SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 22, 1996
BURLINGTON NORTHERN SANTA FE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-11535 41-1804964
(State of other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2650 Lou Menk Drive
Fort Worth, Texas 76131
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (817) 333-2000
3800 Continental Plaza
777 Main Street
Fort Worth, Texas 76102-5384
(Former name or former address, if changed since last report)
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events
Burlington Northern Santa Fe Corporation announced its third quarter 1996
earnings in an October 22, 1996, press release, which press release is
attached as Exhibit 99 and is hereby incorporated by reference.
Item 7. Financial Statements and Exhibits
See Index to Exhibits on Page E-1 for a description of the exhibits filed
as a part of this report.
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Burlington Northern Santa Fe Corporation
(Registrant)
By: /s/ Thomas N. Hund
Thomas N. Hund
Vice President and Controller
(On behalf of the Registrant and as
Principal Accounting Officer)
Schaumburg, Illinois
October 22, 1996
<PAGE>
BURLINGTON NORTHERN SANTA FE CORPORATION
INDEX OF EXHIBITS
Exhibit
Number Description of Exhibit
99 Burlington Northern Santa Fe Corporation Press Release dated
October 22, 1996.
E-1
EXHIBIT 99
Contact: Richard A. Russack FOR IMMEDIATE RELEASE
(817) 352-6425
Burlington Northern Santa Fe Reports
Improved Third Quarter Results
. Net income of $247 million or $1.58 per common share, up 4 percent
from $237 million or $1.53 per common share for the same 1995
period on a comparable basis.
. Third-quarter operating income was $476 million, $7 million higher
than a year ago on a comparable basis.
. Operating ratio for the 1996 third quarter was 76.8 percent
compared with 77.6 percent for 1995 on a comparable basis.
. Net income of $645 million or $4.14 per common share for the nine
months ended September 30, 1996, up 22 percent from net income
of $530 million or $3.45 per common share for the same 1995
period on a comparable basis.
FORT WORTH, TEXAS, October 22, 1996 - - Burlington Northern Santa Fe
Corporation (BNSF) (NYSE: BNI) today reported third quarter 1996 net income of
$247 million, or $1.58 per common share, compared with pro forma third quarter
1995 net income of $237 million or $1.53 per common share.
Pro forma amounts are presented on a comparable basis to 1996 and include
1995 amounts for both Burlington Northern Inc. (BNI) and Santa Fe Pacific
Corporation (SFP) which became subsidiaries of BNSF in a business combination
effected September 22, 1995.
Revenues of $2.05 billion for the third quarter 1996 declined 2 percent
from combined third quarter 1995. Agricultural commodities revenues declined
$100 million or 30 percent due to a significant decline in corn exports,
compared with record corn and wheat exports a year ago. Among other major
sectors, coal revenues increased 5 percent to $520 million, chemicals revenues
increased 8 percent to $190 million and intermodal revenues increased 2
percent to $529 million.
more . . .
<PAGE>
BNSF 3Q EARNINGS / Page Two
"Our 1996 third quarter performance beat last year's record quarterly
results, even with a $100 million shortfall in agricultural commodities
revenues," said Robert D. Krebs, president and chief executive officer of
BNSF. "This demonstrates the value of our commodity balance and tight expense
controls."
Third quarter 1996 operating expenses were $1.57 billion, $54 million
below pro forma 1995. Compensation and benefits expense declined $23 million
to $633 million, due to a lower number of salaried employees as a result of
the merger. Purchased services declined $22 million to $202 million due to
lower professional service fees and intermodal drayage expenses. Material and
other expenses of $191 million declined $24 million due to synergies from the
merger and lower personal injury expenses resulting from a continued decrease
in employee injuries. The expense reductions were partially offset by
increases in fuel, equipment rents and depreciation and amortization expenses.
Operating income was $476 million for third quarter 1996 compared with
$469 million for the same period in 1995, and the operating ratio was 76.8
percent for the third quarter 1996 compared with 77.6 percent a year earlier.
Interest expense declined $10 million to $76 million reflecting lower debt and
interest rate levels.
NINE-MONTH 1996 RESULTS
BNSF net income for the nine months ended September 30, 1996 was $645
million, or $4.14 per common share, compared with pro forma 1995 net income of
$530 million, or $3.45 per common share. Revenues for the first nine months
of 1996 were $6.12 billion, up slightly from the $6.09 billion reported for
the same period in 1995.
