(Reuters circulated the following article on October 24.)
CHICAGO — Railroad company Burlington Northern Santa Fe Corp. said on Tuesday quarterly net profit rose 18 percent on strong revenue growth across its business units, beating market expectations.
In a presentation posted on its Web site, the Fort Worth, Texas-based company also said it expected fourth-quarter freight revenue growth of 10 percent and earnings per share growth of 20 percent to 25 percent over the same period last year.
BNSF reported third-quarter net income of $488 million, or $1.33 a share, compared with $414 million, or $1.09 a share, a year earlier. Wall Street analysts had on average forecast $1.30 per share, according to Reuters Estimates.
Operating revenue rose almost 19 percent from last year to $3.82 billion, shy of the $3.85 billion analysts had expected.
“BNSF experienced double-digit revenue increases in each of the company’s four business groups,” Chief Executive Matthew Rose said in a statement, citing record volumes led by a 10 percent unit increase in coal.
The company said revenue from hauling consumer products rose nearly 19 percent to $1.58 billion from $1.33 billion a year earlier.
The majority of that growth came from BNSF’s intermodal business with freight volume up nearly 8 percent and revenue rising more than 17 percent to $1.34 billion from $1.13 billion a year earlier.
Intermodal services use standardized containers that can be interchanged between different modes of transport – truck, ship or train. As the U.S. manufacturing base is shifted overseas, this fast-growing rail freight segment is driven by rising imports from developing nations such as China.
For the fourth quarter BNSF said it expects return on invested capital to reach 11 percent and that after dividends it would have free cash flow of more than $700 million.