New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-03-06
Pennsylvania
System Earns
S443,33S,364
Net Income Is Larger, in
Spite of Increased Oper-
ating Expenses

of traffic on its lines as result oil the
huge volume of export trade and the
further expansion of general business
throughout the United States, the
PENNSYLVANIA Railroad system rolled up
record breaking revenues last year.
The summary of the income statements
Of all the Pennsylvania lines, issued to-
dav in connection with the annual re-
port Of the Pennsylvania Railroad
Company, the parent corporation OF the
system, which operates and controls
that part of the system east of Pitts
burgh, shows q grand total of operating
revenues for 1916 Of s443,33s,364, an
increase Of s6s.399,7 26 over the figures
reported in 1915.
Operating expenses OF the whole sys-
tenn aggregated 1884,. 1926, an in
crease OF S47A36,4O9 over the year be-
fore. On lines both east and west Of
Pittsburgh there were transported dur
ing the year a total OF 40I, 62i,143 tons
Of freight and 195,951,1 6S passengers.
The service rendered TO the public was
equivalent TO carrying one ton OF
freight 46,s3i, 766,7s6 miles and one
passenger 4,972, 563.9 1863 miles.
Eastern Lines Earn $52.oo0,oo0
The Pennsylvania Railroad Company,
operating the Eastern part Of the sys-
tom, furnished the larger part OF the
revenues. From its directly operated
lines the company returned net in
come of $50 ,276,5Oi, compared with S42,-
425.322 i'm 1915. This sum, after apply
ing S2.13S.959 to sinking and other re-
serve funds, was equivalent 70 1913 p r
cent on the S499 ,265, 700 common stock
outstanding, against $40 per cent in
1915. 6.S2 per cent in 1914 and $50 per
cent in 1918.
After payment OF the usual per
cent dividends, calling for the dis
bursement Of approximately S30,oOO,-
600. the sum of $9,214,925 was appro-
priated for revision of grades, removal
Of grade crossings, betterment Of
equipment and other Improvements; the
additional sum Of s3.713,7S6 was appro-
priated for similar expenditures on
leased and branch roads. Deducting the
profit and loss charges. the balance for
the wear was S5,522, 707. The profit and
loss surplus at the end of the twelve
months stood at S33,514,207, against
s27. O91 .499 the year before.
Railway operating revenues OF the
railroad company in 1916 were $780,
27s.533. an increase Of 33,650,363 over
1915. OF this total freight traffic CON
tributed Sl6i,206,7 1872, an increase Of
S23. SOL .935. and passenger traffic S44.-
907.A76. a gain OF s6,296,39l. The in
crease in total revenues over 1915 was
II per cent. Operating expenses were
Greatly increased. For the Pennsylva-
MIA Railroad Company alone this item
totalled s16G.164.5s1. an increase OF
500. 428O2O. Total operating expenses,
said President Rea, increased Is per
cent over 1915, maintenance OF way and
structure expenses increasing Il per
cent; maintenance Of equipment, 10 per
cent, and transportation II per cent.
Substantial increases in the cost Of ma
terials. supplies and labor explain the
larger operating costs.
President Rca's Remarks
Commenting on net income. Presi-
dent Rea tells the stockholders: Your
company maintained its dividend and
earned a substantial surplus, but II It
had not heretofore consistently pur-
sued the policy OF investing its sur
Mus above reasonable dividends in tho
bettcrmcnt Of your railroads and equip
mcnt instead OF providing therefor
through the issue Of additional bonds
end stocks. the present dividends could
not be maintained under the existing
traffic rates
The report shows that the Pennsyl-
vania Railroad Company and the lines
operated directly by it east of Pitts
burgh earned 54 per cent on the actual
cash investment in road and equipment
devoted TO public use. The earnings of
the entire system, lines east and west,
1911 ,,rorer.t- invoetmcpt NJ 81