Document and Entity Information
Document and Entity Information Document - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Jan. 18, 2019 | Jun. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | KANSAS CITY SOUTHERN | ||
Entity Central Index Key | 54,480 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 100,941,555 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 10,770 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues | $ 2,714 | $ 2,582.9 | $ 2,334.2 |
Operating expenses: | |||
Compensation and benefits | 495.7 | 493.8 | 462.4 |
Purchased services | 200.7 | 193.7 | 208.5 |
Fuel | 348.2 | 316.1 | 253.8 |
Mexican fuel excise tax credit | (37.7) | (44.1) | (62.8) |
Equipment costs | 126.1 | 129.2 | 120 |
Depreciation and amortization | 346.7 | 320.9 | 305 |
Materials and other | 265.9 | 251.7 | 228.8 |
Gain on insurance recoveries related to hurricane damage | (17.9) | 0 | 0 |
Total operating expenses | 1,727.7 | 1,661.3 | 1,515.7 |
Operating income | 986.3 | 921.6 | 818.5 |
Equity in net earnings of affiliates | 2.6 | 11.5 | 14.6 |
Interest expense | (110) | (100.2) | (97.7) |
Debt retirement costs | (2.2) | 0 | 0 |
Foreign exchange gain (loss) | 7.8 | 41.7 | (72) |
Other income (expense), net | 2.4 | (0.3) | (0.7) |
Income before income taxes | 886.9 | 874.3 | 662.7 |
Income tax expense (benefit) | 257.5 | (89.6) | 182.8 |
Net income | 629.4 | 963.9 | 479.9 |
Less: Net income attributable to noncontrolling interest | 2 | 1.9 | 1.8 |
Net income attributable to Kansas City Southern and subsidiaries | 627.4 | 962 | 478.1 |
Preferred stock dividends | 0.2 | 0.2 | 0.2 |
Net income available to common stockholders | $ 627.2 | $ 961.8 | $ 477.9 |
Earnings per share: | |||
Basic earnings per share | $ 6.16 | $ 9.18 | $ 4.44 |
Diluted earnings per share | $ 6.13 | $ 9.16 | $ 4.43 |
Average shares outstanding (in thousands): | |||
Basic | 101,852 | 104,728 | 107,560 |
Potentially dilutive common shares | 418 | 312 | 201 |
Diluted | 102,270 | 105,040 | 107,761 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net income | $ 629.4 | $ 963.9 | $ 479.9 |
Other comprehensive income (loss): | |||
Unrealized gain (loss) on interest rate derivative instruments during the period, net of tax of $1.0 million and $(2.2) million | 2.6 | (3.4) | 0 |
Foreign currency translation adjustments, net of tax of $3.8 million and $(1.0) million for 2017 and 2016 | 0.1 | (3.3) | (1.5) |
Other comprehensive income (loss) | 2.7 | (6.7) | (1.5) |
Comprehensive income | 632.1 | 957.2 | 478.4 |
Less: comprehensive income attributable to noncontrolling interest | 2 | 1.9 | 1.8 |
Comprehensive income attributable to Kansas City Southern and subsidiaries | $ 630.1 | $ 955.3 | $ 476.6 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parentheticals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Tax effect on unrealized gain (loss) on interest rate derivative instruments during the period | $ 1 | $ (2.2) | |
Tax effect on foreign currency translation adjustments | $ 3.8 | $ (1) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 100.5 | $ 134.1 |
Accounts receivable, net | 301.2 | 237.8 |
Materials and supplies | 160.3 | 150.8 |
Other current assets | 73.4 | 157.4 |
Total current assets | 635.4 | 680.1 |
Investments | 44.9 | 44.6 |
Property and equipment (including concession assets), net | 8,691.1 | 8,403.8 |
Other assets | 98.4 | 70.2 |
Total assets | 9,469.8 | 9,198.7 |
Current liabilities: | ||
Long-term debt due within one year | 10.1 | 38.8 |
Short-term borrowings | 0 | 345.1 |
Accounts payable and accrued liabilities | 436.9 | 587.8 |
Total current liabilities | 447 | 971.7 |
Long-term debt | 2,679.3 | 2,235.5 |
Deferred income taxes | 1,079.9 | 987.2 |
Other noncurrent liabilities and deferred credits | 130.9 | 138.9 |
Total liabilities | 4,337.1 | 4,333.3 |
Stockholders’ equity: | ||
$.01 par, common stock, 400,000,000 shares authorized, 123,352,185 shares issued; 100,896,678 and 103,036,805 shares outstanding at December 31, 2018 and 2017, respectively | 1 | 1 |
Additional paid-in capital | 946.6 | 943.3 |
Retained earnings | 3,870.6 | 3,611.4 |
Accumulated other comprehensive loss | (10.9) | (12.9) |
Total stockholders’ equity | 4,813 | 4,548.9 |
Noncontrolling interest | 319.7 | 316.5 |
Total equity | 5,132.7 | 4,865.4 |
Total liabilities and equity | 9,469.8 | 9,198.7 |
$25 Par Preferred Stock [Member] | ||
Stockholders’ equity: | ||
$25 par, 4% noncumulative, preferred stock, 840,000 shares authorized, 649,736 shares issued; 228,395 and 242,170 shares outstanding at December 31, 2018 and 2017, respectively | $ 5.7 | $ 6.1 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Stockholders’ equity: | |||
Common Stock, Par Value | $ 0.01 | $ 0.01 | |
Common Stock, Shares Authorized | 400,000,000 | 400,000,000 | |
Common Stock, Shares Issued | 123,352,185 | 123,352,185 | |
Common Stock, Shares Outstanding | 100,896,678 | 103,036,805 | |
$25 Par Preferred Stock [Member] | |||
Stockholders’ equity: | |||
Preferred Stock, Par Value | $ 25 | $ 25 | $ 25 |
Preferred Stock, Dividend Rate | 4.00% | 4.00% | |
Preferred Stock, Shares Authorized | 840,000 | 840,000 | |
Preferred Stock, Shares Issued | 649,736 | 649,736 | |
Preferred Stock, Shares Outstanding | 228,395 | 242,170 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Operating activities: | |||
Net income | $ 629.4 | $ 963.9 | $ 479.9 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 346.7 | 320.9 | 305 |
Deferred income taxes | 91.7 | (301.3) | 104.8 |
Equity in net earnings of affiliates | (2.6) | (11.5) | (14.6) |
Share-based compensation | 20.4 | 18.2 | 19.2 |
Distributions from affiliates | 5.5 | 12.5 | 13 |
Settlement of foreign currency derivative instruments | 13.9 | (10.8) | (58.4) |
(Gain) loss on foreign currency derivative instruments | (6.3) | (38.2) | 53.5 |
Mexican fuel excise tax credit | (37.7) | (44.1) | (62.8) |
Gain on insurance recoveries related to hurricane damage | (17.9) | 0 | 0 |
Insurance proceeds related to hurricane damage | 17.9 | 0 | 0 |
Deemed mandatory repatriation tax | (18.7) | 41.3 | 0 |
Changes in working capital items: | |||
Accounts receivable | (68.4) | (46.7) | (18.3) |
Materials and supplies | (4.5) | 1.4 | (14.2) |
Other current assets | (3.4) | (24.5) | 9.9 |
Accounts payable and accrued liabilities | (18.2) | 160.4 | 101.8 |
Other, net | (2.1) | (13.1) | 0.2 |
Net cash provided by operating activities | 945.7 | 1,028.4 | 919 |
Investing activities: | |||
Capital expenditures | (520.3) | (585.4) | (563.6) |
Purchase or replacement of equipment under operating leases | (98.9) | (42.6) | (26.6) |
Property investments in MSLLC | (26.1) | (26) | (33.1) |
Investments in and advances to affiliates | (19.2) | (20.4) | (0.9) |
Insurance proceeds related to hurricane damage | 7.6 | 0 | 0 |
Proceeds from disposal of property | 8.7 | 8.8 | 5 |
Other, net | (3.7) | (15.5) | (9) |
Net cash provided (used) | (651.9) | (681.1) | (628.2) |
Financing activities: | |||
Net short-term borrowings | (348.1) | 159 | 100.8 |
Proceeds from issuance of long-term debt | 499.4 | 0 | 248.7 |
Repayment of long-term debt | (81.5) | (25.4) | (276.4) |
Dividends paid | (147.5) | (142.5) | (142.8) |
Shares repurchased | (243.5) | (375.6) | (185.4) |
Debt issuance and retirement costs paid | (8) | 0 | (2.6) |
Proceeds from employee stock plans | 1.8 | 0.7 | 0.9 |
Net cash used for financing activities | (327.4) | (383.8) | (256.8) |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | (33.6) | (36.5) | 34 |
At beginning of year | 134.1 | 170.6 | 136.6 |
At end of year | 100.5 | 134.1 | 170.6 |
Non-cash investing and financing activities: | |||
Capital expenditures and purchase or replacement of equipment under operating lease accrued but not yet paid at end of year | 26.9 | 34.9 | 60.8 |
Other investing activities accrued but not yet paid at the end of the year | 60.6 | 56.7 | 38.3 |
Capital lease obligations incurred | 0 | 0.1 | 2.4 |
Non-cash asset acquisitions | 0.7 | 0.1 | 4.8 |
Dividends accrued but not yet paid at end of year | 36.6 | 37.2 | 35.2 |
Cash payments: | |||
Interest paid, net of amounts capitalized | 105 | 97.9 | 84.3 |
Income tax payments, net of refunds | $ 221 | $ 51.1 | $ 40.5 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Millions | Total | $25 Par Preferred Stock [Member] | $25 Par Preferred Stock [Member] | $.01 Par Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Retained Earnings [Member]$25 Par Preferred Stock [Member] | Accumulated Other Comprehensive Loss [Member] | Non-controlling Interest [Member] |
Balance at Dec. 31, 2015 | $ 4,224.7 | $ 6.1 | $ 1.1 | $ 947.1 | $ 2,964.7 | $ (4.7) | $ 310.4 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 479.9 | 478.1 | 1.8 | ||||||
Other comprehensive income (loss) | (1.5) | (1.5) | |||||||
Contributions from noncontrolling interest | 2.4 | 2.4 | |||||||
Dividends on common stock | (141.9) | (141.9) | |||||||
Dividends on preferred stock | $ (0.2) | $ (0.2) | |||||||
Share repurchases | (185.4) | (18.8) | (166.6) | ||||||
Options exercised and stock subscribed, net of shares withheld for employee taxes | 1.6 | 1.6 | |||||||
Excess tax benefit from share-based compensation | 5.7 | 5.7 | |||||||
Share-based compensation | 19.2 | 19.2 | |||||||
Balance at Dec. 31, 2016 | 4,404.5 | 6.1 | 1.1 | 954.8 | 3,134.1 | (6.2) | 314.6 | ||
Cumulative-effect adjustment due to adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting at Dec. 31, 2016 | 2.5 | 1.3 | 1.2 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 963.9 | 962 | 1.9 | ||||||
