The New York herald., 1877-12-11
READING DIVIDENDS.

HAVE THEY BEEN EARNED WITHIN THE LAST
LEaED-paEsIpENT aowES RUNNING THE
COMPANY BEHIND FIFTEEN MILLION DOL
LARS
PHILADELPHIA, Dec. 10, 1877.
Mr.. Charles f. Smith, formerly tor several years
President OF the Philadelphia and Reading Railroad
Company to-day issues circular to the stockholders
and boudholders Of that company protesting against
the management of that company under the pros
ldency of Mr.. Franklin f. Gowen since April, 1862
In this letter Is now for the first time made public
the following report Of committee OF the Board Of
Managers, made year ago.
STARTLING FIGURES.
Tho report is as f0llows:-
PHILADELPHIA Nov. 20. 1875
To THE MANAGERS TnH PHILADELPHIA AND READING
RAILROAD COMPANY
CEyrLEMES-Tne committee appointed TO invest-
gate accounts respectfully report that they have
made such Investigation as appeared TO them neces
gary and present the following statement made up 10
November 80, 1875, since when $10,00O00O Of bonds
Thev present statement marked "A, /" being joint
balance sheet OF the Reading Railroad and the Read
ing Coal and Iron Company, by which IS shown the
total stock in bonds of the ompanies the of
the railroad and It's equipment and the lands as FOL
lows, in round numbers
Reading Coal and Iron Company .......... 55oooooO
Represented by stock ............. $50, 0oO 900
Represented by bonds. 76,0000O0
Floating debt per statement .'C". 7,00000O
TIC diilerence OF So, 100000 being represented IN
the current business OF The company Included n the
cost Of the lands is.-
Loss in working, per statement "F," about 100000
Ana discount and interest. L. 100000
Total. sl4 400, 900
statement. marked "B," showing the net result Of
D.lIx ~
Iron Company each year since 1871, showing a total
profit Tor the i've years or $2,3476 $50 81
And dividends declared by the railroad
company. lo,o4o2o4 %
Leaving deficit $l5, ,692, ,5S3 9o
is oiscouni ON bonds sold How mucn OF this lem Of
interest property chargeaDc of lands during
their development is submit ed 10 the Board
A statement marked e, showing the amount OF
the floating deDt on November 80 IN each year since
1871 and the amount transferred ON November 80,
1873 and 1874, from The books of tho Railroad Com
pany those oil the Coal and Iron Company, and SO
excluded from the amounts OF Dcbts due by The CON-
pany the annual reports to the oders
sucn amounts 90 excluded beiLg:-
For 1873 o9l 200
Amounting together. to-. 5s2 900
A statement marked Cd being the the
last. IN tabular iorm.
A statement marked ~, /" analyzng tho operations
OF The Reading Coal ana Iron Company, ana showing
o net loss in working IN Eve years OF S297, 443 So
The operations OF the Coal anu Iron Company are
properly TO be considered in Two cIusses-hrst, col
lierics worked by the company, and, second coeres
leased The loss on coIieries worked w the company
has been $2, ,O5O, 63o 5S
The gam on those leased, that Is Inc
amount oil royalty received, is........ 3l9l 90
Leaving tho net loss above sated..... s297. .44s 80
CHARLES +. SMITH,
ISAAC HlNKLEY,
j. b. LlPPlNCOTE
subIoined this tabular statements Of the
pany's accounts officially attested.
SERIOUS ARRANGEMENT.
To these facts and figures Mr. smith appends his
own deductions, thus:-
The substance OF the above report may be briefly
summed up IN these three points,
Fnst-The real earnings OF the Railroad
and the Coal ana Iron Company since
1871 nave Deem. ,347, $50 81
Aud the dvdends paid by tue ralroad. u.s. 040 264 80
over seven times the rca Profits
Second-Tnat on Two OCCASIONS the amount OF the
floating debt was trans erred the day when The
books vi the railroad company 10 DO balanced,
from the books OF the Railroad to those Of the Cod
and iron Company, and so concealed from the Board
aud the stockholders.
Third--rhat the loss the collieries
worked by the company has been. So, ,050 635 IS
And the gam those leased has becn. l. 1888 l9l 30
according 10 the books on the coal mlnng oper-
atoms OF both kinds. This result 10 my mind
demonstrates clearly the good policy OF leasing the
COilierieS
II the report Of board OF managers processes any,
thing at all II processes to tell the stock noldr RS the
truth 10 Tue condition OF compapys affairs 40
lar rs known 10 tDe managers al the time OF max
ing the report. How lar your managers have per-
formed that duly properly Is respectfully submitted
for your consideration. As they have persisteutiy
concealed The truth, oicIay before them ior a year
past, think u my duty to tell II Tor them shat tue
stockhoder may nave all tho facts necessary to epa
bic them iBtcgenty at the approaching an
meeting ana 70 prevent repetition oil the deception
CHARLES L.. SMITH
No. 216 South Fifteenth street, Phiadclpha