STUDIES IN SECURITIES
tions. This period too marks the real return to normal conditions
after almost a decade of war influences with abnormally favor-
able and adverse effects ($25 a share earned on the common in
1917 and under $3 a share on the preferred in 1921).
The record of net income and of earnings per share of common
stock shows the trend in the past five years:
Net Income
0 er erate rs .$17,761,000
B25. sea oe ns oe 8 15,091,000
1924...%.% 11,187,000
1928. vereernrs 8,925,000
1922. 5,918.000
Surplus for Common
$23.38
19.17
12.60
8.89
3.98
American Smelting & Refining Co. is the largest smelting and
refining business in the world. This phase of its operations is
about six times its mining activity in size. Its properties are in
the United States, Canada, Alaska, Mexico, Peru and Chile. Its
principal products are copper, lead, silver, zine, gold, and coal,
together with numerous semi-finished products and by-products.
Developments in the last five years include the Rosita coke plant
with numerous by-products and the Parral unit in Mexico, a con-
centrator for gold and silver and smelter for copper in Peru,
and a copper rod and wire plant at Baltimore, among others.
Recent years’ capital expenditures are increasingly reflected in
income account.
Capitalization consists of $48,746,900 5% and 6% bonds, $50,-
000,000 7% non-callable preferred stock, and $60,998,000 common
stock. As of December 31, 1926, current assets were $91,137,000
(including cash and U. S. Government securities of $34,520,000)
and current liabilities were $19,674,000, a splendid position.
Asset value of the common stock after deducting all reserves was
$140 a share. Charge-offs from earnings (before surpluses shown
in above table) were made for depreciation, obsolescence and ore
depletion aggregating $24,037,000 in the four years 1923-6 or $40
a share on the common stock, $10 per annum.
After suspension in the war deflation year 1921, dividends were
resumed in mid-1923 at a $5 rate, stepped up to $6 in February,
1925, to $7 in November, 1925, and to current $8 in November,
1926. With no change in the number of shares outstanding over
the years, earning power above the $20 a share a year level, and
recent capital expenditures steadily increasing in productivity,
the American Smelting & Refining situation seems to contain
probability of stock dividend or split, following other old-line
industrials. The widening base of its operations makes for more
stability in results in coming years than appears in the past record.
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