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Of the four Class Is that have reported second-quarter financial results so far, BNSF Railway Co. is the only one that registered higher earnings. Yesterday, BNSF reported non-adjusted earnings of $1.18 per share, up 18 percent compared with second-quarter 2008 earnings. Analysts had expected earnings per share of $1.00, according to Reuters Estimates.

But similar to the other Class Is, BNSF’s revenue plunged in the quarter. Freight revenue of $3.2 billion fell 26 percent year over year as traffic volume decreased 19 percent and fuel surcharges declined by about $600 million.

Industrial products revenue plummeted 34 percent to $686 million as traffic volume plunged by the same margin; consumer products revenue dropped 34 percent to $1 billion as volume also fell 34 percent; agricultural products revenue plummeted 25 percent to $618 million as volume tumbled 25 percent; and coal revenue decreased 3 percent to $875 million as volume remained flat.

BNSF also reported that non-adjusted operating income rose 12 percent to $797 million and the operating ratio dropped 4.4 points to 75.2 compared with second-quarter 2008 figures. The Class I increased rates an average of 3 percent in the quarter.

In addition, the railroad’s second-quarter operating expenses fell 33 percent to $2.5 billion primarily because of cost controls, decreased traffic volumes and lower fuel prices. Quarterly fuel costs plunged 61 percent to $509 million while every other expense category declined between 12 percent and 38 percent.

“The second quarter is further evidence that we can manage effectively with whatever the economy throws at us,” said BNSF Chairman, President and Chief Executive Officer Matt Rose during the Class I’s earnings Webcast and teleconference held yesterday.

— Jeff Stagl