Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-01-11
The Company's Statement.

The notice of the roads intention to
authorize 500, 100000 new capital was con-
tanned in this statement issued for the
Pennsylvania railroad late yesterday after
noon:
Notice will appear in the newspapers to-
morrow morning calling the annual meeting
of the stockholders of the Pennsylvania
Railroad Company for March II, 1907, and
stating that the management will then ask
the shareholders to authorize an increase
in the capitalization of the company. AL
though the exact amount has not yet been
determined, it is likely that proposed in
crease will be requested in the form of
SlCO.O00,OOO in capital stock and 100000. 900
in bonds, to be issued in such amounts and
| at such times as the needs of the company
require
The amount of capital stock already is
sued. with that reserved for the conversion
of the outstanding convertible bonds, very
nearly approaches the full sum now au-
thorized. Therefore, while it may not be
necessary to issue any part of the proposed
new stock or bonds during the current year.
! from it's shareholders to make such issue
when circumstances so require.
The laws of the state of Pennsylvania
provide that capital increases shall first be
authorized by majority of the sharehold-
| ers, and the most appropriate and conven-
| lent way for a company of the size of the
Pennsylvania Railroad Company, which has
| over 40, 900 stockholders. is to obtain such
necessary authority at the annual meeting,
of which notice is given to the stockhold-
ers, and such has been the custom of the
Pennsylvania Railroad Company in the
past.
Issue, in Part, to Be Placed Soon.
Despite the reference in this statement
to the possibility that none of the new Sc
curites might be put out this year. 1t is
admitted that part will be placed as soon
after ratification by the stockholders as
money market and other conditions will
permit No large part of the new capital
It is said will be used in the near future,
but the near future is not regarded as ex-
tending over the next six or eight months
by which time provision will have to be
made for the $50. 000, 900 of Pennsylvania
company notes which mature November l.
The surprise caused by this announce
ment of another great increase in the Penn
sylvania railroads capitalization will be the
| more intense when 1t is recalled that within
the last few months the Pennsylvania has
disposed of half of its holdings of Baltimore
and Ohio and Norfolk and Western, yield
ing the road about $50 000, 900 in cash. This
was more than half of the amount of capi-
tai which the road estimated last June it
would need in the next two years. In place
of $90,000.O00. however, the PENNSYLVANIA
000, 900, including the sum realized on its
recent sales of stocks.
Puts capitalization to $500, OOO, 900.
The 5000, 000, 900 new stock and bonds
bring the roads authorized capital stock I'D
to $500, 600, 900, and it's bonded Indebtedness
up to 1922 ,000, 900, a total of practically
$500. O00. 900.
Reference to the statement OF last June
shows how rapidly this huge capitalization
has been built up In that statement the
late President Cassatt pointed out that be-
tween 1900 and 1906 the roads capital stock
had grown from $129. 000. 900 to 1903, 900, 900
and the bonded Indebtedness from $S8, 900,
600 to $192 ,000, 900, the gross earnings mean
while having increased from ST., 600 900 In
1898 to $146, 000, 600 in 1906 and the net
earnings from $l1 600, 900 to $50. 600, O00 In
addition to these amounts provided through
capital issues, the Pennsylvania railroad in
the six years from 1900 to the close of 1905
also spent 81. 000, 900 out Of income for i'm
provements, meanwhile increasing the divi-
dend on its own stock from per cent in
1900 to per cent in 1906.
Roads Enormous Mileage.
Figures compiled yesterday by repre-
sentative of the Pennsylvania railroad