Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-03-20
BY KENNETH S. VAN STRUM.

NEW YORK, March 20.-Few rail-
roads have effected greater economies
In recent years than the principal East
ern trunk line systems. The sections In
which they operate are more densely
populated than any other in the coun-
try, and because they arc more perma-
nently settled their revenues have not
been increasing so fast as those of roads
in territories whose populations are still
growing rapidly. In order to increase
net profits. therefore, these roads have
been forced to cut down operating ex-
penses.
The three Northern trunk lines oper-
ating from New York west are New
vania to the south and Erie between the
two. SO.
New York Central.
The main lines of New York Central.
with its controlled and leased subsidi-
aries, run from New York north to Al
bany, east to Boston and west to Buff
talo. From there one line goes north
through Canada, Detroit and Central
Michigan to Chicago. Another runs
along the south shore of the lakes,
through Northern Ohio and Indiana to
Chicago. The main line, which touches
all the large industrial centers along the
route, also has branches to ST. Louis,
Louisville, Indianapolis, Wheeling and
other important cities to the south.
The freight traffic is we'll diversified,
with bituminous coal the heaviest single
item carried. New York Central has an
advantage over the other lines in its
"Water-level" route. which, being devoid
OF steep grades, Is cheap freight route
That the territory served is one of the
most densely populated in the country
is reflected in the fact that 40 per cent
of its revenue is obtained from passen-
ger traffic. There has also been con-
siderable increase In suburban traffic
out of the larger cities In recent years.
Much OF CentrafS strength lies In
the properties not owned but controlled
and since their total earnings are not
| included in Central's showing 10 /.
rather difficult to estimate actual earn
ings on the stock.
The conservatism of the management
| is we'll known, and one may be sure thai
they are not paying too large shar,
of earnings as dividends. On the othel
! hand, because of relatively largt
funded debt. there is definite tendency
to finance by sale of common stock. II
order to accomplish such financing
dividends are liberal and valuable right!
are given periodically to stockholders.
On the basis of present stock out
standing, including only those divi
dends paid by controlled lines, abou
$40 share has been averaged for tn,
past six years on the common. Thai
this is conservative is demonstrated b,
the recent declaration of dividend OF
the controlled Michigan Central's stock
which will bring enough TO New Yorl
Central to increase its 1929 earnings b.
81 a share. The current low yield q
"a per cent on the common. which Il
somewhat below that of many STANDARD
rails. Is evidently anticipating the pos
sibility of higher dividends and right!
to come.
Erie.
Probably no road In the country ha!
undergone the trials of fraud and mis-
management that marred the early day
Of Erie. In 1895, after years OF struggle
q reorganization was brought abou
which was finally to prove effective. By
! that time, however, the road was il
poor physical condition and was bur
dened with a heavy funded debt.
The Erie lines from New York II
Chicago extend south of those Of New