- Second-quarter 2004 earnings were $0.67 per share, or 24 percent
higher, than second-quarter 2003 earnings of $0.54 per share.
- Freight revenues increased 17 percent, year-over-year, to an all-time
quarterly record of $2.64 billion. Of the 17 percent increase,
2 percent is being driven by fuel surcharges.
- Operating income of $508 million increased $96 million, or 23 percent,
compared with the same period in 2003.
FORT WORTH, Texas, July 27 /PRNewswire-FirstCall/ -- Burlington Northern
Santa Fe Corporation (NYSE: BNI) (BNSF) today reported record second-quarter
2004 earnings of $0.67 per share, a 24 percent increase over second-quarter
2003 earnings of $0.54 per share.
"Record all-time volumes coupled with a 2-percent average price increase
contributed to our third consecutive quarter of double-digit earnings growth,"
said Matthew K. Rose, BNSF Chairman, President and Chief Executive Officer.
"We are pleased with the record second-quarter earnings and freight revenues.
As we move toward fall peak season, our equipment availability and crew
capacity should enable us to maintain network fluidity and handle forecasted
volume growth."
Second-quarter 2004 freight revenues increased $374 million, or
17 percent, to $2.64 billion compared with 2003 second-quarter revenues of
$2.26 billion. Of the 17 percent increase, 2 percent is being driven by fuel
surcharges. Consumer Products revenues reached $1 billion for the first time
as a result of a 12-percent increase in volumes in the international
intermodal sector and a 17-percent volume increase in the truckload sector.
Agricultural Products revenues were up $107 million, or 34 percent, due to
increased corn and wheat exports. Industrial Products revenues increased
$89 million, or 17 percent, to an all-time quarterly record of $620 million
reflecting strong demand in the construction products, building products,
petroleum products, and chemical and plastics sectors. Coal revenues rose
$49 million, or 10 percent, to $553 million driven by record second-quarter
volumes both from new and existing customers.
Operating expenses of $2.18 billion were $295 million, or 16 percent,
higher than the same period in 2003. The increase in operating expenses was
partially driven by a 13-percent increase in gross ton-miles and higher fuel
prices. Additionally, operating expenses included approximately $30 million
of environmental expenses due to developments at two former fueling facility
sites.
Second-quarter operating income increased $96 million, or 23 percent,
year-over-year to $508 million. BNSF's operating ratio decreased to 80.7%
compared with 81.8% for the same prior year period.
Dividend Increase
As announced July 22, 2004, the Board of Directors of the Company voted to
increase its next quarterly dividend by 13 percent, or 2 cents per share, to
17 cents per share on outstanding common stock. This dividend will be payable
on October 1, 2004 to shareholders of record on September 10, 2004. This
equates to 68 cents per share on an annualized basis. This dividend increase
is in addition to the 25 percent increase approved by the Board in July 2003.
BNSF's subsidiary, The Burlington Northern and Santa Fe Railway Company,
operates one of the largest railroad networks in North America, with about
32,500 route miles covering 28 states and two Canadian provinces. The railway
is among the world's top transporters of intermodal traffic, moves more grain
than any other American railroad, transports the components of many of the
products we depend on daily, and hauls enough coal to generate about ten
percent of the electricity produced in the United States. BNSF is an industry
leader in Web-enabling a variety of customer transactions at
http://www.bnsf.com .
Financial information follows.
Statements made in this release concerning projections or expectations of
financial or operational performance, including equipment availability, crew
capacity, network fluidity and expected volume growth, or concerning other
future events or objectives or results, are "forward-looking statements"
within the meaning of the federal securities laws. Forward-looking statements
involve a number of risks and uncertainties and actual results may differ
materially from that projected or implied in those statements. Important
factors that could cause such differences include, but are not limited to,
economic and industry conditions: material adverse changes in economic or
industry conditions, both within the United States and globally, changes in
customer demand, effects of adverse economic conditions affecting shippers,
adverse economic conditions in the industries and geographic areas that
produce and consume freight, and changes in crew availability and labor
difficulties, including stoppages affecting either BNSF's operations or our
customers' abilities to deliver goods to BNSF for shipment; and operating
factors: technical difficulties, changes in operating conditions and costs,
the extent of the Company's ability to achieve its operational goals and
initiatives, the effectiveness of steps taken to maintain and improve
operations and service, the effect of congestion on other railroads, as well
as natural events such as severe weather, fires, floods and earthquakes, or
the effects of acts of terrorism or other disruptions of the Company's
operating systems or its ability to use its structures or equipment.
