 1,051 65 23 375 . 70 581 72 18 14,768 11.431 3.627 13.971 28,912 29.079 9,709 65 23 375 10,732 20,904 10.200 21.146 803) 1,633 [ 950 f 69,613] 74.876 963) 5| 25] 5^ 8.860) 2,565] 5] 12.324 199.091 191.092 284,518 278.292 313,430 307.371 64,864 66.531 8.8605] 1 SJ 9.461 95.202 88.297 168.936 164.289 189.840 185.435 Noses :o :ne accounts continues Note 17 interests in joint ventures and partnerships Consolidated 1973 1972 $000 SOOO Parent 1973 '972 SOOO SOOO interests in joint ventures: investment by Pilbara Iron Ltd. m the Mt Newman iron ore project investment by Gove Alumina Ltd. m the Gove oauxite-aiumma proiect investment by Pacminex (Operations) Pty. Ltd. and Mt Gunson Mines Pty. Ltd. in the Mt Gunson copper project The above investments comprise: Cost of plant and equipment, leasehold improvements and construction in progress deluding exploration, development and administration costs) 214.634 196.126 Plus excess of current assets S11.030.000 (1972 S14.093.000) over current liabilities 5.393 2.146 S5.637.000 (1972 S11.947.000) Administration costs of the year m respect of that part of the Gove joint venture 220.027 198.274 project, which has not yet commenced production, include: Interest paid on debentures S2.423.000. less received on short-term deposits S35.000 'J Debenture and share issue expenses Si 27.000 interests m partnerships: Hardie-8.1.. Australian Chemship Line, and Shipven 716 751 682 751 220.743 199.025 682 751 Note 18 Investments Shares in-- Corporations quoted on prescribed Stock Exchanges Quoted market value Parent S29.928.000 (1972. S25.300.000) Consolidated $31.603.000 (1972. S26.733.000) Corporations not quoted on prescribed Stock Exchanges 1965--Officers' valuation 1973--Officers' valuation At cost Shares m subsidiary companies as under: 1967--Officers' valuation 1970--Officers' valuation 1971--Officers' valuation 1972--Officers' valuation 1973--Officers' valuation Less: Provision for loss on sale of shares in South Pacific Sugar Mills Ltd. At cost Less: Provision for mineral exploration Less: Provision for losses in mining subsidiaries Debentures of a subsidiary company, at cost 25.572 22.738 24.384 21.549 25.572 22.738 24.384 21.549 25,110 14 10.732 35.856 25.111 10.451 35.562 25.091 14 9.270 34.375 25.091 9 080 34.171 61.428 58.300 40.415 11.335 3,093 662 1.842 43.594 ? 1.335 3.093 662 57.347 58.684 6,724 8.705 50.623 49.979 48.725 36.809 99.348 7,867 1,417 88.788 6.863 1.156 90,084 80.769 140 140 148.963 136.629 Note 19 Term debtors This amdunt refers to Pilbara Iron Lid. and consists principally of a debt payable by the Port Hediand Port Authority over a period of vears.________________________________________________ C 4649 13 Notes 10 tie accounts conimuea Note 20 Mineral exploration Cumulative balance to date on current projects Less: Provision by parent company 0S9t' j Consolidated 1973 1972 sooo $000 7.967 6.863 7,867 6.863 Note 21 Current assets Stocks on hand (see below) Work in progress at lower of cost or net realisable value Debtors (see below) Amounts owing by subsidiary companies Short term deposits Cash at banks and on hand Stocks on hand Finished goods--at lower of cost or net realisable value Raw and process materials--at cost* Spares, maintenance stores and supplies--at cost, less provision for diminution in value Consolidated 1973 1972 SOOO $000 30,497) 1290 ( 4'*ww 53,453 79,000 1:i| ** 136.230 158.270 12.501 11,732 6,234 30.467 Parent 1973 1972 $000 SOOO 31,587 15.928 35.469) 556 j 29000 59.780 10.599 31 4gl 94.857 130.834 4.506 3,353 3,240 11,099 The amount for stock on hand has been arrived at after making deductions for possible diminution in value `Raw sugar stocks of S4.54S.000 have been valued in accordance with the conditions o< the New Zealand Sugar Price Stabilisation Agreement (See Note 12). Debtors Trade debtors Less: Provision for doubtful debts Ocher debtors and prepayments Less: Provision for doubtful debts Loans to directors of the company and to directors of its subsidiaries (all such loans are to directors in the full time employment of the company or of a subsidiary) Bad debts written off to provisions 230 1.654 38.784 1.476 37,308 16,002 203 15,799 346 16.145 53.453 503 44.216 1.542 42.674 36.110 86 36.024 302 36.326 79.000 414 134 1.171 18,434 812 17.622 13,976 203 13,773 192 13.965 31.587 97 26.031 812 25.219 34.437 66 34.371 190 34.561 59.780 54 Note 22 Sugar contracts (consolidated and parent) Stocks, debtors and creditors relating to the company's con* tractual arrangements with the Queensland Government, pre viously included under their respective headings in the accounts, are not so included this year. Only the net balance with the Queensland Government is included as a debtor. The totals appearing last year included the following tor the Queensland Government contract: SOOO Stocks 17.389 Debtors 21.198 Less Creditors 38.587 42.642 4.055 14 Notes 10 r>e accounts contmuea Note 23 Particulars relating to subsidiary companies: Mama Piece Contribution ot in to Group' corpora Profit (loss) tion S Oividends to CSR* 3 Class ot share Asbestos Products (Safes) Ply. Ltd. N.S.W. -- A 4 8 ordinary $2 Australian National Power Alcohol Co. Pty. Ltd. Australian Quarries Pty. Ltd. Old. N.S.W. '28.365 30.799 '! 128.000 Ord. 52 A 4 8 ordinary SI Gravel and Sand Suppliers Pty. Ltd. independent Concrete Pty. Ltd. N.S.W. N.S.W. 49.587 ; 14.919 yj.UaUaay Ord. 51 Ord. 51 independent Concrete (Pendfe Mill) Pty. Ltd. N.S.W. 8.1. Holdings Pty. Ltd. N.S.W. 757 25.516 ' Ord. 52 Ord. 52 8 1. (Australia) Pty. Ltd. N.S.W. 1.077 : A 4 B ordinary 52 Sradford insulation industries Pty. Ltd. 1 Bradford insulation (Qld.) Pty. Ltd. N.S.W. Qld. 436.078 | 53.219 f 003.AUAUAv Ord. 52 A ordinary 4 Bradford insulation (Vic.) Pty. Ltd. Building Finance Ltd. 2 Vic. Fiji 1 129.285 - -- ordinary 52 Ord. 52 Ord. SF2 Carba Industries Ltd. Vic. 2.948 ' Ord. 51 / Caroa Australia Ltd. Vic. 447.738 , 477.000 Ord. SI Waldown Pty. Ltd. V Commonwealth Distilleries Pty. Ltd. Vic. 32.776 . Ord. 51 Qld. 8.971 9.000 Ord. 51 CSR Chemicals Ltd. 4 N.S.W. (192.774) 402.169 Ord. 51 Robert Corbett Pty. Ltd. The Newcastle Chemical Co. Pty. Ltd. CSR Flooring Sales Pty. Ltd. CSR Provident Fund Nominees Pty. Ltd. CSR Researcn Pty. Ltd. Dia Plastics Pty. Ltd. Frome C02 Pty. Ltd. Gove Alumina Ltd. N.S.W. N.S.W. Vic. N.S.W. N.S.W. N.S.W. N.S.W. NSWN.S.W. (8.375) (77.283) 881 -- 55.033 8.709 4.S52 420.758 500 S5.000 9.000 4.500 Ord. 52 Ord. 52 Ord. $2 Ord. 52 Ord. $1 Ord. 52 Ord. 51 Ord. 51 Non-red. 7%% pref. 51 Independent Concrete (Contractors) Pty. Ltd. N.S.W. r J. L. Leonard Pty. Ltd. _ Vic. Vic. -- 5.367 5.500 Ord. 51 Ord. $2 6% Cum. gref. 52 Macadamia Nuts Pty. Ltd. N.S.W. 120 A 4 8 ordinary S2 McCaffery Services Pty. Ltd. N.S.W. 74.781 74.500 Ord. 51 Masonite Corporation (Aust.) Pty. Ltd. Mitcham Properties Pty. Ltd. N.S.W. Vic. 525.327 1 S.433 532.500 Ord. stock units 52 Ord. 52 c Midatco Pty. Ltd. Mineral Engineers Pty. Ltd. Mount Gunson Mines Pty. Ltd. W.A. A.C.T. S.A. 189.561 -- (22.234) 189.500 Ord. 52 Ord. 51 Ord. 51 New Zealand Sugar Co. Ltd. 3 N.Z. 310.491 200.000 Ord.SNZI Pacminex (N.Z.) Ltd. 3 N.Z. -- Ord. SNZ1 Pacminex (N.S.W.) Pty. Ltd. N.S.W. {65.3541 Ord. 51 Pacminex (N.T.) Pty. Ltd. N.T. (3.756) Ord. $1 Pacminex (Operations) Pty. Ltd. N.S.W. 28.793 Ord. 51 Pacminex (Qld.) Pty. Ltd. Qld. (16.807) Ord. $1 Pacminex (S.A.) Pty. Ltd. S.A. (167.884) Ord. 51 Pacminex (Tas.) Pty. Lid. Tas. (3.715) Ord. $1 Pacminex (Vic.) Pty. Ltd. Vic. (147) Ord. 51 Pacminex (W.A.) Pty. Ltd. Pacminex Pty. Ltd. W.A. N.S.W. (76.751) -- Ord. 51 Ord. 51 Patson Pty. Ltd. Pilbara iron Ltd. N.S.W. -- Ord. 51 5 W.A, 5.218.345 2.548.980 A ordinary 51 S W.A. Ord. 51 Rewa Rice Ltd. South Pacific Sugar Mills Ltd. Torres Exploration Pty. Ltd. 2 Fiji 2 Fiji Qld. 25.710 1.138.724 -- 18.853 M 54.240 Ord. SF2 Ord. F50C Ord. 51 Wunderlich Ltd. Wunderlich Staff Nominees Pty. Ltd. N.S.W. N.S.W. 743.861 -- 746.000 Ord. 51 Ord. 52 1 Carries on Business m Singapore C 4651 2 Carnes on Business m Fni 3 Carnes on Business in