Operating expenses of $4.84 billion for 1996 declined 3 percent from
comparable 1995 expenses. Compensation and benefits and purchased services
decreased by a combined $131 million as a result of employee reductions and
other merger synergies. Material and other operating expenses decreased $49
million due to merger synergies and lower personal injury expenses. These
decreases were partially offset by increases in fuel, equipment rents and
depreciation and amortization expense. Fuel expense was $34 million above
1995 reflecting an 8 percent increase in price.
more . . .
<PAGE>
BNSF 3Q EARNINGS / Page Three
Operating income increased 14 percent to $1.279 billion for the nine
months ended September 30, 1996, compared with pro forma 1995 operating income
of $1.121 billion. The operating ratio was lowered to 79.1 percent for the
first nine months of 1996 from 81.6 percent for the same 1995 period on a
comparable basis.
Through its subsidiaries, Burlington Northern Santa Fe owns one of the
largest railroad networks in the United States, with more than 31,000 route
miles covering 27 states and two Canadian provinces. The network stretches
from the Midwest, Southeast and Southwest to California and the Pacific
Northwest, and from the Gulf of Mexico to Canada.
Consolidated financial statements follow.
<PAGE>
<TABLE>
<CAPTION>
Burlington Northern Santa Fe Corporation
Consolidated Statement of Income
(Unaudited. In millions, except per share data)
<BTB>
Three Months Ended
September 30,
-------------------------------
Pro Forma As Reported
1996 1995 1995
------ ------ -------
<S> <C> <C> <C>
Revenues $2,050 $2,097 $1,462
------ ------ ------
Operating Expenses
Compensation and benefits 633 656 459
Purchased services 202 224 128
Depreciation and amortization 191 188 116
Equipment rents 184 179 120
Fuel 173 166 109
Materials and other 191 215 170
Merger, severance and asset charge - - 106
------ ------ ------
Total Operating Expenses 1,574 1,628 1,208
------ ------ ------
Operating Income 476 469 254
Interest Expense 76 86 52
Other Income (Expense) - Net 4 (1) 16
------ ------ ------
Income Before Income Taxes 404 382 218
Income Tax Expense 157 145 85
------ ------ ------
Net Income $247 $ 237 $ 133
====== ====== ======
Net Income Per Common Share $ 1.58 $ 1.53 $ 1.28
====== ====== ======
Average Shares Outstanding (in millions) 156.3 154.2 104.3
====== ====== ======
<FN>
Statement Explanation
- ---------------------
1996 period represents results of BNSF. 1995 pro forma amounts represent the
historical results from operations of BNI and SFP, adjusted to exclude
special items, and include the effects of purchase accounting. 1995 as
reported amounts represent BNI historical results and SFP results for the nine
day period September 22, 1995 through September 30, 1995. Certain 1995 amounts
have been reclassified to conform with the current year presentation.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Burlington Northern Santa Fe Corporation
Consolidated Statement of Income
(Unaudited. In millions, except per share data)
<BTB>
Nine Months
Ended September 30,
------------------------------
Pro Forma As Reported
1996 1995 1995
------ ------ ------
<S> <C> <C> <C>
Revenues $6,117 $6,085 $4,098
------ ------ ------
Operating Expenses
Compensation and benefits 1,942 2,028 1,387
Purchased services 627 672 373
Depreciation and amortization 565 557 329
Equipment rents 545 533 352
Fuel 524 490 307
Materials and other 635 684 501
Merger, severance and asset charge - - 148
------ ------ ------
Total Operating Expenses 4,838 4,964 3,397
------ ------ ------
Operating Income 1,279 1,121 701
Interest Expense 224 265 145
Other Income (Expense) - Net (1) 4 31
------ ------ ------
Income Before Income Taxes 1,054 860 587
Income Tax Expense 409 330 229
------ ------ ------
Income Before Cumulative Effect
of Change in Accounting Method 645 530 358
Cumulative Effect of Change in
Accounting Method - - (100)
------ ------ ------
Net Income $ 645 $ 530 $ 258
====== ====== ======
Net Income Per Common Share
Income Before Cumulative Effect
of Change in Accounting Method $ 4.14 $ 3.45 $ 3.56
Cumulative Effect of Change in
Accounting Method - - (0.99)
------ ------ ------
Net Income Per Common Share $ 4.14 $ 3.45 $ 2.57
====== ====== ======
Average Shares Outstanding (in millions) 155.8 152.9 100.5
====== ====== ======
<FN>
Statement Explanation
- ---------------------------
1996 period represents results of BNSF. 1995 pro forma amounts represent the
historical results from operations of BNI and SFP, adjusted to exclude
special items, and include the effects of purchase accounting. 1995 as
reported amounts represent BNI historical results and SFP results for the nine
day period September 22, 1995 through September 30, 1995. Certain 1995 amounts
have been reclassified to conform with the current year presentation.
