New-York tribune., 1874-12-12

Eew-York Central. SIT l53s33 81 $l0.!4l4l9 %
Ehe................ l2645G,052 20 5.47S,627 81
Baltimore and Ohio. 36,57o'O3z 50 6,O76,l49 20
DECEPTIVE SURPLUS FUND.
This comparison places tho Baltimore and Ohio Road
In very favorable light but while strictly true is in
certain fallaciOus What mean BY this asser-
ton will be shown by inquiry into the nature Of the
surplus fund" concerning which .there seems to be so
much misapprebensOn. Tls surplus when the report
for 1873 was made amounted s290s3l3l 1S, and had
been created by investing the undivided earnings OF the
road improvements of roadbed, increase of rolling
stock constructing works. aud securing valuable
connections. UIder the policy Of other roads these IN
yesments represented by stock dividends which
interest must be paid. and which therefore go to swell
the capital account, In other words the water"
concerning which there is such popular complaint The
report for 1874, which submitted the 10th nst
shows that this surplus fund now amounts to s32,1A
100 l5 II this Indebtedness was in such shape that
returns would have to be made upon ii in the compar
for 1873 made above the report OF the Baltimore and
Ohio Road instead OF showing s50649 20 of net earn
Jugs s578032 80 Of debt, would have made the fol
lowing exhibit:
s65 GIL l63 % Net Earnings .s5o76l49 %
"A showing not good either the Pennsylvania or
the New-York Central could make As it IL, however
the Baltimore and OHIO enters into competition for the
Chicago trade with fund OF $214lG0 Is, on which 1t
has not only to dividends, but which, invested
in per manent improvements affords means, over and
ABOVE tlc vi WuICu "
pay the upon the funded debt and the capital
stock The policy has been subjected to criticism
being unfair 10 the sockhOlder, the argument being
that all tho earnings or the road belong to the stock
holders and If any portion Of these earnings is invested
in road, certificate of the Indebtedness should be
issued such for instance stock dividend. The stock
holders OF the Baltimore and Ohio have been however
satisfied with a semiannui dividend OF five per cent
finding their interest in the surplus fund to be repre-
lar, m M N
tho market aud the financial advantages conferred
upon the road.
now THE VARIOUS ROADS TREAT THEIR STOCK
HOLDERS.
This explains how it that during the panic
year. when other panes found it impractcable TO
effect loans IN Europe the Baltimore and Ohio Com
pany negotiated lOah OF 4200000O on very favorable
terms paid two dividends OF five per cent each and in
creased its surplus fund by ssso6i 81 The Pennsyls
yana Road declared the same dividends during the
year, but was compelled to pay one OF them in scrip
the New-Yor Central paid TWO dividends OF four per
cent EACH and the Erie dividend OF one per cent for
the SIX months ending June 30 1873 For the end
ing Sept 3O 1874 Notwithstanding the general depres
sion IN trade and falling of in railroad receipts the Bal
timore and Ohio increased its surplus fund by the
amount OF s3IlO2s ", beside paying the usual dvi
dends the interest its loans, and large amount into
the sinking fund, for the exngushment OF its mort
rage utedness Tue entire amount Of the mortgage
indebtedness Of the Company is now 0s2696 IS less
than the surplus fund.
Ibays been particular in explaining the financial
condition of the road, there seem TO be the widest
errors in circulation in regard to IT, As compared with
the NewYork Central any other OF the great trunk
lines the position OF the sOckhoder of the Baltimore
and Ohio is simply this Taat while stockholder in
the former claims not only dividends upon his original
Investment but also the Investment Of his earnings
the stockhOlder Of the latter Is content with good
regular dividend the remainder going to the improve
ment and equipment of the road enabling 20 compete
for business on for ITSELF and to offer more
favorable rates the shipper An original stakeholder
OF tho New-YOrk Central or Pennsylvania road has
received more money from his investment than an
original stockhoder In the Baltimore aud OHIO but
the stockholders OF the Baltimore and Ohio sustain the
peculiar policy of the road nothing be said in the
way OF criticism as regards the interests Of tho stock
holders
ECONOMICAL CONSTRUCTION AND MANAGEMENT.
Another advantage which the (B. anu o. road will
have IN competing with its rivals Is the comparative
cheapness OF its Chicago lne Although the road was
constructed OF the best materials and In the most
thorough aud substantial manner. owing to the depres
sion OF values and the ability OF the road to cash for
everything the whole line OF 26s miles built for less
than an average OF $4,000 mile. All its permanent
structures and its masonry have been made to accom-
double tracked Its cost Will not be very greatly IN
creased completed divisOn or the road was operated
0uriug the year. the being s6i053 CO. the ex
pensps $50 s57 CO. leaving net earning OF s27l9j 49,
Rarely has q and incomplete road made such a ia
vorable exhibit and when the dullness OF the times Is
sidered the fact affords striking indication OF the
economic ability OF the road.
The Baltimore ana Ohio In economical In its manage
ment almost to The salaries paid 10 ats Ofi
GERS are small compared 20 those attached 20 similar
potions on other great roads. II Is said that tue
salary Mr. King the first Vice President, was recently
increased $1,000 per and Mr. keyser The sec
and Wee 10 So 90; Mr.. GuifOrd the General
Freigut Agent and Mr. Snarp the Master OF Transpor-
tution receiving S00J These hgures Will doubt
less appear pltiful compared to the Ere scale.
BALTIMORE's LOCAL BOASTS.
As to the shortues Of the line TO Chicago most or the
talk is mere local boastng. Baltimore Is. OF course
to Chicago than NewYork even by such round
about route as the Baltimore and Ohio Road but IL 10
not 30 near as Philadelphia the Pennsylvania route
wb,cb route Is also some miles shorter TO Biltmore
nm the new route The road 26s miles In length from
on the Lake Erie Division or the Baltimore
and Ohio Road, TO Chicago almost perfect airline;
Tr,, Centreton Newark Ohio, on the Central Ohio
tho Iouto Is at right angles With the Chicago
xconson; at Newark tho route turns east at rignt