Other comprehensive income (loss) | (6.7) | (6.7) | |||||||
Dividends on common stock | (144.2) | (144.2) | |||||||
Dividends on preferred stock | (0.2) | (0.2) | |||||||
Share repurchases | (375.6) | (0.1) | (34) | (341.5) | |||||
Options exercised and stock subscribed, net of shares withheld for employee taxes | 3 | 3 | |||||||
Share-based compensation | 18.2 | 18.2 | |||||||
Balance at Dec. 31, 2017 | 4,865.4 | 6.1 | 1 | 943.3 | 3,611.4 | (12.9) | 316.5 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Reclassification due to adoption of ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | 0 | 0.7 | (0.7) | ||||||
Net income | 629.4 | 627.4 | 2 | ||||||
Other comprehensive income (loss) | 2.7 | 2.7 | |||||||
Contributions from noncontrolling interest | 1.2 | 1.2 | |||||||
Dividends on common stock | (146.7) | (146.7) | |||||||
Dividends on preferred stock | (0.2) | $ (0.2) | |||||||
Share repurchases | (243.5) | $ (0.4) | (0.4) | 0 | (21.1) | (222) | |||
Options exercised and stock subscribed, net of shares withheld for employee taxes | 4 | 4 | |||||||
Share-based compensation | 20.4 | 20.4 | |||||||
Balance at Dec. 31, 2018 | $ 5,132.7 | $ 5.7 | $ 1 | $ 946.6 | $ 3,870.6 | $ (10.9) | $ 319.7 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Common Stock, Dividends Per Share | $ 1.44 | $ 1.38 | $ 1.32 |
$25 Par Preferred Stock [Member] | |||
Preferred Stock, Par Value | 25 | 25 | 25 |
Preferred Stock, Dividends Per Share | $ 1 | $ 1 | $ 1 |
Description of the Business
Description of the Business | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the Business | Description of the Business Kansas City Southern (“KCS” or the “Company”), a Delaware corporation, is a holding company with principal operations in rail transportation. The Company is engaged in the freight rail transportation business operating through a single coordinated rail network under one reportable business segment. The Company generates revenues and cash flows by providing its customers with freight delivery services both within its regions, and throughout North America through connections with other Class I rail carriers. KCS’s customers conduct business in a number of different industries, including electric-generating utilities, chemical and petroleum products, paper and forest products, agriculture and mineral products, automotive products and intermodal transportation. The primary subsidiaries of the Company consist of the following: • The Kansas City Southern Railway Company (“KCSR”), a wholly-owned consolidated subsidiary. KCSR is a U.S. Class I railroad that services the midwest and southeast regions of the United States; • Kansas City Southern de México, S.A. de C.V. (“KCSM”), a wholly-owned consolidated subsidiary which operates under the rights granted by the Concession acquired from the Mexican government in 1997 (the “Concession”) as described below; • Mexrail, Inc. (“Mexrail”), a wholly-owned consolidated subsidiary; which wholly owns The Texas Mexican Railway Company (“Tex-Mex”); • KCSM Servicios, S.A. de C.V. (“KCSM Servicios”), a wholly-owned consolidated subsidiary which provides employee services to KCSM; and • Meridian Speedway, LLC (“MSLLC”), a seventy percent -owned consolidated affiliate. MSLLC owns the former KCSR rail line between Meridian, Mississippi and Shreveport, Louisiana, which is the portion of the rail line between Dallas, Texas and Meridian known as the “Meridian Speedway”. Including equity investments in: • Panama Canal Railway Company (“PCRC”), a fifty percent -owned unconsolidated affiliate which provides ocean to ocean freight and passenger services along the Panama Canal; • TFCM, S. de R.L. de C.V. (“TCM”), a forty-five percent-owned unconsolidated affiliate that operates a bulk liquid terminal in San Luis Potosí, Mexico; • Ferrocarril y Terminal del Valle de México, S.A. de C.V. (“FTVM”), a twenty-five percent -owned unconsolidated affiliate that provides railroad services as well as ancillary services in the greater Mexico City area; and • PTC-220, LLC (“PTC-220”), a fourteen percent -owned unconsolidated affiliate that holds the licenses to large blocks of radio spectrum and other assets for the deployment of positive train control. The KCSM Concession. KCSM holds a concession from the Mexican government until June 2047 (exclusive service through 2027, subject to certain trackage and haulage rights granted to other concessionaires), which is renewable under certain conditions for additional periods of up to 50 years (the “Concession”). The Concession is to provide freight transportation services over north-east rail lines which are a primary commercial corridor of the Mexican railroad system. KCSM has the right to use, but does not own, all track and buildings that are necessary for the rail lines’ operation. KCSM is required to pay the Mexican government an annual concession duty equal to 1.25% of gross revenues during the Concession period. Employees and Labor Relations. KCSR participates in industry-wide multi-employer bargaining as a member of the National Carriers’ Conference Committee, as well as local bargaining for agreements that are limited to KCSR's property. Approximately 75% of KCSR employees are covered by collective bargaining agreements. KCSM Servicios union employees are covered by one labor agreement, which was signed on April 16, 2012, between KCSM Servicios and the Sindicato de Trabajadores Ferrocarrileros de la República Mexicana (“Mexican Railroad Union”), and which remains in effect during the period of the Concession, for the purpose of regulating the relationship between the parties. Approximately 80% of KCSM Servicios employees are covered by this labor agreement. Union labor negotiations have not historically resulted in any strike, boycott, or other disruption in the Company’s business operations. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Principles of Consolidation. The accompanying consolidated financial statements are presented using the accrual basis of accounting and include the Company and its majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Certain prior year amounts have been reclassified to conform to the current year presentation. The equity method of accounting is used for all entities in which the Company or its subsidiaries have significant influence, but not a controlling interest. The Company evaluates less-than-majority-owned investments for consolidation pursuant to consolidation and variable interest entity guidance. The Company does not have any less-than-majority-owned investments requiring consolidation. During the first quarter of 2018, the Company adopted Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers, which is also known as Accounting Standard Codification ("ASC") Topic 606, for all contracts, using the modified retrospective method. Results from reporting periods beginning after January 1, 2018, are presented under ASC Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Company's historical accounting under ASC Topic 605, Revenue Recognition . The adoption of this guidance did not have a significant impact on the Company's consolidated financial statements; thus no adjustment was made to the opening balance of equity at January 1, 2018. See Note 3, Revenue for additional information. During the first quarter of 2018, the Company adopted ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which allows for a reclassification from accumulated other comprehensive loss to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The Company applied the guidance as of the beginning of the period of adoption and reclassified $0.7 million , due to the change in federal corporate tax rate, from accumulated other comprehensive loss to retained earnings. It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach. Use of Estimates. The accounting and financial reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include those related to the recoverability and useful lives of assets, litigation provisions, and income taxes. Changes in facts and circumstances may result in revised estimates and actual results could differ from those estimates. Revenue Recognition. The primary performance obligation for the Company is to move customers’ freight from an origin to a destination. A performance obligation is created when a customer under a transportation contract or public tariff submits a bill of lading for the transport of goods. The Company recognizes revenue proportionally as a shipment moves from origin to destination, using the distance shipped to measure progress, as the customer simultaneously receives and consumes the benefit over time. Related expenses are recognized as incurred. Revenue associated with in-transit shipments at period end is recognized based on the distance shipped as of the balance sheet date. Payment is received at or shortly after the performance obligation is satisfied. The transaction price is generally in the form of a fixed fee determined at the inception of the transportation contract or the inception of the bill of lading. Certain customer agreements have variable consideration that are based on milestone achievements in the form of rebates, discounts or incentives. The Company makes judgments to determine whether the variable consideration is probable of occurring and should be included in the estimated transaction price at the beginning of the period to apply a more consistent rate throughout the year