KCS 2016 earnings slip as volumes, revenues fall

Kansas City Southern’s net income fell 1.1 percent to $479.9 million for the full year in 2016 on revenues that slid 3.5 percent compared to the previous year, according to the company’s most recent financial statements.    Kansas City Southern (KCS), a transportation holding company that owns the Kansas City Southern Railway Company, Kansas City Southern de México, S.A. de C.V., and a 50 percent interest in the Panama Canal Railway Company, saw net earnings slip 1.1 percent year-over-year to $479.9 million for the full year in 2016.
   Net earnings per diluted share (EPS), on the other hand, grew from $4.40 in 2015 to $4.43 per diluted share in 2016, according to the company’s most recent financial statements. Excluding the impacts of foreign exchange rate fluctuations, and 2015 lease termination and debt retirement and exchange costs, adjusted diluted EPS stood at $4.48 per share compared with $4.49 per share the previous year.
   KCS’ revenues dropped 3.5 percent year-over-year to $2.3 billion for the year as volumes fell 2 percent to 2.17 million carloads compared with 2015.
   The Kansas City, Mo.-based Class I railway reported an operating ratio of 64.9 percent for 2016, a 1.9 point improvement from 66.8 percent the previous year.
   “KCS’ ability to react swiftly and efficiently was proven throughout 2016, as our network faced challenging operational interruptions throughout the year,” KCS President and CEO Patrick J. Ottensmeyer said of the results. “In addition, volatility in key commodities such as energy, consumer, and intermodal markets created uncertainty during 2016.
   “Looking ahead to 2017, the Company is aware of both economic and political uncertainty, he added. “However, we continue to emphasize our commitment to growth and we are well positioned to take full advantage of the significant new business opportunities that lie ahead of us.”