THE DEBT OF
The United States of Mexico
AND OF THE
NATIONAL RAILWAYS OF MEXICO
(Ferrocariles Nacionales de Mexico)
as of 1919
by
T. W. OSTERHELD
Specialist and Consulting Expert
in Mexican Values
with
LANSBURGH BROTHERS
Members of New York Stock Exchange
30 Broad Street New York City
Orders Executed and Quotations Furnished on all
American and Foreign Securities
Copyright, 1919
Debt of the Mexican Government
FOREWORD
In the study of the Mexican National Debt, from the founding
of the Republic, to the present day, there can be found no ten¬
dency on the part of the Government to repudiate any legitimate
obligation. In fact, it has been an empiric law of that Republic
never to repudiate its material debts, and to insist upon each state
the fulfillment of any obligations which it may have contracted.
The greatest proof of this statement and the integrity of the
Mexican Republic will be found in the history of its first two
loans, where the Republic in assuming the responsibility of the
Spanish debt received $11,000,000 for a $30,000,000 loan, paid
$29,500,000 for the service of the loan and finally in 1890
extinguished this debt by the payment of over $62,000,000.
A more recent example, taken from the present administration,
may be seen in the conversion of the paper money issued by the
Provisional Government the first few months at Mexico City,
and later at Vera Cruz, in order to maintain the Army while the
new Government was in formation. This issue amounted to, in all,
about 670,000,000 pesos, the larger part of which was redeemed
as taxes, railroad fares, etc., and the balance amounting to about
50,000,000 pesos being converted into gold certificates, payable
in five years, on the basis of five cents gold for each peso of
Constitutional paper, which was greatly in excess of its value
at that time.
Notwithstanding all difficulties, the recuperative powers of
Mexico have always been effective and quick, as her growing
wealth showed during the presidency of Porfirio Diaz. Through
the ownership of her ' entire railroad systems, telegraphs, and
public works, acquired since the prior revolution under Diaz,
aided by the development of the great oil fields and mining
industries, which are more important to-day than ever before,
Mexico's recovery from the revolutionary conditions existing in
1
1914-15 is now assured, and what is most important, without
aid of any Foreign capital whatsoever. The world has been
too occupied with the Great European War to notice the progress
of Mexico, but that country has fully occupied her time in develop¬
ing her great resources and industries to the best advantage in
order that the income derived therefrom may aid as much as
possible in her recovery. As yet no public announcement has
been made relative to the resuming of the payment of interest
on her bonds, both Government and Railway issues, as well as
the providing for the interest already due, but it may be stated
that this important miatter has had careful official attention.
In order to more fully explain the present debt of Mexico, it
is necessary to divide the same into two periods the first of which
will deal with the years of 1885 to 1912, and the second from 1912
to date. At the end of the second period will be found seven
exhibits which show as nearly as possible the present debt of"
Mexico.
2
PERIOD FROM 1885 TO 1912
This period might be called by a historian, "The Era of Con¬
struction," when considering the life of the Mexican Republic,
but to the minds of the financial world, this period contains
only one thought, and that is the earnestness shown by Mexico
in her desire to pay off her creditors, and the great progress
made toward that end, aided by the growth and prosperity of the
entire country.
The first act of any note took effect on June 22, 1885, con¬
solidating into the three per cent, interior silver bonds all the
prior debts of the Republic then outstanding, except the fioating
debt and the old English debt which now had reached an amount
of $69,958,670. However, one year later, in June, 1886, with the
approval of the bondholders and the Mexican representative.
General F. Mena, this debt was converted into three per cent,
bonds, which were later redeemed in accordance with the contract
out of the proceeds of the loan of 1888. The Mexican con¬
solidated loan of £10,500,000 six per cent, gold bonds of 1888
had for its primary object the payment of the interest bearing
fioating loan, and to comply with the redemption clause of the
three per cent. English loan of 1886. When the five per cent,
gold loan of 1899 was authorized, the six per cent, bonds of
1888 were included in the conversion.
Throughout the entire period under discussion will be found
a desire on the part of the Government to look with favor on the
building of railroads and public works, lending financial aid where-
ever and whenever practical, recognizing the imperative need
of Mexico in having a good transportation system and the con¬
venience of well built and organized public works.
In this connection we find that the Government in 1889 issued
£2,700,000 five per cent, bonds, in order to complete the building
of the Tehauntepec Railroad,- which bonds were later converted
into the issue of 1899. The next project was the Monterey and
Mexican Gulf Railroad, in order to obtain funds for which the
Government issued $6,700,000 six per cent, silver currency bonds
at a rate of 65, and later converted them into five per cent.
3
internal redeemable stock of the same road. For the purpose
of paying off and consolidating the different subventions granted
for railway construction, the Government in 1890 made a six
per cent, gold loan of £6,000,000 and in 1893 a similar loan for
£2,594,720, both of which were included in the 1899 conversion.
For the purpose of subventions, public work, and the redemp¬
tion of other outstanding interior obligations, the Congress of
Mexico authorized an internal ñve per cent, silver issue for a total
of $100,000,000 (silver pesos) which were placed on the market in
five series, the first in 1894, amounting to Mex. Silver $19,985,800,
the second in 1895, for Mex. Silver $20,000,000, the third in 1898
amounting to Mex. Silver $20,000,000, the fourth in 1899
amounting to Mex. Silver $20,000,000, and the last in June, 1902,
for Mex. Silver $16,472,600—so that of the total amount author¬
ized, only Mex. Silver $96,458,400 were put in the hands of the
public.
The next issue of bonds, probably the best known in this
market, took place in 1899, when the Mexican Government
consolidated the prior six per cent gold loans of 1888, 1889 and
1893 into an authorized issue of £22,700,000 five per cent, gold
bonds, of which £10,433,820 were redeemed out of the proceeds
of the four per cent, gold loan of 1910. This five per cent, loan
is secured by sixty-two per cent, of the national import and
export duties, and redeemable in forty-six i'ears. Interest was
paid regularly quarterly until July 1st, 1914, when due to un¬
settled conditions caused by the revolution, the interest was
defaulted, and up to the present writing payment has not been
resumed, though it is understood that the matter is now under
consideration.
In order to better emphasize the desire on the part of the
Mexican Government to aid its Municipal bodies, it is well to
mention at this tim.e the loan of £2,400,000 contracted in London
by the City of Mexico, in order to cover public improvements,
which the Government under the law of March 26, 1903, made a
national obligation.
A four per cent, external gold loan was authorized in 1904,
amounting to $40,000,000 American gold, and was applied to the
redemption of $12,500,000 Treasury gold notes of 1905, $600,000
4
Treasury notes of 1906, $9,213,500 silver six per cent, subventions
of the Mexican Southern Railway, subvention of Vera Cruz and
Pacific Railway, and $5,909,500 for the redemption of certain
amounts of silver certificates, issued for the construction and
exploitation of the Tehuantepec Railway, harbor of Coatza-
coalcos. Salina Cruz, Vera Cruz, and Manzanillo.
The last loan attempted during this period is that of 1910,
which loan probably reflects the highest point of financial standing
reached by the Mexican Government in its history. This loan was
under the then Finance Minister, Mr. Limantour, who desired
to convert the 1899 issue of five per cent, gold bonds into a four
per cent, issue of gold bonds, and had already placed one half
of the amount necessary with the bankers in Paris at 97.625, and
had the other half optioned, when the first Madero revolution
put a stop to the issuance of the second half.
5
PERIOD 1912 TO 1918
During the years 1912 to 1916 Mexico experienced one revolu¬
tion after another, commencing with the overthrow of Diaz by
Madero, and the final triumph of General Carranza, who, after
considerable endeavor succeeded in bringing order out of chaos,
until to-day, under his Presidency, Mexico is enjoying more real
freedom and prosperity than ever before. Due to unsettled
conditions of the country, the mines had suspended operations,
the soil was untilled, and conditions in general were very bad.
