Burlington Northern Santa Fe (BNI) reported strong third quarter results Thursday, despite economic woes. 

The railroad says it earned $695 million, or $2.00 a share, far exceeding analysts’ estimates of $584 million.  The company reported profits of $530 million in the same quarter last year.

"The U.S. and global economies are facing very significant challenges,” said BNSF chairman, president and CEO Matthew K. Rose. “Despite the economic uncertainty, BNSF continues to perform well.”

Burlington Northern’s freight revenues jumped by 21% to $4.77 billion, as compared with $3.95 billion in the same period last year.  The company saw revenue gains in nearly every unit, most notably in transportation of agricultural products.  

Average revenue per car was up 23%.  However, fuel prices paid on average soared 61%, cutting into the railroad’s bottom line. The company says it helped mitigate some effects of high gas prices by charging increased fuel surcharges. 

The company’s outlook remains positive. 

"While we are all concerned about the current financial and economic situation, we continue to be optimistic about the future of our diverse franchise and we remain confident about our long-term prospects," Rose said.

The company also announced Thursday that it would issue a quarterly dividend of 40 cents per share that will be paid on January 2, 2009. 

Shares of Burlington Northern are up about 1% in after hours trading.

Union Pacific (UNP) reported a 38% jump in profit in the third quarter, beating analysts’ expectations.

The railroad company weighed in with profits $703 million, or $1.38 a share -- up from the $532 million it earned in the same quarter last year.  Analysts polled by Thomson Reuters had expected the company to earn $1.30 in the third quarter.

“Union Pacific achieved record quarterly financial results despite a challenging economic environment and record-high diesel fuel prices,” Jim Young, Union Pacific chairman and CEO said in a release.

The company saw its average freight revenues jump by 16%, led by big gains in agriculture and energy shipping. Average revenue per car also soared 22%, with broad gains in all categories. 

Union Pacific says it is optimistic about the fourth quarter, despite the effects of financial turmoil and the economic slowdown. 

“We’re planning on a pretty weak economy next year,” Young said in an interview with the FOX Business Network. “On the other side, the diversity of our business has really helped us.”

Indeed, the company says it is unfazed by tightening credit markets. 

"Our liquidity is in very good shape … we don’t see any real challenges in terms of Union Pacific accessing the capital markets,” Young added.