Kansas City Southern's (KSU.N) quarterly profit beat Wall Street estimates, boosted by strong intermodal and automotive volumes, and the railroad company forecast 2013 revenue growth in the high-single digits.
The company's shares rose 5 percent to an all-time high of $91.81 on the New York Stock Exchange on Tuesday morning.
Kansas City Southern said it expects 2013 to be a "bridge year" as it awaits a significant increase in volumes in 2014 from new automobile plants in Mexico.
"No one should interpret the term "bridge year" as suggesting that Kansas City Southern will be in a low-growth environment," Chief Executive David Starling said on a post-earnings conference call.
The fourth-largest public railroad operator in the United States said it expects 2013 revenue to grow at high-single digits and volumes to grow in the mid-single digits.
Kansas City Southern is generally considered to be in a better position than most railroads as it gets a boost from cross-border trade. Other U.S. railroads have been hit by lower shipments of coal due to a warm winter and low natural gas prices.
The company is banking on four new auto factories coming up in Mexico to boost volumes. Mexico accounts for about 45 percent of Kansas City Southern's total revenue.
The factories are set to open in the first quarter of 2014 and will increase Mexican production by 25 percent to 30 percent, the company said on the call.
Kansas City Southern's net income fell to $92.5 million, or 83 cents per share, in the fourth quarter, from $96.0 million, or 87 cents per share, a year earlier.
Excluding debt-retirement and other costs, the company earned 92 cents per share. Revenue rose 7 percent to $568.4 million.
Analysts had expected earnings of 82 cents per share on revenue of $565.2 million, according to Thomson Reuters I/B/E/S.
Total carloads in the quarter rose 2 percent.
Revenue from intermodal volumes — which 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 — rose 14 percent. Automotive revenue jumped 33 percent.
Kansas City Southern is the first major U.S. railroad company to report fourth-quarter results. CSX Corp CSX.N and Norfolk Southern Corp (NSC.N) report results later on Tuesday, while No. 1 U.S. railroad Union Pacific Corp (UNP.N) reports on Thursday.
Shares of Missouri-based Kansas City Southern, which has a market valuation of about $9.6 billion, have gained about 30 percent since the beginning of 2012.
(Reporting by A. Ananthalakshmi in Bangalore; Editing by Don Sebastian, Supriya Kurane)