Two private equity firms are considering a takeover bid for Kansas City Southern, according to a report based on information from anonymous sources in the Wall Street Journal posted late afternoon on July 31, just before the closing bell on Wall Street.
Kansas City Southern (KCS) reported 2Q20 revenues of $547.9 million, a decrease of 23% from 2Q19, primarily as a result of an overall decline in demand due to COVID-19. Overall, carload volumes were down 21% compared to the prior year.
“We view concerns around Kansas City Southern’s concession in Mexico as overblown. The exclusivity provision cannot be revisited until 2027 and the concession remains in effect for 20 years after that. Further, KSU is improving its operations via PSR, which should aid Mexico as reliable rail service is likely to be a necessity for the country as it grows its manufacturing base. Reiterate Outperform.”
“Shippers expect rail price increases of 2.3%, up 40bps sequentially, above rail cost inflation, but well below the survey’s average. Economic expectations are all higher sequentially; some remain below the survey’s average while some are very positive indicators. With PSR cost-cutting, growth opportunities and the ability to capitalize on supply chain near-shoring, Kansas City Southern remains our top rail pick.”
Kansas City Southern de Mexico, S.A. de C.V. (KCSM) President, General Manager and Executive Representative Dr. Jose Guillermo Zozaya Delano will retire as of Aug. 1, 2020. Delano will be succeeded by Vice President and Director General Oscar Augusto Del Cueto Cuevas.
Kansas City Southern (KCS) has released a 2019 sustainability data update to its sustainability report, “For the Long Haul: Delivering Prosperity, Valuing People, Protecting the Planet,” which shows the Class I railroad improved its U.S. and Mexico consolidated reportable train accident frequency ratio and consolidated reportable injury frequency ratio, and reduced its use of diesel fuel.
Kansas City Southern (KCS) has appointed Manny Loureiro as Vice President and Chief Engineer with responsibility for the engineering departments in the U.S. and Mexico. He reports to KCS Executive Vice President and Chief Operating Officer Jeffrey M. Songer, and replaces Vernon “Buck” Jones, who plans to retire this summer after a 42-year career with the company.
Kansas City Southern (KCS) reported record revenues of $731.7 million, an increase of 8% from first quarter 2019. Overall, carload volumes were up 4% compared to prior year.
The Kansas City Southern (KCS) board of directors recently promoted Adam J. Godderz from General Counsel and Corporate Secretary to Senior Vice President – Chief Legal Officer and Corporate Secretary.
The Panel of the Mexican Federal Competition Commission (COFECE) published an excerpt of its final report regarding its assessment of effective competition, and found that 20 of 31 Kansas City Southern (KCS) routes under analysis lacked effective competition. KCS disagrees.