based on an analysis of historical experience with the customer, forecasted shipments and other economic indicators. The Company adjusts the estimate on a quarterly basis. Other revenues, including switching, storage, and demurrage are distinct services and are recognized as services are performed or as contractual obligations are fulfilled. The consideration for other revenue is allocated between the separate services based upon the stand-alone transaction price. Foreign Exchange Gain (Loss). For financial reporting purposes, foreign subsidiaries maintain records in U.S. dollars, which is the functional currency. The dollar is the currency that reflects the economic substance of the underlying events and circumstances relevant to the entity. Monetary assets and liabilities denominated in pesos are remeasured into dollars using current exchange rates. The difference between the exchange rate on the date of the transaction and the exchange rate on the settlement date, or balance sheet date if not settled, is included in the income statement as foreign exchange gain or loss. Cash Equivalents. Short-term liquid investments with an initial maturity of three months or less are classified as cash and cash equivalents. Accounts Receivable, net. Accounts receivable are net of an allowance for uncollectible accounts as determined by historical experience and adjusted for economic uncertainties or known trends. Accounts are charged to the allowance when a customer enters bankruptcy, when an account has been transferred to a collection agent or submitted for legal action, or when a customer is significantly past due and all available means of collection have been exhausted. At December 31, 2018 and 2017 , the allowance for doubtful accounts was $4.1 million and $4.6 million , respectively. For the years ended December 31, 2018 , 2017 and 2016 , bad debt expense was $0.3 million , $1.6 million and $1.2 million , respectively. Materials and Supplies. Materials and supplies consisting of diesel fuel, items to be used in the maintenance of rolling stock and items to be used in the maintenance or construction of road property are valued at the lower of average cost or net realizable value. Derivative Instruments. Derivatives are measured at fair value and recorded on the balance sheet as either assets or liabilities. Changes in the fair value of derivatives are recorded either through current earnings or as other comprehensive income, depending on hedge designation. Gains and losses on derivative instruments classified as cash flow hedges are reported in other comprehensive income and are reclassified into earnings in the periods in which earnings are impacted by the variability of the cash flow of the hedged item. Property and Equipment (including Concession Assets). KCS capitalizes costs for self-constructed additions and improvements to property including direct labor and material, indirect overhead costs, and interest during long-term construction projects. For purchased assets, all costs necessary to make the asset ready for its intended use are capitalized. Expenditures that significantly increase asset values, productive capacity, efficiency, safety or extend useful lives are capitalized. Repair and maintenance costs are expensed as incurred. Property and equipment are carried at cost and are depreciated primarily on the group method of depreciation, which the Company believes closely approximates a straight line basis over the estimated useful lives of the assets measured in years. The group method of depreciation applies a composite rate to classes of similar assets rather than to individual assets. Composite depreciation rates are based upon the Company’s estimates of the expected average useful lives of assets as well as expected net salvage value at the end of their useful lives. In developing these estimates, the Company utilizes periodic depreciation studies performed by an independent engineering firm. Depreciation rate studies are performed at least every three years for equipment and at least every six years for road property (rail, ties, ballast, etc.). The Company performed depreciation studies for KCSR in 2018 and KCSM in 2016. The impacts of the studies were immaterial to the consolidated financial results for all periods. Under the group method of depreciation, the cost of railroad property and equipment (net of salvage or sales proceeds) retired or replaced in the normal course of business is charged to accumulated depreciation with no gain or loss recognized. Gains or losses on dispositions of land or non-group property and abnormal retirements of railroad property are recognized through income. A retirement of railroad property would be considered abnormal if the cause of the retirement is unusual in nature and its actual life is significantly shorter than what would be expected for that group based on the depreciation studies. An abnormal retirement could cause the Company to re-evaluate the estimated useful life of the impacted asset class. Costs incurred by the Company to acquire the concession rights and related assets, as well as subsequent improvements to the concession assets, are capitalized and amortized using the group method of depreciation over the lesser of the current expected Concession term, including probable renewal of an additional 50-year term, or the estimated useful lives of the assets and rights. Long-lived assets are reviewed for impairment when events or circumstances indicate that the carrying amount of an asset may not be recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the long-lived assets, the carrying value would be reduced to the estimated fair value. Future cash flow estimates for an impairment review would be based on the lowest level of identifiable cash flows, which are the Company’s U.S. and Mexican operations. During the years ended December 31, 2018 and 2017 , management did not identify any indicators of impairment. Goodwill. Goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in business combinations. As of December 31, 2018 and 2017 , the goodwill balance was $13.2 million , which is included in other assets in the consolidated balance sheets. Goodwill is not amortized, but is reviewed at least annually, or more frequently as indicators warrant, for impairment. An impairment loss would be recognized to the extent that the carrying amount exceeds the assets’ fair values. The Company performed its annual impairment review for goodwill as of November 30, 2018 and 2017 , and concluded there was no impairment. Investments and Impairment. The Company reviews equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable in accordance with generally accepted accounting principles. This determination requires significant judgment. In making this judgment, the Company considers available quantitative and qualitative evidence in evaluating potential impairment of these investments. If it is determined that an indicator of impairment exists, the Company assesses whether the carrying value exceeds the fair value of the asset. If the carrying value of the investment exceeds its fair value, the Company will evaluate, among other factors, general market conditions, the duration and extent to which the carrying value is greater than the fair value, and KCS’s intent and ability to hold, or plans to sell, the investment. The Company also considers specific adverse conditions related to the financial health of and business outlook for the investee, including industry and sector performance, changes in technology, and operational and financing cash flow factors. Once a decline in fair value is determined to be other-than-temporary, an impairment charge will be recorded and a new carrying basis in the investment will be established. No impairment charges were recognized during the years ended December 31, 2018 , 2017 and 2016. Fair Value of Financial Instruments. Non-financial assets and liabilities are recognized at fair value on a nonrecurring basis. These assets and liabilities are measured at fair value on an ongoing basis but are subject to recognition in the financial statements only in certain circumstances. