The rail operator reported revenues of $US3.37 billion, a $470 million increase over the same period in 2005. This increase in revenue resulted in an increase of $89 million in net income to $410 million for the quarter.
The 16% increase in revenue, the company said, is attributable to volume growth, rate increases and fuel surcharges. The surcharges alone more than doubled during the quarter, going from $170 million to $350 million. These surcharges were offset by increased fuel expenses of $169 million, which contributed to the $323 million increase in operating expenses.
The net result of the increases in revenues and expenses was a quarterly operating income of $792 million, a record for BNSF.
“Demand for rail service continued to be very strong, with growth spread across each of our four business groups,” said company chief Matthew Rose.
In addition to the record operating income, he added, the company’s operating margin continued to improve while coal cargo and tonnage grew 5%.
Just two weeks ago, BNSF announced its plans to open an office in Shanghai, China, the first US rail company to do so. It anticipates opening the doors of the new office sometime during the next quarter.
“As the United States trade with Asia continues to grow, it becomes more and more important for BNSF to collaborate with our customers in countries such as China to ensure the fluidity of US-Asia trade,” company consumer products vice-president Steve Branscum said, at the inaugural BNSF International Supply Chain Summit April 12.
During the company’s year-end report for 2005 held in January, BNSF announced additional growth plans through the expansion of its Lincoln, Nebraska, facility as well as the addition of approximately 50 miles of double- and triple-track on its Powder River Basin Joint Line.
