New-York tribune., 1922-11-20

/ {We present IL. the sGbjesred artici
! tho thirty-t third OF series Of forti
daily discussions Of the presont earning
po9ey Of The leading American stean
railroads. At the request OF The Trio
aRe, these studies Wero undertaken bi
| the Standard Statistics Compnny, INC.
| OF Nesp York, chich hds prepared th,
papers and is securing copyright fo'
| tkem la 1888. The thirty fourth article
,eiu appear to-moyrosg and acill deal ,pitl
| DeiaicGre & Hudson.--FinGRcidI Editor
The Pennsylvania RailxosA as il
| stands to-day is the respss of many
years of intensive development under @
| management second to none in ability
efficiency and farsightedness. The com,
pany has always rapjared the highest
type of transportation service, and its
operating staff is composed of men
who, for the most part, have grown up
in it's employ.
The company's financial position is
one of unusual strength. The 1921 bal
ance sheet showed q net working capi-
tai amounting in round numbers to
s100,000,000, over half of which con-
sisted of cash. 1t showed q surplus
and surplus items totaling $32s, 100000,
The company has exceptional financial
strength and remarkable record of
earnings made and services performed,
extending back over a period of more
than sixty-f1ve years. Factors bearing
upon the company's development DUR
ing the last decade are given in some
detail below.
Growth Of Capitalization and Mileage
Funded Leased Capital Total
year debt line stock stock. capital
~ --Mtllions OF dolars------
isEs''''.''.' 71o,t 1o4s 1922 1,s14,4
Inc. (9o)... ls1 $50 10 so
:. Between 1912 and 1922 the mileage
directly operated by the Pennsylvania
Railroad Company increased from .O25
miles to 10,290 miles, or 1b6 per cent.
Ihe tremendous increase in capital
ization and mileage operated is due to
the taking over under lease during the
last few years Of a number of rail
roads controlled by the Pennsylvania,
but formerly operated as Independent
UNITS. The more important Of the re-
cent leasehold acquisitions are the
Plttsburgh, Cincinnati, Chicago g. st.
Louis with 2,435 miles of road, and the
Hrahd Rapids q Indiana with SIS miles
OF road. These two roads were leased
during the current year. The above
statement of capitalization includes
the bonds and stocks of leased lines
outstanding with the public.
In 1912 the entire mileage of the
Pennsylvania system of railroads, in
cludlng lines owned and leased and
those controlled, totaled 1857 miles.
At the close Of 1921 the mileage of
the system totaled 11,713 miles, an in
crease Of 1876 miles, or ia per cent. 1t
will be seen that most of the mileage
formerly controlled, but temporarily
operated, has been absorbed, and it is
apparently the intention of the Penn
sylvania gradually to absorb the re-
naming mileage and thus follow out
the tentative consolidation plan sug-
gested by the Interstate Commerce
commission year ago.
Estimated Property Value
The estimated property value of the
railroads owned and leased by the
Pennsylvania is $1,000 100000, or SIS
per cent more than the total capitaliza-
tion outstanding in the hands of tho
public. Assuming funded debt and
leased line securities to be theoreti-
cally retired at par there would remain
an equity for Pennsylvania Railroad
stock in estimated property value
equivalent TO s122 a share of $50 par
value.