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company determines the fair values of its financial instruments based on the fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The hierarchy is broken down into three levels based upon the observability of inputs. Fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value in its entirety requires judgment and considers factors specific to the asset or liability. Environmental Liabilities. The Company recognizes liabilities for remediation and restoration costs related to past activities when the Company’s obligation is probable and the costs can be reasonably estimated. Costs of future expenditures for environmental remediation are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. Costs of ongoing compliance activities related to current operations are expensed as incurred. Personal Injury Claims. Personal injury claims in excess of self-insurance levels are insured up to certain coverage amounts, depending on the type of claim and year of occurrence. The Company’s personal injury liability is based on actuarial studies performed on an undiscounted basis by an independent third party actuarial firm and reviewed by management. The liability is based on claims filed and an estimate of claims incurred but not yet reported. Adjustments to the liability are reflected as operating expenses in the period in which the adjustments are known. Legal fees related to personal injury claims are recognized in operating expense in the period incurred. Health and Welfare and Postemployment Benefits. The Company provides certain medical, life and other postemployment benefits to certain active employees and retirees. The Company uses actuaries to assist management in measuring the benefit obligation and cost based on the current plan provisions, employee demographics, and assumptions about financial and demographic factors affecting the probability, timing and amount of expected future benefit payments. Significant assumptions include the discount rate, rate of increase in compensation levels, and the health care cost trend rate. Actuarial gains and losses determined at the measurement date (December 31) are recognized immediately in the consolidated statements of income. Share-Based Compensation. The Company accounts for all share-based compensation in accordance with fair value recognition provisions. Under this method, compensation expense is measured at grant date fair value and is recognized over the requisite service period in which the award is earned. Forfeitures are recognized as they occur. The Company issues treasury stock to settle share-based awards. Income Taxes. Deferred income tax effects of transactions reported in different periods for financial reporting and income tax return purposes are recognized under the asset and liability method of accounting for income taxes. This method gives consideration to the future tax consequences of the deferred income tax items and immediately recognizes changes in income tax laws in the year of enactment. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (the “Tax Reform Act”). Further information on the tax impacts of the Tax Reform Act is included in Note 12, Income Taxes. The Company has recognized a deferred tax asset, net of a valuation allowance, for net operating loss and tax credit carryovers. The Company projects sufficient future taxable income to realize the deferred tax asset recorded less the valuation allowance. These projections take into consideration assumptions about future income, future capital expenditures and inflation rates. If assumptions or actual conditions change, the deferred tax asset, net of the valuation allowance, will be adjusted to properly reflect the expected tax benefit. Treasury Stock. The excess of repurchase price over par value of shares held in treasury is allocated between additional paid-in capital and retained earnings. New Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases , which requires lessees to recognize for all leases a right-to-use asset and a lease obligation in the consolidated balance sheet. Expenses are recognized in the consolidated statement of income in a manner similar to current accounting guidance. Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less. Lessor accounting under the new standard is substantially unchanged. Additional qualitative and quantitative disclosures, including significant judgments made by management, will be required. The new standard will become effective for the Company beginning with the first quarter 2019. The Company will adopt the accounting standard using a prospective transition approach, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. The Company is finalizing its evaluation of the impacts that the adoption of this accounting guidance will have on the consolidated financial statements, and estimates approximately $175.0 million of right-to-use assets and lease liabilities will be recognized in the consolidated balance sheet upon adoption. |
Mexican Fuel Excise Tax Credit
Mexican Fuel Excise Tax Credit | 12 Months Ended |
Dec. 31, 2018 | |
Mexican Fuel Excise Tax Credit [Abstract] | |
Mexican Fuel Excise Tax Credit | Mexican Fuel Excise Tax Credit Fuel purchases made in Mexico are subject to an excise tax that is included in the price of fuel. The Company is eligible for and utilizes an available credit for the excise tax included in the price of fuel that is purchased and consumed in locomotives and certain work equipment in Mexico. For the years ended December 31, 2018 , 2017 and 2016, the Company recognized a $37.7 million , $44.1 million and $62.8 million benefit, respectively. The Mexican fuel excise tax credit is realized through the offset of the total annual Mexico income tax liability and income tax withholding payment obligations of KCSM, with no carryforward to future periods. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue The following table presents revenues disaggregated by the major commodity groups as well as the product types included within the major commodity groups (in millions) . The Company believes disaggregation by product type best depicts how cash flows are affected by economic factors. See Note 18 , Geographic Information for revenues by geographical area. Years ended December 31, 2018 (ASC 606) 2017 (ASC 605) 2016 (ASC 605) Chemical & Petroleum Chemicals $ 236.3 $ 225.1 $ 204.7 Petroleum 241.9 186.0 142.5 Plastics 143.9 128.8 128.2 Total 622.1 539.9 475.4 Industrial & Consumer Products Forest Products 268.0 255.8 250.2 Metals & Scrap 208.2 223.3 211.2 Other 114.8 109.2 92.6 Total 591.0 588.3 554.0 Agriculture & Minerals Grain 289.9 278.1 262.9 Food Products 145.7 151.1 149.8 Ores & Minerals 20.9 19.9 19.6 Stone, Clay & Glass 29.9 28.3 28.7 Total 486.4 477.4 461.0 Energy Utility Coal 117.3 166.3 125.8 Coal & Petroleum Coke 44.3 40.8 37.9 Frac Sand 37.4 51.8 24.8 Crude Oil 57.3 24.9 14.2 Total 256.3 283.8 202.7 Intermodal 382.8 363.8 357.6 Automotive 253.2 230.8 189.9 Total Freight Revenues 2,591.8 2,484.0 2,240.6 Other Revenue 122.2 98.9 93.6 Total Revenues $ 2,714.0 $ 2,582.9 $ 2,334.2 Major customers No individual customer makes up greater than 10% of total consolidated revenues. Contract Balances The amount of revenue recognized in 2018 from performance obligations partially satisfied in the previous year was $20.0 million . The performance obligations that were unsatisfied or partially satisfied as of December 31, 2018 , were $21.9 million , which represents in-transit shipments that are fully satisfied the following month. A receivable is any unconditional right to consideration, and is recognized as shipments have been completed and the relating performance obligation has been fully satisfied. At December 31, 2018 and 2017 , the accounts receivable, net balance was $301.2 million and $237.8 million , respectively. Contract assets represent a conditional right to consideration in exchange for goods or services. The Company did not have any contract assets at December 31, 2018 and 2017 . Contract liabilities represent consideration received in advance from customers, and are recognized as revenue over time as the relating performance obligation is satisfied. The amount of revenue recognized in 2018 that was included in the opening contract liability balance was $26.8 million . The Company has recognized contract liabilities within the accounts payable and accrued liabilities financial statement caption on the balance sheet. These are considered current liabilities as they will be settled in less than 12 months. The following tables summarize the changes in contract liabilities (in millions) : Contract liabilities Years ended December 31, 2018 (ASC 606) 2017 (ASC 605) Beginning balance $ 26.8 $ 13.7 Revenue recognized that was included in the contract liability balance at the beginning of the period (26.8 ) (13.7 ) Increases due to consideration received, excluding amounts recognized as revenue during the period 32.4 26.8 Ending balance $ 32.4 $ 26.8 |
Hurricane Harvey
Hurricane Harvey | 12 Months Ended |
Dec. 31, 2018 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Hurricane Harvey | Hurricane Harvey In late August 2017, Hurricane Harvey made landfall on the Texas coast and caused flood damage to the Company’s track infrastructure and significantly disrupted the Company’s rail service. The Company filed a claim in the fourth quarter of 2017 under its insurance program for property damage, incremental expenses, and lost profits caused by Hurricane Harvey. In the third quarter of 2017, the Company recognized a receivable for probable insurance recovery offsetting the impact of incremental expenses recognized in the quarter. During 2018, the Company partially settled its insurance claim for $35.5 million . As a result of the nonrefundable partial settlement, the Company recognized gain on insurance recoveries of $17.9 million , net of the self-insured retention and insurance receivable. The Company received the nonrefundable cash proceeds from the partial settlement in the fourth quarter of 2018. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per common share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share adjusts basic earnings per common share for the effects of potentially dilutive common shares, if the effect is not anti-dilutive. Potentially dilutive common shares include the dilutive effects of shares issuable under the 2008 and 2017 Equity Incentive Plans and shares issuable upon the conversion of preferred stock to common stock. The following table reconciles the basic earnings per share computation to the diluted earnings per share computation (in millions, except share and per share amounts) : 2018 2017 2016 Net income available to common stockholders for purposes of computing basic and diluted earnings per share $ 627.2 $ 961.8 $ 477.9 Weighted-average number of shares outstanding (in thousands) : Basic shares 101,852 104,728 107,560 Effect of dilution 418 312 201 Diluted shares 102,270 105,040 107,761 Earnings per share: Basic earnings per share $ 6.16 $ 9.18 $ 4.44 Diluted earnings per share $ 6.13 $ 9.16 $ 4.43 Potentially dilutive shares excluded from the calculation ( in thousands ): 2018 2017 2016 Stock options excluded as their inclusion would be anti-dilutive 117 150 185 |
