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Kansas City Southern today reported record revenue of $699 million for the third quarter, a 6 percent increase over the same period in 2017.Third-quarter net income rose to $174 million, or $1.70 per diluted share, from $129 million, or $1.23 per diluted share, a year ago. Adjusted diluted earnings per share were $1.57, 16 percent higher than a year ago, excluding the impacts of foreign exchange, adjustments to 2017 provisional income tax benefit for the Tax Cuts and Jobs Act and a gain on insurance recoveries related to hurricane damage, KCS officials said in a press release.Carload volume climbed 4 percent in the quarter compared with the same period in 2017. Third-quarter revenue rose in three commodity groups, led by a 17 percent increase and chemicals and petroleum due to refined product shipments to Mexico. Automotive and intermodal each grew by 8 percent. Industrial and consumer products, as well as agriculture and minerals, were each flat compared to the prior year. Energy declined by 2 percent.Excluding a gain on insurance recoveries related to damage and service interruptions from Hurricane Harvey in 2017, adjusted operating expenses in the third quarter of 2018 were $443 million, a 5 percent increase over the 2017 period. Adjusted operating income in the quarter rose 9 percent over the year-ago period. The Class I posted an adjusted third-quarter operating ratio of 63.4 percent, a 1.0 point improvement over third-quarter 2017.“Kansas City Southern faced a challenging third quarter, as network congestion in northern Mexico led to a difficult operating environment,” said President and Chief Executive Officer Patrick Ottensmeyer. "However, we have taken steps that we are confident will restore our service levels and allow us to continue delivering strong and diversified franchise cross-border volume and revenue growth, led by increased refined product shipments to Mexico and strength in intermodal and automotive commodity groups."Looking ahead to 2019, the Class I's cross-border network offers opportunity for volume growth in the chemicals and petroleum, intermodal, automotive and export grain franchises, Ottensmeyer said."Moreover, the capital investments that we have made throughout our network position us to deliver superior long-term growth and strong financial results to our stockholders," he said.