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BNSF Q2 net profit up 10% amid 15% increase in freight revenues

Net profit hit $1.66 billion despite lower volumes

A BNSF train hauling intermodal containers. (Photo: Jim Allen/FreightWaves)

BNSF’s second-quarter net profit rose 10% year over year amid higher freight revenue and despite lower rail volumes.

Net income for the western U.S. railroad the second quarter of 2022 was $1.66 billion, compared with nearly $1.52 billion for the second quarter of 2021. BNSF is privately owned by Berkshire Hathaway (NYSE: BRK.B).

Overall revenue rose 14% to $6.64 billion, with freight revenue increasing by 15% to nearly $6.3 billion. Revenue per carload/unit grew nearly 22% to $2,542 year over year.

Operating income was $2.38 billion, 7% higher than the second quarter of 2021, while operating ratio grew to 63.2% compared with 60.4% last year. 

By segment, BNSF’s consumer products revenue rose 18% to $2.45 billion despite a 7% decrease in volumes. For the second quarter and the first half of 2022, lower international intermodal shipments, resulting from supply chain challenges, were partially offset by higher domestic intermodal volume and an increase in automotive shipments, BNSF said. 

Agricultural products revenue increased 9% to $1.39 billion amid a 3% volume reduction. Lower grain exports were partially offset by higher volumes of renewable diesel and oil feedstocks in the second quarter and for the first half of 2022.

Industrial products revenue rose 8% to $1.46 billion despite a 4% decrease in volumes, which was due to a decrease in petroleum volumes and lower demand for shipments of crude by rail. 

Coal revenue increased 30% to $999 million despite a 3% drop in volumes. Network challenges dented volumes in the second quarter, while increased electricity generation, higher natural gas prices and improved export demand supported a 5% volume increase for the first six months of 2022. 

(Chart: BNSF)

Operating expenses were $4.26 billion, up 19% year over year amid an 84% increase in fuel expenses, which totaled nearly $1.28 billion. Compensation and benefits expenses grew 6% to $1.23 billion amid wage inflation, health and welfare costs, and lower productivity, BNSF said.

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Joanna Marsh

Joanna is a Washington, DC-based writer covering the freight railroad industry. She has worked for Argus Media as a contributing reporter for Argus Rail Business and as a market reporter for Argus Coal Daily.