Property and Equipment (includi
Property and Equipment (including Concession Assets) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment (including Concession Assets) | Property and Equipment (including Concession Assets) The following tables list the major categories of property and equipment, including concession assets, as well as the weighted-average composite depreciation rate for each category ( in millions ): As of December 31, 2018 Cost Accumulated Depreciation Net Book Value Depreciation Rates for 2018 Land $ 219.3 $ — $ 219.3 N/A Concession land rights 141.2 (27.9 ) 113.3 1.0 % Rail and other track material 2,032.2 (264.2 ) 1,768.0 2.4-2.9% Ties 1,682.9 (450.6 ) 1,232.3 2.0-4.8% Grading 978.2 (169.4 ) 808.8 0.9 % Bridges and tunnels 803.9 (153.8 ) 650.1 1.1 % Ballast 797.9 (221.9 ) 576.0 2.5-4.2% Other (a) 1,367.2 (401.4 ) 965.8 3.2 % Total road property 7,662.3 (1,661.3 ) 6,001.0 2.8 % Locomotives 1,638.1 (436.3 ) 1,201.8 4.9 % Freight cars 1,034.1 (200.9 ) 833.2 2.7 % Other equipment 67.3 (29.0 ) 38.3 5.7 % Total equipment 2,739.5 (666.2 ) 2,073.3 4.1 % Technology and other 305.6 (173.9 ) 131.7 16.6 % Construction in progress 152.5 — 152.5 N/A Total property and equipment (including concession assets) $ 11,220.4 $ (2,529.3 ) $ 8,691.1 N/A _____________ (a) Other includes signals, buildings and other road assets. As of December 31, 2017 Cost Accumulated Depreciation Net Book Value Depreciation Rates for 2017 Land $ 218.6 $ — $ 218.6 N/A Concession land rights 141.2 (26.5 ) 114.7 1.0 % Rail and other track material 1,967.0 (425.9 ) 1,541.1 2.7-3.0% Ties 1,779.6 (441.0 ) 1,338.6 2.0-4.8% Grading 969.9 (162.1 ) 807.8 0.9 % Bridges and tunnels 775.0 (144.9 ) 630.1 1.1 % Ballast 795.2 (222.0 ) 573.2 2.3-4.2% Other (a) 1,270.4 (363.3 ) 907.1 3.2 % Total road property 7,557.1 (1,759.2 ) 5,797.9 2.8 % Locomotives 1,527.9 (375.2 ) 1,152.7 4.7 % Freight cars 937.9 (168.9 ) 769.0 2.7 % Other equipment 69.1 (26.6 ) 42.5 5.9 % Total equipment 2,534.9 (570.7 ) 1,964.2 4.0 % Technology and other 229.1 (144.4 ) 84.7 17.1 % Construction in progress 223.7 — 223.7 N/A Total property and equipment (including concession assets) $ 10,904.6 $ (2,500.8 ) $ 8,403.8 N/A _____________ (a) Other includes signals, buildings and other road assets. Concession assets, net of accumulated amortization of $596.1 million and $638.2 million , totaled $2,260.4 million and $2,208.1 million at December 31, 2018 and 2017 , respectively. The Company capitalized $0.2 million , $0.3 million , and $0.5 million of interest for the years ended December 31, 2018 , 2017 , and 2016 , respectively. Depreciation and amortization of property and equipment (including concession assets) totaled $346.7 million , $320.9 million and $305.0 million , for 2018 , 2017 , and 2016 , respectively. |
Other Balance Sheet Captions
Other Balance Sheet Captions | 12 Months Ended |
Dec. 31, 2018 | |
Other Balance Sheet Captions [Abstract] | |
Other Balance Sheet Captions | Other Balance Sheet Captions Other Current Assets. Other current assets included the following items at December 31 (in millions): 2018 2017 Refundable taxes $ 11.2 $ 81.6 Mexican fuel excise tax credit 30.9 35.1 Prepaid expenses 21.7 18.3 Other 9.6 22.4 Other current assets $ 73.4 $ 157.4 Accounts Payable and Accrued Liabilities. Accounts payable and accrued liabilities included the following items at December 31 (in millions): 2018 2017 Accounts payable $ 180.5 $ 225.1 Income and other taxes 35.2 111.8 Accrued wages and vacation 60.9 89.0 Derailments, personal injury and other claim provisions 44.0 48.0 Dividends payable 36.4 37.2 Other 79.9 76.7 Accounts payable and accrued liabilities $ 436.9 $ 587.8 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company’s assets and liabilities recognized at fair value have been categorized based upon a fair value hierarchy as described in Note 2, Significant Accounting Policies. As of December 31, 2018 , the Company’s derivative financial instruments are measured at fair value on a recurring basis and consist of foreign currency forward and option contracts and treasury lock agreements, which are classified as Level 2 valuations. The Company determines the fair value of its derivative financial instrument positions based upon pricing models using inputs observed from actively quoted markets and also takes into consideration the contract terms as well as other inputs, including market currency exchange rates and in the case of option contracts, volatility, the risk-free interest rate and the time to expiration. The Company’s short-term financial instruments include cash and cash equivalents, accounts receivable, accounts payable and short-term borrowings. The carrying value of the short-term financial instruments approximates their fair value. The fair value of the Company’s debt is estimated using quoted market prices when available. When quoted market prices are not available, fair value is estimated based on current market interest rates for debt with similar maturities and credit quality. The carrying value of the Company’s debt was $2,689.4 million and $2,274.3 million at December 31, 2018 and 2017 , respectively. If the Company’s debt were measured at fair value, the fair value measurements of the individual debt instruments would have been classified as Level 2 in the fair value hierarchy. The fair value of the Company’s financial instruments is presented in the following table (in millions) : December 31, 2018 December 31, 2017 Level 2 Level 2 Assets Foreign currency derivative instruments $ 0.3 $ 7.9 Liabilities Debt instruments 2,661.3 2,377.8 Treasury lock agreements 2.0 5.6 |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments The Company enters into derivative transactions in certain situations based on management’s assessment of current market conditions and perceived risks. Management intends to respond to evolving business and market conditions and in doing so, may enter into such transactions as deemed appropriate. Credit Risk. As a result of the use of derivative instruments, the Company is exposed to counterparty credit risk. The Company manages this risk by limiting its counterparties to large financial institutions which meet the Company’s credit rating standards and have an established banking relationship with the Company. As of December 31, 2018 , the Company did not expect any losses as a result of default of its counterparties. Interest Rate Derivative Instruments . In May 2017, the Company executed four treasury lock agreements with an aggregate notional value of $275.0 million and a weighted-average interest rate of 2.85% . The purpose of the treasury locks is to hedge the U.S. Treasury benchmark interest rate associated with future interest payments related to the anticipated refinancing of the $275.0 million , 2.35% senior notes due May 15, 2020 . The Company has designated the treasury locks as cash flow hedges and recorded unrealized gains and losses in accumulated other comprehensive loss. Upon settlement, the unrealized gain or loss in accumulated other comprehensive loss will be amortized to interest expense over the life of the future underlying debt issuance. Foreign Currency Derivative Instruments. The Company’s Mexican subsidiaries have net U.S. dollar-denominated monetary liabilities which, for Mexican income tax purposes, are subject to periodic revaluation based on changes in the value of the Mexican peso against the U.S. dollar. This revaluation creates fluctuations in the Company’s Mexican income tax expense and the amount of income taxes paid in Mexico. The Company hedges its exposure to this cash tax risk by entering into foreign currency forward contracts and foreign currency option contracts known as zero-cost collars. The foreign currency forward contracts involve the Company’s purchase of pesos at an agreed-upon weighted-average exchange rate to each U.S dollar. The zero-cost collars involve the Company’s purchase of a Mexican peso call option and a simultaneous sale of a Mexican peso put option, with equivalent U.S. dollar notional amounts for each option and no net cash premium paid by the Company. The Company’s foreign currency forward and zero-cost collar contracts are executed with counterparties in the U.S. and are governed by an International Swaps and Derivatives Association agreement that includes standard netting arrangements. Asset and liability positions from contracts with the same counterparty are net settled upon maturity/expiration and presented on a net basis in the consolidated balance sheets prior to settlement. There was no offsetting of derivative assets or liabilities in the consolidated balance sheets as of December 31, 2018 and 2017 . Below is a summary of the Company’s 2018, 2017 and 2016 foreign currency derivative contracts (amounts in millions, except Ps./USD) : Foreign currency forward contracts Contracts to purchase Ps./pay USD Offsetting contracts to sell Ps./receive USD Notional amount Notional