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Rail News Home Kansas City Southern

10/28/2004



Rail News: Kansas City Southern

KCS reports record third-quarter revenue, higher income



Similar to most of its Class I counterparts that have already posted third-quarter financial results, Kansas City Southern is reporting much higher quarterly revenue, but also much higher costs. Today, KCS announced its third-quarter operating revenue reached an all-time-high $162.1 million, an 11.9 percent increase compared with third-quarter 2003.

The railroad's quarterly consolidated net income of $11.1 million rose 158 percent and operating income of $24.6 million increased 35.9 percent compared with similar 2003 data. KCS' quarterly operating ratio improved 2.7 points to 84.8.

However, total quarterly operating expenses of $144 million rose about 10 percent because of higher fuel, compensation, and casualty and insurance costs.

"During the third quarter, there were a number of positive developments in KCS' effort to complete the Grupo TFM acquisition process," said KCS Chairman, President and Chief Executive Officer Mike Haverty in a prepared statement. "KCS received the approval of the Mexican National Foreign Investment Commission, which combined with an extension of the previous approval by the Mexican Competition Commission, gives KCS the approval of the two Mexican regulatory bodies needed for it to become the majority owner of TFM."

During 2004's first nine months, KCS increased operating revenue 7.8 percent to $461.9 million and consolidated net income, 36 percent to $23.7 million compared with last year. The railroad's nine-month operating ratio improved 4.6 points to 84.6, and total operating expenses of $408.8 million rose only 3 percent compared with a similar 2003 period.

"KCS has continued to grow its carload volume and revenues throughout the first nine months of 2004, and that positive trend should continue through the remainder of the year," said Haverty. "As KCS continues to expand its market presence, an equal degree of effort is being placed on controlling costs while operating its rail network efficiently."


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