Kansas City Southern profits soar

Kansas City Southern profits soar

Kansas City Southern said Tuesday its fourth quarter net profit increased 39.8 percent to $49.9 million, up from $35.7 million in the same quarter in 2006.

   Operating income for the fourth quarter was $108.7 million, up 23.2 percent from $88.2 million last year. Revenue rose 4 percent to $460.3 million.

   The company’s commodity highlights included a 12 percent revenue increase for chemical and petroleum products to $83 million, while intermodal and automotive revenue, led by increased volumes in Mexico, grew 11.6 percent in the quarter to $68.5 million. Overall carloads in the quarter were down 2.5 percent to 481,998.

   For the full year, KCS's net income jumped 49.9 percent to $134 million, compared with $89.4 million in 2006. Operating income gained 19.1 percent to $362.4 million from $304.3 million. Annual revenue increased 5 percent to $1.74 billion from $1.66 billion.

   “While KCS’s 2007 revenue growth of 5 percent fell short of our projections going into the year, given the weakness in the U.S. economy, we were generally pleased by the year-over-year increase, and by the new business opportunities that developed during the year. Chemicals, intermodal and automotive were particularly strong in the fourth quarter and should remain so in 2008,” said Kansas City Southern Chairman Michael Haverty in a statement.

   “While the uncertain economy will provide a challenge, KCS is confident that new business coming online both in the U.S. and Mexico, and continued strong pricing, will allow for volume growth in most commodity areas and revenue growth across-the-board,” Haverty added.