i STEAM COAL - Clpdigital.org
i STEAM COAL - Clpdigital.org
i STEAM COAL - Clpdigital.org
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THE ANNUAL STATEMENT OF<br />
THE PITTSBURGH <strong>COAL</strong> COMPANY.<br />
The annual report of the Pittsburgh Coal Co.<br />
shows that after paying the regular dividend on<br />
the preferred stock, together with the usual fixed<br />
charges, a balance of over $150,000 was added to<br />
the surplus. An important feature of the report<br />
is a statement based on comparative appraisals,<br />
that there was an unprecedented growth in the<br />
value of the company's coal lands during 1904.<br />
The following is President Francis L. Robbins'<br />
address to the stockholders:<br />
Notwithstanding a year of industrial depression<br />
such as we have just experienced which curtailed<br />
our tonnage and brought about a reduction in<br />
the selling price of coal and coke, your officers are<br />
able to report that during the year after maintaining<br />
and improving the physical condition of<br />
the company's properties and after paying all fixed<br />
and other charges and dividends of $7 per share<br />
on the preferred stock, there has been added to<br />
surplus account $150,941.47. A considerable portion<br />
of the earnings were the direct result of<br />
economies in operation growing out of the policy<br />
of your management in the past in building large<br />
power plants to furnish power for groups of mines<br />
and in introducing labor saving machinery and<br />
devices, including electrical haulage in place of<br />
animals, wherever practicable.<br />
As in previous years a charge has been made<br />
against operating expenses of five cents for each<br />
ton of run-of-mine coal taken from the property—<br />
this is equivalent to about $400 per acre. The<br />
coal lands as well as the other real estate, improvements<br />
and equipments of your company and<br />
its subsidiary companies have always been and<br />
are still carried at cost. It is somewhat singular<br />
perhaps that in a year of industrial depression,<br />
such as we have just passed through, there should<br />
have been an unprecedented increase in values of<br />
coal lands in the Pittsburgh district, and yet this<br />
is the case. The values of the company's lands<br />
to-day, measured by all recent purchases of lands<br />
in the district, represent an increase in the intrinsic<br />
value of your securities during the year<br />
1904 several times greater than the earnings from<br />
operations.<br />
On November 1 a contract was closed, with the<br />
approval of your directors, for the control and<br />
operation of the seven mines of the Pittsburgh<br />
Terminal Railroad & Coal Co., now owned by the<br />
Wabash- Railroad Co. interests. By securing these<br />
mines a connection was made with the Wabash<br />
railroad system, which through its controlled<br />
lines has just entered the Pittsburgh district, and<br />
through which we will have another much needed<br />
means of transportation for our product.<br />
At the <strong>org</strong>anization of your company it inher<br />
THE <strong>COAL</strong> TRADE BULLETIN. 27<br />
ited an unwritten agreement, afterwards embodied<br />
in five year contracts with two coal and ore handling<br />
companies operating on the great lakes, under<br />
which they have obtained large commissions in<br />
the sale of about 1,000,000 tons annually of lake<br />
coal. These'agreements, were terminated by limi'ation<br />
at the close of lake navigation for the year<br />
1904 and were not renewed because in the judgment<br />
of your officers and directors it will be more<br />
profitable to sell direct to consumers.<br />
Although during the year many blast furnaces<br />
and foundries were idle, greatly curtailing the consumption<br />
of coke, the four hundred ovens of the<br />
Colonial Coke Co., whose entire capital stock is<br />
owned by your company, were in almost continuous<br />
operation. This is one of the most complete<br />
and economical coke making plants in the entire<br />
coke region and its product is taking high rank<br />
in the market. As conditions may warrant it will<br />
be the policy of the management to further increase<br />
the coke production by the building of<br />
additional ovens and in this way get a return on<br />
our large investment in coking coal lands.<br />
In previous annual reports references have been<br />
made to the inadequacy of railroad facilities for<br />
marketing the product of your mines and coke<br />
ovens, and the hope expressed that the expenditures<br />
then being made by the railroad companies<br />
would enable them to render more satisfactory<br />
service, but during the greater portion of the last<br />
half of the year your operations were seriously<br />
interrupted by the lack of cars, or facilities for<br />
transporting those that were provided.<br />
To at least partially overcome this disadvantage<br />
your directors have authorized the purchnse of<br />
1,400 standard steel gondola cars for which a satisfactory<br />
contract, on a ten-year car trust plan.<br />
has been entered into, delivery of tbe cars to be<br />
made during the coming spring. With those now<br />
owned the company's pquipment will consist of<br />
5.500 standard railway cars. The rai'roads in the<br />
Pittsburgh district are also adding materially to<br />
their car and locomotive equipment, which gives<br />
encouragement for the proper handling of your<br />
large future production.<br />
The advantages of ownership and control of<br />
docks at all the principal points on the great lakes.<br />
and the strength of your company's <strong>org</strong>anization<br />
in the Northwestern territory supplied bv lake<br />
shipments, have been more strikingly demonstrated<br />
in the year under review than ever before.<br />
It will be the policy of vour officers to further extend<br />
and strengthen this important branch of the<br />
company's <strong>org</strong>anization.<br />
Reference has been made in previous reports to<br />
the work of the Pittsburgh Coal Co. Employes'<br />
Association which was <strong>org</strong>anized four years ago<br />
for the purpose of helping the company's em-