June i, 1902.] 



THE INDIA RUBBER WORLD 



295 



ANNUAL MEETING OF THE UNITED STATES RUBBER CO. 



T^'HE tenth annual meeting of the stockholders of the 

 United States Rubber Co. was held at 12 o'clock M., 

 on May 20, at the registered offices of the company in 

 New Jersey, at New Brunswick. The annual reports 

 of the president and treasurer were presented and accepted, 

 and an election of directors held for the ensuing year. The 

 reports referred to were much more comprehensive than 

 usual, containing information in regard to the condition of 

 the company not before made public, for which reason they 

 are given in full here : 



president's annual report. 



New Brunswick, New Jersh\', May 20. lgo2. 



To THE Stockholders of the United States Ruhber Co : It is 

 now ten years since the United .States Rubber Co. was chartered under 

 the laws of the state of New Jersey and began operations. At the out- 

 set there was acquired a large majority interest in the capital stock of 

 nine of the leading companies manufacturing rubber boots and shoes, 

 thus giving the United States Rubber Co. the control of about one-third 

 of the output of those products in the United States. The following 

 year the Woonsocket Rubber Co. and the Goodyear's India Rubber 

 Glove Manufacturing Co. were added, through the purchase of their 

 capital stock, thereby raising the percentage of output to about one-half 

 of the total. In l8g8, by the acquisition of the stock of the Boston 

 Rubber Shoe Co., the largest of the individual companies, the per- 

 centage of product of the United States Rubber Co. and of its subsidiary 

 companies was further increased to three-quarters of the total output of 

 rubber boots and shoes in the United States. 



Some of the advantages of consolidation which were indicated in the 

 prospectus issued at the formation of the company have been to an ex- 

 tent realized, while others have not. Among those realized maybe men- 

 tioned ; 



1. Economies in manufacture resulting from each mill having the 

 benefit of the improved methods of manufacture employed in other mills. 



2. Consolidated purchasing of certain materials. 



3. Reduction in selling expenses, owing to the large product sold. 



4. Better supervision of credits, and consequent reduction of losses by 

 bad debts. 



Among the advantages anticipated but as yet not realized are : 



1. Advantage in purchase of crude rubber. 



2. Distribution of manufacture of different classes of goods in the 

 various mills (the preservation of brands and trade-marks being an ob- 

 stacle thereto). 



Competition. — While the United States Rubber Co. during the ten 

 years of its existence has met with a fair degree of success, it became 

 apparent more than a year ago that prices were maintained at a figure 

 which stimulated competition, and the formation of new companies and 

 investment of new capital. Consequently, in January and February, 

 1901, your directors determined that it was wise to make a marked re- 

 duction in prices, which brought the selling price of the standard grades 

 of goods down to about the cost of manufacture. The result of this 

 reduction has been that the sales have largely increased. For the year 

 ending March 31, 1902, the gross sales of the company were $45,917,- 

 536.84, as against gross sales of $32,224,216.14 the previous year ; and 

 for the year ending March 31, 1902, the net sales (including miscella- 

 neous goods) were $25,436,150.59, as against $20,853,633 94 the pre- 

 vious year, being an increase in gross of 42. 5 per cent, and in net of 22 

 per cent. 



Exports of Goods. — While the exports of rubber footwear are still 

 relatively small, it is gratifying to note that our foreign trade has in- 

 creased from a total of net sales in 1899 of $[22,322.59, to $741,737.58 

 the past year. 



Future Policy. — The regaining of trade through the reduction in 

 prices as above shown has been largely accomplished. 



The problem now before us is, how to manufacture and market the 

 large product of goods at a fair margin of profit. 



That much is being accomplished, both in the way of economy and 

 of efficiency in the important departments of purchasing, manufactur- 

 ing, and selling, is evidenced by the following : 



Crude RuniiER. — While in the past our crude rubber has been pur- 

 chased largely through importing houses, necessitating the payment to 

 them of commissions, the United States Rubber Co., under arrange- 

 ments recently inaugurated, imports most of its crude rubber directly 

 under its own letters of credit, thereby saving not Only in commis- 

 sions and otherwise, but also obtaining other advantages as the result 

 of direct importations. As the cost of crude rubber is nearly one- 

 half the total cost of the manufactured product, the new management 

 feels that this subject demands the closest attention, and that owing to 

 the very large consumption of crude rubber by the United States Rub- 

 ber Co. (amounting to $9,068,379.11 last year) even greater opportunity 

 exists for obtaining our crude rubber advantageously than has as yet 

 been realized. 



Condition of Manufactories. — The physical condition of the 

 extensive plants of the United States Rubber Co. and its constituent 

 companies has been well maintained, the buildings being in a good state 

 of repair, and the machinery up-to-date and first-class in every respect. 



Selling Agencies and Branch Stores. — Selling agencies have 

 been consolidated where it could be done without detriment to trade, 

 and the "Branch Stores" belonging to the company have been in- 

 corporated. 



Auditing of Books. — Your management has arranged for quarterly 

 audits of the books and accounts of the United States Rubber Co. and 

 of its subsidiary companies, by Messrs. Haskins & Sells, certified public 

 accountants. 



Financial Matters. — Soon after the organization of the new board 

 of directors of the United States Rubber Co. a year ago, the officers and 

 directors were called upon to adjust a large indebtedness which was 

 then found to be owing the company. This adjustment has been ac- 

 complished, and while it has been necessary for one of our subsidiary 

 companies (the Meyer Rubber Co.) to take over securities for a large 

 amount, it is believed that serious loss has been avoided. 



Funding Indebtedness. — The management has recently consum- 

 mated the funding of the entire floating indebtedness of the United 

 States Rubber Co. and of its subsidiary companies, by the issuing of 

 $12,000,000, five per cent, three year, funding notes, which on April I, 

 1902, were sold to the First National Bank and Blair & Co,, of New 

 York. These funding notes are secured by notes of the subsidiary com- 

 panies aggregating $12,000,000, held by the Morton Trust Co. of New 

 York, as trustee for the holdeis of the funding notes. The existence 

 of a large lloating indebtedness, from the very inception of the United 

 States Rubber Co., has been a menace to a thoroughly economic and 

 independent administration of its affairs, and its funding has placed 

 the company in a stronger and more secure position than ever before. 



Treasurer's Reports. — By the treasurer's reports which follow, it 

 has been the intention to give the stockholders much fuller information 

 than has been contained in the reports of past years. The result of the 

 year's business, so far as profit is concerned, is not flattering. But 

 while it is true the operations of the United States Rubber Co. and its 

 subsidiary companies show only a very small net profit, namely : $119,- 

 495.60 ; and the consolidated property account of the United States 

 Rubber Co. and its subsidiary companies, shows a surplus of but $42,- 

 011.75 ; and while it is also true that the charging off on property ac- 

 count of items of doubtful value (nearly all of which existed prior to 

 the beginning of the year) shows a deficit of $1,110,344.15 in the prop- 

 erty account of the United States Rubber Co. itself — nevertheless, it 

 can be said that it is believed by the management that everything is 

 now brought down to a rock bottom basis, and that from this time for- 

 ward the process of building up should go on. The inventories of 



