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SANTA FE PACIFIC ANNOUNCES 67 PERCENT INCREASE IN SECOND QUARTER EARNINGS

 SANTA FE PACIFIC ANNOUNCES 67 PERCENT INCREASE IN SECOND
 QUARTER EARNINGS
 SCHAUMBURG, Ill., July 22 /PRNewswire/ -- Santa Fe Pacific Corp. (NYSE: SFX) (SFP) reported net income of $28.7 million or 16 cents per share for the quarter ending June 30, 1992, reflecting substantial improvement over net income of $17.2 million or 10 cents per share in the second quarter of last year.
 "Improved operating results at each of our businesses and lower interest expense are responsible for the overall improvement," said Robert D. Krebs, chairman, president and chief executive officer. "Santa Fe Railway continues to benefit from steady growth and the success of ongoing cost efficiency measures, despite the effect of a two-day work stoppage in June. Santa Fe Pacific Minerals' improved results were primarily due to rapid growth in gold operations," said Krebs.
 Operating income at Santa Fe Railway of $68.1 million was up $3.6 million or 6 percent from the second quarter of 1991. Revenues increased 5 percent to $550.0 million due to a 4 percent rise in carloadings and a 1 percent increase in revenue per car. The overall revenue increase was principally due to a 12 percent growth in intermodal shipments, resulting from continued strength of the direct marketing and international business segments. Carload business unit shipments were even.
 Santa Fe Railway's quarterly operating expenses of $481.9 million increased by $22.3 million or 5 percent, reflecting both volume and inflationary increases. Compensation and benefits expense increased $10.8 million to $195.6 million due to higher wages and benefits, as well as the increased level of overall business activity. Fuel expense was equal to the prior year's level, reflecting both stable prices and consumption-related efficiencies. Fuel usage was flat despite increased traffic volumes.
 Equipment rents increased $5.4 million to $44.1 million, primarily the result of lease payments on 50 new locomotives acquired in the first half of 1992 and the higher intermodal volumes. Materials and supplies expense decreased $3.0 million or 9 percent to $30.7 million due to lower equipment maintenance activity. Other operating expenses increased by $10.2 million to $118.4 million, due to volume related increases in ramping operations and other costs.
 Santa Fe Pacific Mineral's quarterly operating income of $14.3 million was up 51 percent as gold sales increased from 33,000 ounces to 73,000 ounces. Sales at the Lone Tree Mine, which began production in August 1991, were responsible for the majority of this growth. The average price of gold sold was $385 per ounce, which is 10 percent below the 1991 second quarter average but well above current market prices due to effective hedging strategies. Coal sales, however, were 21 percent below the same period for 1991.
 SFP's equity investment in Santa Fe Pacific Pipeline Partners, L.P., produced operating income of $8.5 million, compared to $7.7 million in the second quarter of 1991. This improvement is the result of increased volumes, haul distance and rates.
 Interest expense of $45.8 million reflects a decrease of $11.0 million which is primarily the result of more favorable interest rates and lower outstanding debt. Other income-net declined to $1.1 million from $1.9 million in second quarter 1991 principally because of lower interest income.
 1992 YEAR TO DATE RESULTS
 For the six months ended June 30, 1992, net income was $59.1 million or 32 cents per share compared to net income of $34.5 million or 20 cents per share last year. This increase was principally the result of higher operating income related to traffic growth and cost efficiency measures at Santa Fe Railway and increased gold sales at Santa Fe Pacific Minerals. Lower interest expense also favorably impacted net income. Other income-net declined, primarily a result of lower land sales at Santa Fe Railway.
 OTHER EVENTS
 Santa Fe Railway and the United Transportation Union (UTU) recently reached a tentative agreement covering the eastern 40 percent of the railroad to reduce crew sizes and eliminate productivity fund payments and liberalize certain work rules, while establishing other benefits for covered employees. The agreement, which is subject to ratification, would permit operation of all through freight trains with an engineer and conductor only. The cost of the agreement, if ratified, will result in significant additional restructuring expenses. The results of the ratification process are expected to be known by Sept. 1, 1992.
 Additionally, Santa Fe Railway is planning to consolidate certain key operational planning and control functions over the next two years. The impact of this consolidation effort on restructuring expenses is not currently known.