However, during 1918, real progress has been noted. The
mines and smelters with very few exceptions are all running
to capacity, the oil wells are producing more oil than ships can
be furnished to transport it, farms are being worked extensively,
the railroads are once again operating on a regular schedule, and
several of the Banks of Issue are about to reopen.
Throughout this period, Mexico on only two occasions en¬
deavored to obtain the aid of Foreign capital, once in 1912, when
the Government under President Madero floated a $10,000,000
gold loan, through Messrs. Speyer & Co., in New York, and
Speyer Brothers in London. In 1913, during the administration
of Huerta, there was authorized an issue of ten year 6% gold
bonds in an amount of £16,000,000 which could be increased with
the approval of the Bankers to £20,000,000. This loan was to
be secured by 38% of the import and export duties of Mexico, and
in the agreement with the Bankers, it was stipulated that no
further external loans should be made for a period of two years.
The Loan had for its object the repayment of the Madero Loan
made by Speyer & Co., and Speyer Brothers (about 41,000,000
pesos), to guarantee the certificates issued by the National Rail¬
ways of Mexico for interest not paid on its bonds, to cover certain
guarantees to the Banks of issue, for the guaranteeing of railroad
subventions, and for providing equipment for the army, purchase
of the Mexican National Packing House, and the deficit existing
in the Budget. Under contract with the Bankers in Paris,
£6,000,000 of these were placed under the date of June 8, 1913,
and further amoimts were offered for subscription in Mexico
City by the Secretary of the Treasury under decree and authoriza¬
tion granted by the Mexican Congress, under the stipulated
6
conditions as set forth in the contract with the Bankers in Paris.
The legality of £700,000 of this issue brought out in London by
Reuter & Co. has been questioned.
In 1914, due to the loss of income caused by the Revolution,
interest on all bonds with the exception of a few local railway
bonds, such as those of the United Railways of Yucatan, was
defaulted.
This leads to the present Government under General Carranza.
The military campaigns of General Carranza were financed
entirely with paper money, of which there were several issues.
The first issue, ordered by decree dated April 26, 1913, was for
an amount not to exceed 5,000,000 pesos, known as the Monclova
Issue. In December, 1913, it was found necessary to increase this
by 20,000,000 pesos, and in February, 1914, it was raised again
by 30,000,000 pesos. The amounts issued against this last
authorization totaled 25,000,000 pesos, and were known as the
"Issue of the Constitutionalist Army."
Upon arrival of the Constitutionalist Army in Mexico City
in August, 1914, it was found expedient to convert the previous
issues of paper money, and at the same time make a larger issue
to meet the increased expenses necessitated by the occupation
of the southern part of the country. Therefore, on November 19,
1914, an issue for 130,000,000 pesos was sanctioned, in order to
convert the Monclova and Constitutionalist Issues, and at the
same time provide money for the prosecution of the campaign
against General Villa. About 43,000,000 pesos were printed in
Mexico City, and were known under the name of the "Provisional
Government df Mexico Issue." The printing continued in
Vera Cruz, the issue being increased to 200,000,000 pesos and
later to 250,000,000. These last bills were titled "Vera Cruz
Paper," the amount of which was greatly exceeded. It is esti¬
mated that the total amount of paper money issued during the
first and second periods of the Revolution was 671,954,221 pesos.
During this period there were several issues of paper money
made by such Generals as Francisco Villa, Alvaro Obregon and
Pablo Gonzalez, while the Revolution was still in its early stages,
under authorization granted by General Carranza. However,
in some cases, such as that of General Villa, advantage was taken
7
of the authorization and amounts greatly in excess of that author¬
ized issued, especially after his break with General Carranza.
Redemption of the Vera Cruz issue was made in the form of
railway fares, taxes, etc., and the balance, amounting to 50,000,000
pesos, were converted into gold certificates, payable in five years,
on the basis of five cents gold for each peso of Constitutional
paper, which was greatly in excess of its value at that time. All
other authorized issues were duly withdrawn and exchanged in
part, leaving at present only about 2,000,000 pesos outstanding,
which are under care of the Monetary Commission pending
conversion.
The final issue of paper money, that which is now outstanding,
was the paper known as Infalsificabies (non-counterfeitable)
or Carranza bills. These were printed in New York by the
American Bank Note Company in the denominations of five, ten,
twenty, fifty and hundred pesos bills, in an amount of 450,000,000
pesos. It was found necessary, however, to print in Mexico
City, small bills of two and one peso notes, as well as five, ten
and twenty centavo denominations, which increased the total
issue to nearly 540,000,000 pesos. Of this amount, only 400,000,-
000 were placed in the hands of the public, half of which were
redeemed the first year through the medium of railroad fares,
freight fares, and import and export duties. In 1916 Mexico
was placed on a Gold and Silver basis. Since then, redemption
has continued steadily through the medium of import and export
duties, which also include all oil shipped from Mexico, so that to¬
day, it has been conservatively estimated that not more than
80,000,000 pesos are outstanding. Redemption is taking place
at the rate of approximately 100,000 pesos daily, which are burned
in the Public Square in Mexico City. It is expected that the
balance outstanding will be entirely redeemed within the next
year. Should this be found impracticable before the entire
amount is redeemed, it is expected that some such system as
was adopted in the case of the Vera Cruz paper will be used.
The present market value of Infalsificabies is three cents per
peso (U. S. Currency) but in view of previous acts of the Mexican
Government it is assumed that the final redemption of the small
amount of bills which will be outstanding will be at ten cents
U. S. Gold, their issuing rate. At that rate the amount now
involved does not exceed $8,000,000 U. S. Currency.
8
During the Revolution, the Government found occasion to
borrow money from the Banks of Issue, the total of which is
stated to be about $20,000,000. Therefore the total actual
debt of the present administration is practically $28,000,000 U. S.
Currency. At the same time, it must be borne in mind that
there is a large amount due to the Government employees for
back salaries, and that a certain amount will have to be paid for
property destroyed during the revolution, including the damage
done to the various railway lines, the total of which, however,
should not exceed $20,000,000.
In the consideration of the debt of Mexico, there must also be
taken into account the guaranteed debt of the Government.
This consists of various railway and state bonds, interest and
principal of which are guaranteed by the National Government.
The principal of these are the $50,747,925 General Mortgage
4% Gold Bonds of the National Railways of Mexico, and various
state bonds, such as States of Vera Cruz, Tamaulipas, and
Sinaloa, a full statement of which will be found under Exhibits
■No. 1 and No. 2.
In conclusion, it may be said that the attitude of the Mexican
Government to-day is to pay in full all outstanding legitimate
debtsi in order to do which the Government is pursuing a policy
which has as its aim the development to the fullest extent all the
natural resources of the country, in order to further the general
prosperity and happiness of her people.
9
MEXICO
Area, 767,000 square miles.
Population, 1919, 17,000,000 (1910 census placed population at 15,063,000).
Total direct obligation of Mexican Government, U. S. $375,280,177.
Debt per Capita, U. S. $22.07.
(1) COMPARISON OF INCOME AND EXPENDITURES OF MEXICAN
GOVERNMENT
For Fiscal Years 1909-10 and 1910-11
Ordinary Ordinary Extraordinary
Year Revenue Expenditures Expenses Excess Deficit
Mex. S Méx. $ Méx. $ Méx. $ Méx. $
1909-10 106,328,485 95,028,650 12,426,499 1,626,664
1910-11 111,142,402 100,913,924 12,574,800 2,346,322
Por convenience the Mexican peso may be figured on the basis of two pesos
for each American Dollar.
The deficit noted above is caused, as it will be seen, by Extraordinary Expenses,
which consisted of money spent for the improvement of the Water System of
Mexico City, building of schools, asylums, etc., and is made up from a sinking,
fund created in 1899 for that purpose.
