Kansas City Southern (KSU 105.98, +3.30, +3.21%) added 0.3% in
pre-market and moved higher in early trade after reporting in-line earnings for
the third quarter.
The rail carrier delivered in-line third quarter earnings of $1.57/share on revenue, which jumped 6.5% year/year to $699 mln, but was shy of expectations.
President and CEO Patrick Ottensmeyer said the railroad faced some challenges during the quarter, including network congestion in Mexico. However, Mr. Ottensmeyer expressed confidence in the company's ability to produce strong results going forward.
Adjusted operating ratio improved by one percentage point to 63.4%.
Looking at the segment breakdown, Chemical & Petroleum revenue grew 17% to $160.6 mln, mostly due to 36% growth in Petroleum revenue, which increased to $64.5 mln. Carloads and units increased 15% to 77,700, largely due to a 40% jump in Petroleum Carloads (to 32,800). Revenue per Carload/Unit increased 2% to $2,067. Chemicals revenue per Carload/Unit grew 8% to $2,324 while Petroleum revenue per Carload/Unit fell 3% to $1,966.
Industrial & Consumer Products revenue was unchanged at $152.5 mln. Metals & Scrap revenue fell 15% to $50.1 mln, which was offset by 7% growth in Forest Products revenue (to $68.7 mln) and 15% growth in Other revenue ($33.7 mln). Carloads and Units declined 1% to 81,300. Metals & Scrap Carloads and Units fell 8% to 27,700 while Forest Product Carloads and Units increased 3% (to 30,500) and Other Carloads and Units rose 2% (to 23,100). Revenue per Carload/Unit grew 1% to $1,876.
Agriculture & Minerals revenue was little changed at $116.2 mln. Ores & Minerals revenue declined 7% to $5.4 mln, which was offset by 1% growth in Food Products revenue (to $34.9 mln) and 7% growth in Stone, Clay & Glass revenue (to $7.4 mln). Carloads and Units declined 2% to 59,900 while Revenue per Carload/Unit rose 2% to $1,940. The growth was mostly due to a 4% increase in Food Products revenue per Carload/Unit (to $2,424) and 3% growth in Grain revenue per Carload/Unit (to $1,935).
Energy revenue fell 2% to $73.20 mln. Utility Coal revenue fell 23% to $35.4 mln and Frac Sand revenue declined 36% to $8.8 mln. The declines were largely offset by a 27% spike in Coal & Petroleum Coke revenue (to $11.9 mln) and a 223% surge in Crude Oil revenue (to $17.1 mln). Carloads and Units fell 8% due to a 35% decline in Frac Sand Carloads and Units (to 5,600) and a 25% drop in Utility Coal Carloads and Units (to 37,300). Crude Oil Carloads and Units surged 120% to 10,100. Revenue per Carload/Unit grew 7% to $1,040, mostly due to a 47% surge in Crude Oil revenue per Carload/Unit (to $1,693).
Intermodal revenue increased 8% to $100.0 mln while Carloads and Units grew 7% to 267,900. Revenue per Carload/Unit rose 1% to $373.
Automotive revenue grew 8% to $66.2 mln while Carloads and Units increased 4% to 40,700. Revenue per Carload/Unit increased 4% to $1,627.
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