Page:U.S. Department of the Interior Annual Report 1877.djvu/34

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XXXII
REPORT OF THE SECRETARY OF THE INTERIOR.

30 paid 8 per cent., 36 paid over 8 per cent., 115 paid under 8 per cent., and 628 paid no dividends. Of these 809 companies, the earnings of 31 were insufficient to pay “operating-expenses,” the earnings of 170 were insufficient to pay “operating-expenses” and “interest,” and 216 defaulted on their “bond-interest.”

The Union Pacific Railroad Company, and the Central Pacific Railroad Company, did better than ever before in the year 1876, notwithstanding the fact that all other railroad companies suffered from the great depression of trade and industrial enterprise. (See pages XV and XVI of Poor's Manual, 1877.)

Gross earnings  $31,033,803
Operating-expenses 14,000,286
Net earnings 17,033,517
Bonded interest, paid  $6,612,815
Eight per cent. dividend on stock  7,299,000
13,911,815
Surplus 3,121,702

Excepting these two companies from the calculation, but 34½ per cent. of the capital stock invested in railroads pays a dividend; the average rate per cent. of dividends paid is but 281100; but 68¾ per cent. of the bonded investment in railroads receives interest, and the average rate of interest is but 422100 per cent. The two railroads named pay 8 per cent. dividends on capital stock, and 621100 per cent. interest on their bonded debt.

On the “one-hundred miles basis” a comparison between all other roads in the United States and these two roads for the year 1876, is as follows, viz:

Items.  All other 
roads.
 Union Pacific and 
Central Pacific
Railroads.



Locomotives used. 21  17
Passenger-cars used 20  20
Freight-cars used 510  319
Capital stock  $2,912,919   $4,652,112
Bonded debt 2,793,355  7,180,342
Cost of road and equipment 5,170,322  11,453,038
Passenger-earnings 184,859  453,795
Freight-earnings 397,754  806,054
Total earnings, including mails, &c.  686,214  1,378,465
Operating-expenses 436,604  [1]621,867
Net earnings 249,610  756,598
Bond-interest paid 129,087  293,725
Dividends on capital stock 90,180  324,208
  1. Construction, new equipment, and improvements evidently enter largely into this amount for “operating-expenses.”

To illustrate still more fully the ability of the Union Pacific and Central Pacific Railroad Companies to earn money, and with a proper disposal of their earnings in due time to pay off all of their indebtedness