MEXICAN GOVERNMENT DIRECT EXTERNAL DEBT
Amount Last
Bond Issue Outstanding Interest Coupon
U. S. $ V.3.% Paid
Citj of Mexico 5% Sterling Loan, 1889 6,762,907.00 1,690,726.50 100
Mexican Got. Consolidated 5% Loan, 1899.... 48,603,414.00 12,150,853.50 57
Mexican Gov. 4% Gold Loan, 1904 37,037,500.00 7,407,500.00 18
Mexican Gov. 4% Gold Loan, 1910 51,065,246.00 10,213,049.00 7
Me«.ican Gov. 6% Treasury Bonds (Gold) 1913
(Series "A" only) 30,000,000.00 9,000,000.00
173,469,067.00 40,462,129.00
DIRECT INTERNAL DEBT
Las t
Coupon.
Paid
56
ZT
66,611,012.00 14,531,206.00
10
Amount
Outstanding Interest
u. s. $ u. s. $
Interior Consolidated Silver 3% of 1885 21,215,462.00 3,182,319.00
Interior Consolidated Silver 5% of 1894 45,395,550.00 11,348,887.00
(2) BONDS GUARANTEED BY MEXICAN GOVERNMENT
(Not including National Ry. Issues)
Amount
Last
Outstanding
Interest
Coupon
U. S. $
U. S. $
Paid
State of Vera Cruz 5% Bonds, 1901
588,000.00
147,000,03
47
State of Tamaulipas 5%, Aug. 15, 1902, Ser. 1.. .
449,750.00
112,437.50
42
State of Tamaulipas 5%, Sept. 3, 1906, Ser. 2.. ..
399,800.00
99,950.00
14
State of Sinaloa 5%. Oct. 13, 1906
233,350.00
58,337.50
14
State of Vera Cruz 5%, Oct. 2, 1906
332,000.00
83,000.00
14
Caja de Prestamos, etc., 35-yr. 4^% Sink. Fund
25,719,790.00
5.786,952.75
Nov. '13
Mex. Natl. Pack. Co. 6% 1st Mtge. Gold Bonds..
3,000,000.00
900,000.00
Jan. '14
Mex. Natl. Pack. Co. 6% 2d Mtge. Gold Bonds. .
1,500,000.00
450,000.00
Jan. '14
32,222,690.00
7,637,677.75
(3) BONDED STATE AND MUNICIPAL DEBT, OTHER THAN THAT
GUARANTEED BY THE MEXICAN GOVERNMENT
State
ßoitd Issue
'State of Aguascalientes, Silver 5%, 1910
State of Chihuahua, Silver 5%, 1900, due 192,$..
State of Coahuila, Gold S%, 1900
State of Durango, Silver 5 9t» 1906, due 1936. . . .
State of Durango, Silver 5%, I9I0
State of Jalisco, Gold 6%, 1930
State of Jalisco, Gold 6%, 192S
State of Jalisco, Silver, 6%, 1933
Stale of hforelos. Silver, 6%
State of San Luis Potosí, Gold 6%, 1934
Amount
Last
Outstanding
Interest
Coupon
U. S. Î
U. S. $
Paid
650,000,00
162,500.00
300,000.00
75,000.00
752,000.00
225,600.00
800,000.00
200,000.00
900,000.00
225,000.00
1,000,000.00
300,000.00
Aug. '18
1,500,000.00
450,000.00
July '13
420,000,00
126,000.00
July '13
91,000.00
27,300.00
636,500.00
190,930.00
Apr. '14
7,049,500.00
1,982,350.00
Municipal
Amount
Outstanding
Interest
U. S. $
U. S. $
Cily of Cordova (State of Vera Cruz) Silver 6%,
1922
414,650.00
124,395.00
City of Parral, Silver 6%, due 1930
150,000.00
45,000.00
City of Puebla, Silver 6%, due 1967
1,750,000.00
525,000.00
City of Saltillo, Gold 6%, due 1928
235,000.00
70,500.00
2,549,650.00
764,895.00
11
(4) COMPARISON OF THE ACTUAL INCOME AND EXPENDITURE OF
THE VARIOUS STATES OF MEXICO FOR A NORMAL YEAR
Deficit
Mex. $
Aguascalientes
Campeche
Chiapas
Chihuahua
Coahuila
Colima
Durango 1,247,160.06 1,347,786.67 100,626.61
Guanajuato.
Guerrero....
Hidalgo
Jalisco
Mexico
Michoacan 1,812,537.16 2,671,981.12 859.443.96
Morelos
Nuevo Leon
Puebla
Queretaro
San Luis Potosi
Sinaloa
Sonora ■.
Tabasco
Tamaulipas
Tlaxcala 326,996.75 333,066.46 6,069.71
Vera Cruz.
Yucatan 2,716,897.26 3,058,393.23 341,495.97
Zacatecas.
Income
Expenditures
Excess
Mex. $
Mex. $
Mex. $
445,036.36
375,589.75
69,446.61
482,801.16
267,176.45
215,624.71
965,100.78
899,827.15
65,273.63
2,743,028.91
1,189,672.43
1,553,356.48
2,451,740.96
926,976.91
1,524,764.05
280,525.63
196,821.17
83,704.46
1,247,160.06
1,347,786.67
2,464,858.57
1,483,248.64
981,609.93
2,086,886.09
1,875,433.56
211,452.53
1,912,499.19
1,531,087.28
381,411.91
3,463,009.87
2,860,966.79
602,043.08
2,481,904.28
1,573,589.44
908,314.84
1,812,537.16
2,671,981.12
657,271.43
513,742.14
143,529.29
1,214,235.71
391,263.59
822,972.12
3,045,762.08
1,599,935.71
1,445,826.37
468,932.87
383,315.45
85,617.42
1,750,139.76
1,409,533.47
340,606.29
1,531,925.24
448,168.20
1,083,757.04
2,200,451.59
987,815.20
1,212,636.39
809,777.39
615,166.98
194,610.41
1,217,978.61
287,141.76
930,836.85
326,996.75
333,066.46
5,032,695.69
1,415,405.06
3,617,290.63
2,716,897.26
3,058,393.23
1,373,082.04
1,000,203.78
372,878.26
45,183,235.44
29,643,308.39
16,847,563.28 :
Deficits in any year in any of the States are converted into an internal
floating debt, payable from the revenue of subsequent years.
12
(5) BONDED INDEBTEDNESS OF THE NATIONAL RAILWAYS OF
MEXICO AND SUBSIDIARY LINES
Accumulated
Int. to Date
of last
Coupon due
for Payment
June 30, 1918 (As of Jan. 1,
Outstanding 1919)
U. S. S U. S. $
Natl. Rys. of Mex. 2-Yr. 6% Notes, due June
1, 1915 26,730,000.00 7,217,100.00
Natl. Rys. of Mex. 3-Mos. 6% Extd. Notes, due
June 1, 1915 746,000.00 201,420.00
Natl. Rys. of Mex. 3-Yr. 6% Notes, due Jan. 1,
1917 2,460,341.00 738,102.30
Natl. Rys. of Mex. 3-Yr. 6% Notes, due Jan. 1,
1917 (Ser. B) 1,509,752.00 452,925.60
Natl. Rys. of Mex. 3-Yr. 6% Notes, due Jan. 1,
1917 (Ser. C) 813,054.00 243,916.20
Natl. Rys. of Mex. Prior Lien 4)^'s, due July 1,
1957 84,821,115.00 19,084,750.88
*Natl. Rys. of Mex. Gen. Mtge. 4's, due Oct. 1,
1977 50,748,575.00 9,134,743.50
Natl. R. R. of Mex. Prior Lien 43^'s, due Oct.
1, 1926 23,000,000.00 5,175,000.00
Natl. R. R. of Mex. 1st Cons. Lien 4's, due Oct.
1,1951 24,740,000.00 4,453,200.00
Mexican Central Ry. Priority 5's, due July 1,
1939 1,374,000.00 343,500.00
Mexican Cent. Ry. 1st Cons. Income Non-Cum.
