Semi-weekly herald., 1913-02-13
Denver. Colo, Feb. IL, 1913.
TO THE STOCKHOLDERS.

The following statement, submitted
by me on behalf of your Board OF Di-
rectors, exhibits the financial condition
Of the Company, December 81, 1872.
On that date we had, in our entire
territory, $40 Exchanges, furnishing
service to 1874 .66s Exchange Stations,
including 1898 Toll Stations. In ad-
dition TO these lS4,66S Exchange Sta
tions, there are 1890 stations con-
nected with our system on the lines
Of connecting companies, making a to-
tai Of 203,05s Subscribers Stations
In service on December 81, 1912, an
increase of 30,255 during the year,
CT a total increase Of 40,l23 stations
since the merger of The Colorado Tel
ephone Company, Rocky Mountain Bell
Telephone Company, and The Iri-
State Telephone and Telegraph Com
pany, on July 81, 1911; a gain Of
almost 25 per cent. since the merger.
The total miles Of exchange and toll
lines, as of December 81, 1912, we're
5O6,618.93, an increase Of l05,831.76
miles for the year. The increase alone
being more than four times the cir
cumference of the earth, and the total
wire mileage sufficient to go more
than twenty times around the earth.
Total miles of exchange and toll wire
underground on December 81, 1912,
were 0,929.O9. Total miles of toll
lines on the same date were 71,516.O6.
Because of the comparatively brief
period which has elapsed since the
formation Of The Mountain States
Telephone and Telegraph Company,
some comment on the balance sheet,
which follows, is probably essential
to thorough understanding of it.
An examination of the balance sheet
of the system of The Mountain States
Telephone and Telegraph Company,
submitted herewith, will indicate to
stockholders the great increase in the
magnitude of the Company. Since
my last report of The Mountain States
Company we have acquired all the
Bell properties in Arizona, so that
our operations now cover the seven
great States of Colorado, Utah, Idaho,
Montana, Wyoming, New Mexico, and
Arizona, with toll lines into all sur
rounding States.
Stockholders Of The Mountain
States Company, who were holders of
Colorado Telephone Company stock
prior to the merger in 1911, will re-
call that in my letter of July 20.
1911, to Colorado Telephone Company
stockholders, l referred to the ad-
vantages to be secured through
wider distribution of our general in
vestment. Pursuing the policy then
commenced, The Mountain States
Company has expanded, until it is
today corporation with outstanding
capital stock practically 81 times as
great as the entire issued capital
stock of the Colorado Telephone Com
pany at the time the merger was eff
fected. The benefits of this broad
ening of investment accrue alike to
those whose Mountain States Tele-
phone holdings come from their for
mer investment ir Colorado Telephone,
to holders of Rocky Mountain Bell
shares, (Which they exchanged for
Mountain States stock), and also to
those who have invested in our shares
since the merger was effected.
There was outstanding, December
81, 1911, as shown by my last annual
report, $20,364, 10000 of Mountain
States stock. Though the average of
outstanding capital stock for the year
was s15,960, $4,000. For payment of
dividends, during 1911 there was avail
able $1,S67 ,293.72, against an actual
dividend payment of $1,022, ,59s.45,
leaving for $1911 $S44 ,695.27 for Sur
plus and Reserves.
1t will be noted that December 81,
1912, there was outstanding $26,994,-
10000 in stock, representing an in
crease of $6,629, 10000 from figures
in my last annual report. OF this
AheA CaoC, @1,Socy tOV.VO WAS lSSSueu III
December, 1912, with dividend obli-
cations against it commencing Jan.
uary 1, 1913.
The average capital stock outstani
ing during the year 1912 was S22,-
739,354.00. During that year there
was available $2,513,37077 for pay
ment of dividend obligations which
reached the actual amount of 81 ,5S7,-
334.00, leaving for 1912 balance of
$926,036.77 to Reserves and Surplus.
In the report of The Mountain
States Company, as of December 81,
1911, our statement showed payments
on account of capital stock subscrip-
uons amounting to more than 81 ,35O,-
10000, the shares for which were not
to be issued and delivered until jan
uary, 1912. The Mountain States Sys-
tenn report for 1912, coming at time
when no such item of cash subscrip-
tions to capital stock appears on our
books, our cash and deposits neces-
sarily show large reduction, amount
ing to more than s750,000.0O.
Our real estate holdinps show nm