Consistent with some of the data we have seen recently, Kansas City Southern announced on April 16th a decline in first-quarter earnings. According to their press release: “First quarter revenues were $706.0 million, a decrease of 4% primarily resulting from lower volumes, lower fuel surcharge, and fluctuations in foreign currency.” At the same time, the report: “Although our first-quarter performance was impacted by several unique and challenging events, including the Polar Vortex, and lingering network congestion, our operating team is focused on improving operating metrics and customer service through PSR phase III” stated president and chief executive officer, Patrick J. Ottensmeyer. “Based on an outlook for improvement in volume growth and operational trends, we can confidently confirm our 2021 guidance.” What does this mean to us: The pandemic is going to end. And, we believe that is coming soon!
A few statistics about freight rail courtesy of AAR:
– Number of freight railroads: 632
– Miles of freight railroads: 136,650
– Freight railroad employees: 159,720
– Avg. wages and benefits per freight railroad employee: $126,170
Your freight rail shipments contribute importantly to the US Economy, as demonstrated by these stats.
Railcar SpecialistsAs much as everyone would like to see our economy has recovered from the pandemic, this data shows we are still down over 10% in carload shipments; which in our view is a reasonable measure of economic and industrial activity. Future monthly comparisons may give a false impression of current trends as the “year-ago” months coming up head into the initial shutting down of much of the economic activity.
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