News Release

Burlington Northern Santa Fe Reports Second Quarter 2002 Results

FORT WORTH, Texas, July 23, 2002 -- :

• Second-quarter 2002 earnings of $0.51 per diluted share compared with second-quarter 2001 earnings of $0.50 per diluted share.
• Freight revenues were $2.18 billion, down 3 percent.
• Second-quarter operating income of $405 million is $23 million lower than second-quarter 2001.
• Other income was $15 million higher than the same period in 2001 reflecting increased land sales.

Burlington Northern Santa Fe Corporation (BNSF) (NYSE: BNI) today reported second-quarter 2002 earnings of $0.51 per diluted share, compared with second-quarter 2001 earnings of $0.50 per diluted share.

“BNSF increased earnings per share by 2 percent despite revenues being impacted by continued softness in most of our product sectors,” said Matthew K. Rose, BNSF Chairman, President and Chief Executive Officer. “BNSF maintained its focus on cost control initiatives, while expanding product offerings and recording its third consecutive quarterly record on-time performance for our customers.”

Freight revenues for the 2002 second quarter were $2.18 billion, down 3 percent compared with the same 2001 period. Consumer Products revenues increased $3 million, or less than one percent, to $848 million reflecting increased intermodal volumes in the international and truckload businesses; this was partially offset by decreased automotive shipments and lower levels of traffic in other intermodal sectors. Industrial Products revenues fell $1 million to $535 million, as a 12 percent increase in Chemicals was more than offset by general softness in the construction products sector. Coal revenues decreased $44 million, or 8 percent, to $488 million, reflecting reduced demand. Agricultural Products revenues declined $16 million, or 5 percent, to $312 million, primarily due to weak wheat and corn exports.

Operating expenses of $1.8 billion were $41 million or 2 percent lower than the same period in 2001. Second-quarter operating expenses primarily reflect lower fuel expense due to an 11-cent reduction in fuel price including hedge compared with 2001, and reduced equipment rents.

Operating income was $405 million for the 2002 second quarter compared with $428 million a year ago. The operating ratio increased to 81.4 percent for the 2002 second quarter compared with 80.9 percent in the same 2001 period.

Interest expense of $105 million was $10 million, or 9 percent, lower than the same period in 2001, primarily as a result of lower short-term interest rates. Other income was $15 million higher than the same period in 2001 reflecting increased land sales.

Common Stock Repurchases

During the 2002 second quarter, BNSF repurchased 4.2 million shares of its common stock at an average price of $28.58 per share. This brings total repurchases under BNSF’s 120 million share-repurchase program to 110.1 million shares as of June 30, 2002, at an average price of $25.92 per share since the program was announced in July 1997.

Through The Burlington Northern and Santa Fe Railway Company, BNSF operates one of the largest railroad networks in the United States, with 33,000 route miles covering 28 states and two Canadian provinces.

Statements made in this release concerning predictions or expectations of financial or operational performance, or concerning other future events or results, are "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements involve a number of risks and uncertainties and actual results may differ materially from that projected or implied in those statements. Important factors that could cause such differences include, but are not limited to, economic and industry conditions: material adverse changes in economic or industry conditions, both within the United States and globally, customer demand, effects of adverse economic conditions affecting shippers, adverse economic conditions in the industries and geographic areas that produce and consume freight, competition and consolidation within the transportation industry, changes in fuel prices, changes in the securities and capital markets, and changes in labor costs and labor difficulties, including stoppages affecting either BNSF’s operations or our customers’ abilities to deliver goods to BNSF for shipment; legal and regulatory factors: developments and changes in laws and regulations and the ultimate outcome of shipper claims, environmental investigations or proceedings and other types of claims and litigation; and operating factors: technical difficulties, changes in operating conditions and costs, and competition and commodity concentrations, the Company’s ability to achieve its operational and financial initiatives and to contain costs, as well as natural events such as severe weather, floods and earthquakes or other disruptions of the Company’s operating systems, structures, or equipment.

The Company cautions against placing undue reliance on forward-looking statements, which reflect its current beliefs and are based on information currently available to it as of the date a forward-looking statement is made. The Company undertakes no obligation to revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs. In the event the Company does update any forward-looking statement, no inference should be made that the Company will make additional updates with respect to that statement, related matters, or any other forward-looking statement.

Consolidated financial statements

BNSF Headquarters
BNSF Railway Company
2650 Lou Menk Dr. 2nd Floor
P.O. Box 961057
Fort Worth, TX 76161-0057
Phone: (817) 352-1000