AR, M&O 4/1/1863 CE

Annual Report of the Mobile & Ohio RR
as of April 1, 1863,
Chief Engineer's Report
Chief Engineer's Report
Office Mobile & Ohio Rail Road Company
Mobile, March 31st, 1863
Hon. Milton Brown
President Mobile & Ohio Railroad Company
   At the last annual meeting of the Stockholders, the Army of the West was occupying Corinth, which rendered it necessary to make that station the headquarters of the operating department of the Road. That meeting was held soon after the battle of Shiloh, and while the movements of the Army for the concentration of men and materials, and the transportation of stores from Memphis just previous to its evacuation so occupied the officers of the Company that they could not devote the time necessary to the preparation of the usual statistical Tables and Reports. It is therefore proper that this Report should review the operations of the past two years. The Earnings and Expenses of 1861 were reported to the Stockholders, but for comparison they are repeated as follows:
Earnings 1861
From Passengers $424,870.49
     "   Freight 745,884.65
     "   Express 15,136.44
     "   Mail 79,426.77
     Making a total of $1,265,318.35
     And the expenses of 1861:
For Repairs of Road $280,549.16
   "        "          Machinery 131,181.36
   " Conducting Transportation 266,417.42
     Making a Total of $678,147.94
     And leaving a Nett Revenue of 587,170.41
   It will be recollected that the day the last Rail was laid, the Federal forces occupied Cairo, and that soon after, the blockade was effectually established at Mobile, cutting off the freight from both ends of the Road, preventing the importation of supplies necessary to operating the Road, and the transportation of the crop of cotton of 1862. Superadded to this was the stringency of the money market, produced by the failure to dispose of cotton, and the consequent inability of planters to make the usual fall purchases, and the beginning of that increase of prices which has so steadily progressed to the present time.
   While, therefore, the receipts of that year were half a million less than they would have been in times of peace, the expenses were increased by the higher prices of supplies and labor, and the stock of supplies then on hand was consumed in the repairs, and charged at the original invoice cost. For these reasons the receipts of 1861 were largely decreased, and the expenses were greater than they would have been in times of peace, while the depreciation consequent upon the want of the necessary supplies to maintain the Rolling Stock and Track in good order left them in worse condition than at the beginning of the year.
Report of the Earnings and Expenses of 1862
   The annexed statements, marked 1 and 2, from the Auditor's office, show the earnings and expenses for the year:
   The causes before adverted to, which in 1861 increased the expenses and prevented the maintenance of the Roadway and Machinery in good order, operated in still greater degree in 1862. In addition to this, the military authorities assumed the supervision of the Road, and trains were forced to run out of time, while the cars were forced upon other Roads, and mutilated and destroyed while thus diverted from the control of the Company's officers. And I deem it proper here to protest against that policy which looks to the interchange of cars, and which, if persisted in, will ruin every Road in the Confederate States. Each Road has had its cars constructed from peculiar patterns, and is prepared with brasses and castings to keep them in good running order; but when sent upon another Road, that Road has not the necessary parts to repair them, so that when out of order, they are placed on the side tracks, many of the parts which cannot be replaced are lost,  they are rendered useless, and are frequently broken up and destroyed. It is this policy which has caused a loss of 141 cars during the past two years, which cannot be replaced until the close of the war. This, as well as the depreciation of Rolling Stock and Rails is as legitimate a part of the expenses as if the articles had been purchased upon credit and the notes of the Company given in payment.
   I have made an accurate inventory of the Rolling Stock, the number of laminated and defective Rails in and removed from the track, and submit the following estimate, at the original standard value, of the depreciation during the past year, and recommend that a special fund be appropriated out of the year's earnings and set apart for the renewal:
141 Cars lost $112,000
Depreciation of 583 Cars 116,000
           "                     Engines 132,000
Two Locomotives lost in Tennessee 20,000
2,729 rails removed from Track 19,000
6,144 Rails Laminated in Track 20,000
Depreciation of other Rails 52,000
To which add Expenditures per statement of Auditor 753,313 26
And for Engine House and Station Buildings 42,442 24
And for unadjusted claims 25,000 26
     Making the total Expenses $1,291,755 76
   The foregoing estimates of depreciation are based upon that portion of the Road in our possession, extending from Mobile to Okolona, and does not include the damage to the Bridges, Roadway and Station Buildings north of the latter point.
   Our information as to the damage to the Road and buildings above Okolona, is too meagre to authorize the making any estimate of the amount required to repair them; but, enough is known to justify the laying aside a large fund especially for this purpose.
   Referring again to Statement No. 1, it will be seen that the earnings were --
From Passengers $1,365,389.55
     "   Freight 1,014,845.75
     "   Express 32,163.09
     "   Mail 59,263.92
     Making a total of $2,671,662.21
And the expenses as before stated 1,291,755.76
     Leaving a nett revenue of $1,379,906.45
   Dividing this latter item in proportion to the length of the Road in operation during the respective months, there was earned in the State of Alabama, $276,546; and the remainder in the States of Mississippi, Tennessee and Kentucky.
   Reference to Table No. 9, hereunto appended, shows that 5 1/4 miles of worn-out rails have been removed from the track, and that there are now upwards of eleven miles of laminated iron, which should be removed during the present year. A comparison of the results given in this, with the corresponding Statement in the previous Reports, shows that the number of defective rails is rapidly increasing. If there were no considerations of higher character, it is important to the preservation of the Rolling Stock, now so valuable and difficult to repair, that the surface of the Rail should be perfectly free from lamination. The well known crystallizing and weakening effect of impact or sudden jars upon the structure of wrought-iron, which human foresight cannot discover or prevent, is occasionally developed in broken axles, now justly regarded as the most terrible form of accidents, and, as it will be impossible to obtain other axles until a return of peace, no pains or expenses should be spared to obtain Rails for renewal.
   The Railroads of the Confederate States have recently taken steps to inquire into the most feasible way of establishing machine shops for the construction of Locomotives and Rolling Stock, and Rolling Mills for making Rails for making Rails and other iron necessary in maintaining the machinery. If these inquiries should result in the practicability of the construction of these works within the present year, and upon plans which will insure success, it will be to the interest of this Company to unite with them.
   Many of the books and papers necessary to make out the statistical tables of the North Division of the Road were lost in the hurried removal from Jackson, and therefore the tables are not as full as in the last published Annual Report.
   Since the last Annual Meeting, a large and commodious Freight Warehouse has been completed at Mobile, and a Gravel Train will be employed during the present year in filling up the Station Grounds above high water mark.
   For the better protection of machinery and other property of the Company, the following buildings should be erected at Whistler:
   Blacksmith Shop, Storehouse, Round House for the protection of Locomotives, Car Shed to protect Cars not in use, and Carpenter's Shop for the construction of Cars.
   These buildings should be erected in the most permanent manner, and adapted to the future business of the Road.
   The Trains have been run with as great regularity and freedom from accident as could have been expected from the uncertain movements and the amount of work required in the Government business.
   Before this war, it had always been with great pride that I informed the Board that no passenger had ever lost his life on this Road, and but for the interference in its management, the Government and the public would have been better served, the machinery would have been in better condition, and the same record of personal safety would again be written.
   The employees of the Company, with few exceptions, have faithfully discharged their duties, and deserve the thanks of the Company.
Respectfully submitted,
L. J. Fleming
Chief Engineer and Gen. Sup.