The St. Louis Republic., 1902-01-30
This Policy Considered Best,
Though Advances Could Have
Been Made = Trade on
Strictly Cash Basis.
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ITEMS FROM STEEL TRUSTS
1<<>>>>%< 80 . 90

>-a- yorr Ian eo-A preliminary report
covering the operations of the United States
Steel Corporation since 1t came INTO eA.S
tence ten months ago was made 10 'he
stockholders to-day.
II was a forerunner to the more eXtenGeo
resume to be submitted at the annual gen.
eral meeting on February II; and was ae-
signed to familiariZe the share owners WITH
the financial status of the company ana
the trade situation in the market Where II
buys and sells.
The report signed by both Charles NJ.
Schwah and Elbert H. Gary. declared pres
ent business and future outlook. viewed
ahead through 1902. to be highly satisfac-
tory. The report said:
'-The outlook for the year 1902 is very
bright. Everything indicates that all of
the facilities of each subsidiary company
will be taxed to their utmost to supply
the demand that Is being made. The actual
business now booked amounts to more than
half the total combined annual capacity
of all the companies. The heavier products.
like rails, billets. plates and structural
material. are sold up to the productive ca
pacty of the mills until nearly the end OF
the year. In the more highly finished pro-
ducts the consumption in each case is great
er now than at the corresponding period in
1901. which, 1t should be remembered, was
an abnorEally heavy year"
Reason for Not Advancing Prices.
Discussing prices, the report said they
could have been advanced but that it was
decided to be better policy to refrain from
doing SO. The reference to prices is as
follows:
.'The demand for products has been so
great that prices coulG easily have been
advanced. Indeed, higher prices have been
voluntarily offered by customers who were
anxious for the immediate execution of
orders, but the companies have firmly
maintained the position of not advancing
prices. believing that the existing prices
were sufficient to yield a fair return on cap
ital and maintain the properties in salts
factory physical condition, and that the
collateral advantages to be gained in the
long run by refusing to advance prices
would be of substantial and lasting value
not only to the companies, but also to the
general business interests of the countries
The report asserted that this policy as TO
prices had not only a reassuring effect upon
the trade. but contributed to the restora-
ton of confidence in the general business
situation.
The report reviewed the larger financial
operations of the company, including those
of its organization, and the recently pup
lished statement of earnings for the flrst
nine months of the existence of the com
pany. and gave condensed general bal
ance sheet for November 80. 1901. The set
tlement with the underwriting syndicate
was thus stated:
Deal With Underwriters Closed.
1.-THE residue of the common and pre-
ferred stock Of this corporation. delivered
March Is. 1901, and not used for the ac-
QUESTION by it of the stocks of the specified
companies, being the shares which, as
q, 1901, were to be retained by and to be-
long to the syndicate. amounted to 6499SI
shares of preferred stock and 1889 shares
or the proceeds thereof. after reimbursing
the syndicate the s25.0Oo,0c0 in cash which
1t paid to the corporation, and approxi-
tions and expenses. constituted surplus or
profit of the syndicate. The transactions
between this corporation and the syndicate
having been concluded. an agreement of
final settlement and mutual release. dated
January g. 1902 was executed between this
corporation and the syndicate managers"
The condensed balance sheet for Noven-
ber 80 showed that on that day the accounts
receivable aggregated s45. 5.269, ,453, the bills
receivable s2,s21.iss and the cash on hand
the list of assets in the balance sheet was a
credit of inventories amounting to s956o3, ,9y7
and subjoined tabulation showed that It
finished products SIS, 1922 $50, manufacturing
supplies and miscellaneous stores Sl2 Isl
and materials labor and expense locked up
:s ass'ssi. ss[ren' on'0p'e'ea 0f'se contracts -
The current liabilities on November 90
were stated at $50. 269, $50. and the surplus Of
nies was placed at STA, 4,S44 22e.
The cost of the properties owned and op
Grated by the several federated companies
was given as s1437. .494, ,SS2.
"The business Of the companies said the
report, had been put on practically a cash
basis. The losses actually incurred through
had debts have beer very small and little
IL any loss In the collection of accounts and
notes receivable Is anticipated. About 20
per cent of the total current monthly ac-
counts due from customers is now being
generally collected within thirty days, and
IT is the effort of the several managements
to maintain the business on strictly cash
ha Siov