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136 
SIMMS MOTOR UNITS LTD.
Page 98
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EXPANSION OF OUTPUT AND PROFIT
MR. LIARDET'S STATEMENT
The annual general meeting of Simms Motor Units Limited was held on June 25th at the Company's Works.
Mr. G. E Liardet (the chairman) presided and in the course of his speech said : The Profit and Loss Account discloses a Profit of £672,294 before Taxation for year ended 31st December, 1953. The charge for taxation, which includes Income Tax, Profits Tax and Excess Profits Levy, after crediting £4,325 from Taxation Equalisation Reserve, amounts to £477,675 leaving a net Profit of £194,619. We have also brought to credit £23,681 representing over-provisions for tax in previous years. From these sums it is proposed to transfer £100,000 to General Reserve and £50,000 to Plant Replacement Reserve.
Out of the remaining balance, your Directors have paid the Preference Dividend at 7i per cent. and recommend a Dividend of 1i9d. on each Ordinary Share for the year ended 31st December, 1953. This absorbs a net amount of £57,750 calculated on the Ordinary Share Capital increased last year to £300,000 and leaves a balance to be carried forward into 1954 of £134,094.
The excess of Current Assets at ' £1,405,903 over Current Liabilities £494,260 amounts to £911,643, which is an increase of £244,694 over the corresponding figures for 1952.
At the Extraordinary General Meeting which follows, you will be asked to approve an increase in the Authorised Ordinary Capital from £300,000 to £800,000; capitalise £200,000 of Reserves to be used to pay up in full 800,000 new Ordinary Shares of each, to be allotted to Ordinary Shareholders on the Register at close of business on 1 1 th June, 1954, in the proportion of two new shares for each three shares held and approve new Articles of Association modified in accordance with current pracace.
In recent years your Company has been very closely associated with the Diesel Engine and we have pinned our faith on the belief that small high speed Diesel Engines would come into almost universal use in Agricultural Tractors, Light Trucks and Industrial applications by reason of their fuel economy and greater reliability compared with similar sized Petrol Engines. We therefore set out to design and produce low cost, high efficiency Fuel Injection Equipment, as this was needed before that type of engine could meet popular demand, and the success of our efforts is demonstrated today by the adoption of Simms components in large quantity by such famous manufacturers as the Ford Motor Company, Ltd., British Motor Corporation, Ltd., A.E.C., Ltd., Leyland Motors • Ltd., and also by Rolls-Royce, Ltd., for whose high power engines rather more complex injection units are required.
At the last Annual General Meeting, brief reference was made to an agreement with the American Bosch Corporation of Springfield, Massachusetts, U.S.A., and I am glad to say that the agreement was duly ratified. We now enjoy a full exchange of technical information, production knowledge and the interchange of patents with that Corporation.
The combined efforts of the two Companies are bringing nearer the adoption of an entirely new conception of Fuel Injection Equipment, a unit which bears a similar relationship to the present Fuel Injection Pump as does Coil ignition on the Petrol Engine to the old and costly Magneto.
This new Distributor Pump has many technical advantages and while the Pump itself should be cheaper than the present " In-Line " Pump, it will also enable economies to be made in the construction of the engine. This, without doubt,will constitute a real step forward in further popularising the low cost small Diesel Engine, but some considerable development work is still necessary before we can go into production.
I can say that for the first few months of the current year we have made excellent progress, but we are up against great competition and vicious price cutting. We could relax the quality of our products and so cut costs, but your Board feel this would be a grave mistake and we believe that our future prosperity will be based on high quality products representing good value for money, though not necessarily the cheapest on the market, and most important of all, giving long years of trouble-free service to the eventual user.
The report was adopted.