Evening star., 1952-01-03
Capital Transit
Votes Dividend
Of S2.4 Million
Big Payment Comes
While Firm Waits
Ruling on Fare Boost

duuOuuI1I1S W 9I.0U-d-SQdTe QlVl-
dend.
The decision was announced
yesterday by Louis E. Wolfson,
chairman of the transit company
board of directors, after a board
meeting. 1t comes while the
company is awaiting a Public
Utilities Commission decision on
a request for a fare increase,
based on plea of poor earnings.
Also pending is a request before
the Maryland Public Service Com
mission to reduce drastically bus
service in nearby Maryland areas
as an economy measure.
Payable January FL.
The dividend amounts to $40
a share on the old stock before it
was split four -to-one recently.
The bonus dividend will be paid
from surplus funds of the COM
pany and will be followed by other
regular dividends through the
year.
The dividend will go to stock
holders of record at the close of
business on January 10. It will
be payable January 81.
The transit company also voted:
l. To buy for cash up to ITO
new type larger buses for delivery
as soon as possible. This will cost
approximately $3,650,000.
2. To set up an employe stock
purchase plan. if feasible, subject
to the approval of the Bureau of
Internal Revenue or other Gov
ernment agency jurisdiction, and
subject to approval of the stock
holders at the annual meeting to
be held April IL.
8. To authorize purchase of
81 million of Capital Transit 4
per cent mortgage bonds. This
will reduce the outstanding
bonded Indebtedness to Sc mil
lion. A saving of $4,000 a year
IN interest charges will result
because of other purchases made
during the past two years of So
million in bonds"
Bought Controlling Stock.
Mr.. Wolfson and a group of
Florida investors bought con-
trolling stock of the transit COM
pany two and a half years ago.
The group now owns an estimated
SIS per cent of the stock of the
company.
At the time of the purchase, the
stock was selling for about $40 a.
share. With the payment of the
bonus dividend this month. the
stockholders will have received al
total of $17.50 a share, based onI
the number of shares before the
stock split.
The new shares of stock are
selling now for around SIT, or the
equivalent of about $68 share on
the old basis.
Mr.. Wolfson. in explaining the
bonus dividend payment, said it
did not affect the financial status
of the company. A fare increase
still was needed and bus service in
Maryland must be cut to reduce
an annual loss of $780, 900 in the
State operation, he said.
Prior Earnings Cited.
even though our income was
substantially reduced in the last
six months of 1851, as result of
increased wages and other costs
without a corresponding fare in
crease, the company at the close
of the year had a substantial ac-
emulation of earnings of prior
years in its surplus" he declared.
He added that more than 81 mil
lion with remain in the surplus
even after the expenditures.
The transit company explained
its actions also in a full page
newspaper ad headed "a New
Years Message and Report"
Mr.. Wolfson also said that the
transit company was making a
study of the transit authority"
suggestion made recently by Col.
S. H. Bingham. chairman of the
New York City Board of Trans
portation, at a recent Washington
Board of Trade meeting.
Col. Bingham said that it might
become necessary in Washington
to establish a metropolitan trans
1t Authority, which would issue
bonds in its name to be exchanged
for securities of the now privately
owned transit company.
Mr.. Wolfson said the transit
company's consideration of this
suggestion probably would be made
public within few weeks at the
same time as the financial
results of the past years opera
tions are released.
Income Statement Released.
The transit company yesterday
also released a statement of it's
income for the month of Novem-
ber.
The report showed that net in
come for November was $1,000,
a drop of 24.1 per cent from net
income of $108,102 for the same
month the previous year. Operat-
ing revenues were $",381,373 for
last November, as compared to
$2,353,946 for November of the
previous year.
For the IL months ending No
vember 80, the report said. the
net income was $1,223,255. as
compared with $645, ,228 for the
same period in the previous year.
The report pointed out that ST.
223,255 net income reflects only
five months of the higher wages
granted employees on last July /.
Operating revenues last year
were SAG, 800, ,464. an increase of
Sc per cent over the previous II
months. Operating expenses,
taxes and depreciation were $25,-
O65,527, an increase of 39 per
cent over the previous 11-month
period.
Citizens MEETING Is Put Off