Evening star., 1933-08-01
RAILROADS SHOW
CONTINUED GAINS.
Outlook Is Held Bright for
Added Increase in Net
Operating Income.
BY the Associated Press.

BY the Associated Press.
To the roar of locomotives pulling
longer freight trains the railroads are
continuing to steam out of the depres-
sion lowlands of 1892 and early 1888.
The comparative highlands Of 1929
and 1880 are still far OF. bat the eco
nomic semaph0res Hash the green go
ahead" signal Dr.. j. n farmelee.
director of the Bureau OF Railway
Economics of the American Railway
Association. says indications are that
the aggregate net operating income
for the carriers in June will show an
increase considerably greater than the
24s.8 per cent gain OF May over the
corresponding month in 1882.
DR.. Parmelee also estimates that the
net operating income for the first SIX
months of 1888 will be about 500
00C 900 more than the income in the
first half OF 1882, despite big declines
registered during the banking crisis
in the early Spring this year. On The
basis of sustained increases in car
loadings July revenues are likewise
expected TO De far i'll excess VI those
last year.
Outlook Is Bright.
He says that if the trend for the
next four months is anything likt lI.e
seasonal movement i'll normal tlnlrs,
railroad returns. with the mOVt Iuent
of crops and Merchandise should be
good He also sees a possibility that
the seasonal rise will be greater than
normal.
Various rail systems have been re-
porting spectacular increases in Oper-
ating net ranging from 100 per cent
to 1000 and even 5000 per cent in
June. as compared with the like period
In 1882 DR.. Parmelee points out,
however, that while these gains are
very heartening the fact that revenues
are still well below those of 1881, which
was bad year. should be taken into
consideration
Glass l railroads in May had q net
operating income of $40,693072, which
for that month was at the annual
rate Of return Of 204 per cent on their
property investment. the association
figures show. In May, 1882. their net
operating income was $ll 665 702 OF
SO per cent on investment. During
1892 the carriers as a whole failed to
earn a net income. but reported a
considerable net deficit.
The highest rate of return on prop
erty investment. according to associa-
tion records was in 1925, when It
averaged 499 per cent. IL 1929 the
rate CT return was ABA per cent, de-
clin!ng to $50 per cent in 1880 and
to ? per cent i'll 1881.
Freight Furnishes Hope
Total revenues for each month this
year through April were below those
OF the corresponding months in 1892.
the accumulated decline for the four
month period being ~ per cent. In
MAY however the trend turned up
ward, the increase for that month be-
Ing l.3 per cent over q year ago.
This increase. DR.. Parmelee says.
was due entirely to a freight revenue
gain of 6.8 per cent. whereas all other
classes continued to decline. He points
out that freight continues to be the
railroads hope of economic salvation,
an anchorage in transportation sea,
which has been more or less menacing
to the railroads for several years.
The passenger business Presents
much different picture than that of
freight, revenues from the former be-
Ing down in every month this year,
Including June, although the percent
age Of decline in the latter was less
than in May or in the five-month
period. Some roads reported pas
Senger increase for June over that
month in 1882.
DR.. Parmelee says the railroads,
which generally have been drferring
maintenance work. probably will have
to increase their expenditures along
this line i'll the coming months. He
explains that while this would have
tendency to reduce net income. such
expenditures would have q beneficial
effect i'll increasing employment and
in stimulating business through the
purchase Of steel and other equipment