UPDATE 2-BNSF profit up on pricing, gives robust Q4 outlook

* Posts EPS of $1.91 versus analysts' view of $1.69

* Profit buoyed by pricing, offsets weak volumes

* Gives Q4 EPS outlook $1.70-$1.80; analysts see $1.71

* CEO says hard to predict '09 after global crisis (Adds CEO comments, company Q4 outlook)

CHICAGO, Oct 23, (Reuters) - Burlington Northern Santa Fe Corp (BNSF) (BNI.N), the No. 2 U.S. railroad, reported sharply higher quarterly net profit on Thursday, topping expectations, as strong pricing offset declining freight volumes.

The railroad also issued a robust earnings outlook for the fourth quarter, saying prices would remain firm, but freight volumes would be slightly down. Chief Executive Matt Rose said the company was reluctant to make predictions for 2009 after the global financial crisis.

The Ft Worth, Texas-based company said third-quarter net income rose to $695 million, or $2.00 a share, from $530 million, or $1.48 a share, a year earlier.

Excluding a favorable tax settlement, the company earned $1.91 per share.

Analysts, on average, expected earnings per share for the quarter of $1.69, excluding items, according to Reuters Estimates.

"While we are all concerned about the current financial and economic situation, we continue to be optimistic about the future of our diverse franchise and we remain confident about our long-term prospects," Rose said in a statement.

BNSF reported quarterly revenue rose to $4.90 billion from $4.07 billion a year earlier. Analysts looked for $4.79 billion.

Freight volumes were down more than 1 percent. But the average revenue per rail car rose almost 23 percent to $1,840 from $1,501.

For the current quarter, BNSF expects earnings in a range from $1.70 to $1.80 per share. Analysts expected fourth-quarter earnings of $1.71 per share.

CEO Rose told Reuters that although its customer agreements on price hikes for 2009 contracts have been similar to increases in 2008 -- freight rates at the railroad were up an average of 6 percent in the third quarter -- he said the company was reluctant to make predictions about 2009.

"We don't know what's going to happen," Rose said. "Things have changed so fast over the past few months."

"If we get the credit flowing again and manage to stem the foreclosures, then I think we will see a (U.S. economic) recovery in 2009," he added. "If we don't, then we'll be in for a longer year."