3's, due Jan. 10, 1939 120,600.00
Mexican Cent. Ry. 2d Cons. Income Non-Cum.
3's, due Jan. 10, 1939 21,000.00
Mexican Central Ry. Equipment 5's 450,000.00 101,250.00
Mexican Central Ry., Car & Locomotive Notes 662,456.00 158,060.99
Mexican International Ry. Prior Lien 4)^'s, due
Sept. 1, 1947 5,850,000.00 1,316,250.00
Mexican International Ry. 1st Cons. 4's, due
Sept. 1, 1977 4,206,500.00 757,170.00
Pan-American R. R. Prior Lien 5's, due Jan. 1,
1934 2,003,000.00 500,750.00
Pan-American R. R. Gen. Mtge. 5's, due Jan.
1. 1937 1,484,000.00 371,000.00
"Vera Cruz & Pacific R. R. 1st Mtge. 4J^'s, due
July 1,1934 7,000,000.00 1,575,000.00
Total Funded Debt 238,740,393.00 51,824,139.47
*Guaranteed principal and interest by the Mexican Government.
13
(6) RAILROADS NOT INCLUDED IN THE NATIONAL RAILWAYS
SYSTEM
Interoceanic Ry. of Mexico:
4% Deb. Stock, due 1950....
4J^% 2d Deb. Stock, due 1950
7% "B" Deb. Stock, due 1950
Max. East. Ry. Co., Ltd.:
5% Deb. Stock, due 1984..
Mexican Ry. Co., Ltd.:
6% Perpetual Debentures.,
4M% 2d Deb., due I960.. .
Amount
Outstanding
U. S. $
5,750,000.00
6,500,000.00
2,347,295.00
Interest
U. S. $
1,150,000.00
1,462,500.00
821,553.00
Total
U. S. S
14,597,295.00 3,434,053.00 18.031,348.00
2,000,000,00 500,000.00 2,500,000.00
10,000,000.00 3,000,000.00
2,407,000.00 541,575.00
12,407,000.00 3,541,575.00 15,948,575.00
Mexican Southern Ry., Ltd.:
4% 1st Mtge. Deb., due 1990
Mexican Union Ry., Ltd.:
6% 1st Mtge. Deb., due 1980
6% Prior Lien Deb., due 1980
4,306,590.00 861,318.00 5,167,908.00
1,085,000.00
825,000.00
325,500.00
247,.500.00
1,910,000.00 573,000.00 2,483,000.00
Mexican Northwestern Ry. Co.:
6% 15-Yr. Pr. Ln. Bds., 1928 8,355,000.00 2.506,500.00
5% 1st Mtge. 50-Yr. Gold
Bonds, due 1959 28,000,000.00 7,000,000.00
6%Cum.Conv. Inc. Bds.,1922 3,750,000.00 1,125,000.00
40,105,000.00 10,631,500.00 50,736,500.00
Michoacan & Pacific Ry. Co.:
6% Pr. Ln. Deb., due 1925... 75,500.00 22,650.00
6% Mtge. Deb., due 1925... 300,000.00 90,000.00
375,500.00 112,650.00 488,150.00
Michoacan Ry. & Min. Co., Ltd. :
5%Pr.Ln. Deb., due 1919... 135,450.00 33,862.50
4%Mtge. Deb., due 1919.... 515,000.00 103,000.00
650,450.00 136,862.50 787,312.50
14
Amount
Outstanding Interest Total
U. S. $ U. S. $ U. S. $
"Vera Cruz Terminal Co., Ltd.:
4}^% Deb. Bonds, due 1976.. 4,962,500.00 1,116,562.50 6,079,062.50
United Railways of Yucatan, Ltd. :
5% 1st Mtge. Redeemable
Gold, 1950 4,054,250.00 4,054,250.00
Total Bonds outstanding and interest ; 113,276,206.00
(7) SUMMARY OF THE MEXICAN DEBT
u. s. $ u. s. $
Mexican Government:
Direct External Debt 173,469,067
Inteiest approximated to 1919 40,462,129
213,931,196
Direct Internal Debt 66,611,012
Interest approximated to 1919 14,531,206
81,142,218
Guaranteed Debt (exclusive of Ry. guarantees)... 32,222,690
Interest approximated to 1919 7,637,678 39,860,368
Bonded Indebtedness of States (not guaranteed) 7,049,500
Bonded Indebtedness of Cities (not guaranteed) 2,549,650
Inter est approximated on State Debt to 1919 1,982,350
Interest approximated on City Debt to 1919.... 764,895
National Railways of Mexico:
Bonded Indebtedness 238,740,393
Interest figured to nearest coupon date, 1919... 51,824,139
Railroads not included in National Railway System:
Bonded Indebtedness 92,368,685
Interest appro.ximated to 1919 20,907,521
Outstanding Government Paper:
Infalsificabies 80,000,000 at 10c 8,000,000
Approximate amount borrowed from Banks of Issue 20,000,000
12,346,395
290,564,532
113,276,206
8,000,000
20,000,000
TOTAL DEBT with interest approximated to 1919 779,120,915
15
The National Railways of Mexico
FOREWORD
Almost immediately upon his election as President of Mexico
on May 5, 1877, General Porfirio Diaz adopted the policy of
furthering railroad construction to provide the country with the
very necessary transportation facilities for its economic and
industrial development. Beginning with the contract signed
on November 12, 1877, with Mr. James Sullivan for himself
and his representatives, Mr. William Palmer, for the construction
of an international and interoceanic road to the frontier of the
United States with lines running to the Pacific Ocean, this policy
was inaugurated, and a great system of roads established during
the following thirty years.
The history of this period is replete with incidents, hopes and
innumerable setbacks, encountered and overcome, leading to
frequent modifications in the hundreds of concessions granted
to various interests without definite methods from the feverish
desire of Mexico to build roads at all costs.
To the railroad from Vera Cruz to the City of Mexico falls the
honor of being the first line completed in Mexico, and the great
period of building activity from 1880 to 1890 saw the completion
of the roads most important to the country. In the years from
1890 to 1897 little building was done, followed by five most
active years ending with 1902.
In 1908 a new and memorable epoch began in the history of
the railroads of Mexico with the constitution of the National
Railways of Mexico, as a corporate body, with the majority of
its stock owned and vested in the Mexican Government. The
organization of this new company was the culmination of many
vicissitudes, threatening their existence, in the life of the two
principal railroads of the country; the National Railroad Com¬
pany and the Mexican Central Railroad which, with their sub¬
ie
sidiaries, were merged to form the The National Railways of
Mexico, and in furthering the organization of which the Mexican
Government took the most important step towards the conserva¬
tion of its railroad system for which purpose it had slowly and
quietly been preparing through the purchase of stock of competing
roads; and by which means it forestalled future combinations,
monopolies and absorptions of a nature detrimental to the interests
of the nation. It marks a new era, civic, economic and political,
and justified the expenditure of great sums of money for sub¬
sidies as well as the severe financial strain endured by the Mexican
people during many years in the accomplishment of this great
purpose.
In subsequent years the The National Railways of Mexico
obtained control of several other important railroad lines in
Mexico, and its present mileage represents fully 80-85% of the
total railroad mileage of the country.
Whilst at the end of 1910 the net surplus of earnings, after
all deductions, of the The National Railways of Mexico, was
$2,836,569 Mex. gold, the company faced on June 30, 1915, a
reported deficit of $28,909,328 Mex. gold after, revolution suc¬
ceeding revoultion, the recognized de facto Government under¬
took the management of the roads. At the end of the fiscal
year, June 30, 1917, the debt pending of adjustment was $142,-
777,588.52 Mex. currency ($71,388,794.26 U. S. currency).
