Evening star. [volume] (Washington, D.C.) 1854-1972, 1903-11-23
MORGAN IN CONTROL
Dominates Railway Situation
in Southeast.
SEABOARD AIR LINE
LAST WEEKS DEAL OF FAR
REACHING IMPORTANCE.
New York Evening Posts Financial
Editor Discusses Affair in All
It's Details.

of interest ever controlled a situation so
judging by present appear
ances. as the Southern Railway Company
now dominates the territory Of the south
east. Louisville and Nashville is absolutely
In control OF the Atlantic Coast line, when
in turn is friendly to the Southern railway.
Interests closely connected with the latter
are upon the new Seaboard directorate In
company with representatives of the ROCK
Island system.
1.-The Illinois Central management Is
friendly with all. And the management
of the Southern railway, which is the lead
ing spirit of the whole is vested In Young
trust, with Mr.. Morgan and his policy IN
control Even our dormant securities mar
ketS could not stand unmoVed IN Inc HSht
of such intelligence.
"Seaboard Air Line has always been IN
the past d threatener of rate disturbance
and trouble to larger railroad interests III
the south. The relative prosperity OF
southern railroads has been matter large
ly of location, Louisville and Nashville be-
ing the most prosperous as wen as the
most westerly of the four principal hnes.
Next in rank comes the Southern railway,
while the Seaboard Air Line and the Attain
tic Coast Line although doing WELL have
not felt the rush of business of the further
west.
Seaboard Consolidation.
"The SeabOard. which Is a consolidation
made in 1900 of numerous small systems,
has issued three annual reports in which IL
has shown each year a surplus above fixed
charges, the respective SURPRISES being
1929. $50 $50. $50 and ss3S,4S1. The latter
amount earned in the fiscal year ended
June so. 1903 is equal to 31a per cent upon
the SD 900 600 of preferred stock. The
operating ratio for the three years has Deen
ii per cent 66 per cent and GOA per cent of
gross earnings. the ratio being hlgh De-
cause of the high cost of conducting trans
pOrtation rather than because Oh eAcessNe
maintenance charges.
The latest report, in last september
showed that there is much room for growth
in traffic with accompanying betterment
of physical condition. But it was also evil
dent that rapid progress is being maze, ana
that the capitalza ton of the road. While
high for the traffic is not too heavy to be
cared for
I'm 1901 traffic density was 226.465 tons
per mile of road: in 1902 1t was 2s4 2s5 and
296. O45 in 1908. The train load from the low
average of 100 tons in 1901 has averaged
175 tons in each of the last two years. but
is still low. Meanwhile gross earnings have
gained from 81. orr to $4,G63 per mile of
road; in 1895 the consolidated lines earned
only 81 .J,ytj per mile. The remarks of Presi-
dent Williams in the last report dealt glow
ingly with the prospects of the property
as a large Garner. and emphasized particu-
larly its important strategic value. He ex-
planned that the company has the shortest
route from the southern iron fields to the
various Atlantic ports. an especially inn
portant point at this time of expected
growth in export trade, and dwelt upon the
fact that in connection with the st. Louis
and San Francisco at Birmingham the
shortest of all routes from the great grain
country. as centered at Kansas City to the
coast is secured, a route reaching Savannah
from thirty to 900 miles shorter than the
present routes to Baltimore and to New
York. 49,
It's Place in the Railway System.
at was to extend and secure the sys-
TENS hold upon various strategic points
that the floating debt was incurred which
has been financed this week. Some two to
three millions has been the total of de-
ferred liabilities carried in the balance
sheet representing advances to proprietary
companies which have been hard to fund
in our depressed markets.
THE important connecting link between
Birmingham and Atlanta has teen delayed
in construction, but the added funds needed
are furnished by the new interests who en-
tered the directorate this week. Seahoard
is thus not only an important part of the
southern community, connecting the At
lanta at Richmond, Norfolk, Wilmington,
Savannah, Fernandina and Jacksonville,
and eventually, by construction at Charles
ton; but is also made an integral part of
the great Rock Island system and valua-
the coast.
Atlantic Coast Lines Expansion.
contributing to the weeks intelligence
upon southern affairs, the annual report
of the Atlantic Coast line, issued yester-
day. is Of more general interest than any
past reports of that company have been
Expans on from a system of 1,756 miles to
T. l29 miles was marked by the absorption
Df the Plant system of 2,.SS} miles.
1.-The purchase of control of the Louis
willie and Nashville. l33-mile road was
100000 Louisville and Nashville capitol
stock S30,GW,oO9 was purchased for $780,
100000 in per cent bonds, $5,00o000 in At
lantic Coast Line common stock. which
paws : per cent dividend. and S1O,0OOOOO in
cash To make this purchase self-support-
ing it will be necessary for Louisville and
Nashville to pay dividends of about 61a per
cent year against per cent now paid.
The louisville Deal"
1.-THE 100000 or $500000 which the At
lantic Coast Line treasury is now losing
annually for the sake of the control may
be somewhat offset by advantages from in
terchange of traffic and by the equity in
the undivided earnings of the Louisville;
but the more obvious inference is that the
Atlantic Coast Line. like many another I'M
lucky property which happened to be handy
for the purpose, was made to Dear the DUR
den of an extravagant deal
an this case it will be remembered, the
load was placed on the Atlantic Coast
Lines shoulders because a stock jobber who
was not safe had bought up the Louisville
ON a margin. At the present distance or
time ii Is entirely safe to say that the
louisville raid of Gates and his cronies
resembled more nearly a matchmaking ex-
plot than a serious investment
There is not the slightest reason to
imagine that but for the readiness with
which the banking interests identified with
the Atlantic Coast Line fell into the trap
the unsafe owners of Louisville could have
remained In possession half a dozen months.
ut will prove more profitable to review
the results Of the Atlantic Coast Line after
another year has given the company a
chance to develop its expanded system. For
the present 1t Is enough to note that the
balance sheet shows no floating debt and
current assets in excess of current liab.li-
ties.
Naturally, the surplus earned upon the
increased common stock was not nearly as
great in percentage as was earned a year
ago, but the earnings of the roads in the
system all increased in proportion to the
growth of general business"