New Zetland 4 01 Me dividend paid 10 CSR VS9.357 was said in resoett ol trading profits tor sno' vear ana S202 9'2 was oaid out c' :asi<ai reserves Owned by CSR % 100 100 100 -- _ _ 100 -- _ Investment of parent S 1.989 1.842.200 1.119.300 1.228.3S9 -- -- 100 100 -- -- 100 50.3 -- -- too 100 100 100 100 51 -- 4 3.407.775 20.000 6.779.260 106.305 193 2 120.000 12.000 15.664.59S 100 100 100 100 100 too -- 100 100 too 100 -- 100 100 100 100 100 100 100 100 100 100 1.7 74 too 97.8 100 100 -- 100 24.031 15.000 63.093 595.045 5.351.327 4.800.000 10.000 800.000 1.875.000 75.000 5.000 ,10 000.000 140.000 610.000 4.000 500 1.025.000 500 2 48.214 22.901.786 158.464 15.934.027 2 11.335.071 15 Statement by directors :-i :ne oomion of :he Directors of The Colonial Sugar Refining Comoany Limiteo. tne grouo accounts and the notes tnereto set out on cages 6 to 15 are drawn uo so as to give true and fair views of respectively the orofft or loss of the comoany ano its subsidiaries for the year ended 31 st March `973. and tne state of affairs of the company and its sub sidiaries as at that date so far as they concern memoers of the company. Signed m accordance with the resolution of Directors R. G. JACKSON General Manager J. W. DUNLOP. Director Sydney 22na June 1973 G. B. KATER, Director Statement by principal accounting officer To the oest of my Knowledge and belief the group accounts with the notes thereto set out on pages 6 to IS give a true and fair view of the matters required to be dealt with therein by Section 162 of the Companies Act 1961. Sydney 22nd June 1973 F. B. LONGLEY Principal Accounting Officer Auditors' report to the members of The Colonial Sugar Re.fining Company Limited 1 in our opinion the attached accounts as set out on pages 6 to 16 of the company and of the group consisting of the comoany and its subsidiaries give a true and fair view of the state of the company's affairs at 31 st March 1973 and of the profit for the year ended on that date. 2 As required by the Companies Act 1961. we report as follows: In our opinion: (a) the attached accounts and the group accounts are properly drawn up m) so as to give a true and fair view of the matters required by Section 162 to be dealt with in the accounts and in the group accounts; and Mi) in accordance with provisions of that Act. 'b) the accounting records and other records, and the registers, required by that Act to be kept by the company and by those subsidiaries of which we are the auditors have been properly kept in accordance with the pro visions of that Act or in the case of the subsidiaries incorporated in other States or Territories of the Common wealth and of which we are the authors in accordance with the provisions of the corresponding law of those States or Territories. The names of the subsidiaries of which we have not acted as auditors are: Australian Quarries Pty. Ltd. Gravel & Sand Suppliers Pty. Ltd. Independent Concrete Pty. Ltd. Independent Concrete (Pendle Hill) Pty. Ltd. McCaffery Services Pty. Ltd. Mount Gunson Mines Pty. Ltd. New Zealand Sugar Co. Ltd. Pacmmex (N.Z.) Ltd. and we have examined their accounts and the auditors reports thereon. We are satisfied that the accounts of the subsidiaries that have been consolidated with other accounts are in form and content appropriate and proper for the purposes of the preparation of the consolidated accounts and we have received satisfactory information and explanations required by us for that purpose. As shown m Note 2 to the group accounts, the accounts of South Pacific Sugar Mills Limited have been consolidated notwithstanding that the procedures for confirmation thereof laid down m the agreement scheduled to the Sugar Industry (Soutn Pacific Sugar Mills Limited Shareholding) Act. 1971, of Fiji has not bsen com pleted and consequently the accounts have not been signed by the SPSM directors or formally reported on by us as the SPSM auditors. The audit reports on tne accounts of the other subsidiaries were not subject to any qualification or comment. YARWOOD VANE & CO. F N Summernayes Partner CHARTERED ACCOUNTANTS Registered under the Public Accountants Registration Act 1945. as amended Sydney 22nd June 1973 16 C 4652 Directors' report continued--statutory requirements In compliance with the provisions of Section 162A of the Comoames Act. the Directors of The Colonial Sugar Refining Company Limited report as follows: (a) The Directors in office at the date of this report are Sir John Ounlop. Mr. G. 8. Kater. Sir James Vernon. Mr. J. M. Dixon. Mr. 8. 8. Riley. Mr. T. J. N. Foley. Mr. K. 0. Brown and Mr. R. G. Jackson. (b) The principal activities of the corporations m the group m the course of the year were as follows: Production and sale of raw and refined sugar together with the provision of services to the Queensland Government for the Australian sugar industry: the production and sale of materials for building and con struction: mining and mineral exploration: production and sale of industrial chemicals, alcohols and carpon dioxide. During the year there was no significant change in the nature of the activities of the group. (c) The net amount of the consolidated profit of the group for the year, after provision for income tax and after deducting amounts which should properly be attributed to persons other than corporations of the group, was S23.339.596. The extent to which each corporation in the group con tributed to the above consolidated profit is S The Colonial Sugar Refining Company Limited (after adding back provision for loss in sub sidiary mining companies $261,338 and after deducting income from dividends on shares in related corporations) Subsidiaries, see Note 23 13.856.195 9,483.401 23.339.596 (d) Particulars of subsidiaries acquired during the year, are: Net tangible Consideration assets Australian National Power $ Alcohol Co. Pty. Ltd. 1.541.593 1.842.200 (e) The amounts and particulars of material transfers to and from reserves or provisions of any corporation in the group are as follows: C 4653 Corporation Particulars Reserve or provision $000 Parent Share issue-- bonus From share premium reserve 9.308 Transfer from To revenue reserve 8.000 profit and loss Reduction m value of noncurrent assets due currency rate changes From capital reserve 4.258 Reduction in provisions for loss on Fiji assets To capital reserve 2.573 Premium resulting To capital reserve from the acquisition of a subsidiary Replacement of To such provision fixed assets 301 9.506 Final dividend To such provision 6.283 Income taxes To such provision 3.922 Doubtful debts To such provision 234 Long service leave To such provision 1.955 Pensions Accrued annual leave Mineral exploration To such provision To such provision To such provision 1.500 764 1.004 Losses in subsidiary companies To such provision 261 Diminution in From such provision 968 value of stocks Australian Provision not Quarries Pty. required Ltd. Gravel and Sand Replacement of Suppliers Pty. fixed assets Ltd. income taxes To revenue reserve To such provision To such provision 19 48 113 Independent Replacement of Concrete Pty. fixed assets Ltd. Doubtful debts To such provision To such provision 29 16 Income taxes To such provision 40 17  rectors recon statutory requirements contmuea Corporation Particulars Reserve or provision sooo Australian National Power Alcohol Co. P'.y. Ltd. Replacement of To sucn provision fixed assets 113 income taxes To such provision Long service To such provision leave 8radford Reoiacement of To such provision Insulation fixed assets industries Pty. Ltd. 35 17 33V income taxes To such provision 221 Doubtful debts To such provision 39 Long service leave To such provision 14 Bradford Insulation (Qld.) Pty. Ltd. Reoiacement of To such provision fixed assets Income taxes To such provision 17 64 Ooubtful debts To such provision 34 Bradford Reoiacement of To such provision Insulation fixed assets (Vic.) Pty. Ltd. 38 Income taxes To such provision 195 Ooubtful debts To such provision 121 Carba Australia Replacement of