Rail Revenues Up, Strong 2006 Expected

In the fourth quarter of 2005, BNSF freight revenues grew 18% to a quarterly record of $3.45 billion. Consumer product revenues showed the most significant gain – up 23% to $1.45 billion – with strong growth in intermodal business. Double-digit growth in the movement of building, construction and petroleum products helped boost BNSF’s Industrial Division by 21% to $763 million. While revenues from coal were relatively flat, up just 4% to $637 million, agricultural product revenues were $592 million, an increase of 20% year over year.

The railroad has announced a $2.6 billion capital improvement program for the remainder of the year, an increase of about 10% over last year’s commitment. $400 million is earmarked for track and facilities expansion. Other expenses are aimed at strengthening infrastructure, including track, signal systems and structure replacement, rebuilding of rolling stock and implementation of new technology.

The fourth quarter for CSX also set a quarterly record with revenues of $2.2 billion. For the eighth quarter in a row, both revenue and operating income grew with continued improvement in the railroad’s surface transportation activities – which include rail and intermodal operations. According to Michael Ward, CSX chairman and CEO, the company’s expansion plans are on schedule.

For example, CSX is seeking to develop an Integrated Logistics Center (ILC) in Winter Haven, Fla. The ILC would function as a rail, truck and warehousing hub and terminal. The ILC would be the first of its kind in the southeastern U.S.

For its fourth quarter, CPR increased its operating income by 27%, pushing it past the billion-dollar mark for the first time in the company’s history. For the year, revenues grew by 13% to $4.39 billion. The railroad notes that while operating expenses grew from $789 million in the fourth quarter of 2004 to $865 million in a comparable period in 2005, 60% of that jump was due to increased fuel costs.

TAGS: Archive
Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.