17
ORGANIZATION OF THE NATIONAL RAILWAYS OF
MEXICO
The Mexican Government practically controlling, through
ownership of stock, the National Railroad Company of Mexico,
it caused to be prepared in the latter part of 1907, by a group
of American and foreign bankers, a plan for the readjustment
and union of this road with the Mexican Central Railway Com¬
pany, Ltd., by means of the constitution of a new company
(National Railways of Mexico) likewise to be controlled by
the Mexican Government through stock ownership. The plan
as drawn up was approved by the Government, and by a majority
of the holders of the outstanding stock of the two constituent
roads and of their respective boards of directors. The board of
directors of the Mexican Central Railway Securities Company,
Ltd., which held $37,500,000 of consolidated mortgage four
per cent bonds, maturing in 1911, of the Mexican Central Rail¬
way Company, Ltd., also lent their approval to the plan sub¬
mitted, with the sanction of its debenture holders.
Provision was made under the new mortgages to be created in
the proposed readjustment plan for the $37,500,000 of consoli¬
dated mortgage four per cent, bonds and the four year five per
cent, notes of the Mexican Central Railway Company, Ltd.,
as well as for the refunding of the then existing bonds of the
National Railroad Company of Mexico. The new company
thus became liable on the consummation of the plan, for the
payment, both as to principal and interest, of the prior lien
four and "one-half per cent gold bonds, the first consolidated
mortgage four per cent, gold bonds and the five per cent. (Ex¬
tended) gold notes of the National Railroad Company of Mexico.
Participation in the plan of adjustment and union was made
dependent upon the deposit with the designated depositary,
within a specified time, of certain securities comprising stocks
and bonds with corresponding coupons, all of which were to be
in negotiable condition, and certificates of stock to be trans¬
ferred in blank.
Briefly, by the plan as finally adopted, a new company was
organized (in March 1908) under the name of National Rail-
is
■ways of Mexico, controlled by the Mexican Government through
52 per cent stock ownership, and with corporate power to take over
and unite the properties of the Mexican Central Railways Com¬
pany, Ltd., and of the National Railroad Company of Mexico,
and to be vested with all securities embraced in the plan.
The following securities were authorized by the new company :
A.—$225,000,000 U. S. Gold of PRIOR LIEN 4^% SINKING
FUND REDEEMABLE GOLD BONDS,
maturing on July 1, 1957, with interest pay¬
able semi-annually secured under restrictions
set forth in the mortgage to the Central Trust
Company of New York, acting as trustee.
The mortgage provides for the creation of a
cumulative sinking fund which shall be suffi¬
cient to retire the entire issue of the bonds by
maturity. All instalments so received to be
applied by the trustee to the purchase of
these bonds at not exceeding 105 and interest;
if not so purchasable, bonds are to be redeemed
by lot on interest dates at 105 in amounts of
not less than $10,000,000 face value of bonds.
The right was reserved to issue $6,000,000
additional bonds of this series to take up
at or before maturity the sum of £1,200,000
of prior lien sterling bonds of the Mexican
International Railroad Company, or the same
amount of Prior Lien 43^% bonds of the
National Railroad Company of Mexico into
which such sterling bonds might in the future
be refunded.
B.—$160,000,000 U. S. Gold of GUARANTEED GENERAL
MORTGAGE 4% SINKING FUND RE¬
DEEMABLE GOLD BONDS, uncondition¬
ally guaranteed as to principal and interest
and sinking fund payments by the Republic
of Mexico by endorsement. These bonds
mature on October I, 1977, and interest is
payable semi-annually, being secured, sub¬
ject to the prior lien mortgage, to the New York
Trust Co. as trustee, under restrictions set
19
forth in the mortgage. Provision is made
for a cumulative sinking fund as in the case
of the prior lien 43^% bonds sufficient to
retire within the life of the bonds the entire
issue of this series; and the manner of its
investment by the trustee, and of the redemp¬
tion by lot, in amounts of $10,000,000 face
value of bonds is likewise stipulated. Under
the terms of the mortgage additional bonds
of the same rank can be issued to the amount
of $26,000,000 to retire at or before maturity
equal amounts of the consolidated mortgage
bonds of the Mexican International Railroad
Company, or of the Consolidated Mortgage
Bonds of the National Railroad Company of
Mexico into which such bonds of the Inter¬
national Company might be in the future
refunded; or to retire equal amounts of the
consolidated mortgage bonds of the National
Railroad Company of Mexico into which prior
lien bonds of that company might be in the
future refunded.
Against its guarantee of these bonds the
Mexican Government received :
$6,000,000 prior lien 4}^% Bonds,
2,450,000 guaranteed general mortgage bonds,
and
63,730,000 common shares; and it was pro¬
vided that for any payment it should be
called upon to make under the guarantee, the
Government was to be deemed a creditor of
the New Company for the amount paid, and
entitled to repaym.ent with interest at 4%
p.a., such repayment, however, to be made
only out of net profits remaining after payment
of dividends on first and second preferred
shares and before any dividend was paid on
any other class of shares, the Government
ranking in case of liquidation next after the
mortgage creditors unless it waived its pre¬
ference in favor of any other creditors.
20
€.—$30,000,000 U. S. Gold (or $60,000,000 Mexican Gold)
NON-CUMULATIVE 4% FIRST PRE¬
FERRED SHARES conferring on their holders
the right to a dividend up to 4% of their par
value from the surplus profits of each year,
and before any dividend was paid on any-
other class of shares—no deficiency, however,
in such dividend, in any year, to be made up
from the surplus of subsequent years. In case
of liquidation of the New Company, the first
preferred shares to be entitled to repayment at
par before any distribution was made to
holders of any other class of shares. No issue
beyond the $60,000,000 Mexican Gold to be
made of First Preferred Shares, and no mort¬
gage or other lien in addition to the prior lien
mortgage and the general mortgage (Series
A and B) to be constituted on any of the
properties embraced in said two mortgages
except with the approval of a majority of the
first preferred shares at the time outstanding,
and by the affirmative vote of the majority
of the capital stock of the New Company at
a duly convened meeting.
These preferred shares could be retired at par
for cash, and the deed of incorporation of the
New Company provided the setting aside, as a
separate fund, of $1,800,000 prior lien bonds
and $1,200,000 guaranteed general mortgage
bonds (or a sufficient amount from the pro¬
ceeds of any eventual sale thereof) to assure
the payment for the period of three years from
January, 1908, of semi-annual dividends of 1%
to the holders of first preferred shares, in as
far as the profits of the New Company should
not be sufficient for that purpose.
D.—$125,000,000 U. S. Gold (or $250,000,000 Mexican Gold)
NONCUMULATIVE 5% SECOND PRE¬
FERRED SHARES. These shares conferred
on their holders the right to a 5% dividend
21
each year after the 4% dividend on the first
preferred shares should have been paid, and
before any dividend was paid on the common
shares, no deficiency to be made up from the
profits of subsequent years. After the pay¬
ment of such 5% dividend, any surplus profits
distributable in dividends in any year, to go
to the holders of second preferred and common
shares constituting part of the initial capital
in proportion to their respective holdings. In
case of the liquidation of the New Company,
the second preferred are repayable at par after
payment at par of the first preferred shares
and before any distribution is made to
holders of the common shares.
E.—$75,000,000 U. S. Gold (or $150,000,000 Mexican Gold)
of COMMON SHARES, which constitute
part of the initial capital and confer on their
holders the right to share in the surplus
profits distributable each year after the pay¬
ment of 4% on the first preferred and 5%
on the second preferred shares respectively,
as hereinbefore provided. The residue of
surplus profits distributable in any year
to be divided among the holders of the second
preferred and common shares, without regard
to class, and in proportion to their respective
holdings. No additional issue of common
shares beyond the initial $150,000,000 could
participate in dividends, and in case of liqui¬
dation of the New Company all common
shares were entitled to participation in the
assets after payment at par of the first and
second preferred shares.
GENERAL PROVISIONS: All bonds, principal and interest
were made payable in U. S. Gold, in New York, without deduc¬
tion for any taxes the company might have been required to
pay at the time, or under any future laws of the United States
or of the Republic of Mexico, or of any of the political sub¬
divisions of either. Coupon bonds are at the option of holder,
22
payable at the company's office in Mexico or in London, as well
as in Germany, Switzerland, France, Holland and Belgium,
at fixed equiyalents of the dollar. All shares are for $200
Mexican gold pesos or $100 U. S. gold.