To such provision Ltd. fixed assets 549 Income taxes To such provision 449 Waldown Pty. Replacement of To such provision Ltd. fixed assets 8 income taxes To such provision 23 Commonwealth Oistilfenes Pty. Ltd. Income taxes To such provision 5 CSR Chemicals Surplus on safe To capital reserve Ltd. land 381 Replacement of To such provision 2.372 fixed assets Catalyst renewal To such provision 87 Long service leave To such provision 187 Diminution in value of investments To such provision 170 Robert Corbett Replacement of To such provision Pty. Ltd. fixed assets 26 Income taxes To such provision 18 Newcastle Replacement of To such provision Chemical Co. fixed assets Pty. Ltd. 201 CSR Research Replacement of To such provision Pty. Ltd. fixed assets 11 Income taxes To such provision 17 Long service leave To such provision 3 18 C 4654 Corporation Oia Plastics Pty. Ltd. Particulars income taxes Reserve or provision SOOO To such provision 3 Frome COi Pty. Ltd. income taxes To such provision 1 Gove Alumina Ltd. Reoiacement of To such provision fixed assets income taxes (deferred) To such provision 1.737 1.879 Dividends To such provision 1.347 J. L. Lennard Pty. Ltd. Reoiacement of To such provision fixed assets income taxes Tp such provision 1 4 Macadamia Nuts Replacement of To such provision Pty. Ltd. fixed assets 3 McCaffery Replacement of To such provision Services Pty. fixed assets Ltd. 100 Income taxes Long service leave To such provision To such provision 85 12 Masonite Corporation (Aust.) Pty. Ltd. Mitcham Properties Pty. Ltd. Replacement of To such provision fixed assets Income taxes Income taxes To such provision To such provision 206 486 19 Midatco Pty. Ltd. income taxes New Zealand Dividend Sugar Co. Ltd. equalisation To such provision To revenue reserve 23 43 Currency rate change Income taxes Long service leave Mineral exploration From capital reserve To such provision To such provision To such provision 9 248 11 30 Pacminex Loss on post To such provision (Operations) balance date Pty. Ltd. sale of asset Pilbara Iron Ltd. Replacement of To such provision fixed assets Income taxes To such provision (deferred) Dividends To such provision 1,859 6.369 7.415 3.038 Rewa Rice Ltd. Replacement of To such provision fixed assets Income taxes To such provision 7 14 South Pacific Sugar Mills Ltd. Replacement of To such provision 1.303 fixed assets income taxes Tp such provision 619 Corporation Particulars South Pacific Sugar Mills Ltd. cont'd Compassionate allowance Currency rate cnange Post crushing overhaul Wunderlich Ltd. Surplus on sale land Transfer from profit and loss Reserve or provision $000 To sucn provision 170 Prom capital reserve To such provision 290 119 To capital reserve 618 To revenue reserve 211 Corporation Particulars Wunderlich Ltd. Replacement of cont'd fixed assets Income taxes Ooubtful debts Long service leave Reserve or provision $000 To such provision 1 087 To such provision To such provision 162 143 To such provision 230 (f) Shares or debentures issued during the year. Shares issued Corporation Parent V Class Ordinary Pacminex Pty. Ltd. Ordinary Pacmmex (N.S.W.) Pty. Ltd. Ordinary Pacminex (N.T.) Pty. Ltd. * Pacminex (Qld.) Pty. Ltd. Ordinary Ordinary V Pacminex (S.A.) Pty. Ltd. Ordinary Pacminex (Tas.) Pty. Ltd. Ordinary Pacminex (Vic.) Pty. Ltd. Pacminex (W.A.) Pty. Ltd. Ordinary Ordinary Number 9.308.435 Amount Si each 498 SI each 74.993 $1 each 4.998 Si each 139,998 SI each 639.998 $1 each 3,998 Si each 498 Si each 1.024.998 Si each Term* Fully paid 1 share per every 8 held At par. payable one-tenth cent on appln. 8al. on call At par. payable one-tenth cent on appln. Bal. on call At par. payable one-tenth cent on appln. Bal. on call At par. payable one-tenth cent on appln. Bal. on call At par. payable one-tenth cent on appln. Bal. on call At par. payable one-tenth cent on '.ppln. Bal. on calf At par. payable one-tenth cent on appln. Bal. on call At par. payable one-tenth cent on appln. Bal. on call Purpose of issue Capitalisation of share premium For exploration of mineral prospects For exploration of mineral prospects For exploration of mineral prospects For exploration of mineral prospects For exploration of mineral prospects For exploration of mineral prospects For exploration of mineral prospects For exploration of mineral prospects C 4655 19 Directors report statutory requirements contmueo Shares issued Corporation Mount Gunson Mines Pty. Ltd. Class Ordinary Number 799.997 Amount SI each Terms At par. payable one-tenth cent on appln. Bal. on call Purpose of issue For exploration of mineral prospects Debentures issued Corporation Gove Alumina Ltd. Class Second senes stock Second series stock Second series stock Second series stock Amount Term Interest rate Purpose of issue $8,825,000 US$2,548,000 $6,000,000 US$10,000,000 1975-1981 1975-1981 March 1974 Sept. 1977 8% % 1 Vz% above the London inter-bank rates for Euro dollar deposits averaged for six months 7V2% 8% Finance requirements of Gove project Finance requirements of Gove project Finance requirements of Gove project Finance requirements of Gove project > D (g) The amounts paid or declared by way of dividend by the company to its shareholders since the end of the pre vious financial year: Final dividend of 7 cents per share in respect of year ended 31 st March 1972, was paid 31st July 1972 $3,212,724 interim dividend of 7 cents per share in respect of year ended 31st March 1973. was paid 18th December 1972 $5,212,724 The proposed final dividend of l'h cents per share in respect of year ended 31st March 1973. would total $6,283,194. (h) Dividends paid to or declared in favour of CSR by sub sidiaries in the period since the end of the financial year. Company Gove Alumina Ltd. Date 11th June 1973 Amount $430,168 Dividends paid to or declared in favour of CSR during the financial year are shown in Note 23 of the notes to the accounts. {/) The Directors {before the profit and loss account and balance sheet were made out) took reasonable steps to ascertain what action had been taken so far as debts owing to the holding company are concerned in relation to the writing oft of bad debts and the making of provisions for doubtful debts and to cause all known bad debts to be written off and adequate provision to be made for doubtful debts. (j) At the date of this report the Directors are not aware of any circumstances which would render the amount written off for bad debts, or the amount of the provision for doubtful debts in the group of companies inadequate to any substantial extent. flc) The Directors {before the profit and loss account and balance sheet were made out) took reasonable steps to ascertain whether any current assets of the holding com pany {other than current assets to which paragraph (i) applies) were unlikely to realise in the ordinary course of business their value as shown in the accounting records of the company and ascertained that none of such current assets were unlikely to do so. other than certain items m respect of which adequate provision was made. 20 C 4656 (I) ai :ne date of this reoort the Directors are not aware of any circumstances which would renaer :ne values attri buted to current assets m the group accounts misleading. (m) At the date of this report there does not exist-- (i) any charge on the assets of any corporation m the group which has arisen since the end of the financial year and secures the iiaoilities of any other person: and (ii) any contingent liaDility of any corporation m the * group which has arisen since the end of tne financial year. (n) No contingent or other liaDility of any corporation in the group has Become enforceaote. or is likely to become enforceable within the period of twelve months after the i end of the financial year which, m the opinion of the Oirectors. will or may substantially affect the ability of the corporation to meet its obligations as and when they fall due. (o) At the date of this report the Directors are not aware of any circumstances, not otherwise dealt