The Company cautions against placing undue reliance on forward-looking
statements, which reflect its current beliefs and are based on information
currently available to it as of the date a forward-looking statement is made.
The Company undertakes no obligation to revise forward-looking statements to
reflect future events, changes in circumstances, or changes in beliefs. In
the event the Company does update any forward-looking statement, no inference
should be made that the Company will make additional updates with respect to
that statement, related matters, or any other forward-looking statement. Any
corrections or revisions may appear in the Company's public filings with the
Securities and Exchange Commission (SEC), which are accessible at
http://www.sec.gov or on the Company's website at http://www.bnsf.com , and
which you are advised to consult. Investors are encouraged to read the
Company's earnings release and investors' report together with its SEC filings
for a more complete picture and better understanding of the Company and its
financial disclosures.
Burlington Northern Santa Fe Corporation
Consolidated Income Information*
(Dollars in millions, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
2004 2003 2004 2003
Operating revenues
Freight revenues $ 2,637 $ 2,263 $ 5,085 $ 4,465
Other revenues 48 31 90 61
Total operating revenues 2,685 2,294 5,175 4,526
Operating expenses
Compensation and benefits 818 699 1,605 1,417
Purchased services 351 312 691 613
Depreciation and amortization 251 225 500 451
Equipment rents 197 180 384 349
Fuel 326 267 606 546
Materials and other 234 199 471 392
Total operating expenses 2,177 1,882 4,257 3,768
Operating income 508 412 918 758
Interest expense 101 106 203 212
Other expense, net 5 3 2 5
Income before income taxes and
cumulative effect of accounting
change 402 303 713 541
Income tax expense 153 103 271 193
Income before cumulative effect
of accounting change 249 200 442 348
Cumulative effect of accounting
change, net of tax (A) --- --- --- 39
Net income $ 249 $ 200 $ 442 $ 387
Diluted earnings per share
before cumulative effect of
accounting change $ 0.67 $ 0.54 $ 1.18 $ 0.94
Diluted earnings per share
after cumulative effect of
accounting change $ 0.67 $ 0.54 $ 1.18 $ 1.04
Diluted average shares
outstanding (in millions) 373.5 372.4 373.7 372.9
Operating ratio (B) 80.7% 81.8% 81.9% 83.0%
(A) Reflects the adoption of SFAS No. 143. This standard changed the way
the rail industry accounts for asset retirement costs.
(B) Calculated as total operating expenses less other revenues divided
by freight revenues.
* Certain prior period amounts have been reclassified to conform to
the current period presentation.
Burlington Northern Santa Fe Corporation
Consolidated Balance Sheet Information
(Dollars in millions, except per share amounts)
June 30, December 31,
2004 2003
Assets
Current assets:
Cash and cash equivalents $ 64 $ 18
Accounts receivable, net 242 129
Materials and supplies 294 266
Current portion of deferred income taxes 320 292
Other current assets 345 157
Total current assets 1,265 862
Property and equipment, net 25,376 25,068
Other assets 1,351 1,009
Total assets $27,992 $26,939
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and other current
liabilities $ 2,074 $ 2,102
Long-term debt due within one year 309 244
Total current liabilities 2,383 2,346
Long-term debt and commercial paper 6,678 6,440
Deferred income taxes 7,750 7,481
Casualty and environmental liabilities 477 462
Minimum pension liability 359 359
Employee separation costs 133 144
Other liabilities 1,303 1,212
Total liabilities 19,083 18,444
Stockholders' equity:
Common stock and additional paid-in capital 5,966 5,771
Retained earnings 6,570 6,240
Treasury stock (3,522) (3,340)
Unearned compensation (58) (36)
Accumulated other comprehensive loss (47) (140)
Total stockholders' equity 8,909 8,495
Total liabilities and stockholders' equity $27,992 $26,939
Book value per share $ 23.93 $ 22.87
Common shares outstanding (in millions) 372.3 371.5
Net debt to total capitalization* 43.7% 44.0%
* Net debt is calculated as total debt less cash and cash equivalents,
and capitalization is calculated as the sum of net debt and total
stockholders' equity.
