Kansas City Southern reported its profit in the second quarter plummeted from $120.4 million in 2012 to $15.4 million in 2013.
However, quarterly revenue improved 6.2 percent year-over-year to $579.3 million, from $545.3 million. Overall, carload volume was 3 percent higher than in the second quarter of 2012.
Revenue gains of 26 percent in energy, 20 percent in automotive, 13 percent in intermodal, 11 percent in chemicals and petroleum and 4 percent in industrial and consumer offset a revenue decline of 18 percent in agriculture and minerals. The 18 percent drop was primarily driven by a decrease in grain volume caused by drought conditions in the Midwest.
The railroad’s operating ratio in the second quarter of this year was 69.0 percent, compared with 62.6 percent in the second quarter of last year.
“In addition to the company’s solid topline performance during the second quarter, KCS took advantage of its recent upgrade to investment grade status and a historically low interest rate environment to refinance approximately $1.2 billion of corporate debt,” said David L. Starling, president and CEO of the Class I railroad, in a written statement
In the first six months of 2013, KCS’s net income dropped 39.0 percent from $195.3 million in 2012 to $119.1 million. Revenue from January to June was $1.13 billion, inching up compared with $1.09 billion in the same period in the previous year.