Evening star., 1933-09-07
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rail- NETS SHOW
STARTLING UPTURN
analysis Of July Earnings En-
phaskes Gains for Class
ICariers. {
by HIRAM HERTELL,
Press Financial Writer.

BY HIRAM HERTELL,
Associated Press Financial Writer.
NEW YORK, September 7.-Analysis
OF the July earnings statement Of the
country's Glass / railroads brings into
bold reHef the phenomenal improve
ment IN the position Of the iron horse
since the arid days Of Midsummer. 1882.
The gain Of nearly 470 per cent In
net railway operating income, assert
transportation specialists here. reflects
not only the substantial gains in gen.
eral business, but also important ad-
vances made in operating methods.
At the same time, railway executives
warn that q comparison between the
two months Is only justified II weighted
with the fact that July last year pro-
duced one Of the smallest monthly traf-
fic totals which the railways have
Surcharges to Expire.
Coincident with publication Of July
results comes the ruling OF the Inter-
state Commerce commission that the
freight surcharges which took effect on
January 2. 1882, are to expire at the
end Of the current month.
Railway traffic officials generally
doubted that these surcharges would
affect substantially the total revenues
of the carriers. The advanced rates
requested horizontal IS per cent in
crease in freight rates. This was de-
MED by the commission. which sug-
gested what was regarded as q novel
compromise, namely, higher charges on
specified freightS, with the provision
that the proceeds be pooled for the
benefit Of the weaker roads.
After q considerable amount of dis
cussion, 1t was agreed eventually that
disbursements from the pool we're to
be in the form Of loans to meet interest
charges only. The Railroad Credit
Corporation was created as admins
traitor OF the pool. Some SIC, 100000
was produced by the surcharges, as
compared with the original estimate Of
$l00,000,000 to $125, 5,000, 900.
Reports Filed Here.
for the first seven months Of 1888 had
d net railway operating income of
S216,740, ,345. which was at the annual
rate OF. return of 164 per cent on their
property investment, according to re-
ports just filed by the carriers with
the Bureau of Railway Economics and
made public today. In the first seven
months of 1882. the net railway oper-
ating income was $120 300, $50 or O91
Per cent on their property investment
Property investment Is the value OF
road and equipment as shown by the
books of the railways. including mate
rials, supplies and cash. The net rail-
way operating income is what is left
at NJ NJ
penses, taxes and equipment rentals but
before interest and other fixed charges
are paid
This compilation as to earnings for
the first seven months of 1888 is based
on reports from 149 class / railroads
representing total of 241.147 miles.
Gross operating revenues for the first
seven months of 1898 totaled S1.708,-
94o,892 compared with $l,Sl8, ,703, ,533
for the same period in 1892, a decrease
OF 6 per cent. Operating expenses for
the first seven months of 1888
amounted to sl,263.853,252 compared
with 81 .456, ,699. .260 for the same pc
Tiod in 1882. decrease Of 1872 per cent.
. Tax Burden Reduced.
Glass l railroads in the first seven
months of 1888 paid Sl57,602, ,694 in
taxes compared with sl7O,009, ,4S4 for
the same period in 1882. a decrease OF
7.3. per cent. For the month of July
alone, the tax bill Of the class rail-
roads amounted to $23,504. $50. a de-
crease of $368,3o4 under July, 1882.
Forty-five class railroads failed to
earn expenses and taxes in the first
seven months of 1888, of which IL were
In the Eastern, 8 in the Southern and
IS in the Western district. The sum-
mary follows: