Evening star., 1938-01-29
HIGHER FARESA|
CAPITAL TRANSIT
Analysis of 1887 Report In
dicates Real Change in
Earnings Outlook.
Ry EDWARD C. STONE.

BY EDWARD c. STONE.
Analysis o! the Capital Transit
Co.'S December and annual reports,
just filed with the Public Utilities
Commission, discloses the fact that
the recent increase in car and bus
fares to six tokens for so cents, in
stead Of four for 80 cents, has proved
highly beneficial to the company.
Operating revenues in December
alone amounted to $685., ,11432, an
increase of $50 3,952.75, or So per cent
This is gain in operating revenues
Of nearly $4,000 day and is said to
be largely due to the higher fares
which went into effect early in No
vember. following approval by the
Utilities Commission.
In November the advance in oper-
ating revenues was something over
$1,000 day, which was about the
amount Of increase predicted by
transit officials at the hearings. The
December revenues were far better.
The showing for the two months
under the higher fares indicates that
the company will profit substantially
in the long run by the higher charges.
The gain of almost $4,000 day in
revenues in December caused general
rejoicing among the company's Off
cials, as it was much more than they
had dared expect. 1t brought the
December net up to s37,85026, which
was S9,625.88 better than the returns
In December. 1886. and was an i'm
portant factor in bringing the years
net earnings up to S136, ,442 26, against
only S3O.387.23 in 1886. or a gain of
$l06055.03 over the previous year.
December Expenses Higher.
Operating costs were all higher in
December. Operating expenses totaled
$723,5 1886, an advance of $7,52l,8l.
Taxes required s65,43l.l7. up $l1.-
1885, or % per cent. Depreciation
called for S99,97472, stepping up
of Sl22O660. or 1873 per cent. These
three cost items made total in
crease of s31.6OS.O6, leaving operating
income at $97,172.47, an increase over
1886 of S22,344.69, or 29.9 per cent.
Gross revenues we're helped by the
fare boost reaching S97,98225, gain
of Sl493444. or 18 per cent. Once
more the number of revenue pas
sengers was lower than in the like
month in the previous year, 14,l15,-
S98, or 84l.77l fever riders than in
December, 1886. But as the number
OF passengers decreased the companys
earnings increased.
Monthly decreases in the number
of passengers began when the original
n
pass buyers. who had been taking
great many short rides, stopped buy
ing the passes and got tokens. 1t is
now evident that While this reduced
the number of riders. it increased
revenues Many of these former pass
buyers are now paying the higher rate
for tokens. thus giving income still
further lift.
Operating costs for the full year
climbed rapidly. Operating costs we're
up $82,875.42, taxes were Sl58,722.29
higher, or "a per cent, and deprecia-
ton reserves were $l30,643.97 above
1886, or IL per cent. Total operating
expenses amounted to $10,182. 1894 .06,
which was S372,24l68 higher than a
year ago. The gain in operating rev.
income from operations alone scored
a gain of Sl63,179.77, or 25 per cent
over the previous year.
Permanent Upturn Seen.
The advance Of more than $4,000
in gross was 20 per cent above the
1886 mark. Deductions for interest
and amortization were S35.000 higher
However, the gain of S535, ,421.45 in
revenues from operations more than
took care of the higher costs, leaving
the much more favorable net income
at the end of the year.
The number of revenue Passengers
carried in the full year was 1862 $780,
27l. a drop of 1881 ,291, or 43 per cent.
The company, however, is not worried
by the easing off in traffic as long as
revenues increase. While the net
earnings of sl36,442 for 1887 are not
sufficient for dividend of ST per
share on the stock, yet the picture is
very different from the previous year.
Two months under higher fares do
not establish definite trend, yet they
clearly indicate an important turn
about in revenues. December is al
ways the best traffic month in the
year, which makes forecast for 1888
difficult. 1t seems certain, however,
the higher rates are going to mean a
permanent increase in revenues. And
that increase is mainly what bond
and stock holders are watching.
Heard in Financial District.
The Norfolk g. Western Ry. reports
net earnings in 1887 equal to s2l.95
on the common stock, against $22.74
on the common stock in 1885,
The Western Maryland r. R. re-
ports So cents per share earned on
common for the year 1887, against
~ cents per share on the common
stock in 1886.
Expert accountants in this city are
interested in Statement of Account
ing Principles" just published by the
American Institute of Accountants
and prepared by three college profess
sors. Thomas H. Sanders of the Har-
ward School of Business Administra-
ton, Henry Rand Hatfield, University
OF California, and Underhill Moore
OF the Yale Law School.
Vice President E. r. Oliver of the
Southern Railway announces that
Ralph j. Brown has been promoted
to general freight traffic manager in
washington and that B. G. Brown has
been appointed coal traffic manager
IN Washington. Many other promo
tlons on the Southern were also an
nounced during the week.
Campania Swift International has
declared a quarterly dividend of so
cents share, payable March l to
STOCK OF record February Is, the WASH
angton Office reports.
New Car Sales Above 1896.
Retail sales OF new passenger auto
mobiles during 1887 were per cent
above the 1886 level, the Department