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August 09, 2011

BNSF second quarter profits up 14.4%

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BNSF Railway continued to generate healthy returns for parent company Berkshire Hathaway in the second quarter, with net profits rising to $US 690 million, an increase of 14.4% compared with the same period in 2010.

Traffic grew just 3% year-on-year, although revenue-per-wagon increased by 10.6%. Sales growth outpaced net income, with overall revenue rising 17% to $US 4.8bn. Operating expenses jumped 19% to $US 3.6bn, largely due to the cost of repairing infrastructure damage caused by flooding along the Missouri and Souris rivers.

bnsf2q.jpgStrong results in its rail and manufacturing businesses, plus favourable investment earnings, helped Berkshire Hathaway to achieve a second-quarter 2011 net profit of $US 3.42bn compared with earnings of $US 1.97bn in the second quarter of 2010. The company, which is owned by the world's second richest man Mr Warren Buffett, became the sole shareholder in BNSF in November 2009 when it acquired 77.4% of the company for $US 26.6bn.

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