February 26, 2019 - TRA Newswire / Progressive Railroading -
BNSF Railway ended their 2018 fiscal year on an upswing in both revenue and profits . Results of the railroad were posted by parent company Berkshire Hathaway in a report released on Monday.
Operating income for the 12 months increased 9 percent to $6.9 billion. Revenue for the railroad was $23.9 billion which was up 12 percent. Volume increased 4.1% and was helped by a 6.2% gain in intermodal service and revenue per carload.
On the expense side, higher labor and fuel costs pushed BNSF's operating ratio to 66.9%, the highest of Class 1 railroads. The 14% cost increase included additional hires as traffic volume rose about 10% in the industrial products sector.
In their regulatory filing Berkshire Hathaway reported that “volumes in 2018 were higher primarily due to strength in the industrial and energy sectors, which drove higher demand for petroleum products, building products, construction products, and plastics". In consumer products " the volume increases were due to higher domestic intermodal volumes, primarily attributable to general economic growth and tight truck capacity leading to conversion from highway to rail, as well as growth in imports and containerized agricultural product exports, partially offset by a sizable contract loss.”
Business unit volume results for Q4 and the full year were as follows:
• Consumer products were flat and increased 3 percent, respectively, due to higher domestic intermodal volumes. The increases were driven by economic growth and tight truck capacity leading some shippers to convert from highway to rail. Also driving the results was growth in imports and containerized agricultural product exports, partially offset by a contract loss.
• Industrial products volumes climbed 7 percent and 10 percent, respectively. Strength in the industrial and energy sectors in 2018 drove higher demand for petroleum products, building products, and plastics. Full-year 2018 also included higher construction products volumes.
• Agricultural products volumes rose 5 percent and 9 percent, respectively, due to strong export and domestic corn shipments, as well as higher fertilizer and other grain products volumes, partially offset by a reduction in soybean exports. The full year also included a reduction in wheat exports.
• Coal volumes increased 5 percent and decreased 1 percent, respectively. The full-year decrease is primarily due to plant retirements combined with competition from natural gas and renewables, mostly offset by market share gains and improved export volumes. The Q4 increase was driven by higher natural gas prices, which led to increased utility coal usage, combined with lower overall utility inventories.
Read more: https://www.progressiverailroading.com/bnsf_railway/news/BNSF-posts-revenue-income-growth-in-2018--56856
BNSF Railway ended their 2018 fiscal year on an upswing in both revenue and profits . Results of the railroad were posted by parent company Berkshire Hathaway in a report released on Monday.
Operating income for the 12 months increased 9 percent to $6.9 billion. Revenue for the railroad was $23.9 billion which was up 12 percent. Volume increased 4.1% and was helped by a 6.2% gain in intermodal service and revenue per carload.
On the expense side, higher labor and fuel costs pushed BNSF's operating ratio to 66.9%, the highest of Class 1 railroads. The 14% cost increase included additional hires as traffic volume rose about 10% in the industrial products sector.
In their regulatory filing Berkshire Hathaway reported that “volumes in 2018 were higher primarily due to strength in the industrial and energy sectors, which drove higher demand for petroleum products, building products, construction products, and plastics". In consumer products " the volume increases were due to higher domestic intermodal volumes, primarily attributable to general economic growth and tight truck capacity leading to conversion from highway to rail, as well as growth in imports and containerized agricultural product exports, partially offset by a sizable contract loss.”
Business unit volume results for Q4 and the full year were as follows:
• Consumer products were flat and increased 3 percent, respectively, due to higher domestic intermodal volumes. The increases were driven by economic growth and tight truck capacity leading some shippers to convert from highway to rail. Also driving the results was growth in imports and containerized agricultural product exports, partially offset by a contract loss.
• Industrial products volumes climbed 7 percent and 10 percent, respectively. Strength in the industrial and energy sectors in 2018 drove higher demand for petroleum products, building products, and plastics. Full-year 2018 also included higher construction products volumes.
• Agricultural products volumes rose 5 percent and 9 percent, respectively, due to strong export and domestic corn shipments, as well as higher fertilizer and other grain products volumes, partially offset by a reduction in soybean exports. The full year also included a reduction in wheat exports.
• Coal volumes increased 5 percent and decreased 1 percent, respectively. The full-year decrease is primarily due to plant retirements combined with competition from natural gas and renewables, mostly offset by market share gains and improved export volumes. The Q4 increase was driven by higher natural gas prices, which led to increased utility coal usage, combined with lower overall utility inventories.
Read more: https://www.progressiverailroading.com/bnsf_railway/news/BNSF-posts-revenue-income-growth-in-2018--56856