amount Weighted-average exchange rate (in Ps./USD) Maturity date Notional amount Notional amount Weighted-average exchange rate (in Ps./USD) Maturity date Cash received/(paid) on settlement Contracts executed in 2018 and outstanding at December 31, 2018 $ 20.0 Ps. 410.9 Ps. 20.5 9/30/2019 — — — — — Contracts executed in 2016 and settled in 2017 $ 340.0 Ps. 6,207.7 Ps. 18.3 1/17/2017 $ 287.0 Ps. 6,207.7 Ps. 21.6 1/17/2017 $ (53.0 ) Contracts executed in 2016 and settled in 2016 $ 60.0 Ps. 1,057.3 Ps. 17.6 4/29/2016 $ 60.7 Ps. 1,057.3 Ps. 17.4 4/29/2016 $ 0.7 Contracts executed in 2015 and settled in 2016 $ 300.0 Ps. 4,480.4 Ps. 14.9 1/15/2016 $ 251.0 Ps. 4,480.4 Ps. 17.9 1/15/2016 $ (49.0 ) Foreign currency zero-cost collar contracts Notional amount Weighted-average call rate outstanding options (in Ps./USD) Weighted-average put rate outstanding options (in Ps./USD) Cash received/(paid) on settlement Contracts executed in 2018 and outstanding at December 31, 2018 $ 120.0 Ps. 19.2 Ps. 22.6 — Contracts executed in 2018 and settled in 2018 $ 220.0 $ 3.9 Contracts executed in 2017 and settled in 2018 $ 80.0 $ 10.0 Contracts executed in 2017 and settled in 2017 $ 450.0 $ 42.2 Contracts executed in 2015 and settled in 2016 $ 80.0 $ (10.1 ) The Company has not designated any of the foreign currency derivative contracts as hedging instruments for accounting purposes. The Company measures the foreign currency derivative contracts at fair value each period and recognizes any change in fair value in foreign exchange gain (loss) within the consolidated statements of income. The cash flows associated with these instruments is classified as an operating activity within the consolidated statements of cash flows. The following table presents the fair value of derivative instruments included in the consolidated balance sheets at December 31 (in millions) : Derivative Assets Balance Sheet Location 2018 2017 Derivatives not designated as hedging instruments: Foreign currency zero-cost collar contracts Other current assets $ 0.3 $ 7.9 Total derivatives not designated as hedging instruments 0.3 7.9 Total derivative assets $ 0.3 $ 7.9 Derivative Liabilities Balance Sheet Location 2018 2017 Derivatives designated as hedging instruments: Treasury lock agreements Other noncurrent liabilities and deferred credits $ 2.0 $ 5.6 Total derivatives designated as hedging instruments 2.0 5.6 Total derivative liabilities $ 2.0 $ 5.6 The following table presents the effects of derivative instruments on the consolidated statements of income and consolidated statements of comprehensive income for the years ended December 31 (in millions) : Derivatives in Cash Flow Hedging Relationships Amount of Gain/(Loss) Recognized in OCI on Derivative 2018 2017 2016 Treasury lock agreements $ 3.6 $ (5.6 ) $ — Total $ 3.6 $ (5.6 ) $ — Derivatives Not Designated as Hedging Instruments Location of Gain/(Loss) Recognized in Income on Derivative Amount of Gain/(Loss) Recognized in Income on Derivative 2018 2017 2016 Foreign currency zero-cost collar contracts Foreign exchange gain (loss) $ 6.3 $ 50.1 $ (3.9 ) Foreign currency forward contracts Foreign exchange gain (loss) — (11.9 ) (49.6 ) Total $ 6.3 $ 38.2 $ (53.5 ) |
Short-Term Borrowings
Short-Term Borrowings | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings | Short-Term Borrowings Commercial Paper. The Company’s commercial paper program generally serves as the primary means of short-term funding. As of December 31, 2018 , KCS had no commercial paper outstanding. As of December 31, 2017 , KCS had $345.1 million of commercial paper outstanding, net of $0.1 million discount, at a weighted-average interest rate of 1.846% . For the years ended December 31, 2018, 2017 and 2016, commercial paper borrowings were outstanding for less than 90 days . |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt at December 31 (in millions): 2018 2017 Principal Unamortized Discount and Debt Issuance Costs Net Principal Unamortized Discount and Debt Issuance Costs Net Revolving credit facilities, variable interest rate, due 2020 $ — $ — $ — $ — $ — $ — KCS 2.35% senior notes, due 2020 257.3 0.7 256.6 257.3 1.2 256.1 KCS 3.00% senior notes, due 2023 439.1 3.2 435.9 439.1 4.0 435.1 KCS 3.85% senior notes, due 2023 199.2 1.4 197.8 199.2 1.7 197.5 KCS 3.125% senior notes, due 2026 250.0 2.7 247.3 250.0 3.1 246.9 KCS 4.30% senior notes, due 2043 448.7 9.1 439.6 448.7 9.3 439.4 KCS 4.95% senior notes, due 2045 499.2 7.4 491.8 499.2 7.6 491.6 KCS 4.70% senior notes, due 2048 500.0 6.2 493.8 — — — KCSR senior notes 3.85% to 4.95%, due through 2045 2.7 — 2.7 2.9 — 2.9 KCSM senior notes 2.35% to 3.00%, due through 2023 23.2 0.1 23.1 28.5 0.2 28.3 RRIF loans 2.96% to 4.29%, due serially through 2037 74.1 0.4 73.7 77.8 0.5 77.3 Financing agreements 5.737% to 9.310%, due serially through 2023 15.5 — 15.5 84.2 0.3 83.9 Capital lease obligations, due serially to 2024 11.4 — 11.4 15.0 — 15.0 Other debt obligations 0.2 — 0.2 0.3 — 0.3 Total 2,720.6 31.2 2,689.4 2,302.2 27.9 2,274.3 Less: Debt due within one year 10.1 — 10.1 38.8 — 38.8 Long-term debt $ 2,710.5 $ 31.2 $ 2,679.3 $ 2,263.4 $ 27.9 $ 2,235.5 Revolving Credit Facility KCS, with certain of its domestic subsidiaries named therein as guarantors, has an $800.0 million revolving credit facility (the “KCS Revolving Credit Facility”), with a $25.0 million standby letter of credit facility which, if utilized, constitutes usage under the revolving facility. The KCS Revolving Credit Facility serves as a backstop for KCS’s $800.0 million commercial paper program (the “KCS Commercial Paper Program”) which generally serves as the Company’s primary means of short-term funding. Borrowings under the KCS Revolving Credit Facility bear interest at floating rates. Depending on the Company’s credit rating, the margin that KCS pays above the London Interbank Offered Rate (“LIBOR”) at any point is between 1.125% and 2.0% . As of December 31, 2018 , the margin was 1.25% based on KCS’s current credit rating. The KCS Revolving Credit Facility is guaranteed by KCSR, together with certain domestic subsidiaries named therein as guarantors (the “Subsidiary Guarantors”) and matures on December 9, 2020 . The KCS Revolving Credit Facility agreement contains representations, warranties, covenants (including financial covenants related to a leverage ratio and an interest coverage ratio) and events of default that are customary for credit agreements of this type. The occurrence of an event of default could result in the termination of the commitments and the acceleration of the repayment of any outstanding principal balance on the KCS Revolving Credit Facility and the KCS Commercial Paper Program. As of December 31, 2018 and 2017 , KCS had no outstanding borrowings under the KCS Revolving Credit Facility. Senior Notes The Company’s senior notes include certain covenants which are customary for these types of debt instruments issued by borrowers with similar credit ratings. The KCS Notes are unsecured and unsubordinated obligations of the Company and are unconditionally guaranteed, jointly and severally, by KCSR and each current and future domestic subsidiary of KCS that guarantees the KCS Revolving Credit Facility or certain other debt of KCS or a Note Guarantor (collectively, the “Note Guarantors”). KCSR’s senior notes are unconditionally guaranteed, jointly and severally, on an unsecured senior basis, by KCS and each current and future domestic subsidiary of KCS that guarantees the KCS Revolving Credit Facility or certain other debt of KCS or a note guarantor. KCSR’s senior notes and the note guarantees rank pari passu in right of payment with KCSR’s, KCS’s and the Note Guarantors’ existing and future unsecured, unsubordinated obligations. KCSM’s senior notes are denominated in U.S. dollars; are unsecured, unsubordinated obligations; rank pari passu in right of payment with KCSM’s existing and future unsecured, unsubordinated obligations and are senior in right of payment to KCSM’s future subordinated indebtedness. Senior notes are redeemable at the issuer’s option, in whole or in part, at any time, by paying the greater of either 100% of the principal amount to be redeemed and a formula price based on interest rates prevailing at the time of redemption and time remaining to maturity. In addition, KCSM senior notes are redeemable, in whole but not in part, at KCSM’s option at any time at a redemption price of 100% of their principal amount, plus any accrued unpaid interest in the event of certain changes in the Mexican withholding tax rate. On May 3, 2018, KCS issued $500.0 million principal amount of senior unsecured notes due May 1, 2048 (the “4.70% Senior Notes”), which bear interest semiannually at a fixed annual rate of 4.70% . The 4.70% Senior Notes were issued at a discount to par value, resulting in a $0.6 million discount and a yield to maturity of 4.707% . The net proceeds from the offering were used to repay the outstanding commercial paper issued by KCS, repay a locomotive lease and certain equipment loans, and for general corporate purposes. On May 3, 2018, KCSM repurchased $5.3 million of the remaining $10.9 million aggregate principal amount of its 3.0% senior unsecured notes due May 15, 2023 , at a discounted price equal to 95.91% of the principal amount. As a result, the Company recognized a debt retirement benefit of $0.2 million within debt retirement costs in the consolidated statements of income. RRIF Loan Agreements The following