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FIRST MORTGAGE BONDS
OF THE
CENTRAL PACIFIC RAILROAD,
Business Prospects and Operations
of the Company.
Remarkable Exhibit of Earnings, &c., for Quarter Ending Sept. 30, 1867.
Banking House of FISK & HATCH,
No. 5 Nassau St., New York.
The following Statement of the Business and Operations of the CENTRAL PACIFIC RAILROAD COMPANY, brought up to a late date is submitted for the information of investors and holders of the First Mortgage Bonds and others.
The natural business of the road exceeds all previous
estimates, and establishes it as one or the most important and profitable
lines of communication on the continent. The Earnings and Expenses of the
ninety-four miles open for traffic, for the quarter ending September 30th,
areas follows, in Gold:
Gross Earnings. |
Operating Expenses. |
Net Earnings. |
$556.509,30. |
$101.620,89. |
$454.888,41. |
This result was upon the actual, legitimate, local business alone, with less than the ordinary proportion of Government transportation, and under the disadvantage that passengers and freight had to be forwarded by wagons, from the temporary terminus, at the summit of the mountains ; and is also independent of the transportion of men, and materials for the extension of the road.
This ratio of profit (nearly eighty-two per cent.
of the gross earnings) is without parallel, even among the oldest roads
in existence ; and is in fact nearly three times the ratio of the best
leading lines of the country. The following is a copy of the sworn Statement
returned to the Treasury Department for the month of August. Since its
receipt, (by mail,) we are advised by telegraph that the Earnings for the
month of September were $200,400 in gold, while the Expenses were about
the same as for August.
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| FREIGHT Transportation |
$142,242 84
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STATION, Train and Wharf Service |
$10,056 64
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| PASSENGER " |
34,041 88
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LOCOMOTIVE Service |
10,478 46
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| MAIL, U. S. " |
2,350 00
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REPAIRS of Track, Buildings, Engines, Cars, &c. |
10,381 07
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| EXPRESS " Wells, Fargo &c. |
1,400
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OFFICE Expenses, Stationery, Printing,
Telegraph,
and Miscellaneous |
985 79
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| C.P.R.R. Warf at Sacramento, Discharging
Schooners, &c. |
1,239 54
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DAMAGES, Freight, (lost) "Stock Killed," |
508 88
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| MISCELLANEOUS |
22 99
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TAXES, U.S. Internal Revenue |
927 38
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$181,297 25
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$33,338 22
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These results may seem almost incredible to persons unacquainted with the extent of the traffic between the Pacific Coast and the Great Mining Regions of the Interior Basin; but it should be understood that the 150,000 adult population, scattered over nearly 200,000 square miles, are mainly dependent upon this single line of communication for their supplies, machinery, etc. Upward of $13,000,000 in gold were estimated to have been paid in a single year (1863) for team-freights, one way only, across the Sierra Nevadas. The population and the production of these important regions, bearing the precious metals, have steadily increased since that time, and a still more active settlement is awaiting the further extension of the Railroad.
The Company is justified in charging the maximum rates10 cents per mile for passengers, and 15 cents per ton per mile for freightand these are cheerfully paid, being less than one third what was formerly paid for far less expedition, comfort, and security.
The Eastern terminus of the track has been throughout this period, at Cisco 94 miles from Sacramento, and nearly 6000 feet elevation above sea level, and the earnings will be immensely increased when the track is extended entirely across the Sierra Nevadas, which it is hoped, may be none during the present year. The Great Summit Tunnel, the last and most important on the line, was opened in August last. Twenty-five miles on the Eastern slope, following the valley of' the Truckee River, have been graded, rails laid, and a locomotive placed thereon, which are now nearly ready for the inspection of the Government Commissioners. All the available force is now being concentrated upon the intervening section of eleven miles, between the completed portions on each side of the range, which is in a forward state; and it is thought the whole distance between the navigable waters of the Pacific and the populous counties of Western Nevada, in the Salt Lake Basin, may be successfully and regularly operated during the current year.
The importance of this achievement, and the financial resources of the Company, as well as their future prospects, may be understood when it is known that nearly half the entire cost of preparing the road-bed on the 800 miles between San Francisco and Salt Lake is concentrated upon the 150 miles now nearly finished and paid for.
The Company has overcome the only considerable obstacle on their portion of the National Through Line, and will commence the easier work of building the 600 miles of light grades across the Great Basin under the most favorable auspices. It is an important fact, that along this portion of the line there are no Indians, and consequently no trouble from their hostility need be feared by this Company. The business between the Pacific Coast, and the Great Mining Regions of Nevada, Idaho, Utah, and Montana, is already very large, and will be proportionately profitable with that over the Mountain Section.
The Government subsidy between the two ranges of mountains is $32,000 per mile, which is more than half the estimated cost of construction. By becoming joint investor in the magnificent enterprise, and by waiving its first lien in favor of the First Mortgage Bondholders, the General Government, in effect, invites the co-operation of Private Capitalists, and carefully guards their interests against all ordinary contingencies.
The $1,000 bond is Series "D", No. 6316, Dated July 1, 1866, and is signed by Leland Stanford (President) and E.H. Miller (Secretary). There are only three such bonds known to be still in existence (two owned by private collectors).
Courtesy John Chamberlin, The Museum of American Finance, 48 Wall St., New York, NY, and Bruce C. Cooper.
THE CENTRAL PACIFIC RAILROAD COMPANY OFFER FOR SALE, THROUGH US, THEIR
First Mortgage Thirty-Year Six Per Cent Coupon Bonds,
Principal and Interest payable in Gold Coin, in New York city. They are in sums of $1,000 each, with semi. annual gold coupons attached, and offered for the present at 95 per cent. and accrued interest from July 1, in currency, at which rate they yield nearly NINE PER CENT. UPON THE INVESTMENT.
These bonds, authorized by the Pacific Railroad Acts of Congress, are issued only as the work progresses, and to the same extent only as the Bonds granted by the Government, and represent the preferred claim upon the whole valuable property furnished by Subsidies, Donations, Stock subscriptions, etc. They possess special assurances and advantages over other corporate securities, and are destined to rank among the best securities in the world.
I. They are the prior lien upon a valuable and productive Railroad line, in which three times their utmost issue has been invested.
II. The road is peculiarly exempt from competition, and must form the Trunk Line of the North American Continent.
III. Much the hardest part of the work is now done; what remains is easy and inexpensive, and will be rapidly carried through.
IV. The surplus earnings, after the payment of all expenses and interest liabilities, during the current year, will exceed one million dollars in gold.
V. The Bonds, like the revenues of the road, are payable in coinprincipal as well as interest.
This agreement has the sanction of the Act of Congress, and being made under the Specific Contract Acts of California and Nevada, is valid and binding in law.
Conversions of Government Securities into Central Pacific First Mortgage Bonds,
now realize for the holders from TWELVE TO EIGHTEEN PER CENT. ADVANTAGE,
with the same rate of interest.
Bonds can be obtained through the subscribers directly, or through responsible Banking agencies.Descriptive pamphlets, maps and information can be had at the
Office of the C. P. R. R. Co., 54 William St., New York, and of
FISK & HATCH,Bankers and Dealers in Government Securities, and
Financial Agents of the C. P. R. R. Co.,
5 NASSAU STREET, N. Y.
Government Bond Payments to the CPRR
Pacific RR Commission hearings, 1887-88, p. 4319
Courtesy G.J. Graves Collection.
