The Sun.
London, England, 1848-10-23 00:00:00

RAIL WAY INTELLIGENCE.

LONDON, BRIGHTON, AND SOUTH COAST.
The extreme depression which_ has lately affected the
whole of the railway property of the kingdom has set
the directors of the various companies at work in pre-
paring statements of their affairs, to prove to their
shareholders and the public that there is no real ground
existing for the depression. The directors of the Brigh-
ton Company have been 'the first to issue their state-
'went, i❑ which they say:—
" In the present depressed state of railway property,
it appears to the directors to be a duty towards the pro-
prietors to adopt any legitimate means of restoring con-
fidence. For this purpose, they believe that a perfect
understanding of the actual state of the company's af-
fairs is the first requisite.
" The total capital authorised to be raised by the
Acts of the Brighton Railway Company is 7,490,805/.
" The total amount of capital raised up to the Ist
Jan. 1849, will be, as nearly as possible 6,955,000/.,
Consisting of-
1. Loan capital (1,631,2981., at date of last
half-yearly report, since reduced by the
proceeds of the Six per Cent. Stock ap-
plied in extinction of debt) ... 1,303,000
2. Preference share capital, viz.:—
Five per Cents. ... ... 644,000
Six per Cents ... 393,000
3. Ordinary share capital ... 4,615,000

£6.955,000
" The future expenditure requisite to close the capital
account, by the completion of the different works in
progress is so limited, and most of the contracts are so
tar advanced, that the following estimate is given with a
high degree of certainty that it will not be exceeded,
unless the increase of traffic should be so considerable as
to require an amount of accommodation not at present
foreseen.

1. Arrears of accounts for works, land, &c.,
on lines already opened ... £63,300
2. Further expenditure to complete lines and
works in progress, viz.:—
The Hailshata and Eastbourne and
Thames Junction Branch, the Brick-
layers' Arms and Portsmouth Stations,
and materials ordered (turn-tables,

cranes, sleepers, &c.) 68.000_
3. Engines ordered, , seise 4.- —"Piano

sheds, improvement of Brighton sti-
tion, &a. ... 70,000

£202,100

Or say, including all contingencies, 240,0001.
The only remaining item is the enlargement of the
London-bridge station, the amount of which cannot be
precisely ascertained, but it is confidently believed that
in any event the estimate of 150,000 L, given by the com-
mittee of investigation in May last, will not be exceeded.
Taking it at this figure, the extreme limit of further
capital required to close the capital account will be
390,000 L, against which must be set about 145,0001. of
available assets, consisting of 60,000 L to be paid by the
South-Western Railway Company for the purchase of a
joint interest in the line into Portsmouth; 15,0001. due
from the steam packet company; 32,000/. of calls in
arrears, surplus land, engines to be resold, atmospheric
materials, &c. This leaves 245,0004 of additional capital,
which will be required during the next two years. As
the existing shares of the company are all fully called
up (with the exception of a final call of 1L on the six per
cent. preference shares, appropriated to paying off loans),
this additional capital must be raised, either by the
creation of fresh shares or by loan, for both of which
sufficient powers are contained in the company's Acts.
The directors fully expect to be able to raiso the requi-
site amount without the necessity of creating fresh
shares. In this case the final capital of the company
will consist of 7,200,0001., viz:—
1. Loan capital £1,548,000
2. Share capital entitled to preferential di-
". 1,037,000
vidend
3. Ordinary share capital ... 4,615,000

£7,200,000
Theother sources to the 14th of
c 1,8781
were 194,805/. ; from the first of July
ee
earceteuea le
f receiptsrev
October, they hare been 168,350/. ; and for the wholeht
ti u of
forth e
the companyfirst half-year a fromlf -ye atrr 'LOP
of the year 1848, they may be estimated, with a slight
margin for the contingencies of traffic during the next
two months, at 450,000/. The expenses of every sort
for the first half-year amounted to 90,2261. The ex-
penses for the present half-year will not, as far as the
directors are able at present to ascertain, much exceed
those of the first half-year, notwithstanding the larger
amount of traffic ; and on the whole they feel confident
that the total expenditure of the year 1848 will not
exceed 190,000/. This would leave a nett income of
about 260,0001., being equivalent to a nett return of
nearly 4 per cent. on the whole productive capital
which has earned revenue, or of about 3/. 10s. per
cent. per annum on the ordinary share capital, after
providing for interest and preferential dividend. With re-
gard to the probable future return, when the whole ca-
pital of 7,200,000/. is expended, it is thought better not
to go into any speculative estimate. Some of the pro-
prietors may have seen an estimate lately given in the
London Weehly Railway Share List, published under the
authority of the Committee of the Stock Exchange, by
which it is made to appear that a gross annual traffic of
609,3401, or at the rate of 11,718/. per week, would be
required to pay a dividend of 4 per cent on the share
capital. This estimate is altogether erroneous, for the
following reasons:—
" 1. The working expenses are assumed to amount to
274,'2031 per annum, whereas the actual working ex-
penses for the year 184-8 will be under 190,000/. The
mistake arises from assuming that the ratio of ex-
penditure to receipt will be the same as it was for
the first half-year of 1848, or 45 per cent.; while,
in point of fact, the high ratio of expenditure to
receipt for the first half-year, when the traffic is
small, is counterbalanced by the lower ratio of the
second half-year, when the traffic is large; and the
general average of the year will only be about 41 per
cent. Any estimate of expenditure by per tentage is,
however, quite fallacious, since by far the greater part
of the expenses are fixed, and do not increase in propor-
tion with an increase in traffic, as is shown by the fact
above stated, that the ratio of expenditure to receipt on
an average traffic of 7,500/. per week, during the first
half-year, is 45 per cent., while on an average traffic of
10,000/. per week, during the second half year, the ratio
is only übout 38 per cent. A traffic of 11,7001. per week
might be carried on with ease by ten trains daily each
way between Brighton and London in summer, and
eight in the winter (the number now running), and,
therefore, the additional expenditure would be compara-
tively small.
"2. The tot al ultimate capital is assumed tobe 7;440,9301.
being 240,0001. in access of what has been already given
as the real amount ; and the present amount of loan and
preferential capital is stated as 2,737,4541., instead of
2,340,0001., which is the actual figure, from overlook-
ing the facts that only 393,0001. of guaranteed 6 per
cent, stock has been issued instead of 461,8551.,
and that this amount is not a creation of new capital,
but in substitution for an equal amount of loan capital.

" 3. The rate of interest on the whole of the loan ca-
pital is assumed to be 5i per cent. This appears un-
reasonable, looking at the fact that the present average
rate of interest paid by the company is only about 4i
per cent., and that only 125,0001. of the debt falls due
up to the beginning of 1850.
, ' Irrespective, however, of any question as to the
rate of interest, which may be a matter of opinion, the
positive errors under the first two heads would di-
minish the net sum available for dividend by an
amount which may be safely stated as at least equ'va-