 SANTA FE PACIFIC CORPORATION
 Consolidated Statement Of Operations
 (Unaudited, in millions, except per share data)
 Three Months Ended Six Months Ended
 June 30, June 30,
 1992 1991 1992 1991
 Revenues
 Rail $550.0 $524.1 $1,095.1 $1,034.9
 Minerals 47.1 37.6 113.0 86.7
 Pipeline 8.5 7.7 14.4 12.5
 Total revenues 605.6 569.4 1,222.5 1,134.1
 Operating income
 Rail 68.1 64.5 128.6 110.0
 Minerals 14.3 9.5 47.3 32.8
 Pipeline 8.5 7.7 14.4 12.5
 Total operating income 90.9 81.7 190.3 155.3
 Other income (expense)-net 1.1 1.9 (1.5) 14.9
 Interest expense 45.8 56.8 93.7 116.8
 Income before income taxes 46.2 26.8 95.1 53.4
 Income taxes 17.5 9.6 36.0 18.9
 Net income $ 28.7 $ 17.2 $ 59.1 $ 34.5
 Net income per share
 of common stock $0.16 $0.10 $0.32 $0.20
 Average number of
 common and common
 equivalent shares 184.7 177.1 184.7 176.0
 SANTA FE PACIFIC CORPORATION
 Condensed Balance Sheet
 (Unaudited, in millions)
 June 30, 1992 Dec. 31, 1991
 Assets
 Cash and cash equivalents $ 103.5 $ 163.6
 Other current assets 315.3 290.8
 Total current assets 418.8 454.4
 Properties and other assets 4,800.9 4,766.2
 Total assets $5,219.7 $5,220.6
 Liabilities and Stockholders' Equity
 Current liabilities $ 903.6 $ 852.7
 Long-term debt due after one year 1,493.7 1,630.4
 Other liabilities 1,719.3 1,700.6
 Stockholders' equity 1,103.1 1,036.9
 Total liabilities and
 stockholders' equity $5,219.7 $5,220.6
 CONDENSED STATEMENT OF CASH FLOWS
 Three months ended Six months ended
 June 30 June 30
 1992 1991 1992 1991
 Cash provided by operations $ 77.4 $ 78.3 $ 137.7 $ 101.7
 Cash used for capital
 expenditures (89.1) (111.5) (127.5) (156.6)
 Proceeds from sale of property,
 plant and equipment 26.1 18.9 31.0 32.8
 Net proceeds from (repayment
 of) borrowings (58.4) 19.0 (126.4) 7.4
 Cash provided by (used for)
 other activities (13.3) (18.8) 25.1 24.2
 Increase (decrease) in cash
 and cash equivalents $ (57.3) $ (14.1) $ (60.1) $ 9.5
 SANTA FE PACIFIC CORP
 Supplemental data (unaudited)
 Three months ended Six months ended
 June 30 June 30
 1992 1991 1992 1991
 RAIL
 Operating expenses (in millions)
 Compensation and benefits $ 195.6 $ 184.8 $ 398.4 $ 375.2
 Fuel 48.1 48.1 97.2 104.9
 Depreciation and amortization 45.0 46.1 90.0 92.2
 Equipment rents 44.1 38.7 84.9 78.7
 Materials and supplies 30.7 33.7 65.7 66.1
 Other 118.4 108.2 230.3 207.8
 TOTAL OPERATING EXPENSES $ 481.9 $ 459.6 $ 966.5 $ 924.9
 Operating ratio 87.6 pct 87.7 pct 88.3 pct 89.4 pct
 Revenue ton-miles (billions) 20.9 19.4 41.7 38.9
 Revenue per revenue ton
 mile (cents) 2.58 2.62 2.57 2.59
 Carloadings (thousands) 397.2 382.2 800.2 763.1
 Average revenue per car $1,35 $1,334 $1,340 $1,324
 Employees (period-end 14,612 15,212 14,612 15,212
 Minerals
 Gold ounces sold (thousands) 73 33 137 52
 Average price (per ounce) $385.01 $425.44 $391.56 $423.68
 Coal tons sold (thousands) 713 904 1,654 1,895
 Average price (per ton) $ 22.40 $ 22.38 $ 22.42 $ 22.23
 Employees (period-end) 928 749 928 749
 -0- 7/22/92 R
 /CONTACT: Catherine Westphal of Santa Fe Pacific, 708-995-6273/
 (SFX) CO: Santa Fe Pacific Corp. ST: Illinois IN: TRN SU: ERN


KD-LR -- NY025 -- 1805 07/22/92 10:58 EDT
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Date:Jul 22, 1992
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