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Show Ikon gold m be alljight yet President Guggenlioim Sends Out Statement Showing What Can Be Expected. LARGE NET PROFITS IN PLACER GROUND Report Favorably Received by the Engineering and Mining Min-ing Journal. In an address to the stockholders of tho Yukon Gold company, just issued by President S. R. Guggenheim, very optimistic opti-mistic forecasts are made regarding thlo proposition In the frozen north, a proposition propo-sition that received no end of comment pro and con last year when Lawson launched tho boom. After describing the good water facilities, and stating that the company's engineers havo reported 540,000.000 net In proven ground, the report re-port says: "Tho shareholders will bo Intorcsted to know that a large majority of the outstanding out-standing capital stock of the Yukon Gold company Is owned by the Guggenheim Exploration company, whose engineers have under their direction the equipment and operation of the properties. Tho Guggenheim .Exploration company has financed the scheme from Us Inception, justifying Its Investment by the conclusions con-clusions of its engineers after a rigid examination ex-amination and exhaustive reports. That they are satisfied with their Investment Is evidenced by the fact that they have not disposed of a share of their holdings. The fact Is that tho directors of the Guggenheim Exploration company feel thai thov, as pioneers in the Industrial development of the north,, have taken tho first steps toward tho establishment of ii permanent and substantial mining ln-duslrv ln-duslrv In the Yukon Territory and Alaska. Alas-ka. The day of the. small operator had come and gono and in its place cntorcd tho corporation, to do things which few Individuals, having the means, would caro to undertake: that is. to supply sufficient capital for the development of tho resources re-sources of the country and make its mining future definitely assured. It required re-quired courage to make such an Investment, Invest-ment, running well tip into millions of dollars, but tho directors feel that tho money and time they have expended in developing the resources of the north will ultimately result In a large profit to the stockholders of the first company to go into placer mining in this region upon so gigantic a scale. That othor3 will foN low In our footsteps wo hope and have-no have-no doubt, now that we have demonstrated that the frozen gravels can be worked within reasonable operating cost, and, in fact, that all of the handicaps undor which the Individual operator labored can be overcome. Wo feel safe In predicting, therefore, for the future, an Immense increase in-crease in the gold output of Alaska and the Yukon Territory which naturally will bo attended by Improvement In local condition? and Increasing prosperity. "For the past season final residts have not as yet been actually determined, but Incomplete figures show that tho net earnings to December 31, IMS. will be about 5550.000. Without doubt, we should have reached our estimated net of ?S0O.-000. ?S0O.-000. had It not been for delay In delivery at Dawson of machinery, which waa held up at "Whitehorse by unusually low water In the Yukon river Immediately after tho opening of navigation. This delay cut the length of our season materially, but possibility of repetition may be omitted from future calculations, notv that our equipment has been delivered and Installed. In-stalled. Our engineers havo estimated the probable earnings for 130D at from 51.-100.000 51.-100.000 to $1,500,000. The wide difference differ-ence In these figures Ik due to the unknown un-known factors entering into tho water supply, and the uncertainties attendant upon the first operation of a new ditch line of such length, and constructed under un-der such difficulties. If we have comparatively com-paratively few washouts or accidents on tho main ditch system or the equipment, our earnings will probably reach the higher figure.. "In 1010 the net profits of the company, should be from $2,000,000 to $2,500,000. and In It'll and thereafter. 52.500,000 net per annum should be the minimum. I havo no doubt that the directors will authorize tho commencement of dividends during this veor, probably In the second quarter; but before deciding definitely as to the date and rate, they deem It prudent to wait until the coming season's operations have sufficiently advanced to enable them to more accurately estimate tho probable earnings for 1000." The following editorial comment In tho Engineering and Mining Journal Is of interest in-terest in this connection: S. R. Guggenheim, president of this company, has Issued to Iho stockholders a letter concerning the object of the enterprise, en-terprise, what has been accomplished and what Is still to de done, estimated earnings, earn-ings, etc. His statement is frank and to the point, except that no data as to tho operating costs are given. However, If he accepts the facts as ptated, together with the estimate of the profits, tho stockholder Is able to form a fair Idea as to the value of IiIh property. At the time of the Lawson flotation, the net profit of the developed ground was estimated at S3fi.000.000. It' Is now stated that J-10. 000.000 net Is to be expected ex-pected The earnings in 1S0S were about $550,000. In 1900 they ar expected to be 51.100,000 .to $1.500.060. In 1910 the net profit, "should be from 52.000.000 to 52.-nOO.OOO 52.-nOO.OOO and In 1911 and thereafter 52.500.-. 000 net per annum should be the minimum." mini-mum." This gives, for the first lime, notice of the time that the management contemplates con-templates for. tho working out of the property, which apparently will he sixteen six-teen to twenty years. Unfortunately, Mr. Guggenheim does not give any indication of what part of the estimated net profit will be applicable to the payment of dividends, and what part, must go hack Into the property for maintenance. Perhaps Per-haps ho means that It will nil bo available avail-able for dlvidendn. There is always a vagueness about the term "net profits." In the case of the Yukon Gold company it might have been dissipated if Mr. Guggenheim Gug-genheim had gone Into the matter of gross yield and operating expense. The discredit arising from tho Lawson connection lias deprived this company of the recognition to which It Is cntlilod. Mr. Guggenheim's letter appears to be Inspired In part bv the desire to correct the faluc Impression. The company Is. indeed, engaged In a great Industrial undortakln;r. Some extraordinary engineering en-gineering foals have been acrompllahed and the Introduction of now melhoda ,marks an era In Alaska placer mining. To O. H. Perry, the managing engineer of the company, is chiefly duo the credit for this. . n |