Kansas City Southern reports record first-quarter revenue but a smaller profit
04/16/2014 9:08 PM
04/16/2014 9:08 PM
Kansas City Southern on Wednesday reported a smaller first-quarter profit but record revenue, thanks to a 4 percent increase in rail car shipments.
The railroad company said it earned $94 million in the first three months of 2014, down from $104.2 million in the same period in 2013. Kansas City Southern said earnings were affected by lease termination rates, foreign exchange fluctuations and debt retirement costs.
First-quarter revenue grew to $607.4 million, up 10 percent from the first quarter of 2013.
All six of the company’s commodity hauling groups reported year-over-year revenue gains, led by a 40 percent increase in agriculture and minerals. Revenue from intermodal grew 10 percent and automotive hauling 7 percent, while chemical and petroleum and industrial and consumer business grew 3 percent. Energy revenue gained 2 percent from the first quarter of 2013.
“We are pleased with how our company performed during the first quarter,” David Starling, Kansas City Southern’s chief executive officer and president, said in a statement.
Starling also said Kansas City Southern’s business improved in April.
“The indication that our core business appears to be gaining strength provides us with positive momentum” toward achieving the company’s 2014 goals, he said.
In a report after the earnings release, analysts at TheStreet.com said Kansas City Southern’s “strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share.” The firm has a “buy” rating on Kansas City Southern’s stock.
Shares in Kansas City Southern closed at $101.44, up $2.28. The financial results were released after regular trading hours ended.