Studies in securities

Gesetz betreffend Kinderarbeit in gewerblichen Betrieben

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Monograph

Identifikator:: 1757542078

URN:: urn:nbn:de:zbw-retromon-134903

Document type:: Monograph

Title:: Studies in securities

Edition:: Revised

Place of publication:: New York

Publisher:: Jas. J. Oliphant & Co.

Year of publication:: 1927

Scope:: 81 S.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Pennsylvania R.R.

Collection:: Economics Books

STUDIES IN SECURITIES Northern Pacific Ry. Evidently, upon a 1926 showing of the best results from company operation since 1917, Northern Pacific Ry. with 1925 ended eight years of difficulties though never deficits. By reducing the divi- dend after nearly eighteen years at 7% to 5% in 1922 the com- pany was able to keep on adding to surplus each year. As against a total $24,800,000 dividend curtailment, 29% annually for five years, a total $81,650,000 was expended on the property since 1917 which can be accounted for as follows: (1) $35,742, 000 surplus income including $9,980,000 Government help 1918- 1920 and $12,451,000 special dividend from the jointly-owned “Burlington’’ in 1921, (2) $12,554,000 receipts from land sale, and (3) $32,127,000 added through operating expenses to equip- ment depreciation fund. Actually there was $817,500 decrease in funded debt apart from issuance of $8,384,000 additional bonds in 1921 to refund the Burlington stock purchase debt which sup- ports itself with $1,448,000 annually over. From these figures obviously the road was not only fully pre- served but further improved in the years of blight and the earn- ings now to compare with pre-war must include a return upon the $80,000,000 interim property additions. The company reported earnings return on railway property investment 6.4% in 1916 and 5.8% in 1917 but below 4% since 1918 and 3.5% average 1922-1926. Thanks to the invested surplus, however, the earnings on Northern Pacific stock, compared with 10.9% in 1916 and 11.9% (including Burlington extra dividend equal to 2.2%) in 1017, were 8.9% (including Burlington extra equal to 5%) in 1921, 6.1% in 1922, 5.2% in 1923, 6.4% in 1924, 7.2% in 1925, and 8.5% in 1926. Up to 1917 for eleven years the net averaged 9% with the least 7.6% in 1914-15. With capitalization $319,481,000 bonds and $248,000,000 or 44% stock a small margin in earnings percentage over dividend rate represents a conservative saving for surplus. Integrity of the $187,852,000 surplus, giving $175 book value for the stock, is checked by Government valuation of physical prop- erty, and this is with $83,017,900 Burlington stock carried at 119 paying 10% and earning 14%. Thriftily, the Northern Pacific has still conserved the possessions of its subsidiary Northwestern Improvement Co., taking in divi- dends only a small part of accumulating earnings from coal, ore, and lumber activities. Liands owned by the railroad in 1926 were 5,582,000 acres valued at about $1.50 per acre and around 15% 1591

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