loans were made under the Railroad Rehabilitation and Improvement Financing (“RRIF”) Program administered by the Federal Railroad Administration (“FRA”): KCSR RRIF Loan Agreement. On February 21, 2012, KCSR entered into an agreement with the FRA to borrow $54.6 million to be used to reimburse KCSR for a portion of the purchase price of thirty new locomotives (the “Locomotives”) acquired by KCSR in the fourth quarter of 2011. The loan bears interest at 2.96% annually and the principal balance amortizes quarterly with a final maturity of February 24, 2037 . The obligations under the financing agreement are secured by a first priority security interest in the Locomotives and certain related rights. In addition, the Company has agreed to guarantee repayment of the amounts due under the financing agreement and certain related agreements. The occurrence of an event of default could result in the acceleration of the repayment of any outstanding principal balance of the loan. Tex-Mex RRIF Loan Agreement. On June 28, 2005, Tex-Mex entered into an agreement with the FRA to borrow $50.0 million to be used for infrastructure improvements in order to accommodate growing freight rail traffic related to the NAFTA corridor. The loan bears interest at 4.29% annually and the principal balance amortizes quarterly with a final maturity of July 13, 2030 . The loan is guaranteed by Mexrail, which has issued a pledge agreement in favor of the lender equal to the gross revenues earned by Mexrail on per-car fees on traffic crossing the International Rail Bridge in Laredo, Texas. In addition, the Company has agreed to guarantee the scheduled principal payment installments due to the FRA from Tex-Mex under the loan agreement on a rolling five-year basis. Locomotive Financing Agreements During 2008 and 2011, KCSM entered into various financing agreements totaling $216.0 million to purchase locomotives. The agreements mature between December 2020 and September 2023 , are payable on a quarterly or semi-annual basis and contain annual interest rates ranging between 5.737% and 9.310% . KCSM has either granted the lender a security interest in the locomotives to secure the loan or has secured the loans by transferring legal ownership of the locomotives to irrevocable trusts established by KCSM to which the lender is the primary beneficiary and KCSM has a right of reversion upon satisfaction of the obligations of the loan agreements. KCSM’s locomotive financing agreements contain representations, warranties and covenants typical of such equipment loan agreements. Events of default in the financing agreements include, but are not limited to, certain payment defaults, certain bankruptcy and liquidation proceedings and the failure to perform any covenants or agreements contained in the financing agreements. Any event of default could trigger acceleration of KCSM’s payment obligations under the terms of the financing agreements. During May 2018, the Company paid the remaining $23.0 million and $19.1 million principal amounts under its locomotive financing agreements with Export Development Canada and DVB Bank AG, respectively, using a portion of the proceeds from the issuance of the 4.70% Senior Notes. As a result of the early repayment, the Company recognized $2.4 million in debt retirement costs in the consolidated statements of income. Debt Covenants Compliance The Company was in compliance with all of its debt covenants as of December 31, 2018 . Other Debt Provisions Certain loan agreements and debt instruments entered into or guaranteed by the Company and its subsidiaries provide for default in the event of a specified change in control of the Company or particular subsidiaries of the Company. Leases and Debt Maturities The Company leases transportation equipment, as well as office and other operating facilities, under various capital and operating leases. Rental expenses under operating leases were $49.3 million , $59.5 million , and $61.0 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. Operating leases that contain scheduled rent adjustments are recognized on a straight-line basis over the term of the lease. Contingent rentals and sublease rentals were not significant. Minimum annual payments and present value thereof under existing capital leases, other debt maturities and minimum annual rental commitments under non-cancelable operating leases are as follows (in millions) : Long- Term Debt Capital Leases Total Debt Years Minimum Lease Payments Less Interest Net Present Value Operating Leases Total 2019 $ 7.4 $ 3.7 $ 1.0 $ 2.7 $ 10.1 $ 57.5 $ 67.6 2020 290.9 2.7 0.8 1.9 292.8 43.6 336.4 2021 4.2 2.7 0.6 2.1 6.3 26.0 32.3 2022 4.3 2.7 0.4 2.3 6.6 18.9 25.5 2023 649.2 2.4 0.1 2.3 651.5 13.3 664.8 Thereafter 1,753.2 0.1 — 0.1 1,753.3 46.0 1,799.3 Total $ 2,709.2 $ 14.3 $ 2.9 $ 11.4 $ 2,720.6 $ 205.3 $ 2,925.9 In the normal course of business, the Company enters into long-term contractual requirements for future goods and services needed for the operations of the business. Such commitments are not in excess of expected requirements and are not reasonably likely to result in performance penalties or payments that would have a material adverse effect on the Company’s liquidity. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Current income tax expense represents the amounts expected to be reported on the Company’s income tax returns, and deferred tax expense or benefit represents the change in net deferred tax assets and liabilities. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities as measured by the enacted tax rates that will be in effect when these differences reverse. Valuation allowances are recorded as appropriate to reduce deferred tax assets to the amount considered likely to be realized. Tax Cuts and Jobs Act. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (the “Tax Reform Act”). The legislation significantly changed U.S. tax law by, among other things, lowering corporate income tax rates, implementing a territorial tax system and imposing a repatriation tax on deemed repatriated earnings of foreign subsidiaries. The Tax Reform Act permanently reduced the U.S. corporate income tax rate from a maximum of 35% to a 21% rate, effective January 1, 2018. While the Tax Reform Act provides for a territorial tax system, beginning in 2018, it includes the global intangible low-taxed income (“GILTI”) provision. The Company elected to account for GILTI tax in the period in which it is incurred. The GILTI provisions require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The GILTI tax expense is primarily caused by a U.S. foreign tax credit limitation which requires an allocation of interest expense to the GILTI income, effectively rendering the allocated interest expense non-deductible. As a result of the GILTI provisions, the Company’s effective tax rate increased by 1.3% for 2018. Provisional Tax Impacts. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Reform Act. The Company recognized a provisional $413.0 million net tax benefit related to the deemed repatriated earnings and the revaluation of deferred tax assets and liabilities in its consolidated financial statements for the year ended December 31, 2017. Adjustments made to the provisional amounts allowed under SAB 118 were identified and recorded as discrete adjustments as described in the following paragraphs. On April 2, 2018, the Internal Revenue Service (“IRS”) issued guidance on how to determine, report and pay the repatriation tax on deemed repatriated earnings of foreign subsidiaries provided in the Tax Reform Act and included in the consolidated financial statements for the year ended December 31, 2017. During the second quarter of 2018, the Company recognized a $4.3 million discrete tax benefit resulting from the additional guidance. During the third quarter of 2018, the Company recognized a $16.6 million discrete tax benefit for adjustments to the provisional tax impacts of the Tax Reform Act included in its consolidated financial statement for the year ended December 31, 2017. These adjustments included a $14.4 million reduction in the provisional tax on deemed repatriated earnings and a $2.2 million tax benefit from changes in its revaluation of deferred tax assets and liabilities due to additional analysis, changes in interpretations and assumptions the Company made, additional regulatory guidance that was issued, and actions the Company took as a result of the Tax Reform Act. The accounting was completed in the fourth quarter of 2018. Tax Expense (Benefit). Income tax expense (benefit) consists of the following components (in millions): 2018 2017 2016 Current: Federal $ (10.5 ) $ 47.3 $ 1.0 State and local 0.7 0.6 0.6 Foreign 175.6 163.8 76.4 Total current 165.8 211.7 78.0 Deferred: Federal 77.6 (350.1 ) 92.7 State and local 9.1 11.9 13.1 Foreign 5.0 36.9 (1.0 ) Total deferred 91.7 (301.3 ) 104.8 Total income tax expense (benefit) $ 257.5 $ (89.6 ) $ 182.8 Income before income taxes consists of the following (in millions) : 2018 2017 2016 Income before income taxes: U.S. $ 366.2 $ 331.8 $ 279.9 Foreign 520.7 542.5 382.8 Total income before income taxes $ 886.9 $ 874.3 $ 662.7 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31 follow (in millions): 2018 2017 Assets: Tax credit and loss carryovers $ 28.9 $ 26.9 Reserves not currently deductible for tax 48.0 54.1 Other 26.4 25.2 Gross deferred tax assets before valuation allowance 103.3 106.2 Valuation allowance (2.3 ) (2.1 ) Net deferred