THE CUBA REVIEW 19 



Cuba Cane Sugar Corporation 



Seventh Annual Report, for the Fiscal Year Ended 



September 30, 1922 



December 1, 1922. 

 To THE Stockholders: 



Your Board of Directors submits herewith the Annual Report of the Cuba Cane 

 Sugar Corporation for the fiscal year ended September 30, 1922. 



Since the last Annual Report was submitted, a great change for the better has taken 

 place in the affairs of the Company, and in the sugar market. Since that time, all of the 

 1921-1922 sugars of this Company have been sold; its floating debt has, as to $10,000,000 

 thereof, been funded into long term bonds; the $10,000,000 loan (to which certain of 

 this Company's debentures were subordinated) has been reduced to $7,500,000, and 

 extended at the rate of 6 per cent per annum to September 30, 1923, and it is the 

 expectation of the officials of the Company that it can be paid off by the conclusion of 

 the coming season and the subordination lifted from the subordinated Debentures. Of 

 the $6,908,062.30 set aside last year out of Surplus Account for adjustment of the value 

 of unsold sugars and of materials and supplies, $2,900,607.53 has proved to be not 

 needed and has been returned to the Surplus Account. The Company ended its fiscal 

 year with $3,584,942.62 of cash in banks, available for dead season expenses. 



One year ago there was in Cuba a visible surplus of about 1,100,000 tons of sugar, 

 and although well-posted sugar merchants at that time believed this to be a mere dis- 

 location and felt convinced that the visible surplus was actually balanced by an invisible 

 shortage in the rest of the world, the visible surplus nevertheless exerted a most de- 

 pressing effect on sugar prices. That apparently huge surplus has now been absorbed 

 and Cuba ends the 1921-1922 season with practically no surplus sugars on hand. As 

 a result, prices are correspondingly higher, the present market being 4c. c. and f. 



The above brief statement summarizes the principal incidents of the past year: they 

 are discussed in greater detail in the following pages. 



The Corporation produced 3,379,451 bags of sugar, on which it showed an operating 

 profit of $3,599,490.99. The Profit and Loss and Surplus accounts follow. 



During the past year the readjustment of the sugar industry rendered necessary 

 by the inflated prices of 1920 (which was fully discussed in the last Annual Report), 

 was completed, and the Sugar Finance Committee, created by President Menocal in 

 February, 1921, to control the sale and shipment of sugar of the 1920-1921 crop, was 

 dissolved on December 31, 1921. 



The effect of the dissolution of the Committee on the sugar market is more fully 

 discussed under the caption "Review of the Sugar Situation." 



In order to repay the large amounts which the Corporation had been compelled to 

 borrow during 1921, against sugars which it was not free to sell at will owing to the 

 control of the Sugar Finance Committee, the Corporation proceeded, upon the dissolution 

 of the Committee to liquidate its sugars as rapidly as conditions permitted. 



The average price obtained for the entire crop was 2.2402c. f. o. b. w^hich com- 

 pares well with the general price obtained by the entire Island. The cost per pound of 

 production was 1.94Sc. f. o. b. The cost, exclusive of the cost of cane was .946c. against 

 1.943c. the preceding year, a significant proof of the economies introduced by your 

 management and of the readiness with which costs adapt themselves to price in Cuba. 



The mill extension at Violeta was completed and that mill is now in first-class 

 condition with a grinding capacity of 500,000 bags. The capacity of the Company is 

 now 5,225,000 bags divided as follows: Cuba Cane Sugar Corporation 2,655,000 bags 

 and Eastern Cuba Sugar Corporation 2,570,000 bags. The greatest care and economy 

 have been exercised in all expenditures and capital expenditures have been rigorously 