Burlington Northern Santa Fe Corporation
Consolidated Cash Flow Information
(in millions)
Three Months Six Months
Ended June 30, Ended June 30,
2004 2003 2004 2003
Operating activities
Net income $ 249 $ 200 $ 442 $ 387
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization 251 225 500 451
Deferred income taxes 101 114 183 183
Employee separation costs paid (7) (8) (15) (18)
Cumulative effect of
accounting change --- --- --- (39)
Other, net 10 (24) (3) (17)
Changes in working capital 69 57 (193) (56)
Net cash provided by operating
activities 673 564 914 891
Investing activities
Capital expenditures (386) (495) (692) (835)
Other, net (97) (22) (269) (32)
Net cash used for investing
activities (483) (517) (961) (867)
Financing activities
Net (repayments) borrowings (140) 9 233 188
Dividends paid (55) (44) (111) (89)
Purchase of BNSF common stock (90) (46) (172) (123)
Proceeds from stock options
exercised 85 16 141 18
Other financing activities 1 (4) 2 (3)
Net cash provided by (used for)
financing activities (199) (69) 93 (9)
Increase (decrease) in cash and
cash equivalents (9) (22) 46 15
Cash and cash equivalents:
Beginning of period 73 65 18 28
End of period $ 64 $ 43 $ 64 $ 43
Burlington Northern Santa Fe Corporation
Operating Statistics
Three Months Six Months
Ended June 30, Ended June 30,
2004 2003 2004 2003
Cars/units (in thousands) 2,362 2,129 4,568 4,171
Average revenues per car/unit $ 1,116 $ 1,063 $ 1,113 $ 1,070
Revenue ton miles (in millions) 142,625 124,465 276,909 245,364
Gross ton miles (in millions) 252,439 223,477 490,238 440,788
RTM/GTM 0.56 0.56 0.56 0.56
Freight revenue/thousand RTM $ 18.49 $ 18.18 $ 18.36 $ 18.20
Operating expense/thousand RTM $ 15.26 $ 15.12 $ 15.37 $ 15.36
Freight revenue/thousand GTM $ 10.45 $ 10.13 $ 10.37 $ 10.13
Operating expense/thousand GTM $ 8.62 $ 8.42 $ 8.68 $ 8.55
Compensation and
benefits/thousand GTM $ 3.24 $ 3.13 $ 3.27 $ 3.21
Average employees 37,819 37,086 37,177 36,528
Period end employees 37,990 36,654 37,990 36,654
Thousand RTM/average employee 3,771 3,356 7,448 6,717
Thousand GTM/average employee 6,675 6,026 13,187 12,067
Gallons of fuel used (in
millions) 337 297 660 589
Average price per gallon of
fuel (cents) (A) 96.7 89.9 91.8 92.7
GTM/gallon of fuel 749 752 743 748
Freight train miles (in
millions) 39 38 76 75
GTM/freight train hours (in
thousands) 129 134 131 137
Route miles operated 32,683 32,318 32,683 32,318
(A) Includes handling, taxes and hedge effect.
