Bisbee daily review., 1908-09-06
CONSERVATISM
/. RESULTS FROM
RECENT PANIC
Capital Stock of Mining Com
panieS Now More In Har-
mony With Earning Power
on Basis of Cheap Copper.

Some of the beneficial effects of the
late panic, on mining are beginning to
be made more and more apparent
Principal among these is the tenden-
ey OF promoters and organizers of COM
panies to make their capitalization
more commensurate with the earning
power of the mine. Only eighteen
months ago. it was the rule to capital
lie on the base of Is cent copper. This
has been proven to be erroneous, and
s result many OF the companies or
ganized about that time and previous
ly viii have to be reorganized with
consequent loss to shareholders. An
other marked improvement is the ten
dency to hold capitalization to about
the two OF three million dollar mark
figure large enough for any company
in Arizona to begin on. If the share
holders are to be permitted fair par
ticipation in the profits The smallest
mining dividend, TO be equal to rail-
road dividend of per cent, should not
be less than 20 per cent per annum;
for mines, no matter how large they
are, win nevertheless play out in time
and are constantly decreasing in value,
while railroads go on for ever and con-
stantly increase in value.
One of the best examples of fair
capitalization afforded recently is that
of the Savanna Copper Co., Rowland
& Smith concern. This company is the
result of a merger of the Comanche
Copper Co. with the Copper Gulf Co.
The former was capitalized at five mil
lion dollars. and the Copper Gulf was
capitalized at five hundred thousand
dollars. Instead of doing what was
customary eighteen months ago, rails
ing the capitalization on the reor-
ganization to about ten millions, the
two companies were combined on q
capitalization of two millions. This will
insure the shareholders of this COM
pany larger participation in the prof
its of the business than it has been
customary heretofore for promoters to
permit their stock holders.
Another company that has adopted
the wise course of conservative capital
fization is the ADderson-Apache, operat-
ling at Hachita. This company is capt
taiized at FIVE hundred thousand dol
lars, and can pay dividends on II cent
copper Just as soon as the heavy cost
of development and remaining por-
ton Of the purchase price are taken
care Of This company is most fortu-
nate in the character of its ore. being
! self-huxer that commands premium
| at the smelters. It is also fortunate
| IN its location with respect to trans,
Iportation facilities. The management
reports that all the proceeds from the
sale of the ore at present being shipped
/ by this company goes TO the fee owners
as a credit on the purchase price. With
1.-THE able management of L. K. HOultQn
| and with A. HouIe, as consulting engi,
neer, this property may be relied up
on to pay handsome profits to its share,
holders. n. S. Berry, formerly mining
superintendent of the Old Dominion, OF
Globe. was a recent visitor to the An.
/ derson-Apache. and reports That the
showing made at the property in the
/ last three or four weeks is little short
iof remarkable.
one hundred thousand dollars net
viii pay twenty per cent year on the
Anderson-Apache' capitalization and
as 1t IS altogether probable that the en-
tire amount Of stock win not have to
be issued before the company gets on
self-sustaining basis, it can be seen
that. If copper should again get up &c
the high figures obtaining a year OF
two ago, that the shareholders of this
company viii be amongst the most
fortunate Of any in the country.