Los Angeles herald., 1907-05-10
HARTMAN SHOWS
LARGE EARNINGS
SOUTHERN PACIFIC INCREASES
SEVEN MILLIONS
Directors OF Southern and Union Pa
cIfics Change Dividend Basis.
Big Stock Isues Are
Proposed
INV Associated Press.

companies To-Day Noleu " Pi"SS e
statistics of the two companies on
quarterly instead of semi-annua
dividend basis.
AS a result a quarterly dividend OF
i1k per cent on Southern Paclhc stoch
and a quarterly dividend OF 21s pei
cent on Union Pacific stock was de-
clared. These dividends will be pay
able July / and are at the same
rate ner annum as the last previous
declarations.
The directors of the Southern PACING
voted to offer for subscriptions pre-
ferred stock to the extent of 10 per
cent of the company's total capitaliza-
tion on s36.0OO,OO0.
Announcement was MADE a1ter the
meeting that the directors of the union
Pacific will call stockholders meet
ing in June to authorize an issue vi
800, 900 common stock, against
(which will be issued $75,OOO,OOO per
cent convertible bonds. The new oonds
will be convertible into stock at 10
at any time within five years. The
bonds will be offered at 80.
In explanation of the proposed Union
Pacific issue e. H. Hartman read a
statement which showed that the re-
uuirements amounted to 63,7OO,OOO.
He stated that it's total free assess
ment was s24S, 900 exclusive of 16OO
miles of completed railway.
He estimated the net earnings OF
Union Pacific for 1906 and 1907 az
s13. 300 900, as compared with S3O,olo'OoU
dn the previous year. All incomes ne
estimated at S36,900,000 and the pal-
ance over all charges, requirements anu
dividends at $12,000,000.
Mr.. Hartman estimated the net
earnings of Southern Pacific for 1861
at s44. zoe, 900, to be compared with
s37. AL, 900 in the previous year.
Earnings Are Large
At the meeting of the board of dlrec-
fors of the Union Pacific To-Day the
chairman submitted statement snow
ing the estimated earnings over operat-
5nS ernenses for the year ending June
40. 1907. to be $32, 465 900. Deducting from
this the interest on the funded debt,
IS. .654. 900, sinking fund requirements, 81
100000. interest on loans, $S77 900, and
other expenses, 1900, would leave
surplus of approximately S22, 100000.
The statement continues:
'In addition to the above income the
company will receive as interest anu
dividends, other than from investment
securities, $12,323000; rental from steam
ships. S244,0OO, which will bring the total
Mr.. Hartman stated that it was his
belief that the actual returns would be
greater rather than less than the estl-
mated figures, as they had been made
upon very conservative lines. After
paying the dividend on the preferred
stock, $4,000 900, and the dividend on the
common stock, 800 900, 900, there would be
something over $12,000,000 over and
above all requirements of every kind
ffrTyI.. IAIN Of no
Union Pacific was incurred for the fol-
lowing expenditures, which have not
been capitalized:
Construction and acquisition of new
lines, $29,172,000; payment on account of
the San Pedro road, $18,050, 900; steam
ships Manchuria and Mongolia, $5,126,-
O0O rolling stock, $9,302,00O; lands and
real estate, $2030,000, a
total of $685. 900.
According to the chairman's state
ment the company owns $50, ,097 900 face
value of bonds, charged on the books at
81, ,654, 900; 1927, 1884, 900 par value invest
ment stocks, and rights costing $191,-
1872, 900 standing on the books at $685.
273,00O; 70,623,O0O par value; other stocks
charged on the books at $39,S11, 900.
Road Is Prosperous
According to the statements sub
mitted to the directors of the Southern
Pacific today the probable earnings of
that company for the year ending June
80 1907, will be approximately $44, 697,-
600; fixed charges, including reserve for
depreciation of rolling stock, $1S,929, 900,
leaving a surplus over fixed and other
charges of $25, ,76S, 900; from this is to be
deducted dividends of 7 per cent on pre-
ferred stock, $2,769, 900, and dividends of
s per cent on common stock, $9,S92 G00
leaving surplus after paying of divi-
dends of $13,106,0OO. Mr.. Hartman
stated that in his opinion the various
figures would show greater results
rather than less.
At present the floating debt of the
Southern Pacific is $32, 100000. of which
$14,270,000 is due to the Union Pacific
The Central Pacif1ce Railway company
has paid three installments of notes
due the United States goVernmnet, re-
leasing funding bonds of that company
to the amount of $S,S22, 10000 which were
in the treasury, and there is also in the
treasury against which nothing has
been sold 1914, 1000 Galveston, Harrisburg
e. San Antonio second mortgage bonds,
making the total capital expenditure
against which nothing has been issued
$3S,414,000, which more than accounts
for the floating debt of S32,3OO,OOO.
Company Lists Assets
Other than the above the company
has the following assets against which
there has been no issue of capital OBJ
legations:
Bonds and stocks, principally of oil
companies in California, SIC, ,947 900: con-
struction advance, $25, ,O0O,O for about
$50 miles of completed railway, for
about 1885 miles partly under con-
struction and for change of gauge of
Nevada & California line, the recon-
struction of southeastern California
lines; for acquisition of new lines, $14.-
5000; for electric railways, princi-
pally around Los Angeles and Salt Lake
City, $16234,000; for steamships, 81, ,255,-
900; for real estate, $13357 900; making
total expenditures. uncapitalized, S14O-
100000 in round numbers.
The board, after considering the
above statement, decided to offer pre-
ferred stock to stockholders of record
May 81. 1907, to the extent of Is per
cent of their holdings, common and
preferred (both having the right to sub
scribe), which will amount to about $50.
100000. Subscriptions are to be made
on or about June Is, and to be made
payable, rs per cent June Is, and %
per cent July Is, and so per cent August
Is.
After the adjournment of the meet
fufYS Of tha TInion and GoIIthe,-p Do oo;6o