New-York tribune., 1905-08-14
PROSPERITY OF B. AND o.
Railroad Elevated to s%Git Edge"
Class of DiUidend Payers.

The salient points in the remarkable showing
made by the Baltimore and Ohio since II became
& railroad in fact in name unquesuonaoly served
70 maintain the reasonabIeness OF the recent pre-
diction that the common stock was 70 go on a
Z ner cent basis Reports that this action would
be taken at the July meeting remained current up
to the day OF the dividend declaration the continu-
ing Of quotations on the common stock around
rs evidencing the conviction OF investors that the
Baltimore and Ohio's elevation to the gilt edge"
class among dividend payers was a foregone con-
cIuson-
Gross earnings from operation increased 50 per
cent a mile; a decrease OF per cent occurred in
the ratio OF operating expenses to earnings mile.
and there Increase OF 50 per cent IN net earn
fnCs from operation a mile. Tonnage, a whole.
doubled In volume while receipts as a whole. in
creased two and three-quarters times Freight re-
ceipts mile increased rs per cent; passenger
receipts increased a thousand dollars a mile gross
income from all sources d mile increased 50
per cent, gross expenses and charges meanwhile
advancing in the ratio Of only one-half and nee
income reaching $.1OO a mile The proportion Of
capital liabilities mile changed from Il per
cent bonds and - cent stock. to Sc cent bonds
and A per cent stock; fixed charges interest taxes
rents etc. decreased 13 per cent a mile. The
net income after payment of dividend on preferred
stock has averaged for four years 81 per cent on
the outstanding common stock.
An impression that as 1896 was the year OF the
company's collapse. 1T necessarily must have been
favorable. would be erroneous one. There was
a tremendous effort made IN 1886 so to Increase
business as TO avert the impending catastrophe
The revival OF trade. following the depression OF
the previous years was most encouraging and
the work to profit by the frightening conditions
was tremendous. The total tonnage Of 1896 was the
greatest IN the history Of the company 20 that
time.
On the other hand. in 1904 earnings in all classes
showed increase over the preceding year. but ow
ing the general slump in commercial circles. so
marked in the closing months OF 1903 these coming
within the fiscal year OF 1904. the advance not
proportional the increased expenditures in other
directions The net income fell OF Sl.5OO.coo How
ever. a year enabling the payment of interest upon
bonds and per cent dividend upon stock together
representing principal OF $40 90; the payment
CT rentals and taxes and OF miscellaneous improve
menrs aggregating coo: the appropriation OF 81,
600 900 in lump for additions and betterments; the
taking care Of 100000 and more other expendi
lures with about 100000 left over 10 add TO the
surplus not 10 be mininized in any way
as 20 the outcome There could scarcely be con-
ceived one affording a inspriting contrast
with the situation nine years before. Then. de-
spite the herculean efforts Of the late John +.
Cowen than whCrn more conscientiOusly loyal an
official ever served company. disaster came, and
the oldest OF American railway corporations suf-
fered the commercial isnominy OF cour, interven-
ton
No sooner was the past thing OF the past than
the held sway and for something over three
years there happenings in connection with the
Baltimore and Ohio that established legal well
other precedents destined 10 have most impor-
tant influence upon later receiverships Backed BY
Cowen who untangled the legal knots they
were encountered. Oscar G. Murray. through the in
controvertible presentation he made OF the ncreas
ing volume OF business they would make possible.
lmbued the court with bis own faith. and bis plans