Railroad News

Kansas City Southern Railway Co. will perform $5.6 million in construction and improvement projects on its Shreveport Terminal Subdivision in Louisiana, the railroad announced yesterday.

The projects — which are being done to address capacity, maintenance and safety improvements — will begin March 8 and continue through March 22. The work will include installation of 37,000 ties and other improvements to more than 20 public and private grade crossings in Shreveport, according to a KCS press release.

A decrease in traffic volume, a hurricane in Mexico and flooding in the United States resulted in Kansas City Southern posting lower revenue, profit and earnings for the fourth-quarter and full year in 2015, the company announced this morning.

KCS posted fourth-quarter 2015 net income of $140 million on revenue of $598 million, compared with net income of $142 million on revenue of $642.5 million for the same period in 2014, according to a KCS press release.

Kansas City Southern Railway Co. (KCSR) will spend about $15 million this year on rail and bridge improvements at the Beaumont Subdivision between DeQuincy and DeRidder, La., Kansas City Southern (KCS) announced yesterday. 

The projects are aimed at increasing capacity and maintaining and enhancing safety on Kansas City Southern's cross-border network, company officials said inn a press release.

Although Kansas City Southern will face many of the same economic challenges in 2016 that it faced in 2015, the company's "strong financial and operational footing" is well-positioned for growth. As a result, KCS will proceed with many of its planned strategic capital expenditures, the Class I's top executives said yesterday in a letter to KCS employees.

In their "State of the Railroad" report, KCS Chief Executive Officer David Starling and President Patrick Ottensmeyer said the economic challenges ahead result in the company's cautious outlook for the new year.

A shipment of pet food that arrived to the new SENASICA inspection program marked a milestone for Kansas City Southern de Mexico S.A. de C.V.’s (KCSM) Puerta Mexico intermodal facility, the railroad announced last week.

Pet food was in the first container shipped to the new inspection facility, KCSM officials said in a post on the railroad's website.

Kansas City Southern Railway Co. will spend $6.5 million on rail and bridge improvements on its Vicksburg Subdivision in Louisiana, the Class I announced yesterday.

The project is designed to address capacity, maintenance and safety on KCS' cross-border network, according to a KCS press release.

Kansas City Southern today announced its third-quarter financial results bested second-quarter performance and included a record operating ratio. But on a year-over-year basis, most measures declined.

KCS reported third-quarter operating income of $220 million versus $229 million in the year-ago period; net income of $132 million, or $1.20 per diluted share, compared with last year's $138 million, or $1.25 per diluted share; revenue of $632 million versus $677.5 million a year earlier; and carloads totaling 583,400 compared with 595,400 in third-quarter 2014.

Kansas City Southern yesterday released its 2014 Sustainability Report, which outlines the company's progress on social, environmental and economic topics.

Highlights of the report include the Class I’s efforts to improve safety and security, such as through the use of new technology that detects potential safety rules violations involving the inappropriate use of cell phones in locomotive cabs, as well as a new mobile security application that allows real-time reporting of events to enable faster response times when needed, the company said in a press release.

Kansas City Southern yesterday unveiled a new website for Kansas City Southern Railway Co. and Kansas City Southern de Mexico, S.A. de C.V. that is designed around customers' needs.

The new mobile-friendly site offers users new tools, resources and navigation to help them access information, company officials said in a press release.

Kansas City Southern (KCS) yesterday marked the dedication of its new intermodal terminal in Wylie, Texas. The $64 million terminal opened July 13 following 12 months of construction.

The terminal will serve intermodal customers' U.S. international and U.S.-Mexico cross-border shipments, KCS officials said in a press release.

Kansas City Southern Railway Co. (KCSR) on July 21 held a ribbon-cutting ceremony to mark the opening of a mechanical facility in Pearl, Miss.

The state-of-the-art facility near Jackson will better accommodate the continued traffic growth expected through High Oak Yard, railroad officials said in an item posted on the "KCS News" web page.

Kansas City Southern reported second-quarter 2015 revenue fell 10 percent to $586 million compared with second-quarter 2014 results, as overall carloads at 537,200 units were 6 percent lower than a year ago, the company announced this morning.

The Class I's net income for the quarter totaled $112 million, or $1.01 per diluted share, compared with $130 million, or $1.18 per diluted share, a year ago. Excluding the impact of foreign exchange rate fluctuations and lease termination costs, adjusted diluted earnings per share for second quarter were $1.03 compared with $1.21 in 2014.

Kansas City Southern yesterday announced that Brian Hancock has been appointed executive vice president and chief marketing officer. He will report to KCS President Patrick Ottensmeyer.

Most recently, Hancock was senior vice president of supply chain for Family Dollar Stores Inc. His experience also includes roles as vice president-global supply chain for Whirlpool Corp., where he led the development of a multimodal, worldwide logistics strategy for the company’s Mexican manufacturing operation; vice president and general manager for Schneider National; and president-North America for The Martin-Brower Co. LLC, a food and materials supplier to McDonald’s restaurants.

Currently chairman and CEO, Haverty will continue to concentrate on the company’s strategic direction and oversee long-term business decisions. Currently president and chief operating officer, Starling will succeed Haverty as CEO and report to him. Starling will focus on execution of the company’s long-range plan, as well as oversight and management of all facets of operations, including subsidiaries and affiliates.

Starling joined KCS in July 2008 as president and COO “with the thought in mind that he could succeed me as CEO,” said Haverty in a prepared statement. “After two years, we are ready. David is a great team leader, and I truly believe we have the best management team, both north and south of the border, that we have had in the 15 years I have been associated with KCS.”

Currently chairman and CEO, Haverty will continue to concentrate on the company’s strategic direction and oversee long-term business decisions. Currently president and chief operating officer, Starling will succeed Haverty as CEO and report to him. Starling will focus on execution of the company’s long-range plan, as well as oversight and management of all facets of operations, including subsidiaries and affiliates.

Starling joined KCS in July 2008 as president and COO “with the thought in mind that he could succeed me as CEO,” said Haverty in a prepared statement. “After two years, we are ready. David is a great team leader, and I truly believe we have the best management team, both north and south of the border, that we have had in the 15 years I have been associated with KCS.”

In addition to his current responsibilities for federal, state and local government and regulatory affairs, corporate communications and community relations, Erdman now will manage administrative functions, including the legal department, claims, real estate, industrial development, facilities and U.S. railroad police security.

Prior to joining KCS in 1997, he was chief of staff for Sen. Christopher Bond (R-Mo.) for 10 years. Erdman also previously served on the staffs of Missouri governors John Ashcroft and Christopher Bond.

In addition to his current responsibilities for federal, state and local government and regulatory affairs, corporate communications and community relations, Erdman now will manage administrative functions, including the legal department, claims, real estate, industrial development, facilities and U.S. railroad police security.

Prior to joining KCS in 1997, he was chief of staff for Sen. Christopher Bond (R-Mo.) for 10 years. Erdman also previously served on the staffs of Missouri governors John Ashcroft and Christopher Bond.

Today, KCS reported revenue of $346 million, down 23 percent compared with first-quarter 2008. The Class I’s traffic volume declined 15 percent primarily because of the weak U.S., Mexican and global economies, reduced fuel surcharge revenues and a weakened Mexican peso. Revenue dropped in four of five business lines, with only coal recording volume and revenue gains.

KCS recorded a net loss of $7.5 million compared with net income of $32.9 million in first-quarter 2008. The railroad reported a negative impact of $5.9 million from debt retirement costs and $5.1 million in a foreign exchange loss associated with the weakened peso.