1 6 



HARDWOOD RECORD 



A Huestion Still Unanswered. 



In the Hakdwood Kecord of April 10, 

 under the title "Is It a Legitimate Lumber 

 Kuterprise or a Get-Eieh-Quiek Proposition? " 

 was published a copy of an advertisement 

 of the International Lumber & Development 

 Companj' of Philadelpliia, which stated that 

 it had paid dividends of twelve per cent from 

 the sale of mahogany lumber between April 

 1> 1905, and Jan. 31, 1906. The article also 

 covered the general conditions of the mahog- 

 any lumber business in the United States 

 and abroad, and quoted letters from the 

 majority of the mahogany producers of this 

 country, in which it was ineontrovertibly 

 proven that the statements made of the earn- 

 ings of the Philadelphia concern should be 

 taken with a good many grains of salt. Re- 

 peated inquiries by letter made to the In- 

 ternational Lumber & Development Company 

 by the editor of the Hardwood Record and 

 by well-known business men throughout the 

 country, asking for definite figures concern- 

 ing, the imports of this wood by the company 

 named and a statement of cost, expense and 

 net results from its shipments, have failed 

 in every instance to elicit a reply. 



What the Vice President Says. 

 Col. A. S. McClure, vice-president of the 

 concern, ex-editor of the Philadelphia Times 

 and now occupying the position of prothono- 

 tary of the Supreme Court of Pennsylvania, 

 to whom a Baltimore gentleman, interested 

 in lands and other investments, forwarded 

 the article from the Record, was asked by 

 him for some specific information about the 

 International Lumber & Development Com- 

 pany. The following is Col. McClure 's reply: 



PHILADELPHIA; April 23. — Dear Sir : I have 

 your favor with its enclosure. If you will look 

 with any reasonable care at the article in the 

 Hardwood Kecoiid you will see that it is simply 

 one of the many blackmailing devices * which 

 have attempted to prey upon us without success 

 and which do prey upon all. organizations n;hich 

 are nt>t on a sound basis. Of all the letters 

 given, there is not a single responsible name 

 presented, and the publication would likely 

 never have been made if we had souglit the 

 favor of the Uecohd by liberal advertising and 

 big i^ay for notices. If you will call or send 

 any competent person to the office of tbe com- 

 pany you can readily ascertain tbat tbe state- 

 ment made by the Record that. we are paying 

 dividends from stock sales is absolutely false. 

 We not only have never paid a dollar out in 

 dividends th.it was not earned and applicable 

 for that purpose, but we have today legitimately 

 earned nut only the dividend w'e are pa.ving this 

 month but the additional four per cent that will 

 be paid in (October. 



Some months ago when there was quite a 

 flurry about the failure of several speculative 

 rubber companies in Mexico, the government was 

 appealed to to investigate them. \\'e voluntarily 

 asked the government to extend their inspec- 

 tion to our company, and they sent two inspec- 

 tors, neither of whom was known to any of 

 our company. ' Everything was presented to 

 them, ever.v book was open, the title given up to 

 examination, and they found not a thing to 

 report against eitlier the management or the 

 prospects of the company. Of course, they could 

 not make a report in favor of any company, but 

 they could make formal report where they found 

 the company was either violating the law or 

 manifesting a fraud upon the public. I would 

 be very glad indeed if you would come in per- 

 son and make the examination, or if you cannot, 

 any person who comes here with a letter from 

 yon will be given every oi)portunily to ascertain 

 that the business of this company is conducted 

 on the\. soundest business basis and that . its 

 earnings today are far in excess of its prom-' 

 ised dividends. Yours truly, . ■ 



A. K. McCluhe. 



The Hardwood Record would say that it 

 has not attempted to blackmail either Col. 

