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6 - PANAMA RAIL ROAD COMPANY.

line of Road and double-tracked roadway and of relocating and recon-
structing the Rail Road, which work was done by The Panama Canal
and at its own expense, it became necessary that an actual physical
inventory of the larger part of this Company’s property on the Isthmus
be established prior to the expiration of the fiscal year. Such an inventory
was completed and all except its landed property and telegraph and
telephone plant appraised (they to be appraised hereafter) as of date of
June 30th; and thereby a relatively definite starting point for the read-
justment of Property Accounts and Reserves for Accrued Depreciation
was established. Under legal advice and with the aid of competent
experts those accounts were adjusted to the valuations shown in the
Report of the Appraisal Committee and a net total of $1,866,503.72 was
by authority from the Board of Directors written off to ‘Profit and Loss,”’
a large proportion of that total representing property that had become
obsolete, condemned or destroyed during the elapsed period of ten years
of U.S. Government ownership. It is perhaps needless for me to enlarge
upon the importance of the revised exhibits of the actual value of the
Company’s property.
_. The result of the Company’s business of every character for the period
covered by this report, after meeting the cost of operation together with
fixed charges aggregating $93,309.04 and charges for depreciation on
rolling stock, floating and plant ao of $140,843.71, shows a net
income of O14, 860.58.
During the same period $2,341,591.61, or more than double the net
income, was expended for additions to and betterments of plant and
z equipment, as described in the reports hereto attached; notwithstanding
_the loss of traffic, the Rail Road and its appurtenances are of necessity
‘maintained in a state of highest efficiency ready for maximum use In any
emergency; the effect of that obligation is fully reflected in the statistical
exhibits of operation attached to this report. |
I call your further attention to the details of a supplemental report
covering the first four months of the ensuing fiscal year hereto attached.
In that connection it should be noted that early in September of the
current year, owing to a serious slide movement, transit of the Canal was
interrupted, and it has since remained closed to commerce. Strenuous
efforts are being made to effect a reopening and in the interval arrange-
ments were made to transship by the Rail Road across the Isthmus in both
directions cargoes of the vessels that were detained in Isthmus waters
by the blocking of the Canal and those en route that subsequently arrived
at its terminals on both oceans. Every effort has been made by this
Company, operating as an adjunct of the Canal, to aid in minimizing
the damaging effect of the delays that vessels and cargoes were subjected
— to, and that work will continue until the: Canal is reopened. The Rail
- Road having withdrawn from any participation in through traffic, it
became necessary to establish a new tariff of rates applicable to the change
from an “Intermediate” to a “transfer”? service. Certain appropriate
: optional rates are temporarily in effect while the Board of Directors has’
-— under consideration the preparation and issuance of a uniform tariff that
_ will apply not only while the Canal is closed at this time but equally i in
any future emergency.
Respectfully submitted,

GEO. W. GOETHALS,

_ President.