The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1871-02-21

GIVING profit on the Leases OF theSe
TWO roads Oh Sl,295, l6Ol2
The net revenues of the Pennsylvania
Railroad Company from investments in other
lines, it is confidently expected, WILL after
1871. yield an amount fully sufficient to meet
the interest upon the whole mortgage indebt-
edness of the company-a source of income
which may be expected to continue and annu-
ally increase.
1t is not the intention of the directors that
the mortgage Indebtedness of the company
shall be increased beyond the thirty-fve mil
lions of dollars already authorized, as they
consider that the other assets of the company,
after exbausting this issue, will be ample to
meet any enlargement of their works that
may be required to comply with the public
demand for transportation facilities.
The value of the existing Sinking Fund in
stituted for the payment of the second mort
gage bonds will not only be sufficient to can
eel the bonds issued under it when due, but
balance will be left which, if judiciously ad
ministered, will also pay off at maturity not
only the first mortgage bonds, but also those
Of the general mortgages while the lien of
the State upon the Philadelphia and Columbia
Railway is being paid off by the annual re-
ductions of its principal, in accordance with
the act of Legislature, to an extent which will
extinguish it before its maturity.
From this summary the shareholders will
notice that the interest upon the mortgage
debt of the company, after 1871, may be pro-
vided from the interest upon instalments out
side of your railroad, and that this debt may
be all cancelled at maturity by the existing
sinking fund, leaving the net earnings of
your railroad, which the past year amounted
to Sc, 271 ,621 '67 (after meeting the annual
payment of $4GO, 900 to the State), for the
stockholders.
The Treasurer's statement, annexed to this
report, will exhibit the condition of the
fiji ances of the company at the close of the
year. The discount allowed upon the large
amount of general mortgage bonds sold in
this country and Europe, to take up the COM
panys debentures and meet its other obliea-
tiops, has been met, as heretofore, by the
net revenues of the company for 1870, in
stead of charging this item, as is usual with
other companies, to the cost of the invest
ment.
To meet the demands upon the treasury
during 1871, to complete the works in pro-
gress that are deemed essential to protect the
existing interests of the company, and pay
the debentures amounting to 81, 109, 224 fall
ing due in July, the board propose to give to
each shareholder the privilege of subscribing
for one share of stock for every six that may
be standing in his name upon the books of
the company on the 30th of April, at par.
Under the terms of the general mortgage
tACAC Cdu 10 AcSuOu OAiJ OEO On0 Aun-
dred and Dinety-two thousand dollars of these
bonds in addition to those already sold, until
| the debentures due in July are cancelled,
and further payments are made upon the
State debt and prior mortgages upon its line,
when an additional issue equal to such re-
duction and payments may be made. The
net revenues of the companYin 1870 were in ex-
cess of the amount required to meet dividends
of 10 per cent. upon the proposed increase of
capital, and there is no reason to expect less
favorable results in the future. To enable
! the company to provide for this distribution
| Of stock, the directors accepted the provisions
of the General Act of the Assembly of Penn.
sylvania, approved December 30, 1869, authO.
rizing the increase of the capital of all rail
way companies 80 per cent.
The directors, in their last annual report
referred to the motives which induced then
to depart from their original policy in extend
ing their direct control of railways west Of
PIttsburg. AS this change has been the sub
iect of much public comment, the board viii
be pardoned if they again briefly refer to it
In consequence of the failure of the mixed
system of canals and railroads of the Com
monwealth of Pennsylvania, and their con
Meeting lines beyond Pittsburg, to attract /
reasonable share of the traffic between th,
East and West, or successfully compete will
the avenues built by New York, all the line
of railway that were first built in the West I,
reach the Atlantic market were directed
towards Buffalo as the then best and cheapes
route to the East, leaving to this company,
it entered the list of competitors for this dis
tsnt traffic, to endeavor without delay to secur
in its interest railway connections with tn