FORT WORTH, Texas — Burlington Northern Santa Fe Corporation reported second-quarter 2002 earnings of $0.51 per diluted share, compared with second-quarter 2001 earnings of $0.50 per diluted share.
“BNSF increased earnings per share by 2 percent despite revenues being impacted by continued softness in most of our product sectors,” said Matthew K. Rose, BNSF Chairman, President and Chief Executive Officer. “BNSF maintained its focus on cost control initiatives, while expanding product offerings and recording its third consecutive quarterly record on-time performance for our customers.”
Freight revenues for the 2002 second quarter were $2.18 billion, down 3 percent compared with the same 2001 period. Consumer Products revenues increased $3 million, or less than one percent, to $848 million reflecting increased intermodal volumes in the international and truckload businesses; this was partially offset by decreased automotive shipments and lower levels of traffic in other intermodal sectors. Industrial Products revenues fell $1 million to $535 million, as a 12 percent increase in Chemicals was more than offset by general softness in the construction products sector. Coal revenues decreased $44 million, or 8 percent, to $488 million, reflecting reduced demand. Agricultural Products revenues declined $16 million, or 5 percent, to $312 million, primarily due to weak wheat and corn exports.
Operating expenses of $1.8 billion were $41 million or 2 percent lower than the same period in 2001. Second-quarter operating expenses primarily reflect lower fuel expense due to an 11-cent reduction in fuel price including hedge compared with 2001, and reduced equipment rents.
Operating income was $405 million for the 2002 second quarter compared with $428 million a year ago. The operating ratio increased to 81.4 percent for the 2002 second quarter compared with 80.9 percent in the same 2001 period.
Interest expense of $105 million was $10 million, or 9 percent, lower than the same period in 2001, primarily as a result of lower short-term interest rates. Other income was $15 million higher than the same period in 2001 reflecting increased land sales.
Common Stock Repurchases
During the 2002 second quarter, BNSF repurchased 4.2 million shares of its common stock at an average price of $28.58 per share. This brings total repurchases under BNSF’s 120 million share-repurchase program to 110.1 million shares as of June 30, 2002, at an average price of $25.92 per share since the program was announced in July 1997.
Through The Burlington Northern and Santa Fe Railway Company, BNSF operates one of the largest railroad networks in the United States, with 33,000 route miles covering 28 states and two Canadian provinces.