Certificates of second preferred shares were issued in registered
and bearer form, interchangeable, and certificates on both first
and second preferred shares have dividend warrants attached
thereto. In case of liquidation, payments due to holders of these
certificates will be made at their option in New York City or
Mexico City at the fixed rate of two Mexican gold pesos to the
dollar, with no deduction for any taxes under existing or future
laws of the United States or Mexico, or of any political sub¬
divisions of either.
Provision was made for a reserve fund of not less than $5,000,-
000 Mexican gold ($2,500,000 U. S. gold) by setting aside
annually from surplus profits an amount not exceeding 5% of
such net profits, this reserve to be available for all purposes
decided upon by the general meeting of stockholders, including
the equalization and maintenance of dividend.
The New Company became liable upon the consummation
of the plan for the punctual payment, both as to principal and
interest, of the:
NATIONAL RAILROAD COMPANY OF MEXICO
Prior lien 4)14% gold bonds.
First consolidated mortgage 4% gold bonds.
Five per cent (extended) gold notes.
MEXICAN CENTRAL RAILWAY COMPANY, LTD.
Four year 5% gold notes,
and also assumed, or guaranteed any bonds guaranteed by
the National Railroad Company of Mexico, and the Mexican
Central Railway Company, Ltd., and the payment of the
equipment and obligations of the latter company.
CASH REQUIREMENTS: Under the plan as outlined
the cash requirements were estimated at $14,870,000 which
23
sum was raised by the sale by the New Company to the bankers
constituting the readjustment management, of $10,000,000
prior lien 43^% bonds and $6,750,000 guaranteed general mort¬
gage 4% bonds, and used:
1. For the floating indebtedness of the Mexican
Central Railway Company, Ltd., and the
National Railroad Company of Mexico,
to be taken up by the New Company $5,500,000
2. For cash payment of 10% on deposited pre¬
ferred stock of the National Railroad Co. of
Mexico 2,870,000
3. For working capital and expenses of readjust¬
ment (including compensation to readjust¬
ment managers) 6,500,000
Total $14,870,000
24
MILEAGE OF THE NATIONAL RAILWAYS OF MEXICO UNDER
THE PLAN OF READJUSTMENT
Mexican Central Railway Company, Ltd.:
Main Line: Mexican City to Ciudad Juarez 1,224.16
Cuemavaca Div—Mexico City to Rio Balsas 181.25
Santiago Branch—Mexico City to Santiago 1.40
Mexico City Belt Line 5.95
Other Divisions, Branches and Extensions 1,998.61
Two leased Lines 17.06
Total Mileage (all Standard Gauge) 3,428.43
National Railroad Company of Mexico:
Colonia to Rio Grande Bridge 801.89
Belt Line in City of Mexico 6.37
Matamoros Branch 204.76
Texas-Mexican Ry. (stock ownership) 161.85
Other Lines and Branches (6 units) 203.68
Standard Gauge Mileage 1,378.55
Hidalgo Line (stock ownership) 152.24
Tacuba Junction to Uruapan 317.07
Michoacan & Pacific (leased) 56.91
Narrow Gauge Mileage 526.22
Total Mileage (Standard and Narrow Gauge) 1,904.77
Mexican International Railroad Company:
Ciudad Porfirio Diaz to Durango 540.44
Durango to Tepehuanes 135.00
Reata to Monterey 71.80
Other Lines (8 units) 146.92
Barroteran to Muzquiz (leased) 24.06
Total Mileage (all Standard Gauge) 918.20
Interoceanic Railway of Mexico:
Vera Cruz to Mexico City 342.00
Morelos Division 123.00
Matamoros Division 102.00
Three Branches 30.00
Mexican Eastern Railway—2 lines—(leased) 139.00
Total Mileage (all Narrow Gauge) 736.00
Total Mileage of all Lines (Standard and Narrow Gauge).. 6,987.40
Summary: Standard Gauge of all Lines 5,725.18
Narrow Gauge of all Lines 1,262.22
6,987.40
25
THE NATIONAL RAILWAYS OF MEXICO
Property
Upon and since its organization in March 28, 1908, the Company- has obtained
control ot the following companies:
National Railroad Company of Mexico (1909)
Mexican Central Railway Company, Ltd (Í909)
Mexican International Railroad Company (1910)
Hidalgo & Northeastern Railroad Company, Ltd (1909)
Mexican Pacific Railway Company (1909)
Vera Cruz to Isthmus Railroad (1913)
Pan-American Railroad Company (1914)
and operates in addition thereto, under rental contract, the;
Mexican Southern Railway Company and Interoceanic Railway of
Mexico, and other subsidiaries of the National Railroad Company
of Mexico and the Mexican Central Railway Company, Ltd 1908
The aggregate of kilometers operated on June 30, 1917, was 11,923
Equivalent in miles to 7,409
Securities
The Securities of the New Company were applied, in accordance with the pro¬
visions of the Plan as finally adopted, as follows:
A—Prior Lien Bonds for $22i,000,000 U. S. Gold
$6,597,000 at 70% of Prior Lien 5% Bonds (redeemable) of the
Mexican Central Railway Co., Ltd $4,617,900.00
$265,062.50 at 100% of Assented First Mortgage Bonds and
Scrip of the Mexican Railway Co., Ltd 265,062.50
$109,020,000 at 60% of Consolidated Mortgage 4% Bonds of
the Mexican Central Railway Co., Ltd 65,412,000,00
$70,294,962.50
Sold for cash (to provide part of the cash requirements) 10,0(X),000.00
Issued to Mexican Government, on account of its guarantee
and other considerations 6,000,000.00
For retiring outstanding Prior Lien 4J^% Gold Bonds of the
National Railroad Company of Mexico 23,000,000.00
26
For issue for betterments, improvements and equipment, and to
take up 5% (extended) Gold Notes of the National Rail¬
road Company of Mexico, and the Equipment Notes of
Mexican Central Railway Co., Ltd 20,205,037.50
For issue for the construction of Short Line from Tampico to the
City of Mexico, or for construction of additional lines, or
construction of bridges costing more than $100,000 10,000,000.00
For issue after January 1, 1910, at the rate of $2,500,000 per
year, for betterments, improvement and equipment 47,000,000.00
For issue for the construction of additional lines of railroads,
terminals, etc. (not to exceed $12,500 per kilom. of rail¬
road) and bonds not used for that purpose to be applied to
further betterments and improvements after the regular
Improvement and Betterment Fund shall have been
exhausted 38,000,000.00
$225,000,000.00
B—Guaranteed General Mortgage 4% Bonds
$6,597,000 at 47J^% of Priority 5% Bonds (redeemable) of the
Mexican Central Railway Co., Ltd $3,133,575.00
. $109,020,000 at 32H% of Consolidated Mortgage 4% Bonds
of the Mexican Central Railway Co., Ltd 35,431,500.00
$38,565,075.00
$6,750,000,00
2,450,000.00
24,749,000.00
12,985,925.00
6,000,000.00
49,500,000.00
19,000,000.00
$160,000,000.00
Sold for Cash (to provide part of the Cash requirements)
Issued to the Mexican Covemment on account of its guarantee
and other considerations
For retiring First Consolidated Mortgage 4% Cold Bonds of the
National Railroad Co. of Mexico (including the bond
pledged for two-year 5% Notes of the Company)
For issue for betterments, improvements and equipment, and to
take up 5% (extended) Cold Notes, due April 1, 1909, of
the National Railroad Co. of Mexico, and for other
purposes
For issue for the construction of Short Line from Tampico to
the City of Mexico, or for construction of additional lines,
or for construction of bridges costing more than $100,000..
