Server: Netscape-Enterprise/2.01 Date: Thu, 20 Nov 1997 16:13:53 GMT Accept-ranges: bytes Last-modified: Wed, 19 Nov 1997 00:21:20 GMT Content-length: 15328 Content-type: text/html News 97
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News Release - 1997

 Record ID #

58

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BNSF Reports Improved Third Quarter Results

10/21/97

FORT WORTH, Texas, October 21, 1997 -- Burlington Northern Santa Fe Corporation (BNSF)  (NYSE:BNI) today reported a 15 percent increase in third quarter 1997 net income, reaching $283  million, or $1.79 per share, compared with third quarter 1996 net income of $247 million, or $1.58 per share.

"Revenue grew 5 percent, with intermodal and agricultural commodities posting double-digit growth," said Robert D. Krebs, BNSF chairman, president and chief executive officer of BNSF.

Revenues of $2.1 billion for the third quarter 1997 were $102 million higher than third quarter 1996. Intermodal showed increases in all sectors as revenues of $597 million increased $63 million or 12 percent from last year, despite approximately $10 million of lost revenue due to the UPS strike. Agricultural commodity revenues grew by $31 million or 13 percent led by higher export corn shipments through the Pacific Northwest. Merchandise revenues of $675 million increased $29 million or 4 percent, driven by growth in the consumer goods and minerals business segments. Coal revenues declined $20 million or 4 percent.

Third quarter 1997 operating expenses of $1.6 billion were 2 percent higher than the prior year period, principally reflecting higher compensation and benefits, equipment rents, and purchased services driven by increased business levels, partially offset by lower material and other costs.

Operating income was $541 million for the third quarter 1997 compared with  $476 million for the same period in 1996. The operating ratio improved to 74.8 percent for the third quarter 1997 compared with 76.7 percent a year earlier. Interest expense increased $10 million to $86 million, reflecting higher debt levels.

Nine-Month 1997 Results

BNSF net income for the nine-months ended September 30, 1997, was 4 percent higher at $668 million, or $4.24 per share, compared with 1996 net income for the same period of $645 million, or $4.14 per share. Revenues for the first nine months were $6.3 billion, up 3 percent from the $6.1 billion reported for the same period in 1996. Operating expenses of $4.9 billion for 1997 increased 2 percent from 1996 expenses. For the first quarter of 1997, BNSF reported a 20 percent reduction in net income as a result of severe weather conditions throughout the Northern Plains and the Pacific Northwest. In the second quarter, net income improved 11 percent, followed by a 15 percent increase in the third quarter.

Yesterday, Santa Fe Pacific Pipelines, Inc., an indirect wholly-owned subsidiary of BNSF, announced that it had entered into a Definitive Agreement to dispose of substantially all of its General Partnership interests in Santa Fe Pacific Pipeline Partners, L.P. (NYSE:SFL) to Kinder Morgan Energy Partners, L.P. (Kinder Morgan). Total consideration for these interests will be approximately $90 million. Upon consummation of this transaction, which is expected to take place in the first quarter of 1998, BNSF anticipates that it will record an after-tax gain of approximately $30 million. On an ongoing basis, the impact of this transaction on the operating results for BNSF is expected to be immaterial.

Through The Burlington Northern and Santa Fe Railway Company, BNSF owns one of the largest railroad networks in the United States, with 35,000 route miles covering 28 states and two Canadian provinces, approximately 7,900 route miles of which consist  of trackage rights.


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