with in this report or group accounts, which wouJd render any amount stated in the group accounts misleading. i (p) The results of the operations of the group or of any corporation m the group during the financial year were not. in the opinion of the Directors, substantially affected by any item, transaction or event of a material and unusual nature apart from setting up a provision for the payment of pensions previously charged to revenue as incurred, see Note 4. and as otherwise referred to in the accounts or this report. (q) There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely, m the opinion of the Oirectors. to affect substan tially the results of the operations of any corporation in the group for the next succeeding financial year except as referred to m the accounts or this report. Since the end of the previous financial year no Director of CSR has received or become entitled to receive a benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by Directors shown in the group accounts, in accordance with the Ninth Schedule, or the fixed salary of a full-time employee of the company) by reason of a contract made by the company or a related corpo ration with the Director or with a firm of which he is a member, or with a company in which he has a substantial financial interest. Signed in accordance with the resolution of the Oirectors of The Colonial Sugar Refining Company Limited. R. G. JACKSON General Manager J. W. DUNLOP, Director Sydney 22nd June 1973 G. 8. KATER. Oirector i C 4657 21 Review of operations R G JacKson General Manager Sugar activities CSR manufactures raw sugar at four milts in Queensland and at three mills in New South Wales. All Australian raw sugar is acquired for marketing by the Queensland Government. As contractor to the Government. CSR re fines and distributes about 95% of the refined sugar products used in Australia, markets all exports of raw sugar and provides a wide range of services for the Australian sugar in dustry. The New Zealand Sugar Company Ltd., a CSR subsidiary, refines and distributes alt the refined sugar products used in New Zea land. Until 1st April 1973, when ownership of CSR's shareholding passed to the Government of Fiji, the four raw sugar mills in Fiji were owned by South Pacific Sugar Mills Ltd., in which CSR held 97.8% of the shares. CSR's sugar activities during the year are reviewed below. Comment on matters of more general sugar industry interest appears on page 29. CSR's Australian raw sugar mills The average price received by mills for 1972 season raw sugar was higher than for 1971 but lower crops in CSR mill areas and higher wages and other costs reduced the earnings of our mills. Our Queensland mills produced 403,000 tons of sugar, about 10% less than the record 1971 production of 449,000 tons. Cane crops were lighter, due mainly to cyclone damage prior to harvesting. Production in New South Wales, at 97,000 tons, was 17% less than in 1971. Cane crops were extensively impaired by drought and. later, by flood. Additional crushing capacity was installed at some mills for the 1972 season. High standards of efficiency in milling operations were main tained. Capital expenditure continues to be directed to the control of mill costs in the face of general inflationary pressures. A start has been made in applying computer technology to process control. CSR is working, along with the Sugar Research Institute. CSIRO and IBM on a programme aimed at improving the design and operation of factory plant. At our four Queensland mills, conversion to 100% mechanical harvesting of cane will be completed in the 1973 season. In New South Wales, where mechanical harvesting is much more difficult due to the different characteris tics of farm structure and cane growing, it is expected that 35% of the crop will be mech anically harvested in 1973 compared with 22% in 1972. For the first time, cane at Harwood mill will be mechanically harvested on a com mercial scale. Crop prospects for the 1973 season are good in most of our mill areas. On current estimates. CSR's production is expected to be higher than in 1972 in both New South Wales and Queensland. For 1973 our seven mills now estimate that they will make about 556,000 tons, compared with 500,000 tons in 1972 and the record 566,000 tons produced in 1971. Fiji raw sugar mills South Pacific Sugar Milts Ltd. made 300.000 tons of raw sugar from the 1972 Fiji cane crop, which had been damaged by both drought and hurricane. Production in 1972 was 17,000 tons less than in 1971. CSR's shareholding in South Pacific Sugar Mills Ltd. passed to the Government of Fiji on 1st April 1973. The change of ownership was accomplished smoothly and with goodwill. The Government has renamed the milling enter prise The Fiji Sugar Corporation Ltd. CSR con tinues to supply staff and services, to market export sugar and to purchase molasses in accordance with agreements which had applied when SPSM was in CSR's ownership and which are continuing with the Fiji Sugar Corporation. As at 31st May 1973, 55 CSR staff officers were on secondment to the Corpora tion. This number will be progressively re duced as trained Fiji staff become available to take over their positions, in pursuance of the policy of localisation which CSR had followed for many years. 22 C 4658 Refined sugar in Australia compared with 330.000 tons in f97t. However. Our five Australian sugar refineries sold 663.000 tons of sugar products, 2.3% more than last year. Sales through retail outlets were slightly down, out a hot summer in all States resulted in record sales of sugar to Fiji's export commitments under the supply commitment provisions of the International Sugar Agreement (ISA), the British Common wealth Sugar Agreement and the US Sugar Act were fully met. soft drink manufacturers and some other industrial users. Purchases by some canners of deciduous fruit were higher following better export market prospects for the output of their 8uoyant world free market conditions pre vailed throughout most of 1972 and have con tinued into 1973. current season. Sugar improved its position in the brewers' market but competition from At this stage, it seems unlikely that 1973 cereal-based fermentable materials is still calendar year exports will be subject to res strong. A satisfactory share of the refined trictive ISA quotas and no difficulties are sugar trade in Papua New Guinea and in Paci expected in finding markets for all 1973 season 'W fic Islands has been maintained against com petition from foreign refiners. sugar acquired for marketing by the Queens land Government and for Fiji's production. Deliveries of bulk granulated sugar com menced in Perth and Adelaide, and are now available in all mainland capital cities. The conversion of all sugar packages to metric measure, which began in July last year when the traditional 70 lb bag was replaced by a slightly smaller 30 kg bag, is continuing and is to be completed befo.re the end of 1973. Refined sugar in New Zealand In 1972 the New Zealand Sugar Company Ltd. entered into a Sugar Price Stabilisation Agree ment with the New Zealand Government as part of that Government's programme directed towards greater stability of'intemal prices. Under the Agreement, refined sugar prices remained constant throughout the year, despite higher costs of raw sugar purchases. These higher costs are being met from a special bank overdraft account called the Sugar Price Stabilisation Account. The Agreement pro vides the necessary safeguards for the New Zealand Sugar Company, including the repay ment of the Sugar Price Stabilisation Account by the time the Agreement terminates. Helped by a hot summer, sales for the year were 161,000 tons, or about 5% higher than last year. Raw sugar exports Australian raw sugar exports made by CSR on behalf of the Queensland Government reached 2.221.000 tons in the 1972 calendar year, sub stantially exceeding the previous record exports of 2.080,000 tons in 1968. Traditional markets were maintained and some