Kansas City Southern (NYSE:KSU) surged more than 5% to a 52-week high Tuesday after reporting strong third-quarter revenues despite major headwinds from a hurricane in July, helping to double the transportation holding company's better-than-expected profit.
The Kansas City, Mo-based company posted net income of $50.2 million, or 48 cents a share, compared with $25.4 million, or 27 cents a share, in the same quarter last year.
Results were ahead of average analyst estimates polled by Thomson Reuters of 45 cents a share.
Revenue for the freight train operator was $438.3 million, up 13.5% from $386.1 million, beating the Street’s view of $445.92 million.
The strong revenue growth occurred despite an estimated $33 million loss from Hurricane Alex, during which widespread flooding damaged Kansas City Southern de Mexico’s track and bridge infrastructure, hindering volume by approximately 27,000 carloads.
Despite the impeded freight segment, automotive revenues were up 63% due to rebounding auto production from lows last year, while coal revenue gained 29% on improved pricing.
“Considering the impact of Hurricane Alex on our Mexican and cross-border traffic in July, KCS’s third quarter financial results are impressive,” said David L. Starling, the company’s chief executive. “Given the extent of the damage, we recovered quickly from the nearly three and a half week service outage.”
Last quarter Kansas continued slashing debt, repurchasing the remaining $63.7 million of notes due 2012, brining total debt reduction so far this year to $332 million.