(Reuters) – U.S. railroad operator Kansas City Southern <KSU.N> withdrew its full-year earnings forecast on Friday on coronavirus concerns, but topped Wall Street estimates for quarterly profit as higher Mexico shipments boosted sales its chemicals and petroleum business.
Shares of the company rose 3% before the bell as adjusted operating ratio, a key metric for Wall Street, fell to 59.7% from 66.2% a year ago. A lower operating ratio signals improved profitability.
Ratings agency Moody’s has warned that freight railroads, parcel delivery companies and truck carriers will face lower demand for freight services, as the pandemic disrupts supply chains and slows down economic activity.
Revenue from the chemicals and petroleum business rose 18% to $198.6 million, boosted by higher refined fuel products and liquid petroleum gas shipments to Mexico.
Intermodal revenues also rose 11%, driven by strong cross-border shipments.
On an adjusted basis, Kansas City Southern earned $1.96 per share, beating analysts’ average estimate of $1.78 per share, according to IBES data from Refinitiv.
The company’s net income available to common stockholders rose to $151.7 million, or $1.58 per share, in the first quarter ended March 31, from $102.7 million, or $1.02 per share, a year earlier.
Revenue rose 8.4% $731.7 million.
(Reporting by Sanjana Shivdas in Bengaluru; Editing by Maju Samuel)