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KCS reports Q3 2021 results

(Source: Kansas City Southern press release, October 19, 2021)

KANSAS CITY, Mo. — Kansas City Southern (KCS) reported revenues of $744.0 million, an increase of 13% from third quarter 2020. Overall, carload volumes were down 3% compared to prior year primarily due to the following commercial impacts:

• Auto plant shutdowns driven by a global microchip shortage;
• Service interruptions at Lazaro Cárdenas due to KCSM right-of-way blockages resulting from teachers' protests; and
• Increased regulation of refined fuel product shipments into Mexico resulting in supply chain disruptions.

Third Quarter 2021

Third quarter revenues were $744.0 million, an increase of 13% primarily resulting from mix, higher fuel surcharge, and the strengthening of the Mexican peso against the U.S. dollar.
Third quarter operating expenses were $492.1 million, including $36.5 million in merger costs. Operating income was $251.9 million and the reported operating ratio was 66.1%. Third quarter net income was $156.5 million, or $1.71 per diluted share.

“We are encouraged that despite several commercial headwinds, our network is performing extremely well and we are delivering near record velocity and dwell,” stated Patrick J. Ottensmeyer, KCS president and chief executive officer. "Underlying industrial demand is strong, and KCS has maintained resources to prioritize customer service as volumes return to the network. As certain supply chain disruptions are resolved and our revenue environment improves, our network will be well-positioned to handle incremental volume while continuing to provide premium service to our customers.

“We are also very pleased to have announced our combination with Canadian Pacific, creating the first single- line rail network linking the U.S., Mexico and Canada. This historic combination will enhance competition, create new options for customers, and support economic growth in North America."

Full story: Kansas City Southern press release (PDF)

Tuesday, October 19, 2021

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