The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-05-29
Rock Island Expects to Pay S
Per Cent on Common.
In Spite Of This, the Stock Goes
Down.
RAIDING THE MARKET.
Bears Still Hammering Down
on Rock Island.
Nay Be a Scheme to Create
Large s'Short" Interest.

Chicago. May 29.-It is estimated that
in the present fiscal year the Rock
Island Frisco system VIII show a sur
plus Of about per cent for Rock ISL
and common In this estimate there
are deducted a full years charges on
the new bonds issued for Frisco com
mon- and no account is taken Of pos
sible economies resulting from the har-
uonious operation Of the new system.
The SIS. SOC, COO > per cent bonds is
sued for Frisco common viii increase
the fixed charges Of the system sS25, GOO
Including this amount, the total
charges Of the Rock Island company
VIII be s105z5. 000. Adding the s., $50, =
o0o required to 1ay per cent on the
preferred makes total charges ahead
Of the common 81. 6S5. COO.
The net earnings Of the Rock Island
for the nine months ended March 81
1903, amounted 10 S14 PSI 600. or 81, sec. 0O0
more than dxed charges and preferred
G4NldeuGs- 50 that all the net earnings
Tor me rest of the year Will be avail
aole Tor the common In the remain
ing three months net earnings. incIud-
ING other income. should not fall far
snort Of 81 Geo 0G0- 1t IS quite likely that
the surplus for the common viii be at
least $4,000. 900
Last year the surplus Of the Frisco.
afIeF charges and preferred dividends.
amounted to SLAP, 600. This year. IN
Guiding operations OF the CHICAGO and
eastern Illinois the surplus for the
common may be Conserva tiveIv estf-
mated at s.. 1000. 600 This. together with
The $1,000 600 surplus for the Rock Is
land. makes q total of 81 600 coo which
VIII be available for Rock Island com
mon this year. This amount IS equiv
alent to about per cent on s86. 500 600
stock, including that issued for Frisco
common
The question is often raised as to
why, if Rock Island common IS earning
50 much. 1t is selling in the 4es- The
answer is to be found in the fact that
the surplus available for the common
represents the oureru1ost margin of the
earnings Of the system, the stock Of
subsidiary companies having in many
cases been put ahead in the form Of
bonds or guarantees. There IS quite a
difference in this respect between the
old Rock Island stock and the new
Rock Island common. as shown by the
Old RI New r I.
Cross earnings s.. 3s5s45 *s72- ore coo
Fer cent surplus 70
gross -------- ---.------- . 10
*Es5imated
1t Is evident from the above that in
case of a shinkage in gross earnings the
surplus as available for the new Rock
Island common would be wiped ava Y
sooner than would the surplus availabis
for the Old Rock Island stock. Therefore,
s per cent on the new stock does not
mean 50 much as 8 per cent on the bid
stock.
HANIMERING DOWN THE STOCK
New York. May 29.-FVith a steadier
( feeling in st. Paul and the market raid
ers aiming their blows at Rock Island
attention naturally was entered on the
latter property. A tip that Rock Island
I common would sell at 20 was circula ted
SO generally that even the messenger
I boys running about the street must
4 have had it, The point was regarded as
too commonly distributed to be true
Talk on Rock Island resem bEes close
7 ~ that which went the rounds last No
vem5er when the common shares were
under s. Then. instead Of going To pot.
the common stock began a recovery
which extended TO about 20 points and
i squeezed numerically many traders
Erho sold rha stock short IN large guam
tities Many believe that Monday
f bsarish gossip had for its principal OBJ
fect the creation Of large short inter
est in the stock.
1t is argued that Rock Island, selling
at the equivalent Of 1s9 fer the old stock