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Rail News: BNSF Railway
BNSF's net income up 5 percent, total revenue down 6 percent in 2Q
BNSF Railway Co.'s total revenue in second-quarter 2015 fell 6 percent to $5.4 billion compared with $5.7 billion in second-quarter 2014, but net income rose 5 percent to $963 million compared with $916 million a year ago, the Class I reported last week.
Operating income was $1.8 billion, up 5 percent for the quarter compared with a year ago. Operating expenses fell 11 percent to $3.6 billion for the period. The railroad’s operating ratio came in at 66.3, down from 70.1 during the same period last year.
Revenue per unit slipped 7 percent for the quarter, and 3 percent for the first six months of 2015, as lower fuel surcharges were partially offset by increased rate per car/unit and business mix changes, company officials said in a performance summary.
Consumer products volumes fell 1 percent during the six-month period, as some freight was sent to other import gateways as a result of the slow down in productivity at U.S. West Coast ports. However, consumer products volumes bounced back in the second quarter — up 3 percent compared with second-quarter 2014 — as ports resumed normal operations and the West Coast port backlog was worked off.
Industrial products volumes were hit by lower crude oil prices on petroleum products and frac sand, as well as the impact of the strong dollar on domestically produced steel demand. Volumes fell 7 percent in the second-quarter and 2 percent for the sixth-month period of 2015 compared with the same period in 2014.
Low natural gas prices squeezed coal volumes in the second quarter, which were down 1 percent. For the first six months of 2015, coal volumes rose 3 percent due to higher demand, as BNSF worked to rebuild customer stockpiles.
Agricultural products volumes were down 3 percent for the second quarter, primarily as a result of strong global competition and lower demand for fertilizer, which was partially offset by increased movement of domestic grain. For the first half of 2015, agricultural products volumes rose 6 percent compared with the year-ago period, due to an increase in domestic grain shipments and Gulf exports.
Contact Progressive Railroading editorial staff.