For issue after January 1,1910, at the rate of $2,500,000 per
year, for betterments, improvement and equipment
For issue for the construction of additional lines of railroads,
terminals, etc. (not to exceed $6,250 per kilom. of railroad)
and bonds not used for that purpose to be applied to further
betterments and improvements after the regular Improve¬
ment and Betterment Fund shall have been exhausted....
27
C—First Preferred Shares
$28,833,000 at 100% of Preferred Stock of National Railroad
Company of Mexico $28,833,000.00
$1,167,000 reserved in the Treasury 1,167,000.00
$30,000,000.00
D—Second Preferred Shares
$109,020,000 at 7>á% of Consolidated Mortgage 4% Bonds of
Mexican Central Railway Co., Ltd., (including shares to be
issued in part substitution for about $40,938,000 Consoli¬
dated Mortgage Bonds pledged to secure the Four-Year
Gold Notes, and on payment of these Notes, the shares to
become a Treasury Asset) $8,176,500.00
$20,569,700 at 110% of First Income Bonds and Scrip of Mexi¬
can Central Railway Co., Ltd. (exclusive of $7,136,300 of
bonds owned by the Company and exclusive of $5,000,000
of bonds pledged to secure Three-Year Gold Notes and
Four-Year Gold Notes 22.626,670.00
$11,284,000 (less $1,028,656) at 100% of Second Income Bonds -
of Mexican Central Railway Co., Ltd 10,255,344.00
$325,000 at 110% of Registered Income Bonds and Scrip of
Mexican Central Railway Co., Ltd 357,720.00
$59,127,100 at 100% of Stock of Mexican Central Railway
Co., Ltd 59,127,100.00
$22,030,600 at 110% of Second Preferred Stock of National
Railroad Co. of Mexico 24,333,660.00
$304,100 at 73H% of Common Stock of National Railroad
Co. of Mexico 223,006.00
$125,000,000.00
E—Common Shares
$304,100 at 33H% of Common Stock of National Railroad Co.
of Mexico $101,370.00
$11,015,3CX) at 100% of Deferred Stock of National Railroad
Co. of Mexico 11,015,300.00
Issued to the Mexican Government on account of its guarantee
and other considerations 63,730,000.00
Reserved in the Treasury 153,330.00
$75,000,000.00
2S
TABLE SÍIOWING THE AMOUNTS OF THE DIFFERENT SECURITIES OF THE NEW COMPANY, AND THE CASH
AMOUNT, DELIVERED UPON COMPLETION OF THE READJUSTMENT, IN EXCHANGE FOR
DEPOSITED BONDS AND STOCKS OF THE TWO CONSTITUENT COMPANIES
Cash
Mexican Cential Ry. Co., Ltd. :
Priority 5% Bonds
First Mtge. 7% Bds. and
Scrip assented
Cons. Mtge. A% Bonds....
First Cons. Inc. Bonds and Scrip
Reg. Inc. Bonds and Scrip..
Second Cons. Inc. Bonds...
Stock
National Railroad Co. of Mexico:
Preferred Stock
Second Preferred Stock
Common Stock (old)
Deferred Stock
Prior Lien
4}^% Bonds
$4,617,900.00
265,062.50
65,412,000.00
$3,200,000
Guaranteed
Gen. Mtge.
4% Bonds
$3,133,575.00
35,431,500.00
First
Preferred
Stock
$28,833,000.00
Second
Preferred
Stock
8,176,500.00
22,626,670.00
357,720.00
10,255,344.00
59,127,100.00
24,233,660.00
223,006.00
Common
Shares
$101,370.00
11,015,300.00
83,200,000 $70,294,962.50 $38,565,075.00 $28,833,000.00 $125,000,000.00 $11,116,670.00
Mexican Government:
On account of its Guarantee
and other considerations....
6,000,000.00 2,450,000.00
63,730,000.00
$3,200,000 $76,294,962.50 $41,015,075.00 $28,833,000.00 $125,000,000.00 $74,846,670.00
THE NATIONAL RAILWAYS OF MEXICO
Funded Debt
Nat. Rys. cf Mexico 2-Yr. 6 % Notes, due Juno 1, 1915..
Nat. Rys. of Mex. 3-Mos. 6 % Extd. Notes, due June 1, 1915
Nat. Rys. of Mexico 3-Yr. 6% Notes, duo Jan. 1, 1917. . .
Nat. Rys. of Mex. 3-Yr. 6 % Notes, due Jan. 1, 1917 (Ser. B)
Nat. Rys. of Mex. 3-Yr. 6 % Notes, due Jan. 1, 1917 (Ser. C)
Nat. Rys. of Mexico Prior Lien 4 H's, due July 1, 1957.
Nat. Rys. of Mexico Gen. Mtge. 4's, due Oct. 1, 1977. . .
Nat. R. R. of Mexico Prior Lien 41^^*8, due Oct. 1, 1D26.
Nat. R. R. of Mexico 1st Cons. Lien 4's, due Oct. 1, 1951.
Mexican Central Ry. Priority 5's, due July 1, 1939
Mex. Cent. Ry. 1st Cons. Inc. Non-Cum. 3's, due Jan. 10
1939
Mex. Cent. Ry. 2d Cons. Inc. Non-Cum. 3'a, due Jan. 10
1939
Mexican Central Ry. Equipment 5's
Mexican Central Ry. Car and Locomotive Notes
Mexican International Ry. Pr. Lien 4 H's, due Sept. 1, 1947
Mexican International Ry. 1st Cons, 4's, due Sept. 1, 1977
Pan-American R. R. Prior Lien 5*s, due Jan. 1, 1934
Pan-American R. R. Gen. Mtge. 5'g, due Jan. 1, 1937. . . .
Vera Cruz & Pacific R, R. 1st Mtge. 4 ]■•/'», due July 1, 1934
Total Funded Debt
June 30. 1913,
Outstanding
$26,730,000
746,000
2,460,341
1,509,752
813,054
84,821,115
60,748,575
23.000,000
24,740,000
1,374,000
120,600
21,000
450,000
662,456
5,850,000
4,206,500
2,003,000
1,484,000
7,000,000
?238,740,393
Date Coupon
Assented
June 1, 1914
June 1, 1914
(No coupons)
No coupons
No coupons
Jan. 1, 1914
Apr. 1, 1914
Jan, 1, 1914
Apr. 1, 1914
Jan. 1, 1914
Interest Assjnted
With
Notes due Jan. 1, IQll
(Series C)
Notesdue Jan. 1, 1917
(Series C)
Notesdue Jan. 1, 1917
Notes dtie Jan. 1,1917
(Series B)
Notes due Jan. 1,1917
Notes due Jan. 1, 1917
(Series B)
Notesdue Jan. 1, 1917
Date Coupon
Defaulted
Dec. 1, 1914 ■
Dec. 1,1914
July 1, 1914
Int. due Jan. 1, '17
(At maturiry)
Int. due Jan. 1, '17
(At maturity)
July 1,1914
Oct. 1. 1914
July 1,1911
Oct. 1, 1914
July 1, 1914
Accumulated
Int. to Date of
Last Coupon due
for Payment
(As of Jan. 1,
1919
$7,217,100.00
201,420.00
738,102.30
452,925.60
213,916.20
19,081,750.83
9,134,743.50
5,175,000.00
4,453,200.00
343,500.00
Last int. paid
July 10, 1892
No interest paid
Oct. 1, 1914
Defaulted since
Julv 1, 1914
Sept. 1, 1914
Sept. 1, 1914
July 1. 1914
July
July
1, 1914
1, 1914
101,250.00
158,060.99
• 1,316,250.00
757,170.00
500,750,00
371,000.00
1,575,000.00
$51,824,139.47
THE NATIONAL RAILWAYS OF MEXICO
Outstanding Capitali/ation June 30, 1917
First Preferred Stock $28,831,CX)0.00
Second Preferred Stock 120,379,491.00
Common Stock 74,803,467.00
Funded Debt 238,740,393.00
$462,754,351.00
AU the stock of the Company is fully paid and non-assessable, and possesses
equal voting rights.
