THE CUBA REVIEW 



21 



CUBAN RAILWAY RESULTS 



(From the Financial Times of London) 



The details given in the ordinary dividend announcements for the year ended Jime 30th 

 last of the United Railways of the Havana and its associated lines, the Western Railway of 

 Havana and the Cuban Central Railways, point to some falling off in net revenue, though 

 not to an extent gi-eater than might have been anticipated. The published traffics for the 

 twelve months of all three systems registered a dechne — of £50,600 in the case of the United, 

 of £200 in the case of the Western and of £28,900 in the case of the Central. This appears 

 to have been due to a somewhat imusual set of circumstances. All the lines are dependent 

 on the sugar crop for much of their freight business — in 1912-13, for instance, they carried 

 between them 8,298,300 tons of sugar products, representing over 78% of the total quantity 

 of goods handled — and the last crop so far from being a poor one was better even than that 

 for 1912-13, which in its turn was of abnormal volume. The supplies, however, last year, 

 were so abundant that a considerable proportion of the contemporary crop had to be stored, 

 not only because it was not wanted, but in order to maintain prices in the planter's intere-st. 

 The storage pohcy, while holding off business from the railwaj^s for the time l)eing, does not 

 therefore mean a permanent loss of traffic, but really represents deferred freightage. The 

 lines will inevitably benefit from the carriage of these held-up stocks during the current 

 financial period, paj-ticularty as the bottling up of the German and Austrian beet crops has 

 greatly increased the demand for the American product, and will stimulate its marketing. 

 For the current year to date the rate of the falling off in earnings has sensibly decreased, 

 and the hnes are now barely £10,000 behind receipts in 1912. 



After allowing for all charges, including preference interest, the net revenue of the United 

 comes out at £465,900, as compred with £506,400 and, with the sum brought into the accounts, 

 the available surplus is £482,200, as against £524,300. The ordinary dividend is maintained 

 at 5%, but owing to the larger amount of stock now ranking for return, through the Cuban 

 Central deal, the sum absorbed is £328,000, or £35,000 more than last time. The feature 

 of the distribution is that it is to be paid in Five Per Cent Debenture stock, carrying interest 

 as from January 1st next, a somewhat arbitrary method of ensuring subscription for a further 

 debenture issue at par, though the nature of the security offered is excellent enough. Since 

 the ordinary dividend is unchanged it is the special appropriations that have to bear the 

 burden of the decrease in revenue. Thus the reserve gets £50,000 as against £125,000, and 

 the Pension and Insurance accounts, which a year ago received £20,000 and £5,000 respect- 

 ively, now secure nothing. On the other hand, the allocation to the general renewals reserve 

 is unaltered at £50,000, and the figure set aside to meet extraordinary expenditure on works 

 is raised from £15,000 to £40,000. The net drop in the aggregate appropriations is £75,000. 

 The carry forward is £2,100 down at £14,200. The net revenue of the Western of Havana 

 is £82,400, as agamst £92,400, and including the sum brought forward the available balance 

 is £99,100, as compared with £108,700. In this case, too, the dividend is unchanged at 7%, 

 but no reserve recommendations appear in the dividend declaration, whereas last time £10,000 

 was placed to reserve and the insurance account got £5,000. The carry over is increased 

 from £16,700 to £22,100. The Central is the only concern of the three whose reduced dis- 

 posable surplus is regarded as justifying a smaller ordinary dividend. The net revenue, 

 after providing for the preference interest, is down from £39,900 to £32,700, and the available 

 balance from £50,400 to £46,100. The reserve appropriation goes up from £10,000 to £15,000, 

 and the carry forward at £13,100 is wi thin £300 of the sum brought into the accounts. This 

 has to come down from 3 to 2%, which was the rate ruling in 1911-12. 



Station at Matanzas, of the United Railways of Havana. 