</TABLE>
<PAGE>
Burlington Northern Santa Fe Corporation
(Unaudited. In millions)
<TABLE><CAPTION>
Condensed Consolidated Balance Sheet
September 30, December 31,
1996 1995
------------ ------------
<BTB>
Assets
<S> <C> <C>
Cash and cash equivalents $ 34 $ 50
Other current assets 1,356 1,214
------ ------
Total current assets 1,390 1,264
Properties and other assets 17,867 17,005
------ ------
Total Assets $19,257 $18,269
====== ======
Liabilities and Stockholders' Equity
Current liabilities $ 2,354 $ 2,369
Long-term debt and commercial paper 4,243 4,153
Deferred taxes 4,496 4,233
Other liabilities 2,464 2,477
Stockholders' equity 5,700 5,037
------ ------
Total Liabilities and
Stockholders' Equity $19,257 $18,269
====== ======
<FN>
Statement Explanation
- ---------------------------
Amounts represent combined BNI and SFP amounts for all periods.
</TABLE>
<TABLE><CAPTION>
Condensed Consolidated Statement of Cash Flows
Three Months Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
1996 1995 1996 1995
---- ---- ---- ----
<BTB>
<S> <C> <C> <C> <C>
Cash Provided by Operating Activities $ 520 $ 541 $1,233 $ 871
Cash Used for Capital Expenditures (531) (190) (1,353) (592)
Net Proceeds (Repayments) of Borrowings 80 (298) 143 333
Dividends Paid (46) (32) (138) (97)
Proceeds from stock options 6 4 101 12
Investment in SFP - 12 - (488)
Cash Used for Other Activities (19) (6) (2) (4)
----- ----- ----- -----
Increase (Decrease) in Cash
and Cash Equivalents $ 10 $ 31 $ (16) $ 35
===== ===== ===== =====
<FN>
Statement Explanation
- ---------------------------
1996 period represents results of BNSF. 1995 amounts represent BNI historical
results and SFP results for the nine day period September 22, 1995 through
September 30, 1995.
</TABLE>
<PAGE>
<TABLE><CAPTION>
Burlington Northern Santa Fe Corporation
Supplemental Data
(Unaudited)
<BTB>
Three Months Nine Months
Ended September 30, Ended September 30,
1996 1995 1996 1995
----- ----- ----- -----
Revenues (In millions)
<S> <C> <C> <C> <C>
Intermodal $ 529 $ 518 $1,517 $1,469
Coal 520 497 1,487 1,478
Agricultural Commodities 236 336 823 899
Chemicals 190 176 573 530
Forest Products 143 139 406 409
Consumer and Food Products 114 118 345 356
Automotive 89 91 295 295
Metals 106 98 311 291
Minerals and Ores 84 84 236 233
----- ----- ----- -----
Total Freight Revenue 2,011 2,057 5,993 5,960
Other Revenue 39 40 124 125
----- ----- ----- -----
Total Revenues $2,050 $2,097 $6,117 $6,085
===== ===== ===== =====
Operating ratio 76.8 % 77.6 % 79.1 % 81.6 %
Revenue ton miles (billions) 101.3 103.8 304.3 305.3
Freight revenue per thousand
revenue ton mile $19.86 $19.82 $19.69 $19.52
Cars/Units (thousands) 1,783 1,822 5,218 5,307
Average revenue per car/unit $1,128 $1,129 $1,149 $1,123
Employees (average) 44,335 46,110 43,942 45,840
<FN>
Statement Explanation:
- ----------------------------
Amounts represent combined BNI and SFP amounts for all periods.
</TABLE>
