KCS hits record revenues driven by Mexico’s auto production, energy reform
Kansas City Southern reported record second quarter 2017 revenues of US$ 656 million, an increase of 15% from second quarter 2016, supported in part by Mexican automotive production and businesses related to Mexico’s Energy Reform, said the company in its quarterly report.
Overall, carload volumes increased 6% compared to second quarter 2016. Operating expenses in the second quarter were US$ 417 million, 20% higher than 2016. In the second quarter of 2016, KCS determined it could utilize a Mexican fuel excise tax credit, and recognized a year-to-date benefit, including US$ 17 million for the first quarter of 2016.
Operating income for the second quarter of 2017 was US$ 239 million, an increase of 9% from the second quarter 2016 and an all-time quarterly record. KCS reported a second quarter operating ratio of 63.5%, a 2.2-point increase from second quarter 2016.
Reported net income in the second quarter of 2017 totaled US$ 135 million, or US$ 1.27 per diluted share, compared with US$ 121 million, or US$ 1.11 per diluted share, in the second quarter of 2016. Excluding the impacts of foreign exchange rate fluctuations, adjusted diluted earnings per share for second quarter 2017 was US$ 1.33, compared to US$ 1.22 in second quarter 2016.
“We are pleased to report record second quarter revenues and earnings per share, as well as an all-time record quarterly operating income,” stated Kansas City Southern’s President and Chief Executive Officer Patrick J. Ottensmeyer. “All three milestones highlight the overall strength of our second quarter 2017 results.
“Carloads were up in four out of six commodity groups, driving strong second quarter revenue growth of 15%. Our revenue performance featured strength in Energy, Automotive and Chemicals & Petroleum, as higher commodity prices, Mexican automotive production and the emergence of Mexican energy reform supported growth,” Ottensmeyer added.
Headquartered in Kansas City, Mo., Kansas City Southern is a transportation holding company with railroad investments in the U.S., Mexico and Panama.
Its primary U.S. holding is The Kansas City Southern Railway Company, serving the central and south-central U.S. Its international holdings include Kansas City Southern de Mexico, S.A. de C.V., serving northeastern and central Mexico and the port cities of Lazaro Cardenas, Tampico and Veracruz.