important new markets (referred to on page 29) were developed. Because of reduced production. Fiji's 1972 calendar year exports fell to 271,000 tons, C 4659 Sugar marketing service* In concert with the Queensland Sugar Board, and in advance of the changes in the exchange rate which occurred during the year. CSR secured the maximum practicable protection of foreign currencies due under forward con tracts for export of sugar. In consequence, the Australian dollar value of proceeds from 1972 sugar exports was only slightly reduced by changes in the exchange rate of the Australian dollar against other currencies in which export contracts are written. The impact on 1973 and 1974 season exports will also be reduced to some extent by the action taken but, if present exchange rates are maintained, the Australian dollar value of export prices in the 1973 and subsequent seasons wifi be adversely affected by the currency adjustments. Materials for building and construction CSR is engaged in the manufacture of materials for building and also the supply of concrete and stone for building and road construction. We manufacture and market a wide range of building products in all States of Australia. The main operating groups are the gypsum pro ducts group, vinyl floor coverings group, mineral fibres group, Wunderlich Ltd. (a wholly owned subsidiary) and the two 60% owned companies, Hardboards Australia Ltd. and Pyneboard Pty. Ltd. CSR's interests in the concrete and quarry ing industry include shareholdings of almost 50% in Ready Mixed Concrete Ltd., more than 40% in Farley & Lewers Ltd., 25% in Hymix Australia Pty. Ltd. and our subsidiaries, Aus tralian Quarries Pty. Ltd. (100% CSR) and 23 Review o! ooerations contmueo Gravel and Sand Suppliers Pty. Ltd. (51% CSR). These companies operate quarries, sand and gravel pits, concrete batching plants ana a numoer of other activities. 8ased on the value (at constant prices) of work done on ail types of new buildings, the Australian building industry grew by an esti mated 7% in the year ended March 1973. compared with the year ended March 1972. This compares with a growth of 2% in the industry during the preceding year. The rate of building of dwellings in the year ended March 1973 was relatively high, partly due to more funds being available from build ing societies and banks. At constant prices, the value of work done on dwellings increased by an estimated 11% in the year ended March 1973. compared with a rise of 1% in the pre vious year. On the other hand, the increase in the value (at constant prices) of work done on buildings other than dwellings was similar to that of the previous year. Industrial disputes and shortages of skilled labour affected the building industry in some areas and adversely affected sales of some of our materials. Nevertheless, total sales value of products of our building materials division was 12% greater than last year and earnings improved notwithstanding cost increases. The production of ready-mixed concrete in Australia in the year under review is estimated to have increased by about 5% over the pre vious year. Sales of mineral fibre products by the Brad ford group were higher than last year. Indus trial disputes in the building industry, par ticularly in NSW, have delayed completion of a number of large projects using our insulation products, with some adverse effects on sales. Sales by Wunderlich of clay roof tiles, asbestos-cement products and aluminium win dows show small increases over the previous year. The market for aluminium windows is ex tremely competitive as the prime aluminium metal manufacturers strive for an increased share of the market for fabricated aluminium products. A new aluminium extrusion plant jointlyowned by CSR and Comalco and built at Minto. NSW, at a cost of $1.4 million, began production in May. The new continuous-tunnel kiln for clay tiles at Rosehill, NSW, is now producing a highquality tile. Production rates are increasing after some initial settling-in problems. Hardboards Australia Ltd. (50% CSR) The market for hardboard products in Aus tralia is subject to intense competition but sales were better than last year. Exports of Australian hardboard were satis factory and the overseas market has been generally firm. However, revaluation has made our products less competitive in some over seas markets. Building materials division A strong demand continues for gypsum pro ducts. which we manufacture in all mainland States. Construction has begun of a large Gyprock plasterboard factory at Wetheritl Park, NSW. This plant wili supplement the present plant at Concord. Gyprock lining attached to timber, steel or aluminium frames, using the dry construction method, continues to gain popularity at the expense of other construction methods be cause of its speed, convenience and lower cost. The market for vinyl flooring has improved compared with last year. However, currency changes have increased competition from imports. Pyneboard Pty. Ltd. (50% CSR) Although the Australian market for particle board has shown good growth during the year, competition has increased. Nevertheless, so did the total value of sales. A plant costing about $2.5 million has been ordered by Pyneboard to make thin particle board by a new process. This plant will be at Rosedaie, Victoria, .and will begin production in 1974. Increased imports of particle board follow ing revaluation have added to the competition against this product in Australia. Concrete and quarrying activities Earnings from concrete and quarrying, com prising mainly dividends from investments in ready-mixed concrete and quarrying com panies, were significantly better than for last 24 year. This improvement was achieved in spite of severe competition m the Sydney readymixed concrete industry. The financial year of Ready Mixed Concrete Ltd. (almost 50% CSR) ends on 30th June. Dividends brought to account in CSR's books (on a quarterly basis) relate to the year ended 3ist March. Estimated earnings (after tax) to the end of March 1973 (i.e. nine months), show a satisfactory increase over the corresponding period in tne previous year. Dividends to CSR in the year ended 31st March 1973 were up by 15% on the previous year. The profits for the year so far reflect im proved trading m Australia. Results from tin dredging in Malaysia, although higher than in the previous year, are not yet up to expecta tion. As usual, the full year's operations will be reviewed in the next half-yearly report. Our subsidiaries. Australian Quarries Ply. Ltd. {100% CSR) and Gravel and Sand Sup pliers Pty. Ltd. Group (51% CSR), traded pro fitably, although not as well as in the previous year. CSR (40%) and Blue Metal Industries Ltd. (60%) have formed a company, Djakarta Ready Mixed Concrete Pty. Ltd., which owns 75% of PT Jaya Readymix. established in association with Indonesian interests to manufacture and market ready-mixed concrete in Djakarta. Mining Through subsidiaries. CSR is a participant in the Mt Newman iron ore venture in Western Australia and in the Gove bauxite and alumina venture in the Northern Territory. We operate gypsum mines in New South Wales. Victoria. South Australia and Western Australia, and conduct mineral exploration in many places in Australia. During the year, CSR subscribed for a shareholding in Weeks Natural Resources Ltd., an international oil and gas exploration company. Mt Newman iron ore CSR's participation in the Mt Newman joint venture is through our subsidiary. Pilbara Iron Ltd., which has a 30% interest. CSR owns 68% of Pilbara Iron Ltd. During the year, Mt Newman shipped 23.2 million tons of ore to Japan (19,159.000 tons). Europe (1,636,000 tons) and Australian mills (2.408.000 tons). Shipments were 3.9 million tons higher than in the previous year, due mainly to increased shipments to Japanese steel mills ana BHP. Shipments during the year were about 2 million tons greater than was forecast at the beginning of the year and in the half-yearly report. Japanese steel