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