Kansas City Southern revenue trails estimates
(Reuters) - Railroad company Kansas City Southern (KSU.N) reported a slightly higher-than-expected quarterly profit on Tuesday, but revenue lagged estimates on a bigger-than-expected drop in coal shipments.
Utility coal demand in the quarter was hurt by a mild winter and low natural gas prices, sending revenue for that business down 24 percent.
The fourth-largest public U.S. railroad operator posted second-quarter net income of $120 million, or $1.09 per share, up from $71 million, or 64 cents a share, a year earlier.
Excluding debt retirement costs and other items, the company earned 85 cents a share. Analysts on average were expecting 84 cents, according to Thomson Reuters I/B/E/S.
Quarterly operating revenue rose 2 percent to $545 million, below the analysts' average forecast of $569.9 million. The company said it had benefited from double-digit revenue increases in its intermodal and automotive segments.
Intermodal refers to the shipment of goods in containers that can be shifted from one form of transportation to another, such as from train to truck.
While lower-than-anticipated coal traffic clearly had an impact on second quarter results, Kansas City Southern still reported a 4 percent increase in carloads, Chief Executive Officer David Starling said in a statement.
The company also had its highest average daily carloads ever in the month of June, he said.
The Kansas City, Missouri-based company, which relies heavily on shipments to and from Mexico, said its cross-border intermodal volumes jumped 106 percent from a year earlier. The Kansas City Southern de Mexico unit is a primary Mexican rail line connecting Mexico and the United States.
Auto carloads rose 18 percent in the quarter. The company said it expected growing auto production in Mexico to continue to boost its shipments of vehicles and related parts.
(Reporting by Lynn Adler in New York; Editing by Gerald E. McCormick and Lisa Von Ahn)
- WTO overcomes last minute hitch to reach its first global trade deal
- Colorado baker discriminated by denying gay couple wedding cake: judge
- Flights delayed as air pollution hits record in Shanghai
- U.S. freeze shows no sign of weekend melt after deadly storm
- Australia foreign minister downplays China air defense zone tension in visit