production made a strong recovery during the second half of 1972/1973 and as a result the cut-backs in deliveries to the Japanese steel mills reported on previously were less than expected. The tonnage snipped during the year would have been about 2 million tons greater but for stoppages caused by cyclones, industrial disoutes and the derailment of an ore train. It is expected that during the current year the recovery in Japanese steel production will continue and shipments will be about 29 mil lion tons. Present indications are that the Japa nese steel mills now do not expect to make any cut-backs below the contractual minimums in their contracts with Mt Newman during the year ending March 1974. As a result the ton nages to be delivered to Japan during the current year will be close fo. or slightly in excess of. the base tonnage specified in the contracts. Sales to Europe and BHP are expected to increase this year. Expenditure on construction by the Mt New man venturers during the year totalled $23.4 million, of which the share of Pilbara Iron Ltd. was $7 million. The Mt Newman venturers have authorised a further expansion of project capa city to provide by the end of 1974 an annual shipment capacity of 35 million tons. This increased capacity will be required to meet commitments under existing sales contracts. Gove bauxite and alumina Gove Alumina Ltd. (51% CSR) owns 30% of the alumina plant and mining assets compris ing the venture, is entitled to 30% of the total alumina production of the plant, and in addi tion has the sole right to export untreated bauxite from Gove. Gove Alumina has sold its share of the alumina produced to Swiss Alu minium Ltd. for 20 years, subject to certain rights of drawback. Shipment of alumina from the first stage of the alumina plant at Gove (500.000 tons per annum capacity) began in August 1972. Con struction of the alumina plant second stage (also 500.000 tons per annum capacity) is vir tually complete. This Is scheduled to come into production during June 1973 and will bring the alumina plant to its full initially planned capacity of one million tons per annum. 25 iew of ooerations commute Total estimated expenditure by Gove Alu mina to completion of the one million tons alumina plant is S106 million. Gove Alumina Ltd. exported 1.073.000 tons of bauxite and 80.000 tons of alumina during the year. Bauxite sales were lower than ex pected. largely due to the prevailing world wide depression of the aluminium industry, which is now showing signs of recovery. During the year. Gove Alumina issued US$10 million of debenture stock to Japanese banks to complete its finance requirements. In March 1973 Gove Alumina became a 10% shareholder in Mitsui Alumina Co. Ltd. of Japan Oy acquisition for cash of 600.000 shares at par at a cost of approximately AS790.000. Gove Alumina has contracted to supply 18.5 million tons of bauxite from Gove for the Mitsui alumina plant at Wakamatsu, Kyushu. Japan. Mt Gunson copper At the time of the last report, the Mt Gunson copper venture was owned as to two-thirds by a subsidiary of CSR and as to one-third by United Uranium N.L. As was reported last year, operations at Mt Gunson were suspended in December 1971. In June 1972 we purchased the one-third interest of United Uranium N.L. and the shares held by that company in Mt Gunson Mines Pty. Ltd., the manager of the venture. The joint venture has now been con solidated into Mt Gunson Mines Pty. Ltd., as owner. Pacminex {our exploration subsidiary) con tinued exploration in the district after the suspension of operations. The scale of activity has increased following the recent discovery of an interesting deposit of copper mineralisa tion in previously untested areas about two miles from the concentrator. An evaluation programme, including the sinking of test shafts and pilot plant testing of the material is being undertaken. Mineral exploration Basic exploration and examination of pros pects by the Pacminex group have continued with activities extending throughout Australia. Exploration efforts have been directed to wards uranium, coal, iron, nickel, copper and other base metals. In New Zealand an initial programme of investigation did not reveal any prospects meriting further expenditure and exploration activities have been suspended. Prolonged negotiations with the Government of Western Australia followed the reaction in March 1972 by the Environmental Protection Authority of the original Upper Swan site oroposed for a refinery to produce alumina from bauxite deposits near Perth. The W.A. Govern ment offered to help find an alternative site and some 12.000 acres of Crown land at Muchea was offered to the company by the Government together with some concessions to help offset the economic disadvantages of the more remote Muchea site. A new Act, known as the Alumina Refinery (Muchea) Agree ment Act. was finally passed by the Western Australian Parliament in January 1973. The world aluminium industry remained de pressed throughout 1972 and it is only recently that significant and sustained rises in alu minium prices have occurred. The upvaluation of the Australian dollar and the devaluations of the US dollar, have made bringing this project into production more difficult. Efforts directed to this end are continuing. On-site exploration and evaluation of the Julia Creek oil shale/vanadium project have been discontinued pending a solution being found to technological problems of recovery, on which research work is continuing. Other interests CSR's other interests comprise principally industrial chemicals alcohol carbon dioxide and freezing services shipping operations and management anticay. CSR Chemicals Ltd. (50.3% CSR) Totaf tonnage safes of products for both domestic and export markets increased during the year by 9.2%. However, lower tariff pro tection. announced by the Government in March 1972, adversely affected domestic selling prices, with the result that total revenue from sales was only 4.1% ahead of the previous year. During 1972 world prices of basic chemi cals remained very low and some sales of key products were lost to imports. Lower prices for certain imported chemicals arising from the currency realignments brought further downward pressure on the prices of several of our products. CSR Chemicals was virtually free of strikes in its own operations throughout the year, but major strikes at suppliers' establishments had serious effects on the company's sales, profit and stocks in July and August 1972. and again in February and March 1973. In addition to direct less of sales and of profit, these outside industrial disputes led to acute shortages of key raw materials over protracted periods and adversely affected manufacturing costs. These effects came on top of increases during the year in some key raw material costs and in wages so that, in spite of an overall increase in sales revenue, the company's trading opera tions for the year resulted in a loss of S565.000. During the year capital surpluses totalling $1,162,864 were obtained from realisation of assets by CSR Chemicals Ltd. and by its wholly owned subsidiary Robert Corbett Pty. Ltd. and were transferred to capital profits reserves. Distilleries Sales volume of industrial alcohol within Aus tralia increased by 5% over the previous year. A number of bulk shipments were made to Japan of alcohol from the distillery in Sarina. North Queensland, of our new subsidiary, Australian National Power Alcohol Co. Pty. Ltd. A new grade of alcohol of very high quality for use in perfumery, cosmetics and white potable spirits was introduced by Pyrmont Dis tillery in January 1973. This- has been we!! received and has good expectations of growth. Sales of rum, both the traditional dark types and the newer white rums, were maintained. 