Kansas City Southern Reports Fourth Quarter Revenues Increase 18 Percent

KANSAS CITY — Kansas City Southern reported fourth quarter 2010 revenues of $479 million reflecting continued improvement in economic conditions in the markets served.

Sequentially, revenues recovered from third quarter 2010 which were negatively impacted by service disruptions caused by Hurricane Alex, the railroad said.

Revenue growth was experienced across all commodity groups. Automotive revenues were up 41 percent over fourth quarter 2009 as a combination of strong pricing and new cross border vehicle routings benefitted the commodity group. Coal revenues increased 31 percent from a year ago on improved contract pricing which took effect at the beginning of 2010.

Intermodal revenues were up 28 percent on a strong volume increase of 24 percent. Other period-over-period revenue improvements were 23 percent for Industrial & Consumer Products, 11 percent for Chemical & Petroleum, and 8 percent for Agriculture & Minerals.

Reported operating income for the fourth quarter was $135 million representing a 47 percent increase from a year ago. The Company reported a fourth quarter 2010 operating ratio of 71.8 percent compared with 77.3 percent in fourth quarter of 2009. Operating expenses in the fourth quarter increased 9 percent from a year ago on a revenue increase of 18 percent.

The company has produced positive free cash flow of $174 million year to date, including $48 million in the fourth quarter.