Burlington Northern Santa Fe Corporation
Revenue Statistics by Commodity
Three Months Six Months
Ended June 30, Percent Ended June 30, Percent
Revenues (in millions) 2004 2003 Change 2004 2003 Change
Intermodal $881 $757 16.4% $1,660 $1,453 14.2%
Automotive 80 80 0.0 155 161 (3.7)
Other Consumer Products 79 74 6.8 152 145 4.8
Total Consumer Products 1,040 911 14.2 1,967 1,759 11.8
Industrial Products 620 531 16.8 1,183 1,042 13.5
Coal 553 504 9.7 1,073 989 8.5
Agricultural Products 424 317 33.8 862 675 27.7
Total freight revenue 2,637 2,263 16.5 5,085 4,465 13.9
Other revenue 48 31 54.8 90 61 47.5
Total revenues $2,685 $2,294 17.0% $5,175 $4,526 14.3%
Cars/units (in thousands)
Intermodal 1,117 1,002 11.5% 2,117 1,926 9.9%
Automotive 41 40 2.5 80 82 (2.4)
Other Consumer Products 46 43 7.0 88 83 6.0
Total Consumer Products 1,204 1,085 11.0 2,285 2,091 9.3
Industrial Products 389 354 9.9 757 697 8.6
Coal 548 504 8.7 1,069 991 7.9
Agricultural Products 221 186 18.8 457 392 16.6
Total cars/units 2,362 2,129 10.9% 4,568 4,171 9.5%
Average revenue per car/unit
Intermodal $789 $755 4.5% $784 $754 4.0%
Automotive 1,951 2,000 (2.5) 1,938 1,963 (1.3)
Other Consumer Products 1,717 1,721 (0.2) 1,727 1,747 (1.1)
Total Consumer Products 864 840 2.9 861 841 2.4
Industrial Products 1,594 1,500 6.3 1,563 1,495 4.5
Coal 1,009 1,000 0.9 1,004 998 0.6
Agricultural Products 1,919 1,704 12.6 1,886 1,722 9.5
Average revenue per
car/unit $1,116 $1,063 5.0% $1,113 $1,070 4.0%
Revenue ton miles
(in millions)
Intermodal 27,969 25,040 11.7% 53,309 48,254 10.5%
Automotive 1,225 1,195 2.5 2,341 2,448 (4.4)
Other Consumer Products 3,248 3,102 4.7 6,239 6,169 1.1
Total Consumer Products 32,442 29,337 10.6 61,889 56,871 8.8
Industrial Products 26,551 23,982 10.7 51,284 47,254 8.5
Coal 58,645 51,662 13.5 112,317 99,536 12.8
Agricultural Products 24,987 19,484 28.2 51,419 41,703 23.3
Total revenue ton
miles 142,625 124,465 14.6% 276,909 245,364 12.9%
Freight revenue per
thousand ton miles
Intermodal $31.50 $30.23 4.2% $31.14 $30.11 3.4%
Automotive 65.31 66.95 (2.4) 66.21 65.77 0.7
Other Consumer Products 24.32 23.86 1.9 24.36 23.50 3.7
Total Consumer Products 32.06 31.05 3.3 31.78 30.93 2.7
Industrial Products 23.35 22.14 5.5 23.07 22.05 4.6
Coal 9.43 9.76 (3.4) 9.55 9.94 (3.9)
Agricultural Products 16.97 16.27 4.3 16.76 16.19 3.5
Freight revenue per
thousand ton miles $18.49 $18.18 1.7% $18.36 $18.20 0.9%
Burlington Northern Santa Fe Corporation
Capital Expenditures and Track Maintenance*
Three Months Six Months
Ended June 30, Ended June 30,
2004 2003 2004 2003
Capital expenditures (in
millions)
Maintenance of way
Rail $ 63 $ 80 $ 114 $ 127
Ties 71 83 139 135
Surfacing 48 48 75 73
Other 94 96 169 167
Total maintenance of way 276 307 497 502
Mechanical 18 26 32 49
Information services 13 15 24 25
Other 18 18 28 36
Total maintenance of
business 325 366 581 612
New locomotive acquisitions --- 84 16 156
Terminal and line expansion 61 45 95 67
Total capital expenditures $ 386 $ 495 $ 692 $ 835
Track maintenance
Track miles of rail laid
Maintenance of business 200 249 318 356
Expansion projects 37 29 37 33
Total 237 278 355 389
Cross ties inserted (thousands)
Maintenance of business 678 861 1,178 1,212
Expansion projects 94 81 102 84
Total 772 942 1,280 1,296
Track resurfaced (miles) 3,493 3,851 5,269 5,811
* Certain prior period amounts have been reclassified to conform to the
current period presentation.
SOURCE Burlington Northern Santa Fe Corporation
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Related links:
http://www.bnsf.com
Photo Notes:
NewsCom:
http://www.newscom.com/cgi-bin/prnh/20010719/BNSFLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
investors, Marsha Morgan, +1-817-352-6452, or
media, Richard Russack, +1-817-867-6425, both of Burlington
Northern Santa Fe Corporation
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