The Alaska daily empire., 1915-08-10
QUESTION AND
 ANSWER ON
 JUNEAU MINE

The Boston News Bureau contains the following question and answer concerning Alaska Gold prospective earnings:
 'In a recent article you figured tho earnings of Alaska Gold at S2.6o per share with a 10000 ton plant in com-l mission, 80 with a 10000 ton plant. and S7 witr a 10000 ton plant. the share capital. according to your es- inmates being S5O.OOO 900,0O0 and 95O- 00o respectively. for the three differ ent sized plants Do you not think you have underestimated the company earning capacity and overostimoted the capitalization which win be ex. tant when Alaska Gold has reached the point where it can treat the ton-l nages of ore mentioned by you?
 have seen statements by bankers closely connected with Alaska Gold that with a 10000 ton plant in com mission the earnings would be mot less than SS.OOO,OOO per annum." Why should there be such discrepancy between your figures and those Of the bankers?"
 -F. B.
 Answer-Our estimatot ae Alaska Colds prospective earnings were. as stated in our article the minimum" which are expected to be realized. We took. therefore. the original fi- gures of the company's engineers, viz: ore averaging S15O per ton, a cost of 70 cents per ton, which would leave an operating profit of 70 cents per ton. which would leave an operating profit of 75 cents per ton. TO be ul- tra conservative we took 800 operat- ing days per annum, thereby arriv- ing at our figure of net. with a 10000 ton plant. of S75OO per day,'or $2,25O- 900 a year. This would be S260 per share on S5O.OOO shares outstanding, which we assumed would be the com pany's capitalization when it has funded S1,OOO.OOO of additional capital requirements
 A more liberal estimate of ore val ues. costs and working days would show an expansion of yearly earnings to the SS.00O.OOO quoted by you. Then if it were figured that the $1,00O,000 referred to could be taken care of by bonds which in conversion would not require the issue of more than 8O.OOO shares of stock. the conclusion would be reached that the present proposition would have Co support a capitalization of SSO.OOO shares against the S5O,OOo figured in our article. The earnings would then be $3.6O per share with a 1O,OOO-ton plant against S2.6O as we estimated
 Indications now are that Alaska Colds ore will average considerably larger better than $15O per ton, that its costs will be substantially less than 75 cents per ton. and 1t undoubt- edly can operate more than 300 days in the year. It was for these reasons that we qualified our estimate by stating that actual results should be materially better than the above es- inmates"
 As to the capitalization which Ale aska Gold may have when it has en- larged its plant to 20,OO0 tons per day capacity-or 30.OOO when the time comes-it is obviously too early def- nitely to state what the conditions may be when this financing is done. We therefore took what appeared to be the maximum share capitalization. It is quite probable that the company will be able to show results with it's 10000 ton plant that will make it possible to provide the funds for a 2O.- 900 ton plant on terms more favorable than we outlined in our article