7% of total rum sales were exported. Carba Australia Ltd. Carba's operations resulted in sales of 8% above the preceding year. The use of CO, for food chilling and freezing increased; this expansion is expected to be further stimulated in 1973/74 by sales of Carba-designed food freezing equipment re cently introvuced to the market. Export sales of CO, plant and equipment were made to Hong Kong, Singapore and Indonesia. In Darwin, the capacity of Carba cold stor age facilities was increased by 50% by the purchase of a cold store previously operated by the Government. Shipping CSR is managing agent for Australian Chemshtp Line (50% CSR) which operates two chartered chemical tankers. 8oth vessels per il: 4663 formed satisfactorily and earnings from our participation m this business improved. Shipflex Pty. Ltd. (50% CSR) has undertaken the managing agency of two vessels for Aus tralian Territory Liner Services. These vessels are scheduled to begin service during 1973. Anticay Anticay (the registered name for a special calcium sucrose phosphate complex) is a food additive developed by the company wtiich helps to reduce the incidence of tooth decay when added in small quantities to processed carbohydrate foods. Anticay. which was discovered in i960, has been subjected to a comprehensive research programme, both in Australia and overseas, to establish its safety and effectiveness. In November 1969 the National Health and Medi cal Research Council of Australia recom mended to the States of the Commonwealth that Anticay be permitted as a food additive. Permitting Regulations have now been gazetted by all State Governments. A plant with sufficient capacity to meet the projected Australian market requirements for Anticay was completed in December and suc cessfully commissioned early this year. Anticay is sold to food manufacturers for incorporation in their products as an ingredi ent. About 30 leading food companies are to incorporate it in many of their food products. The first food products containing Anticay became available for retail sale during April 1973 in Victoria. South Australia and Tasmania. A wide range of such products is expected to be available throughout Australia shortly. Research and development R & 0 in CSR is conducted in four labora tories and by specialist development groups attached to particular activities. Product im provement, increased efficiency, effluent con trol, and automation are typical aspects of current efforts related to sugar and building materials. Laboratory, phytotron and field staff are engaged in plant breeding, disease and insect control. Our. biologists have recently introduced a computerised information system which will greatly assist breeding of new sugar cane varieties. R & D continues to give support in the fields of ore extraction, automatic sorting of unusual minerals, new exploration techniques, and im proved methods of beneficiation of lower grade ores. 27 =eview of ocerations commuea Examination of opportunities for future ex pansion is an important part of R & 0 work, increased attention is at present being given to improving the group's capacity to search for and evaluate new business proposals. The environment Much effort is being focused on the planning of investment to ensure that group operations not only comply with current community stan dards for emissions, effluents, and noise: but will also comply with the more stringent stan dards likely to be required by the community over the next few years. Capital expenditure for such purposes over the last four years has exceeded $3.5 million. The resources of both capital and tech nology to be applied in the next few years will be much greater. At Victoria mill. Ingham, extensive investiga tional work conducted since 1969, in co-opera tion with outside consultants, has resulted in the development of an efficient and novel treat ment system for sugar mill effluents. A fullscale plant based, on this system will be operational later this year at a capital cost approaching $400,000. At Sarina. Queensland, an extensive spray irrigation system covering several hundred acres has been developed to handle effluent from the Australian National Power Alcohol Co. Pty. Ltd.'s distillery. Many other effluent control measures are being implemented. The company's factories have achieved an outstanding record for safety. Many of our major plants are `safety millionaires' and safety is a continuing and vital activity of manage ment. Staff The past year has been one of considerable change both in the environment in which CSR works and within CSR itself. It is largely be cause of the ability of our staff to turn change to advantage and to follow through with per severance and hard work that the year has been one of achievement and success for the company. It gives the directors considerable satisfac tion to express appreciation of these efforts by the staff and to say that they have complete confidence in the ability of the staff to carry forward the plans being formulated for the company's growth. C 4664 28 Australian sugar industry matters There are 34 raw sugar mills in Australia: 12 are owned co-operatively by farmers. 7 by CSR and IS by other companies. These mills process cane supplied by about 8.500 canegrowers. Harvesting and crushing usually extends from June to December. Raw sugar production and exports international Sugar Agreement (ISA) export quotas were suspended from the beginning of January 1972 `and remain suspended), consequent upon the in crease in world free market sugar prices referred to below. This permitted all available cane to be har vested in the 1972 season, and with good seasonal conditions m most but not all districts, a record 2.704.000 tons of raw sugar was made. This was 25.000 tons higher than in 1971. The 1973 season, on present estimates, is expected to produce about the same as in 1972. The availability of sugar for export was increased by the release in January 1972. of 155.000 tons of mandatory reserve stocks held in accordance with the terms of the ISA. and 1972 calendar year exports reached a record 2.221.000 tons. Commitments to Britain under the British Commonwealth Sugar Agreement and to the United States under the US Sugar Act were fully met. as were the 'supply com mitment' obligations under the ISA to longestablished customers in Canada. Japan. New Zealand and other countries which are members of the ISA. Major markets for raw sugar exports in 1972 were Japan (664.000 tons). Britain (442.000), Canada (405.000) . United States (196.000). USSR (132.000). New Zealand (97.000). Malaysia (61.000). Finland (48.000) . Singapore (37.000). and the Peoples Republic of China (35.000). Sugar was sold for the first time to Algeria. Belgium. Chile. China. Morocco. Tunisia and the USSR. The first shipment of bulk (not bagged) sugar was made to South Korea. Long-term contractual arrangements were negotiated for the supply of Australian sugar to Singapore and Malaysia. Both arrangements are for the period of five years to 1977, but provide for extension beyond 1977. Prices It is customary to regard the ISA Daily Price as denoting the world free market price for raw sugar. This price quotation is expressed in terms of US cents per lb. basis f.o.b. and stowed Caribbean port. For 1972 calendar year, the ISA Oaily Price averaged US 7.27 cents per lb. it reached US 9.68 cents on 29th Oecember 1972. and its low point was US 5.12 cents on 28th July. The 1972 average of US 7.27 cents compares with US 4.50 cents averaged m 1971; US 3.68 cents in 1970: and US 3.20 cents in 1969. the first year of operation of the current ISA. For the period January-May 1973. the ISA Oaily Price averaged US 9.10 cents per lb. The progressive improvement in world free market prices between 1969 and 1971 was due in substantial part to the effective operation of the international Sugar Agreement, the purpose of which is to so regulate supplies coming onto the market as to achieve prices within a defined range. However, the high prices of 1972 reflected a set of circumstances with which the ISA was not designed to cope. They included large reductions in sugar production in the USSR and in some other Eastern European countries, a reduction in