New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-08-14
With Working Forces and
Wages Reduced, Carriers
Are Beginning TO Cut
Deeply Into Expenses
Some Big Gains
For Year Forecast
Net Income of Leading
Roads Should Show
Approach 40 Normal
N AILWAY expenses for July

N will be the first to show the
effect of the - per cent re-
duction IN wages granted by the
Railroad Labor Board. Official fig
ures will be available between the
Goth and 9th of this month, but 1T
is possible to make an estimate of
July figures from the data available
at this time. This is a rough estl-
mate subject to change, but it is be-
lieved that the figures which The
Tribune has assembled are in the
main accurate.
Comparison Of the indicated July net
earnings with those Of the preceding
six months, and especially with May
and June, indicates that the progre ~
shown in the last two months for which
reports have been made will be Tar sur
passed in July, and that in many in
stances the last six months of the
year will enable stronger roads to snow
big gains over 1920.
Although the examples taken in this
article NAV not be said to be typical
OF the country's lines. they cover a
wide range Of territory and present a
picture of what has taken place since
The carriers have been able TO make
sharp cuts in transportation expenses:
With reductions III wages and fuei
costs effective TO large extent, net
income will begin TO show an approach
to normal and striking gains over the
last few years, it is believed More
over, the inquiry shows that stronger
roads arc now doing more maintenance
of equipment work. On the whole,
new era of railroading is drawMng'
What July Sho,cs
The Chicago, Burlington & Quincy
operates 1892 miles OF railroad, COW
ering the Central Middle West from
Chicago to Denver. Its conditions are
those OF the granger roads, Its po!lcy
is that of the strongest companies, and
its standards of maintenance and
economical operation are of the high
est. Even in 1920 it was able to show
10000 900 net from the operation OF
the property. In January. 1921, how
ever, earnings dropped OF 10 some eA-
tent, but after January net earnings
began to run far ahead of 1920. IN
July it is estimated that the gross
operating revenue of the Burlington
will be about Sl3.9000 600. This com
pares with gross operating revenues in
July. 1920, of S14,720,00Q.
The ratio OF operating expenses and
taxes to gross revenue Will De. APP
parently, in the rcighborhood OF -
per cent On that basis the Burning
ton would earn little more than
$4,000 600 net in July, 1921, comparing
with $685.. 900 net earned in july, l92o.
In the first six months Of 1921 the
Burlington earned S1l.3s2 COO net, max
ing s14,382 900 for the seven months
Of 1921. The last five months OF the
wear arc the big earning months LOT
most roads. and especially is this true
OF the grangers. Assuming that the
Rurlinrton holds the ratio of increase
shown in July through the rest OF the
YEAR. net operating income would De
over $40 900 600 The stock Of ms CON-
many is the security for the Northern
Pacific Great Northern joint 6'2 PER
cent bonds. and the par value OF the 10. TO-
tai is about sllO.oo9.ooo Through the
conversion Of joint 6's per cent oono5
for the Great Northern I Per cent
bonds nearly half OF this stock - no"
6enosited under the Great Northern
general mortgage. and less than slV'-
o0o coo If il is deposited under No''n-
err Pacific refunding and improvemeh NJ
Ynortoage. through the conversion OF
ioiat sias for Northern Pacific os.