The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-02-26
But Net Profits Decreased
More Than S2,50O,OOO
Last Year.
SALES WERE $12s,179,251
Company Charged S12,509,816
Off for Depreciation
I'm 1918.


ee annual report OF the Baldwin Lo-
schhotive Works. were about SIS. ZOO, 900
In excess OF those for the preceding
year and gross profit for tho year IN
creased more than s7.ooo.ooo. the net
profit after all charges before dividends
was smaller by S2.50o.ooo than In 1917,
and was equivalent to s21.a2 share on
the common. against s34.53 a share
In 1917. Tho reason for this decline In
net profits as compared with the big
advance in both gross sales and gross
profits was the heavy charges for taxes,
which were increased about $5.ooo.ooo ;
the increase Of more than 100000 in
depreciation and adjustment write of
and an advance Of more than $4,000, 900
in amortization account
The gross sales for the year 1918
were $l23,l7s.251. against sss,2es.sss
IN 1917. Against these figures were
charged for cost in 1918, s1o5,322,455
and IN 1917, ss6.4s4.s45, leaving manu.
fact.ring profit for the year just ended
Of s17.SSs,7s6, against s11.779,o1s in
tuc plSSSNAS eWcANo nnOubuns oUler IN
come was increased py about $1,000. 900
to s1.so3,644. bringing gross profit for
the year up to s1s,7so.441. compared
with S12.740.4s5 in 1917. Interest,
regular taxes, So, to DO deducted from
gross profit was slightly less than in
1917, so that the profit before charges
was sls.262,112. as compared with sf1,-
lsssi0.
Depreciation Charges,
The total write OF in 1918 was
t2.j09,Sl6. an increase of almost sl0.-
100000. This was divided between de-
probation and adjustment reserves.
which were increased from 100000 TO
N.S50,o00; tax reserves. which were in
creased from $1,75o,o0o TO $6.50o,o00 ;
charges and adjustments. which were
slightly lower, and amortization OF ma
ehinery. building, &C. which increased
from nothing In 1917 to s3.6ss,921 In
1918. After making these deductions
from the years profit the net profit
shown in the report was but S5,752,e95.
as against sS,305,722.
The surplus for the year Just ended
after the deduction OF the regular diyi-
bends on the preferred stock aggregat-
Ing Sl.4O0,oo0, and the further deduc-
ton Of s2,500.0o0 in unexpended appro-
priations, was $1.s52,295, as compared
with s6,9o5.122. Added to previous sur
Plus the company reported a total sur
Plus as OF December 81. 1918, of ST.
g07.642.
In the review OF the president. Alba
b. johnson. covering the year 1918 it
was declared that operations in 1918
continued on the same basis as In the
previous year, when the plant was oper-
ated as nearly TO its full capacity as
possible for the entire year Both the
volume and value OF the 1918 produc-
uone, however. exceeded all previous
records. the president said.
There were constructed" he declared
S'e32 new locomotives and eleven rail-
way mounts for II inch guns, sixteen
caterpillar mounts for inch guns &c
naving value of s10s,515,970.6 other
regular work was completed amounting
TO l3,663,2S1.36. The total production
OF every kind amounted to $I23.17s,-
25l99
Contracts with various departments
OF the United States Government for
locomotives, gun mounts. tanks and
other materials to a value OF approxi-
tnately *6S,4O0,000 were cancelled after
me signing OF the armistice.
shop at Eddystons.
The new erecting shop at Eddy
stone, constructed at a cost of S3226-
siv, proved To be OF inestimable value
II Increasing production TO meet the war
necessities OF the nation. There has
oeen charged of s1,6l3,47 IS the excess
cost due TO building and eqmpping IL
under war conditions Other expendi-
tures Tor plant improvements and ma
chl7ery, chargeable to capital account
amounted TO S1.s03,6s990. Owing to
me Standardization OF locomotives by
NE United States Railway Administra-
non the value of patterns and drawings
has been deprecated s2,0s5,451, leaving
sneF valuation at 100000. There has
.een set aside for depreciation Of plant
NsSo,o0o. A reserve for taxes has been
made OF ;6,500.oo0.
curing the year 1918, acting in con-
lorm!ty with Government regulations. no
horK was accepted other than that au-
EoTized by the Government. When the
Greatest production had been reached
ne armistce was signed, hostilities were
,tspended. and. as heretofore stated.
''s4Vo'oOO OF contracts entered into
were cancelled. The prior contracts re-
'e'Ned and set aside TO give precedence
10 Government orders had been taken
zen costs were lower than at present.
Inc completion of these delayed con-
uacts will undoubtedly entail a reduc-
Uon OF profits and in many cases con
toerab!e loss. The uncancelled Govern
''H' contracts are now largely COM
pioed and there are no immediate pros
poets OF further Government orders.
The railroads Of the United States,
whose neSds would naturally teE.a to re-
!.eve the present s1ttatlon, are under the
control and operation OF the United
states Railroad Administration, which
pursuing policy OF retrenchment OF
expenditures. So long as this curtail-
Uent OF domestic business continues the
foreign market must be the chief source
o. orders. Political unrest In some couD-
F.es. the creation OF new governments
IN others, the need for a readjustment OF
exchange by foreign loans in others de-
Jay the work OF reconstruction and de-
'eIopment The completion OF these re-
adjustments will probably at some time
~ the future create a large demand for
me products which your plants are pre-
pared TO supply. In view Of these con-
oitlons the board OF directors have
adopted the conservative policy of
strengthening the company's finances.
believing that the interests of the stock
holders were beet served by placing the
company in the strongest financial po-
ttlon 10 meet the uncertainties of the
l4luTe. For this reason they have con-
Ohued the policy of emitting dividends
o. the common stock"