Grupo Mexico's Transportation Division Reports 18.5% Revenue Decline, 21% Profit Drop

Grupo Mexico's transportation division, which includes Ferromex, Ferrosur, Florida East Coast Railway, and Texas Pacifico, reported a significant decline in revenue and profits for the first quarter. The primary cause was a sharp decrease in the transportation of automobiles and minerals, leading to an overall reduction in cargo volume.

The company's recent data revealed that the operating revenue of Grupo Mexico's transportation division (GMXT) decreased by 18.5% to 2.25 billion dollars, while revenue dropped by 12.1% to 7.78 billion dollars. Net profit fell by 21% to 1.12 billion dollars, with an operating ratio of 76.4%.

In terms of cargo volume, measured by the number of railcars, there was a 6.1% decrease. When measured by ton-kilometers, the decrease was 14.2%. The primary contributors to this decline were a 21% drop in automobile transportation and a 20% decrease in mineral transportation.

However, there were some positive developments. The increase in cross-border transportation and a resurgence in demand for Florida East Coast Railway services led to a 4.9% growth in intermodal transportation. Additionally, key operational metrics for Grupo Mexico's transportation division improved during the first quarter. Train speeds increased, dwell times at terminals were reduced, and both train lengths and load weights increased.

Despite the overall decline in revenue and profits, the improvements in operational efficiency and the growth in intermodal transportation suggest that Grupo Mexico's transportation division is taking steps to mitigate the impact of reduced cargo volumes. The company's focus on enhancing operational metrics and adapting to changing market conditions may help stabilize its financial performance in the coming quarters.