Kansas City Southern Earnings Rise

Merger with Canadian Pacific Inches Forward
Kansas City Southern
Whitney Curtis/Bloomberg News

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As it undertakes a $30 billion merger, Kansas City Southern released its fourth-quarter and full-year 2021 financial report on Jan. 28.

Kansas City Southern (KCS), though small is strategically important to Canadian Pacific Railway, which it is set to merge with.

KCS said quarterly net income climbed to $595.1 million compared with $527 million. It generated revenue of $747.8 million compared with $693.4 million a year ago.

KCS-Q4-2021 by Transport Topics

The railroad did not release a price per share in the earnings report as CP is the sole shareholder.

KCS said in the fourth quarter it reported a $512.6 million loss relating to the planned merger with CP when in the same period a year ago it showed a gain of $264 million.

MERGERCanadian Pacific Says Weather, KCS Merger Affected Q4 Results

For the full year, net income declined to $527 million compared with $619.1 million a year ago. Revenue increased to $2.94 billion from $2.63 billion a year ago.

KCS said revenue in its chemical and petroleum sector declined in the fourth quarter to $183.9 million from $214.8 million a year ago.

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Revenue from industrial and consumer products increased to $152 million from $131.7 million.

Agriculture and minerals reported an increase to $167.6 million from $131.2 million.

Energy revenue jumped to $68.2 million from $52.6 million.

Intermodal revenue also increased to $87 million from $77.8 million.

Revenue from automotive shipments declined to $49.6 million from $54.7 million.

The proposed merger between KCS and CP is currently before regulators. However, it has already cleared one major legal hurdle when the U.S. Surface Transportation Board approved CP’s proposed voting trust to manage the railroad as the merger moves through the regulatory process.

The merger is expected to come before the five-member Surface Transportation Board this year for a vote.

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