Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1891-08-16

SlbtLr-it. uIS moi tANf1->tNt or lLtt'ISOifD4S.
The actual net earnings OF the Texas rail
ways. compared with The amount of their
stocks ana bonded debt. or Oy ant fair CTi-
terlon that may be adopted for aScertaining
the actual Investment. viii demonstrate
that the Texas railways have not FOR Sew
eral years received anything like a fair re
turn on the actual investment The fact
that for several years past the Missouri,
Kansas and Texas, the Houston and Texas
Central, the St. Louis. Arkansas and Texas
have been IN the hands of receivers ap-
pointed by the Federal courts, and the In
ternatlonal and Great Northern, the San
Antonio and Arkansas Pass and the HOuS-
ton East and West Texas in the hands Of
receivers appointed by the state courts,
all OF which receivers are operating their
respective roads As officers OF the respect
i've courts and subject TO repeated eXamina-
tons into their accounts by the masters Of
such courts. whose accounts are AT inter
YaIS approved, under the sanction Of the
oaJhs of the judges of such courts. and who
have been unable to pay the interest on
their bonds, would seem Of itself sufficient
evidence that the railways of Texas have
not been earning
a SUFFICIENT AMOUNT on THEIR CAPITAL
The Gulf, Colorado and Santa Re railway
company is bonded for so. 900 per mile and
its stock is S43l0 per mile, making capital
account of S24.3l0 per mile. II, interest &c
count. per cent on first mortgage ana Is
per cent on second mortgage bonds, amounts
to s.. $50. $50 per year
A fair dividend on its stock would be ut
least per cent. hence TO pay fair return
on its capital, after payment OF the other
fixed charges. its net earnings should be
1870, 100 per year. If Texas wishes her
roads 10 reach the standard of excellence Of
other states. some surplus should be Al
lowed for improvement of the property. Its
net earnings above operating expenses for
the year ending December u. ISIS, We're
sl66. S0T12. After payment Of all items of
fixed charges. except interest on its bonds,
it had 4 little less than 5000 left towards
payment OF interest on its bonds. For the
twelve months ending December 81, 1854,
Its net earnings above operating expenses
were SSlI.40e62 After payment IF the fixed
charges OF the road. exclusive Of interest on
the bonds, IL had leit.availIblc for payment
of interest on the bonds. SU25. go. Il. l. For
the twelve months ending DcCe,abcf 81,
1870, its net earnings were S990, gg4. Is.
After payment of fixed charges other than
bond interest, il had left. avdilab!, toward
the payment of bond interest, $>-1,S.5.Il.
Thus In the three wears the amount avail
able for payment Of interest ON bonds has
been 81, lbs. OJ.2S, not enough 10 pay the i'll
terest for two years. and only $jl .G4U > in
excess of The payment OF Interest Tor one
wear. During the past three Years il fell
short =, 73l, l19.12 oi earning enough 10 pay
interest.
The monthly reports filed with the conf
mission viii snow that there has been 10
material Improvement for the first SIX
months Of 1891 over 1880.
To pay fair return on the investment
during the three years referred 10, it should
have earned Sj.0l9,4sO. while j, earned only
l.i5s.5002S. During the three YeaIs re-
ferred to, the company has practically eN-
pendedSli OF It's net earnings in improve
ments Of the road. having expended over
81. 200, 600 for that purpose
N THE LAST TWELVE MONTHS.
The published statements in Poor'S
Manual OF the Galveston, Harrisburg and
san Antonio railway company for 1883
show that it fell short 1926 of the cam
ing interest on the bonds. The New York,
Texas and Mexican railway. Sui. f3l while
the Gulf. Western and Texas and Pacific
was S32.G11 short Of earning its actual op-
Grating expenses.
We understand statements which will be
furnished the commission by the
last three named companies viii
show an equal or greater deficit for
1890.
The Fort Worth and Denver City railway
company has been able 10 earn interest on
its bonds, but 10 dividends The Texas aud
Pacific railway company has been able TO
Fay iitltLtSL OlI VI - DC4lltNt GtDi
The Texas and New Orleans is the only
road in the state which has earned any sur
plus which could be applied toward pay
ment of dividends
Were il not for the fact that the Atchison
company has advanced money to pay inter
est on the bonds of the Gulf. Colorado and
Santa F'e railway and the Southern Pacific
has made similar advances for its lines in
Texas some time during the past three
years, every railroad of Texas of any I'M
portanCe would have been in the hands of
receivers, except the Texas and New Or
leans, the ForT Worth ana Denver City and
the Texas and Pacific; and the latter com
pany would only have escaped because Of
an arrangement by which it has only 10 pay
interest on one-half of lis bonded debt. i'll
terest on the other half rot being payable
unless the earnings are sufficient to make
payment.
The average net earnings of all the rail
roads in the United States for the fiscal
year ending June 80, 1883 (see report of |.
c. O. were S20sT per mile. while for Texas,
as heretofore shown. sS77 per mile.
In veritcation Of these statements we
hand to the commission FOR your inspection,
with January. 1855. 4 monthly
statement showing III detail the earnings
and expenditures of the company. Cover
ing a similar period we also hand to the
commission for its inspection statements of
the income and construction expenses. and
fuel and material account; ard for a lesser
period monthly statements showing
the passenger and freight pro-
portion Of each operating expense account,
the average cost of moval of freight
per ton and passengers per mile. These
statements are not written up for the oc-
Casion, but are copies of the monthly state
ments furnished by the auditor to the Off
GERS of the company, and which copies are
retained in the auditors Office for his rec
ordS and information. over his own sigma
ture.
In order that the commission may see
what effect reduction of rates on any par
tiCular article will have on the earnings, we
also hand in for the inspection of the COM
mission u monthly report covering period
of eleven months ending MAY 81, 1891. show
ing the amount of pounds and the amount
of earnings on each article transported.
These statements We're not tabuiated prior
to July. 1890, and the auditors books for
June are not yet completed.
TO facilitate the commission in obtaining
we hand you statement for
the twelve months ending June 20 dune be-
ing eStimated). showing the total nun Der Of
pounds trans ported and the earnings thereon
of thirteen of the most important articles of
transportation. We also hand You table
giving the total pounds of all other articles
transported. and the revenue on the same
for eleven months.
We cheerfully invite the exercise of the
power conferred upon the commission 10
appoint experts to examine the books of the
in verifcatiOn Of the statements
made. In verifcatiOn of the statements
made in comparing aggregate rates and ey-
penditureS of Texas roads with those of
other companies. we file with the commits