Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-03-13

ing divided between agricultural prod
ucts and those of mines, forests and
factories, with especial emphasis on
products of iron ore mines.
For long period Of years Great
Northern paid dividend OF 81. which
was reduced to IS because Of the agri-
cultural upset following tina war After
few years of meager earnings, the
trend again started upward, and after
averaging $7.3l for the past six years
reached 3d. in 1928. With 3l8 million
the company is In sound financial con-
dition. At current prices 1t yields about
4.50 per cent.
Northern Pacific.
Northern Pacific has had stormier
career than its closely allied road. Great
Northern. In 1873 the failure Of North
ern Pacific under the management OF
Jay Cooke precipitated the panic OF that
that time didn't take" and 1t went
through another one in 1890 and be-
came the present company of 1895.
Finally, in the famous Northern Pa
cific corner of 1901 it came under con-
troll of the Hill interests, and there has
been a strong community of interests
between the two roads ever since.
Northern Pacific extends in much the
same general direction east and west
as Great Northern, only somewhat more
to the south. 1t is dependent upon
much the same business influences, al
though it carries more lumber. while
Great Northern carries more ore.
Northern Pacific had long dividend
record at 81 until, like all carriers in
this section, its business slackened for
n
years steady progress has been made,
however, earnings averaging 1882. and
in 1923 reaching 1882. Paying IS. the
yield at current prices Is about $50 per
cent.
Great Northern Pacific.
The increased earnings of both Great
Northern and Northern Pacific might
seem to justify a resumption OF the for
mer rate of ST. but Great Northern and
Northern Pacific have applied to the In
terstate Commerce Commission for the
right to consolidate into the Great
Northern Pacific Co. on basis of one
share of Great Northern or one OF
Northern Pacific for share In the new
company. Since an increase In dividend
rate by either company might upset
those plans, it is not considered prob
able that the rate will be increased until
renders its decision.
It is stated that merger of the two
companies would effect economies which
would result in savings of 100000
year in expenses. Thus earnings
on the stock of both companies, aver
aging $685. in 1927, might approach $40
If the consolidation is allowed. In 1923
join. earnings were 1929, and it Is said
that because of savings effected they
would be about Sill II operated as one
unit.
There is a bit Of irony in the fact
that when the two roads tried to unite
In 1902 by forming the Northern Securi-
ties Co. 1t was disallowed by the courts
and they were forced to retain their
separate identities. There Is some doubt
as to whether the Interstate Commerce
Commission will permit the present
merger to go through.
Chicago, Milwaukee, st. Paul g. Pacific.
While difficult conditions were ex-
perlenced by all Northwestern roads
during the past decade because OF a
combination OF poor agricultural condl-
tions, low freight rates, the aftermath
of war, Panama Canal competition on
through freight and loss Of passenger
business. these difficulties were brought
out most strikingly in the failure OF
the Chicago. Milwaukee e. st. Paul.
While 1t is said that the extension OF
its line to the coast was the immediate
cause of its failure. it might have
averted disaster had the general condi-
lions along its lines been better.
While the reorganization still left
heavy total of bonded indebtedness, the
new form of securities issued relieved
the company of some of the fixed
charges. Since the company was only
turned over to it's owners in January.
1928. and thus has only years results
to show it is difficult to estimate its
possibilities. Balance sheet figures dur
ing and imme diately following the re-
organization do not give true picture
Of the situation
tCopyright, 1927