Statement of Assets and Liabilities for the Years ending
June 30, 1916, and June 30, 1917
June 30, 1917 June 30,1916
ASSETS
Road and Equipment.- U. S. $426,538,133 $426,534,132
Additions and Betterments 13,183,176 13,183,176
Construction and Pkirchases of New Lines 11,534,450 11,350,428
Bonds and Stocks Owned 8,769,786 8,769,786
Suspense 1,000
Profit and Loss Deficit 48,026,326 37,331,447
CURRENT ASSETS
•Cash 165,990 153,682
Accounts Receivable 2,470,980 2,430,593
Notes Receivable
Agents and Conductors 487,179 626,757
Traffic Balances
Bills Collectible 1,262,700 1,121,479
Materials and Supplies 5,604,100 5,603,568
Acccrued Interest 826,217 564,250
Prepayments 38,411 38,089
Total Current Assets $10,855,577 $10,538,417
Total Assets $518,907,448 $507,708,387
LIABILITIES
Common Stock $74,803,466 $74,803,466
First Preferred Stock 28,831,000 28,831,000
Second Preferred Stock 120,379,492 120,379,342
Funded Debt 203,836,190 203,834,340
Securities of constituent Companies not exchanged 1,908,747 1,906,748
Mex. Cent. Ry. Equipment and Collateral Trust.. 1,112,457 1,112,457
Reserves 7,916,218 7,916,218
Equipment Depreciation Fund 2,460,200 2,460,200
Reserve Fund 246,743 246,743
Profit and Loss Surplus
31
CURRENT LIABILITIES
Vouchers and Payrolls 51,847,453 $2,082,946
Traffic Balances 10,400 13,733
Accounts Payable 4,376,429 4,105,864
Notes Payable 33,662,132 33,662,131
Unclaimed Dividends 12,617 12,649
Rentals 495,185 371,389
Taxes Accrued 312,372 219,316
Interest Accrued 36,696,347 25,749,845
Dividends Payable
Total Current Liabilities $77,412,935 $66,217,873
Total Liabilities $518,907,448 $507,708,387
Net Current Liabilities $66,557,358 $55,679,456
32
Mexico
PRINCIPAL
CITIES
Pop.—Thousands
8 Acambaro N 17
33 Acanceh. .M 28
6 Acapulco. .Q 17
6Acatlan...P 19
¿6 Aguascalieo^cs^
8 Ameca N 13 ArJueiio '*
8 Amecameca v*
O 18 «y
6 AngaTHçueoN 17
6 Araadas. .M 15
9 Atlixco .. .0 19
7 Atzcapotzalco ^
8 Autîan N 13
4 Cadereyta M 18
17 Campeche N 27
7 Catorce ... J 16
6 Cedral ... .J 17
26 Celaya . . .N 16
7 Chalcñicomua
O 20
39 Chihuahua Ell
7 Chilapa.. .P IS
8 ChUpanzingo
Q 18
7 Oholula.. .0 19
18 Ciudad Guzman
N 14
8 Ciudad Juarez
B 11
9 Coatepec .N 21
25 Colima ... O 14
8 Cordoba ..O 20
6 Cuautla.. .O 19
13 Cuernavaca
O 18
6 Cuetzaîan .Oil
14 Cîuliacan.. .1 10
6 Dolores Hidalgo
M 16
34 Duraugo.. .J 12
6 Kl Carmen O 26
8 El Rosarlo K 11
6 Encarnación
M 16
3 Ensoñada de
Todas Santos
B 1
5 Etzatlan. .M 13
1 Frauoi.'^co.M 16
6 Prcsnillo. . K 15
5 Garcia... .H 17
8 Gomez Palacio
H 14
Ô Gonzales Junc¬
tion . . M 17
119 Guadalajara
IM 14
9 Oi:adalnpc L 15
35 Guanajuato
M 16
9 Guaymas .. F 6
15 HcrmosilJo . E 6
6 liuaniantlaO 20
4 Huotamo .0 17
7 Iguala ,. . . P 18
20 Irapiiato. .M 16
7 ïxtapalapa . Q 6
35 Jalapa. . . .N 21
9 .Mmrnez . .G 13
4Jiqui!pan .N 15
4 Joaquín... IS 16
12 Juchitan. .R 22
7 .Ca Harca. N 15
16 Lagos de Mo¬
reno.JM 16
6 Lamx)uzos.G 17
5 La Paz J 7
63 Leou M 10
6 lycrina. . . .0 18
7 Linares.... 1 18
4 Mallualco. . H 5
7 Mapiini. . .TT '..3
8 Matamorosf«20
6 MatamorosO iO
14 Matchuala K 17
ISMazatîan.K 11
62 Mcrida . .M 28
6 Mctcpcc . . T' 7
471 Mf-xico . . .Q 6
6 Miahuatian
R 21
6 Milpa Alta . .S 6
6 Mixcoac . . - Q 6
7 Monclovn . G 16
Ö MontemoreloR
I 18
Rî Monterrey.I 17
89 Morella. . .N 16
6 Muzqulz. . F 16
7 iS^uevo Laredo
G 18
37 Oaxaca ... y 20
4 Ucuild.u . . . . li 0
5 Oiuetepec .RIO
33 Orizaba. . .O 20
89 Paciiuca. N 19
15 Parral G 12
0 Parras I 15
8 Patzcuaro.O 16
8 P'^njamo. .N 16
8 Piedi-as Neg-as
8 Pines L 10
5 Progreso . . L 28
101 Puebla.. .019
35 Quorctaro .M 2
10 Real de Monte
N 8
6 Rio Verde. L 17
14 Halamanca NIG
85 Saltillo I 17
iO SalvatlerraN 16
9 San Andres
Tuxtla. P 23
32 San Juan Bau¬
tista. .P 25
8 San Juan del
Rio. -N 18
ID San Luis do La
Paz. .M 17
83 San Luis Potosí
L 16
31 San Miguel de
Ailomle. .M 17
9 San Podro TI 14
4 Santa Catarina
I 17
7 Santa Cruz N16
3 Sauta Cruz do
Bravo. .N30
5 Santa Rosalia
8 Sayuîa... .N 14
8 Sierra Mojada
G 14
35 Siiao M 16
3^2 Sombrerete
J 14
5 TacarabaroO 16
tS Tacubaya.O 18
aO Tampico . .L 19
4 Tecamachalco
R 10
7 Tehnacan .P 20
20 Tehuantepcc
R22
10 Tenancingo
O 18
6 Tenango. .O 18
9 Teocalticbe
M 15
6 TepatîtlanAI 15
17 Tepic M 12
4 Tequisquiapan
M 4
5 Tetela .,.. P 10
6 Texcoco.. .O 19
2 Tezlutlan .N 20
6 Ticul M 28
7 Tlskokob. M 28
6 Tixtla P 18
A Tlacolula .Q 21
ó Tlacotalpan
O 23
6 Tîalpam .. . Q 6
10 TiatlauQUitepcc
P 11
3 TIaxcala ... Q 9
8 Tiaxiaco .. Q 20
6 Tollman. .M 17
31 Toluca O 18
14 Torreen ... I 14
7 Tula K 18
5 Tuxpam.. M 20
10 Tuxtla Gutier¬
rez .. R 24
10 Uruapan. .O 15
5 Valladolid M 29
13 Valle de San¬
tiago. .N 16
6 Venado. . .K 16
29 Vera Cruz. O 21
18 Victoria .. J 18
6 Vlesca I 14
4 ViUaldamaH 17
11 Xocbimilco.Q 6
6 Yautepec .G 19
12 Zacapoaztlo
N20
4 Zacapu. . .N 16
26 Zacatecas.K 15
5 Zacatelco .. Q 9
11 Zacatlan. .N 20
7 Zacoalco. .N 14
7 Zautla P 11
6 Zitacuaro .O 17
6 Zumpango N 18