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Because of growth in four of its five commodity groups — led by agricultural and mineral segment gains — Kansas City Southern increased second-quarter revenue 5.7 percent to $152.9 million compared with similar 2003 data.

Today, KCS also reported consolidated quarterly net income of $9.2 million compared with a $500,000 net loss last year and quarterly operating income of $23.1 million, which rose 22 percent. The railroad's quarterly operating ratio improved two points to 84.9.

However, KCS' quarterly expenses increased 2 percent to $134.4 million. Lower equipment, depreciation, and materials and supplies costs were offset by higher compensation, fuel and insurance expenses.

"KCS has now had five consecutive quarters of positive quarter-over-quarter revenue growth," said KCS Chairman, President and Chief Executive Officer Mike Haverty in a prepared statement. "During that time, KCS has significantly improved its operating metrics and customer service."

During the year's first half, KCS earned consolidated net income of $12.6 million, a 200 percent increase compared with first-half 2003's $4.2 million. Quarterly revenue rose 5.8 percent to $299.9 million, operating income increased 65 percent to $46.6 million and the railroad's first-half operating ratio improved 5.5 points to 84.4.

In addition, KCS' quarterly expenses dropped 0.5 percent to $264.8 million because lower depreciation and equipment costs helped offset higher compensation and fuel expenses.

"As KCS moves into the peak transport season in North America, it is positioned to handle increased volume and maintain high levels of customer service," said Haverty.