BNSF announced its financial results on Feb. 22 alongside its parent, Berkshire Hathaway.
Operating income rose 5.6%, to $7.3 billion, as revenue declined 1.4%, to $23.5 billion for the year, Berkshire Hathaway said in a regulatory filing. Traffic volume was down 4.5% for the year.
BNSF’s operating ratio improved 2.3 points to 64.6%, its best performance since 2015. Expenses declined 4.7%, which BNSF attributed to lower volume-related costs, lower fuel prices, the effects of cost control initiatives, and gains from cutting back on retirement plans.
Volume was down for the year in all four of BNSF’s business groups, partly due to severe winter weather and flooding on parts of the network.
Revenues from consumer products — which includes intermodal and automotive shipments — decreased 0.5%, which BNSF said reflected higher average revenue per car/unit and volume decreases of 4.6%.
“Consumer Products volumes decreased primarily due to lower intermodal volumes, which were driven by moderated demand and the availability of truck capacity as well as lower west coast imports,” BNSF said in its regulatory filing.
Industrial Products revenue increased 1.7% due to higher average revenue per car, partially offset by a volume decrease of 3%.
“Industrial Products volumes decreased primarily due to overall softness in the industrial sector, lower sand volumes, and reduced car loadings due to … challenging weather conditions. This decrease was partially offset by higher demand for petroleum products and liquefied petroleum gas,” BNSF said.
Agricultural Products revenue decreased 0.3% as volumes slumped 5.1%.
“Agricultural Products volumes decreased primarily due to export competition from non-U.S. sources, the impacts of international trade policies, and the aforementioned challenging weather conditions,” BNSF said.
Coal revenue sank 7.4% on a volume decline of 5.3% and lower average revenue per car.
“Coal volumes decreased primarily due to the aforementioned challenging weather conditions as well as the effects of lower natural gas prices,” BNSF said.
For the fourth quarter, BNSF’s net income rose 3.7%, to $1.4 billion, despite a 5.9% decline in revenue, which fell to $5.8 billion.
