THE CUBA REVIEW 



25 



CUBAN FINANCIAL MATTERS 



CUBA COMPANY INCOME 

 (From the London Statist) 



"The position of the Cuba Raili'oad Com- 

 pany, indicating the probabihty that the earn- 

 ings and profits of tlie Companj^ would con- 

 tinue to expand so that the prior securities 

 were worth the attention of investors. The 

 common stock of the Cuba Raih'oad Com- 

 pany is not in the hands of private investors, 

 but is entirely owned bj' the Cuba Company, 

 a concern which owns in addition to about 

 300,000 acres of land in Cuba, various town- 

 sites, including the terminal city of Antilla, 

 and sugar mills and i)lantations in the Pro- 

 vince of Camague^' and Oriente. It has an 

 authorized capital of $16,000,000 in moieties 

 of 7% cumulative preferred stock and com- 

 mon stock. Of these there has been issued 

 $2,500,000 of the preferred stock and the 

 whole of the common stock. 



''Thus the income of the Cuba Company is 

 derived from various sources. There is, first 

 of all, the net earnings of the mills and plan- 

 tations; secondly, there is the income from 

 land operations; and thirdh^, the income de- 

 rivable from the holding of the common stock 

 of the Cuba Railroad Companj-. For the 

 twelve months to June 30, 1914, the mills and 

 plantations showed net earnings amounting 

 to $1,159,082. From operations in land there 

 was a net result of $35,026, wliile dividends 

 from the Cuba Railroad Companv brought 

 in $600,060, so that the total income 

 amounted to $1,794,168. Expenses and 

 debenture interest absorbed $369,805, thus 

 leaving a balance of $1,424,363 available for 

 distribution. The divddend on the preferred 

 stock called for $125,185, thus leaving a sur- 

 plus of $1,299,178, which is equivalent to a 

 distribution of 16% on the common stock. 

 The actual dividend is 7%, which calls for 

 $560,000. and ther is consequently a net sur- 

 plus of $739,177, which added to the surplus 

 brought forward, gives a total of $3,450,805. 



"The prevailing prices for raw sugar during 

 the past grinding season were lower than have 

 been known for any considerable period, and, 

 consequenth", it is very satisfactory that the 

 company should be able to show net earnings 

 from this source of $1,159,082, but since then 

 a remarkable change has occurred in the posi- 

 tion. The outbreak of war had the effect 

 inter alia of causing a complete'stoppage of 

 beet suppKes. This has naturally reacted in 

 a most favorable manner, from the planters' 

 point of view, on the price of cane sugars of 

 all kinds, and increases in some values are 

 from 50% to 75 Sc as compared with this time 

 last j'ear. In so far as the Cuba Company' is 

 concerned at the date of the report there re- 

 mained unsold 32,000 bags of sugar which 

 stand in the books at the low prices prevailing 

 on June 30. 



"The recent large advance in prices will 

 mean on the sugar unsold at the beginning of 

 the current financial year an additional profit 

 of about $300,000. The company's two 

 sugar plants were built with an estimated 

 total capacity of 500,000 sacks of 325 lbs. 

 each, but last season the plant produced more 

 than 600,000 sacks, 'and this unexpectedlj' 

 large output makes necessary some additional 

 plantings of cane, which are now coming on, 

 and every effort is being made to provide for 

 the utmost capacity of the mills for the com- 

 ing season in order to secure the fullest advan- 

 tage of the probable continuance of the pre;^- 

 ent high prices.' Consequenth' there is 

 every reason to believe that the sugar plant 

 will this year show net earnings considerably 

 in excess of those reported for last year. 

 Similarly also it may he anticipated that a 

 larger dividend will l^e received from the 

 Cuba Railroad Company. For the year to 

 June 30, 1914, the Railroad Company earned 

 10^2% on its common stock and distributed 

 6%. With the much more favorable outlook 

 it ma.y fairly be anticipated that both earn- 

 ings and distributions \\-ill be on a larger 

 scale for the current financial year. Each 

 1% paid on the common stock of the Cuba 

 Railroad Company means 15^% on the com- 

 mon stock of the Cuba Company, and as 

 already indicated on last year's figures the 

 Cuba Company earned as much as 16%, while 

 it only distributed 7%. Altogether, there- 

 fore, with the probal)ilities of larger crops 

 fetching enhanced prices, the outlook for 

 both the Cuba Railroad Company and Cuba 

 Company is distinctly promising, and the 

 latter company shares in the prosperity of the 

 former." 



THE HAVANA EXPLORATION COMPANY 



This company, which has been in voluntary 

 liquidation since November, 1913, was formed 

 in Juns, 1909, with a capital of £500,000 to 

 acquire and take over asphalt, bitumen, oil, 

 and coal bearing and other properties situate 

 in Cuba and known as the Mariel Mines, and 

 particularly to take over the assets and lia- 

 bilities of the Havana Investment Sj'ndicate 

 (Limited) at the price of £300,000, payable 

 in shares. The compam', in addition, under- 

 took to discharge the syndicate's liabilities, 

 which amounted to £38,000. Xo prospectus 

 was issued, but each of the ten subscribers to 

 the Memoran:lum and Articles of Association 

 agreed to apj^ly for 5,000 shares, and in that 

 wa provided capital of £50,000. In April, 

 1910. the Havana Oil Company (Limited) 

 was formed with a nominal capital of £80,000, 

 divided into shares of 2s. each, and obtained 

 from this Exploration Company a license for 

 f iftv vears to drill for oil on the Mariel Mines 