 A. K. McClure or his company. It would 

 be a matter of sincere regret for this publi- 

 cation to be obliged to call that gentleman 

 a hoary-headed old liar, but the alternative 

 is too sad a one to contemplate. Col. Mc- 

 Clure states to his correspondent that if he 

 will call or send any competent person to the 

 oifice of the company he can readily ascer- 

 tain that the statement made in this paper 

 that his company is paying dividends from 

 stock sales, is absolutely false. The ai-tiele 

 merely said it was ' ' dollars to doughnuts ' ' 

 that the company was not paying the divi- 

 dends named from the sale of mahogany 

 lumber, and in the light of the evidence pub- 

 lished, tliis statement may be reiterated. 

 Again, repeated efforts by mail and by per- 

 sonal calls at the office in Philadelphia have 

 failed to establish any evidence that the com- 

 pany is iwt paying dividends from stock sales. 

 The Hakdwood Record will be just as 

 frank in this matter as Col. A. K. McClure, 

 :ind a good deal franker. If he or an author- 

 ized representative of his company will call 

 at this oifice he will be supplied with in- 

 dubitable evidence that the greater number 

 of legitimate mahogany importing and manu- 

 facturing houses in this country having a 

 thorough equipment of capital, brains and 

 experience, are unable to show earnings that 

 approximate half the sum named in his com- 

 l>any's advertisement; and he will be further 

 given evidence that will constitute proof that 

 tlie letters published are bona fide and the 

 authors are entirely responsible. 



Interview with Secretary McMahon. 



.\ representative of the IIaudwuod ItECuitD 

 called at the oUices of the International Lumber 

 & Development Company. 701-715 Drexel build- 

 ing. Philadelphia, to secure information concern- 

 ing the mahogany operations of the concern. 

 The headquarters of the company are located in 

 one of the most spacious suites in the bhilding, 

 and the office force, consisting of about tifteen 

 girls, was busily employed in sending out adver- 

 tising matter, which appeared to be the chief 

 business done there. The assistant secretary, 

 who sat at an imposing desk with pigeon-holes 

 labeled ■'lists of agents," "instructions to agents" 

 and "agents' contracts," etc., declined to talk 

 in the absence of C. M. McMahon, secretary and 

 treasurer of the company. 



When Mr. McMahon returned from lunch he 

 received the caller affably. He is a man of good 

 appearance, about forty years old, and expresses 

 confidence in the ultimate success of tlie pro- 

 .iect. He was asked if the company bad expe- 

 rienced any difficulty in getting its lumber to 

 marliet. 



"No," he replied, "we have had no difficulty in 

 getting our stock to the United States. Our 

 land is situated in the State of Campeche, Mex- 

 ico, and lies along the coast. We have an ocean 

 frontage of over twenty-four miles, in the mid- 

 dle of which is situated the port of Chenkan, 

 where we have our wharf. We own a railroad, 

 which traverses our territory, and ship the 

 mahogany to the port by our own cars." 



"Have you any mills on the land'.'" he was 

 asked. 



"Yes." he replied, "we have two small saw- 

 mills, but when we fell the logs they are hewn 

 on the ground in a form almost square for 

 easier shipment and then dragged to the cars 

 and forwarded to the port." 



"Bv what line do you ship?" 



"We own our own boat, the Vueltaba.io, a 

 steamer of 1.260 tons. Each cargo consists of 

 about 400 tons of wood." 



"How does that total up in feet?" 

 ■ "Well, roughly speaking, there are about 4S0 

 feet in each ton, or 192.000 feet." 



"And how many carloads have you shipped?" 



"Altogether we"have sent to tbe United States 



seven boatloads, the first one, shipped about 

 fourteen months ago, was sent to New York, 

 where the wood was sawed up by the Astoria 

 Mills there. The other six have been unloaded 

 at Mobile, Ala., and discharged into a large 

 boom which we own at that point. The last 

 cargo arrived April 11." 



"By whom was this lumber cut up?" 

 "By the Underwood Veneer Company of Mo- 

 bile, hut we are now building a mill down there. 

 I can't tell you the exact dimensions of the 

 building, but "we are going to employ seventy- 

 five men there. The machinery was shipped 

 about thirty days ago and is now being installed. 

