The Bon Homme County independent. [volume] (Tabor, S.D.) 1904-1913, 1907-08-08

crease IN the margin Tor the products OF
both Pennsylvania and Lima crude oil
combined (taking single years. and not, as
ABOVE, groups OF years. from 1893 to 1904
was over cents per gallon, and, allowing
very liberal estimate of one-half cent
per gallon lS per cent? for increase in
the costs OF production and marketing
during this period, the net average in
crease IN profit during these seven years
would thus he at least l.5 cents per gal
lon. If the same increase in profit be ap-
pned TO the Standards entire sales of al!
kinds or petroleum products in the United
states in 1904, the profits for that year
would have been on the basis of the prices
and costs In 1898. AS a matter of fact, the
known increase of profits on its whole
business, as stated hereinafter, was more
Similarly. for the year 1903, when the
prices of oil reached their maximum, these
prices would represent an increase in the
Standards profits on sales in the United
prices and costs In 1898.
These figures show conclusively the ef-
feet OF the domination of the Standard on
the amount that the public pays for its
oil.
increase In Profits.
Naturally an increase has also taken
place in the profits of the Standard by rea-
son OF this price policy. The increase in
annual an profits from 1896 to 1904 was over
The total dividends paid by the Standard
from 1882 to 1906 were $55l ,922 904 80, aver
aging thus A.15 per cent. per year The
diyidends' however. We're much less than
the total earnings. Exact information as
to these earnings Is available only for the
years 1882 to 1896 and for the years 1903 to
1905, inclusive, an aggregate for these years
or about S714OO0,OO0; but from these figures
the earnings for the other six years may
be estimated with some degree of correct
ness, and II Is substantially certain that
the entire net earnings of the Standard
Wa af No VI
and possibly much more.
These enormous proflts have been based
on an investment worth at the time of its
original acquisition not more than SO, 900,
Furthermore. the rate Of profit on the
capitalization has increased greatly. From
1852 to 1894 the net earnings averaged about
10 per cent. on the capital stock or trust
certificates outstanding. while the average
net earnings for the period from 1903 to
1905 were about So per cent. yearly.
These rates Of profit and their great in
crease are strikingly confirmed by the
known profits of one important Standard
concern, the Water Pierce OIL company
The lowest rate of profit on its investment
nearly every year thereafter until In the
flrst six months of 1904 the profits were al
the rate of 47.2 per cent. per year. More
over, the rate of profit OF this company
has Increased not only in proportion to its
investment but also per unit Of products
sold: The average profit on illuminating
| oil for the years 1896 to 1889 was SO cents
per barrel, while from 1900 to June, 1904
the average profit was $1.32 per barrel
with similar increase of profits on the i'm.
| portant by-products.
Rate Of Profit.
A further verification of the profits OF
! the Standard was afforded by computa-
ton of the profits of certain of its indi.
| vidual refineries. In 1904 the rate of profit
| on investment in these refineries and In
| the marketing concerns distributing theii
! products was. as follows: Refinery al
Lima, o., 81 per cent. Whiting, Ind, Al
| per cent: Sugar Creek, Mo-, IS per cent.
Neodesha, Kas, 35 per cent; Florence
aColo, 62 per cent; or a weighted average
fof AZ per cent, about 2.3 cents per gallon Of
crude handled. This excludes the profits
/ on pipe line business. ..
| The foregoing facts as to the profits viii
| thus explain WILDLY what has become OF
the increase In prices and margins on pc
troleum products during the regime of thu
/ Standard since 1898.
/ Very valuable additional information Il
also shown In the report by the figures