OMAHA, Neb. (Reuters) - Berkshire Hathaway’s BNSF railroad is “forever better” after a capital program last year boosted capacity following complaints about congestion, BNSF chief executive told Reuters on Saturday.
“The railroad’s in better shape than it was. We think we’ve got opportunities going forward,” said Carl Ice, BNSF’s president and chief executive officer, speaking on the sidelines at Berkshire Hathaway’s annual meeting.
The railroad saw its results improve in the first quarter, according to an earnings report released on Friday.
Profits at the railroad rose 44 percent from a year earlier, when bad weather and congestion led to what Berkshire called “substandard” service that left many customers unhappy.
The railroad’s $6 billion capital improvement program will continue this year.
“We were strong in grains for the first part of the year,” Ice said, although he noted that coal could be slowing a bit.
The recent slump in oil prices constrained growth as well, Ice said. The railroad also had to deal with work stoppages on the West Coast after a contract dispute earlier this year led to months of disruptions at 29 West Coast ports.
Berkshire Hathaway is celebrating its 50th year with iconic billionaire Warren Buffett at the helm, and the annual meeting is expected to attract around 40,000 people from around the world.
Buffett has often highlighted BNSF as a major part of Berkshire Hathaway’s future.
In last year’s letter to shareholders, for example, he said the railroad will still be playing a major role in the U.S. economy a century from now.
“We’ve got another strong capital program this year,” Ice said. “And those investments last forever. The railroad will be forever better with the things we’ve put in the last couple of years.”
Reporting by Luciana Lopez; Editing by Bernard Orr