 We hope to have tbe plant in running order in 

 about a month." 



"How much do you calculate that it costs 

 your company to ship mahogany from the woods 

 to Mobile?" 



"Roughly speaking, we can cut the timber and 

 land it in Mobile for $9 to $10 a thousand, and 

 right here we have the advantage over our com- 

 petitors. I know of no one ■n-bo is bringing 

 mahogany from the section of the country where 

 our land is located who can do it as cheaply 

 as we do. This is because we own all our 

 shipping facilities, the railroad, the wharf and 

 the boat." 



"Who handles your mahogany?" 

 "We do it ourselves. We employ no brokers, 

 but sell direct to tbe trade." 



"Then you have shipped altogether about 

 1 .300.000 feet of mahogany since you have been 

 in business?" 

 "Yes." 



"At what price do you sell it?" 

 ".\t the market price. We have been able 

 to dispose of it to good advantage because of 

 the superior quality of the wood." 



"But do you know the exact price at which 

 the various consignments were sold?" 



"No ; that is not my end of tbe business, but 

 I do know that we secured good prices for it." 

 "You claim to have 288,000 acres in Mexico : 

 how mucli of this is covered with trees?" 



"About three-fourths of the land is timbered." 

 "How is the wood found — is it scattered or in 

 lots?" 



"Tlie mahogany is scattered all over the land. 

 We find it growing among the other trees, but 

 the mahogany growth is scattered." 



"Have you yet brought away any of the other 

 woods, such as rosewood, etc. ?"' 



"No : the only lumber we have shipped besides 

 mahogany has been some cedar. We have about 

 ten different kinds of woods that are market- 

 able, but we haven't come to them yet." 



"How many shares of stock have you sold, 

 Mr. McMahoii ?" 

 "I can't say." 



"Can't you say approximately?" 

 "No." 



It was learned in the office, however, that 

 there have been about 3.000 shares disposed of. 

 "Is the money coming in from Stock subscrip- 

 tions being used to develop your resources?" 



"Y'es. As fast as the money comes in. it is 

 applied in that way. We are already cultivating 

 20.000 acres of ground or one acre for each 

 share of stock. We are building up a big busi- 

 ness in heniquen. which is used for making fibre, 

 and onlv needs combing out to make good rope. 

 We have in the ground now 1.200.000 plants, 

 some over two vears old when planted. We 

 expect to place ."I'.OOO.OOO of these plants in the 

 ground. The value of this feature alone can be 

 seen when it is considered that $187,000,000 

 worth of heniquen has been shipped from the 

 port of Progreso. a short distance from our 

 laud, during the past twenty-three years, and_ 

 tbat $2,000,000 worth was sent out last May.' 

 We have, besides, about 2.000 head of cattle, 

 and they are turned loose on 30,000 acres of 

 grazing land, covered with the finest grass. An- 

 other source of revenue is that our steamer 

 carries freight on her return trips, and thus adds' 

 tfi the profits of the company." 



"Then all these improvements have been made 

 with the monev subscribed for stock, and you 

 have been able' to declare a dividend of twelve 

 per cent on your sale of mahogany alone?" 



"Yes. we have been able to do this because 

 we have sent our cargoes to Mobile and had the 

 wood sawed at the mills of the Underwood Ve- 

 neer Company, and then sold to the trade. i)f 

 course. o\ir profits come largely from the fact 

 that our initial expenses are much lighter than 

 those of our competitors, since the wood is easy 

 of access and is shipped via our own cars and 

 our own boats." 



Mr. SIcMahon did not discuss the amount of 

 stock sold, nor the money paid into the treas- 

 ury. The company advertises, however, that its 

 sliares sell for $300 each, and that the amount 

 can be paid in installments. 



It is apparent to the mere tyro in the lum- 

 ber business that C. M. McMahon 's state- 

 ment that his company can cut mahogany in, 

 Mexico and land it in Mobile for .$9 to $10 

 a thousand feet is absolutely and unquali- 

 fiedly ridiculous. Many other statements he 



