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Similar to most other Class Is, BNSF Railway Co.'s first-quarter financial performance was somewhat chilled by winter's wrath.Although total revenue rose 3 percent to $5.4 billion and volume ratcheted up 1 percent to 2.4 million units, operating income fell 7 percent to $1.4 billion, net income tumbled 9 percent to $724 million, operating expenses increased 7 percent to $4.1 billion and the operating ratio worsened 2.7 points to 74.4 compared with first-quarter 2013 figures, according to a Q1 performance summary posted on BNSF's web site.By commodity group, consumer products revenue was flat at $1.7 billion and volume increased 1 percent to 1.2 million units; industrial products revenue rose 5 percent to $1.4 billion and volume crept up 1 percent to 452,000 units; coal revenue inched up 1 percent to $1.2 billion and volume increased 4 percent to 563,000 units; and agricultural products revenue climbed 7 percent to $976 million even though volume dipped 3 percent to 236,000 units.The ag product traffic decline primarily was caused by service-related challenges that were exacerbated by severe winter weather, BNSF officials said in the performance summary. The consumer products volume gain primarily was due to higher international and domestic intermodal traffic, offset by automotive traffic reductions, while the industrial products volume increase mainly was due to higher petroleum products shipments propelled by crude unit-train loadings, they said. However, slower equipment velocity reduced industrial products loadings. In terms of operating expenses, all six categories registered increases: compensation and benefits, up 7 percent to $1.2 billion; fuel, up 3 percent to $1.2 billion; purchased services, up 6 percent to $653 million; depreciation and amortization, up 7 percent to $515 million; equipment rents, up 9 percent to $215 million; and materials and other expenses, up 24 percent to $319 million. Wage inflation and higher overtime helped drive up compensation and benefits expenses, while increased crew transportation, lodging and other travel costs impacted materials and other expenses.Meanwhile, an improving automotive market and a recent influx of domestically produced vehicles for regional and international markets has prompted the Port of Portland, Ore., to sell 5.4 acres to BNSF to enlarge its auto facility.The Class I is expanding operations and capacity at its 27-acre North Rivergate Vehicle Facility, including administrative support, vehicle staging and parking areas. The adjacent port-owned property offered space to support the facility's expansion."BNSF Railway’s investment and growth plans for their auto business are aligned with the port’s business objectives to enhance the Portland region as a hub for auto logistics," said Joe Mollusky, the port's real estate program manager, in a press release.Cars and trucks are received at BNSF’s Rivergate facility, then processed and distributed by truck to auto dealerships or exported by ship. Portland is the second-largest auto import gateway on the U.S. West Coast and the fifth-largest in the nation.
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