The sun., 1919-05-09
NORTHERN PACIFIC
NET INCOME DROPS
Figures of 1918 Are $20,129,-
33l Against $29,502,635
for Previous Year.
GROSS BREAKS RECORD
Decrease Laid.to Failure Of C.
B. & Q. to Declare Extra 10
?. c. Cash Dividend.

The annual report OF the Northern
Pacific Railway Company made public
last night, shows net income Of S2o,12e.-
1874, or approximately $40 per cent. on
its s24S 100000 common stock outgtand-
ing for the road in 1918, against sge,-
b02635 in 1917. The annual income as
fixed for the company under the con-
tract with the Railroad Administration
was s3O0s9,69l, but the principal rea-
son for the decrease in earnings was
the failure of the Chicago. Burlington
and Quincy. which is partly controlled
by the Northern Pacific. to declare the
extra cash dividend of 10 per cent.
which helped bolster up the income OF
the latter road In 1917.
The Northern Pacifc's gross business
during 1918 was the largest in its his
tory being s102,90s,259, against $751;
225.726 in 1917. Freight revenue was
t7S534343, an increase OF $l3.275,34s or
1884 per cent, compared with the pre-
vlous year, but there was likewise a cor
respondingly large increase in operation
expenses, which were s71,516,3o2 last
year, compared with S53,2e7,S6l in 1917.
In his report Howard Elliott, president
Of the road. makes the following COM
nent on the railroad situation to stock
holders:
THE Federal income account shows
that the net income to the Administra-
ton was s2s.S61. 263, which is s1,22S,-
42SSS less than the just compensation,
and represents the loss to the Admin
istration from It's operation of your
property during the year.
"Your company In 1917. during nine
months OF which the country was at
war, earned net income figured on the
count for 1918. sS1,s7s.565.3s. or ST.
cs9,s7351 more than the Just compen-
satlon and s2,51S,302S9 more than the
property earned in 1918. During 1918
higher prices were paid for material,
and wages were increased very mate
rally. A comparison of payrolls in JAN
uary, 1917. and 1919 shows the cumu-
lative effect OF the wage increases
granted since the war began, and the
comparative expenditure for material
and fuel.
January. 1917, payroll ............s2,st SAC $40 80
January, 1919. payroll .............. 4l6S'ollSs
Increase TOO per cent. 81, 500. 100. 50
January 1917. material and fuel. 81, 49, oo2 %
January, 1919, material and fuel. s,tiSs2s.U
Increase 3Ssc per cent ..,.......... 1858 625. s5
The Director-General, to meet heavy
increases in costs, In June, 1918, made
increases in rates for transportation OF
freight and passengers. The result is
shown in an increase in the average
freight rate per mile for the second six
months of 1918 to .904 cents compared
with 1857 cents for the same period in
1911 The average rate for moving
passenger one mile was increased from
2ses cents 10 2.669 cents. But II the
present high costs Of carrying on the
business are to continue, IL good service
IL to be given to the public and progress
sive improvements made to the property.
rates will have to be increased again
For example:
Increase IN revenue per train
mile, 1915 over lsl7.............. 1918 per cent.
Increase in expenses per train
mile, 1918 over lsi7,..,,....,... 37.3e per cent.
Decrease in net revenue per
train mile NEUTRALITY-SUSPICIOUS.. go per cent.
This in the face of an increase in rev.
enue tons per train mile from 662.42 in
1917 to 1914 In 1918. or 1l.2s per cent
On December 81, 1917. there were
approximately rs. 800 stockholders, which
number had increased on December 81.
1918 to approximately $4,000 stock
holders an increase during the year OF
100. This makes an average holding
OF about % shares for each stakeholder.
separate contract was made be-
tween the Government and the Mime
sofa and International Railway Com
pany G7s90 miles in northeastern Min
nesotal. 20 per cent. OF the capital stock
Of which Is owned by the Northern Pa
cine for S202.455.24, just compensation.
The Spokane, Portland and Seattle Rail-
way Company. one-half OF the capital
stock OF which Is owned by the North
ern Pacific. together with its subsidiaries,
the Oregon Trunk and Oregon Electric.
having a total mileage of S67,s0. were
taken over under Federal control, but no
contract has been entered into.
The question OF the best method OF
owning. managing and operating the
railroads OF the United States is before
the public, The Senate Committee on
Interstate and Foreign Commerce had
prolonged hearings on the subject In
January, February and March. 1t Is ex-
pected that investigation of this impor-
tant subject will continue when Congress
convenes. II IL earnestly hoped that
new laws will be enacted during the
coming session that will permit the re-
turn OF your property by the Govern
ment under n protective system Of regu
lat!on that will permit good service 10
the public, good wages and living condi
tons for employees, expansion OF the
property TO meet the requirements OF a
growing country and pay to the owners
or securities the returns which they have
peen receiving during the past ten years
The year 1918 was very difficult one