The sun., 1918-08-07
PETROLEUM INCOME
DECREASES GREATLY.
Mexican Company's Earnings
in 1917 $6,O0O,O00 Less
Than in Previous Year.
OIL SHIPS IN WAR WORK
GENERATING Expenses Increase
S9,646,557 Over 1916-S4,-
$4,000 for Dividends.

loss Of 100000 in net earnings by
season OF the diversion OF Its shipping,
an increased charge OF about 100000
Gar depreciation and exhaustion OF oil
,srds and a relatively strong financial
position are disclosed by the annual
,snort OF the Mexican Petroleum Com
many of Delaware issued yesterday. De-
srlte the reduction in earnings from
water transportation and charges to In
come for depreciation. &C. equal to 81
share on the common. the report
showed surplus after charges and
war taxes of s4,9S6,020. This was
eoual TO slo.23 a share on the common
stock In 1916 the surplus available for
dividends was s7.l53,05s, which was
equal to $15.7s a share.
stockholders are informed In the re-
mort by President E. L. Doheny that
the transfer Of a portion of the fleet
represented a real large sacrifice and
Mr. Doheny describes this contribution
10 winning the war as follows:
'.The volunteering of a large part OF
YOUR fleet, the requisitioning OF others
OF YOUR tank steamships and the delays
which occurred In the construction of
the remainder, limited your company
10 supplying only the customers to whom
former prevailing prices and of fore
, going the sale CT any oil at the better
prtoes which the greatly increased de-
mand stimulated. A calculation was
carefully made or tho loss OF earnings
TO your company, by reason of tho diver
sion of some steamships and the failure
to get others. That amount, conserva-
lively determined. is in excess of Sc
100000 for the last six months OF last
year.
ships in Government Service.
"You may have the consolation Of
knowing that in so far as your invest
ment in this company IL concerned you
have made the supreme investment sac
rifce Of risking the very existence Of the
ships without which your business could
rot b carried on, and OF sacrificing all
Of rhe earnings and profits which II was
planned tho ships should produce for
your company during the remainder of
last year, after they went Into the Gov
eminent transatlantic service, and for
such period In this year as they will
continue in such oervice. Inasmuch as
toe average price of the contracts which
you are legally and morally bound to
fulfill with the use Of steamships that
remain in your possession Is very much
below the price which now obtains for
like products in similar markets your
sacrifice is much more than what might
b. calculated by considering the per-
oentagc of your ships which has been
employed exclusively in war service,
moving none Of your products"
Nevertheless gross earnings in 1917
were nearly double those Of the preced-
ing year. being s1S,121.7S9 against
Ss.66s.46S. Operating expenses. how
ever increased Ss.646.557 from $685.
1852 to S11.906.3 800. but these included an
increase Of more than S1.10o.0oo in de-
probation and a new item OF $1,s39,2ll
representing reserve for exhaustion Of
oil lands and greatly incIeased ordinary
t'Hes. After a provision OF 1921 900 for
income and excess profits taxes, there
remained a balance Tor tvidends OF
S.9s6020. From this $3.50, 900 was paid
in preferred dividends and Sl,lS0,263 in
common dividends From the earnings
of the year S2,S45.757 was added to
profit and loss surplus, making the total
surplus at the beginning of the current
year S1s,426.639.
The balance sheet, issued yesterday,
indicated a strong financial position. with
current assets of S11.442.760. compared
to current liabilities OF $2.Ss6,56O. The
company counts In it's assets s3,6O5,5lS
ava NahtS pdlu 10 the mexican GOyeTn-
ment under protest. but on the other side
OF the sheet has a reserve account OF
S'oO6,sSs and profit and loss surplus
Of SlS.426,63s.
Sales I7.ss7.13s Barrels.
In his remarks to stockholders Press
dent Doheny says in part:
The total number Of barrels disposed
OF during the year was 17,5S7,13S. The
price received therefor was $l7.457,292,
an average of 99A cents a barrel. In
FORMER years the average price received
per barrel was much less than shown
LOT this year. being IS cents In 1916, 81
cents In 1915. "a cents in 1914 and IS
cents in 1913. The greater price re-
ceived this year was not due, however,
70 any increased price for the oil at the
point of production In Mexico. 1t was
que largely to an Increase in the pro-
portion which was refined and which
was delivered at distant points, the SELL
ing price OF which was increased by the
Cost OF refining and transportation.
crude and fuel oil to the extent of
6so6,oi7 barrels were sold (. o. b. Tam
plco at an average of SO l-3 cents
barrel. while 46.l54.430 gallons of crude
sasoIene produced at the Topping plant
AT Iampico sold at approximately II
cents gallon and 9,6s2,174 barrels of
crude oil were sold and delivered at
various foreign ports at 81 cents a bar
rel.
Against the dividends paid In 1917 of
Szlio,26S 1t Is noteworthy that the
Sa%es paid by your companies to the
mexican Government for the same pc
roi amounted to s1.sl2.6S9, and those
pad to the United States Government
'.r the same period amounted to $722,-
vs. tax total OF S2,534,762, or $780,
'Vo IN excess Of dividend payments.
IN addition to the above disburse-
ments there was invested In the United
states and Mexico for the increase Of
taciiitles for handling your products
S-+lo.'ss, making a total of s7,Os5,7s5
expended for capital account, taxes and
uNldends, Of which less than 80 per cent.
was dividends, over 35 per cent. taxes
ana about 81 per cent. was reinvested
III permanent improvements. either IN
t.e United States or Mexico. where such
capital investment again becomes a
sure source Of revenue for the respec-
i've Governments and probable source
NJ revenue TO the Stockholders"