expected supplies from Cuba and lower production in some other long-established ex porting countries. These circumstances led to heavy import demand from the free market by the USSR. China and a number of other countries. This in turn pushed prices well above the 'target range' of the iSA. Member importing countries of the ISA such as Japan. Canada and New Zealand were substantially protected from the full impact of higher prices by the ISA 'supply commitment' provisions, which entitle importing members to obtain their traditional imports from member exporting countries at a ceiling supply commitment' price. The `supply commitment' price was US 6.50 cents per lb in the ISA as negotiated in 1968. International currency adjustments have result ed in its being increased to US 6.95 cents per tb in January 1972. and to US 7.60 cents per lb in March 1973. Throughout most of 1972 and to date in 1973. the 'supply commitment' price was lower than the ISA Daily Price. Raw sugar exports from 1972 season benefitedsubstantially from the price improvement, but not to the full extent of the increase in the ISA Daily Price. Large tonnages were required to be sold at the ISA supply commitment price and the price of sugar shipped to 8ritain under the British Commonwealth Sugar Agreement (and to some extent sugar exported under quota to the United States) was unaffected by world price movements. Wholesale prices for refined sugar products sold m Australia are fixed in accordance with the Sugar C 4s65 29 Australian sugar tnausiry matters co/innued Agreement Detween me Australian and Queens land Governments. Basic crmes nave not been in creased since June 1S67. notwithstanding inflationary oressures reflected by an increase in average weekly earnings of about 60% between Jun8 1967 and December 1972. The higner export prices, however, resulted m the average price paid for an raw sugar croouceo m Australia in 1972 being determined at Si 19.25 oer ton (basis 9* net litre), compared with S110.35 per ton for the 1971 season. Both prices were after providing for repayment of instalments of Aus tralian Government loans received m the 1966 and 1967 seasons when export prices were depressed. Total raw sugar industry income from the 1972 season ;of which approximately two-thirds is paid to the growers of cane) was $332 million, some S29 million higher than for the 1971 season. Export marketing arrangements Britain became a Member of the European Economic Community on 1st January 1973. The British Common wealth Sugar Agreement, under which Australia sells to Britain each year 335.000 tons and other Common wealth countries 1.400.000 tons, will remain in force until 31st December 1974. Developments over the last year have done little to clarify the detailed arrange ments to be made in respect of sales to Sritain of Commonwealth sugar after 1st January 1975. How ever. there has been recent reaffirmation that 8ritish Government policy is to keep taking sugar from oeveiooing Commonwealth countries and that, in respect of Australian sugar, Britain will seek to ensure that imports from Australia will not cease abruptly but will be 'phased down* over some years after 1974. The EEC's domestic sugar regulations, which could affect decisions on the access to be provided for Commonwealth sugar hitherto purchased by Britain, are to be renegotiated, though this may not be until mid-1975. The current United States sugar legislation, under whicn Australia sells approximately 180.000 tons a year, and wnicn provides import quotas at favouraoie prices for many other countries, covers the period io end-1974, and is expected to be reviewed by Congress during 1974. The current International Sugar Agreement, which expires at the end of 1973. is being renegotiated this year, under the auspices of the United Nations Con ference on Trade and Development (UNCTAOJ. There are two sessions: one was held in May and the final substantive negotiations are scneduied for September-October. The EEC and the United States, neither of which are members of the 1968 Agreement, are participating m the 1973 negotiations. It is. as yet. too early to predict the outcome with confidence. Consideration of some issues is compli cated by the position, referred to above, m respect of British and United States imports and ESC domestic policies. However, the 1968 Agreement has been demonstrated to have been effective and bene ficial. not only for exporting countries but also for importing countries which have been helped by the supply commitment provisions. Statistically, the situation is much improved. In August 1968. world sugar stocks were estimated at 19.5 million tons, representing about 29% of 1968 total world con sumption of around 67 million tons. By August 1973. world stocks are forecast to go down to about 15.8 million tons, or about 20% of 1973 consumption which is forecast to rise to about 78 million tons. CSR and sugar industry organisations are assisting Australian and Queensland Government repre sentatives in the ISA negotiations. C 4666 30 Senior management and functional officers The Directors, general management, senior executive officers ana secretary of the comcany are listed on page >. Some of the senior managers of our Derations and of some suosidiary and S0%-owned companies are iisted below, together with some of the senior functional officers. There are many other senior officers who ooerate with a consideraote degree of autonomy. These include: officers wno control large elements of some of the divisions and of some of the general functional areas: the cnief executives of sub sidiary or associated companies not seoarateiy mentioned below: and those wno control maior functions that are within divisions and subsidiaries. J Operations Sugar activities Australian Mills Division General Manager: G A GEMMELL-SMITH Fiji Oivision General Manager: A S HERMS Raw Sugar Marketing Division General Manager: J W LAURIE Refined Sugar Oivision Genera/ Manager: A G STOKES Deputy General Manager: A M HERTZBERG Executive Officer. New Zealand Affairs: B H AMES Managing Director. New Zealand Sugar Co. Ud.: W P RALPH Sugar Marketing Administration Genera/ Manager W A BENNETT Materials for building and construction Building Materials Oivision Genera! Manager: A V SHAW Deputy Genera/ Manager (and Generaf Manager Wunderlich Ud.): J H MATTHEWS Genera) Manager. Gypsum Products: 0 l MACPHAIL General Manager, Vinyl flooring: P J MATHLIN General Managar. Mineral Fibres: 0 j GOODALL Concrete 4 Quarrying Oivision GeneraI Manager; A J OLIVER Hardboards Australia Ltd. (50% CSR) General Manager: J A HUGHES PyneDoard Pty. Ltd. (50% CSR) General Manager; E V MEAD Ready Mixed Concrete Ltd. (50% CSR) General Manager: A L CHAVS Deputy General Managar: 0 W SULLIVAN Mining Pileara iron Ltd. (68% CSR) General Manager: E F HERBERT Gove Alumina Ltd. (51% CSR) Genera/ Manager: R WILKINSON Pacmmex Grouo Managing O'rector: R N SELMAN Other operations CSR Chemicals Ltd. (50.3% CSR) Managing Qirector: N L CARTER General Manager: j E G ESSERY Distillery Oivision Genera/ Manager: P A HANKS Caroa Grouo Genera/ Manager; j W ARNOLD Anticay Proiect Manager: J deB NOAKES Senior functional officers Staff Finance New Sueinesa Technology Planning Research Legal Industrial Publicity Senior Executive Officer and Director of Staff Administration: j F SLAXLANO Chief Staff Officers: C W VERNON and I G BURGESS Senior Executive Officer--Finance: R W HARVEY Controller: F B LONGLEY Assistant Controllers: J F NEWELL and R W COX Treasurer; J G WILLIS Manager. Corporate Taxation: S J DROOER Senior Executive Officer; A W McAULEY Senior Executive Officer and Chief Chemist: C W OAVIS Chief Engineer: J 0 VICARY P anning Officer: B I ALDRICH Director of Research: K L SUTHERLAND Chief Legal Officer: M G CHATE Chief Industrial Officer: 8 L BRENNAN Chief Publicity Officer: A C BROWNE London ieoresentative: B DOWLING Australian branch managers Melbourne: L M SUMMERBELL Brisbane: A A MARR Adelaide: J R BRENNAN Perth: C R LEITH C 466? 31