BOND CIRCULARS 361 



lent price. The white pine product is sold principally in 

 New York, Pittsburg, Cleveland and Chicago. 



QUALITY OF PRODUCT.— The percentage of high 

 grade lumber in the Company's product is unusually high. 

 Its western pine timber produces an average of from 50 

 to 60 per cent No. 3 shop or better. Its white pine runs 

 about 70 per cent No. 2 common, or better. The percentage 

 of low grade producl in both classes of pine is extremely 

 small, being only about 5 per cent No. 4 boards as against 

 about 40 per cent in the ^^linnesota mills. 



EARNINGS. — During the year 1910 the Company sold 

 from its Spirit Lake plant. 41,995,799 feet of lumber, and 

 from its lone plant 7,379,455 feet, making a total of 49,375,- 

 254 feet and its net earnings applicable to the payment of 

 principal and interest of these bonds were $283,418.22, 

 equivalent to $5.75 per thousand feet of lumber sold. In 

 considering these figures for the year 1910 it is proper to 

 call attention to the following facts: 



1st: The Company received practically no benefit from 

 its new mill at lone recently completed and representing 

 a cash investment of over $750,000. 



2nd: The business of the year represents less than 50 

 per cent of the Company's present normal capacity. 



3rd: The year was one of extreme depression in the 

 lumber industry. 



In view of these facts the showing is an unusually 

 creditable one and proves beyond question the ability of 

 this Company to protect the principal and interest of its 

 bonds under the most adverse conditions. The Company 

 now has manufacturing and shipping facilities for an out- 

 put of 100,000,000 feet of lumber per annum, and with the 

 return of normal conditions in the lumber business, it 

 may be conservatively estimated that its margin of profit 

 per thousand feet will be increased at least 50 per cent 

 over the figures of last year. 



FINANCIAL CONDITION.— After receiving the pro- 

 ceeds of these bonds, which have been issued for the pur- 

 pose of retiring its floating indebtedness, the Company's 

 condition will be as follows as of January 1st, 1911: 



ASSETS. 



Laud and standing timber $1,697,856.32 



Farm lands and city real estate.. 66,699.25 



Plants and equipment 1.544,240.45 



Logs, lumber and supplies 680,240.96 



Cash, accounts and bills receivable. 333,442.14 



Total assets $4,322,479.12 



