BNSF REPORTS IMPROVED FIRST-QUARTER NET PROFIT

BNSF REPORTS IMPROVED FIRST-QUARTER NET PROFIT    Burlington Northern Santa Fe Corp. reported an 8.7-percent increase in first-quarter net income, to $187 million, and its first year-over-year quarterly revenue growth in nearly two years.
   Net income benefited from an additional $39 million due to a change in accounting principle related to asset retirement obligations. Excluding the benefit, BNSF's net income would have been down 13.9 percent to $148 million.
   The Fort Worth, Texas-based company, which operates one of North America's largest Class 1 railroads, said revenue improved 3 percent to $2.23 billion. Operating income was $346 million, down 8.9 percent from the year-earlier period, while operating expenses rose 5.8 percent to $1.89 billion, as fuel expenses increased $90 million in the quarter.
   'Excluding the impact of higher fuel prices, our operating expenses were essentially flat,' said Matthew K. Rose, chairman, president and chief executive officer of BNSF.
   Freight revenues increased 3 percent to $2.20 billion for the railroad. Consumer products revenues increased 9 percent to $848 million, due to record levels in the international, truckload and perishable sectors, BNSF said. Coal revenues were off 5 percent to $485 million. Industrial products improved 4 percent to $511 million, with increased steel, aluminum and clay shipments for construction sector and military related and waste products shipments in the building sector. Agriculture products were off 1 percent to $358 million.
   BNSF's operating ratio increased to 84.3 percent from 82.2 percent in the first quarter of 2002.
   'We believe revenue growth will continue this year along with earnings growth, even though the outlook for certain segments of the U.S. economy continues to be cloudy,' Rose said.