Company Asks for an Adjustment: Working at a Loss: No Dividends Since 1929
Formal application has been, made to. the Shanghai: Municipal" Council Jand the French Municipal Council by the Stanghal Telephone Company' for fan adjustment in the telephone tariffs, according to an official statement sued by the Company yesterday. The adjustment lo sought from Apri 1, 1885 in accordance with the Franchise Agreements.
"The Company's statement reads:—"Shanghai Telephone Company has made application to the Shanghai municipal Council "andthe French Municipal Coun! for an adjustment {In telephone tariffs as from April 1085 in accordance with the Franchise Agreements. Under the Franchises, ko Company upon completion of the conversion to automatic operation was entitled to a net return on the capital fa vested in the business of eight per cent. plus two per cent. per annum. But, in the Company's letter August's, 1650 fo the Councils it was Stated that the Company would necept the rate recommendations in the 'Anson Report of November 29, 1029, 'These rates were 10 be effective for {period of three years after the completion of the conversion to. auto: Iatle operation or until March 27, 1985 but they failed to. produce the net return' provided for under the Franchises. With the complete fulfiiment of the supplementary" agreement with the Councils contained in Company's letter of August 8, 1990, the Company' is entitied to revenue cient to meet the provisions of the exchange line per day. The calling rate steadily Increased as the new automatic offices were brought into service s0 that at the completion of the conversion it had doubled and since that time has continued slightly above that level. In 1934, when business conditions were considered to be subnormal, the average overall calling rate for the Company's System was 1481 calls per line per day. This is concrete evidence of the value of the service to subscribers as the usual and best measure of the quality of service is the number of conversations originated, This. increasing usage involves more apparatus and lines with the consequent additional costs for Interest on capital, depreciation, maintenance and operation. When the property was rebuilt, capital was expended to meet immediate requirements and the extra load which would have to be cared for by anticipated growth. If it had not been for the increased use of the service. this excess central office equipment would have been available for extensions of the System but in Shanghai there was little available and it has been necessary to make additional capital expenditures to take care of the additional traffic,
Text read from the printed page and cleaned; old type leaves the occasional error.