Record quarter for Kansas City Southern

Kansas City Southern reported record fourth quarter 2017 revenues of $660 million, an increase of 10% from fourth quarter 2016. Overall, carload volumes increased 5% compared to the prior year, also a fourth-quarter record.

Operating expenses in the fourth quarter were $423 million, 9% higher than 2016. Operating income was a fourth quarter record at $238 million, an increase of 13% from a year ago.

Fourth quarter operating ratio was 64.0, an improvement of 0.8 from the year-ago period.

The Kansas City-based company reported net income in the fourth quarter of 2017 was $552 million, or $5.33 per diluted share, compared with $130 million, or $1.21 per diluted share, in the fourth quarter of 2016. Excluding the impacts of foreign exchange fluctuations and changes in the U.S. tax law, adjusted diluted earnings per share for fourth quarter 2017 was an all-time record of $1.38, compared to $1.12 in fourth quarter 2016.

For the full year of 2017, KCS achieved record revenues, operating income, operating ratio and adjusted diluted earnings per share. Revenue was $2.6 billion, up 11% from 2016, on 5% carload growth. Full year 2017 operating income was $922 million, an increase of 13% from the prior year. The 2017 operating ratio was 64.3, an 0.6 point improvement from the prior year.

Net income in 2017 was $964 million or $9.16 per diluted share, compared with $480 million, or $4.43 per diluted share, in 2016. Excluding the impacts of foreign exchange fluctuations and changes in the U.S. tax law, adjusted diluted earnings per share for 2017 was $5.25 compared to $4.48 in 2016.

“Kansas City Southern achieved record financial results with revenue growth in all six commodity groups in 2017,” said President and Chief Executive Patrick J. Ottensmeyer. “Despite the impact of Hurricane Harvey in the third quarter, strong topline performance, led by our energy, automotive and chemical & petroleum business units, contributed to record full-year adjusted diluted earnings per share of $5.25, an increase of 17% over 2016.

“Looking ahead to 2018, we believe KCS is positioned to maintain its growth momentum driven by unique franchise opportunities, a strengthening economy and a focus on cost control. We expect to continue leveraging the investments made in our network to grow our business, ensure good customer service and maximize shareholder returns.”