Midwest flooding disrupted traffic for some of the company's partners, but total carloadings rose 7 percent from a year ago, the fourth-largest publicly held U.S. railroad said.
The company raised its full-year revenue growth forecast, saying it will be higher than the 14 percent growth rate of the first half. It had projected low double-digit growth.
"Despite the traffic disruptions, Kansas City Southern established new records in the second quarter for carloads and freight, line haul and total revenues, while also attaining the highest average revenue per unit in the company's history," Chief Executive David Starling said in a statement.
Revenue increased across all commodity groups, the company said. Increases in revenue were strongest in the automotive, coal and intermodal segments: up 42 percent, 28 percent and 25 percent, respectively.
The two largest publicly held U.S. railroad companies, Union Pacific Corp and CSX Corp, also reported strong quarterly profits, citing rising volume and pricing.
Kansas City Southern said a closely watched pricing gauge for "same store sales" -- shipments to the same customers from the prior period -- rose 5.4 percent in the quarter from a year ago and looks for mid-single-digit price increases through the year on growing volume.
"We expect the economy in both U.S. and Mexico to remain on a moderate growth mode in the second half," said Pat Ottensmeyer, executive vice president of sales and marketing. "There are certainly signals in the economy that are suggesting some signs of weakness but our customers expect growth in shipments the rest of the year."
The company also relies heavily on cross-border traffic with Mexico, and notes the economy there is growing at about twice the rate as in the United States.
Among its international holdings is Kansas City Southern de Mexico, a primary Mexican rail line connecting Mexico and the United States.
Kansas City Southern reported Thursday net second-quarter income of $71 million, or 64 cents per share, up from $35 million, or 34 cents a share a year ago.
Adjusting for debt retirement costs, Kansas City Southern reported profit of 71 cents a share, up from 55 cents per share a year ago.
Revenue for the Kansas City, Missouri-based company rose 16 percent to $535 million from $461.6 million a year ago.
Analysts, on average, estimated adjusted profit of 70 cents per share on $525 million of revenue, according to Thomson Reuters I/B/E/S. (Reuters)
