BNSF posted higher net income, lower operating ratio in Q1

BNSF Railway Co. posted first-quarter 2021 net income of $1.25 billion, up 5%, and operating income of $1.9 billion, up 4%, compared with the same period a year ago.

The Class I posted an operating ratio of 63.7% in the quarter compared to 65.2% in Q1 2020, according to a financial report on bnsf.com.

Total revenue for the quarter decreased 0.3% compared with the same period in 2020. The decrease was primarily due to a 5% increase in unit volume offset by a 5% decrease in average revenue per unit.

The change in Q1 2021 revenue also resulted from the following:
• Average revenue per unit decreased as a result of business mix changes and lower fuel surcharge revenue due to lower fuel prices.
• Consumer products volumes increased 15%. Growth in both international and domestic intermodal shipments was driven by increased retail sales and inventory replenishments by retailers, along with increased e-commerce activity. Automotive volumes declined due to production impacts from a global microchip shortage.
• Agricultural products volumes increased 12% due to higher grain exports.
• Industrial products volumes decreased 13%. These changes were primarily due to reduced production and demand in the energy sector, which drove lower petroleum products and sand volume. In addition, shipments of chemicals, plastics and aggregates were lower due to winter storm related impacts to Texas and the U.S. Gulf Coast regions.
• Coal volumes decreased 12%. These changes were primarily due to lower utility demand in the early part of the quarter, along with severe winter weather which impacted deliveries.

Operating expenses for the quarter fell 2%, which reflected increased volume-related costs and inflation, offset by productivity improvements and lower average fuel prices.