tax assets 101.0 104.1 Liabilities: Property (1,099.2 ) (1,012.7 ) Investments (49.7 ) (48.0 ) Other (32.0 ) (30.6 ) Gross deferred tax liabilities (1,180.9 ) (1,091.3 ) Net deferred tax liability $ (1,079.9 ) $ (987.2 ) Tax Rates. Differences between the Company’s effective income tax rate and the U.S. federal statutory income tax rate of 21% for 2018 and 35% for 2017 and 2016 follow (in millions): 2018 2017 2016 Dollars Percent Dollars Percent Dollars Percent Income tax expense using the statutory rate in effect $ 186.2 21.0 % $ 306.0 35.0 % $ 231.9 35.0 % Tax effect of: Difference between U.S. and foreign tax rate 46.1 5.2 % (26.6 ) (3.0 %) (19.2 ) (2.9 %) Foreign exchange (i) 21.8 2.5 % 31.6 3.6 % (45.0 ) (6.8 %) Tax credits (14.2 ) (1.6 %) (8.4 ) (1.0 %) (14.3 ) (2.2 %) Global intangible low-taxed income (“GILTI”) tax, net 11.8 1.3 % — — — — Withholding tax 11.2 1.3 % 8.1 0.9 % 9.6 1.4 % State and local income tax provision, net 7.5 0.8 % 8.3 1.0 % 8.1 1.2 % Change in U.S. tax rate (2.2 ) (0.3 %) (487.6 ) (55.8 %) — — Deemed mandatory repatriation (18.7 ) (2.1 %) 74.6 8.6 % — — Other, net 8.0 0.9 % 4.4 0.5 % 11.7 1.9 % Income tax expense (benefit) $ 257.5 29.0 % $ (89.6 ) (10.2 %) $ 182.8 27.6 % _____________________ (i) Mexican income taxes are paid in Mexican pesos, and as a result, the effective income tax rate reflects fluctuations in the value of the Mexican peso against the U.S. dollar. The foreign exchange impact on income taxes includes the gain or loss from the revaluation of the Company’s net U.S. dollar-denominated monetary liabilities into Mexican pesos which is included in Mexican taxable income under Mexican tax law. As a result, a strengthening of the Mexican peso against the U.S. dollar for the reporting period will generally increase the Mexican cash tax obligation and the effective income tax rate, and a weakening of the Mexican peso against the U.S. dollar for the reporting period will generally decrease the Mexican cash tax obligation and the effective tax rate. To hedge its exposure to this cash tax risk, the Company enters into foreign currency derivative contracts, which are measured at fair value each period and any change in fair value is recognized in foreign exchange gain (loss) within the consolidated statements of income. Refer to Note 10 , Derivative Instruments for further information. Difference Attributable to Foreign Investments. As a result of the deemed mandatory repatriation provisions in the Tax Reform Act, the Company included $1,395.7 million of undistributed earnings in income subject to U.S. tax at reduced tax rates. In addition, the Company recognized $226.1 million of global intangible low-taxed income (“GILTI”) included in the Tax Reform Act which increases earnings previously taxed in the U.S. As a result, the Company does not intend to distribute earnings in a taxable manner, and therefore intends to limit distributions to earnings previously taxed in the U.S., or earnings that would qualify for the 100 percent dividends received deduction provided for in the Tax Reform Act, and earnings that would not result in any significant foreign taxes. The Company repatriated $233.8 million during 2018 of earnings previously taxed in the U.S. resulting in no significant taxes. Therefore, the Company has not recognized a deferred tax liability on its investment in foreign subsidiaries. Tax Carryovers. The Company has U.S. state net operating losses which are carried forward from 5 to 20 years and are analyzed each year to determine the likelihood of realization. The state loss carryovers arise from both combined and separate tax filings from as early as 1999 and may expire as early as December 31, 2019 and as late as December 31, 2038. The state loss carryover at December 31, 2018 , was $443.3 million resulting in a state deferred tax asset of $26.2 million . The Mexico federal loss carryovers at December 31, 2018 , were $7.9 million and, if not used, will begin to expire in 2026. A deferred tax asset was recognized in prior periods for the expected future tax benefit of these losses which will be carried forward to reduce only Mexican income tax payable in future years. A deferred tax asset is also recorded for a foreign tax credit carryover in the amount of $5.1 million , which if not used, will expire in 2028. The valuation allowance for deferred tax assets as of December 31, 2018 and 2017 , was $2.3 million and $2.1 million , respectively, primarily attributable to state net operating loss carryovers. The Company believes it is more likely than not that reversals of existing temporary differences that will produce future taxable income and the results of future operations will generate sufficient taxable income to realize the deferred tax assets, net of valuation allowances, related to loss carryovers. Uncertain Tax Positions. The accounting guidance for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The guidance requires the Company to recognize in the consolidated financial statements the benefit of a tax position only if the impact is more likely than not of being sustained on audit based on the technical merits of the position. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows ( in millions ): 2018 2017 Balance at January 1, $ — $ 3.8 Additions for tax positions of prior years 2.2 — Reductions for tax positions of prior years — (0.1 ) Reductions as a result of lapse of statute of limitations — (3.7 ) Balance at December 31, $ 2.2 $ — A tax expense of $2.2 million was recognized in the third quarter of 2018 relating to an uncertain tax position on tax credits generated in prior tax years. The unrecognized tax benefit would affect the effective income tax rate if recognized, and is not expected to change in the next twelve months. Interest and penalties related to uncertain tax positions are included in income before taxes on the consolidated statements of income. Accrued interest and penalties on unrecognized tax benefits and interest and penalty expense was immaterial to the consolidated financial statements for all periods presented. Tax Contingencies . Tax returns filed in the U.S. for periods after 2014 and in Mexico for periods after 2012 remain open to examination by the taxing authorities. In 2018, the IRS initiated an examination of the 2016 U.S. federal tax return. The Company does not expect that the examination will have a material impact on the consolidated financial statements. During the first quarter of 2017, the Company received audit assessments from the Servicio de Administración Tributaria (the “SAT”), the Mexican equivalent of the IRS, for the KCSM 2009 and 2010 Mexico tax returns. In 2017, the Company commenced administrative actions with the SAT. During the first quarter of 2018, the audit assessments were nullified by the SAT. In the third quarter of 2018, the SAT issued new assessments and the Company filed administrative appeals with the SAT. The Company believes that it has strong legal arguments in its favor and it is more likely than not that it will prevail in any challenge of the assessments. The Company litigated a Value Added Tax (“VAT”) audit assessment from the SAT for KCSM for the year ended December 31, 2005. In November 2016, KCSM was notified of a resolution by the Mexican tax court annulling this assessment. The SAT appealed this resolution to the Mexican circuit court. In September 2017, KCSM was notified of a resolution by the circuit court which ordered the tax court to consider an argument made by KCSM in the original tax court proceeding that was not addressed in the tax court’s November 2016 resolution. In October 2017, the tax court ruled that the arguments made by KCSM asserting that the SAT unduly extended the audit process were not valid, and also annulled the assessment consistent with the tax court’s earlier November 2016 ruling. In December 2017, KCSM and the SAT filed an appeal with the Federal Courts of Appeals. In November 2018, the Appeals Court issued a ruling denying the SAT appeal and permanently annulled the VAT assessment. The SAT is unable to appeal the decision. The Appeals Court also denied KCSM’s appeal, therefore through March 29, 2019, the SAT can issue a new assessment; however, any such new assessment would result in no tax being assessed based on the Tax Court’s guidelines, and therefore should not have a material impact to the Company’s consolidated financial statements. KCSM has not historically assessed VAT on international import transportation services provided to its customers based on a written ruling that KCSM obtained from the SAT in 2008 stating that such services were not subject to VAT (the “2008 Ruling”). Notwithstanding the 2008 Ruling, in December 2013, the SAT unofficially informed KCSM of an intended implementation of new criteria effective as of January 1, 2014, pursuant to which VAT would be assessed on all international import transportation services on the portion of the services provided within Mexico. Additionally, in November 2013, the SAT filed an action to nullify the 2008 Ruling, potentially exposing the application of the new criteria to open tax years. In February 2014, KCSM filed an action opposing the SAT’s nullification action. In December 2016, KCSM was notified of a resolution issued by the Mexican tax court confirming the 2008 Ruling. The SAT appealed this resolution. In October 2017, the circuit court resolved to not render a decision on the case but rather to send the SAT’s appeal to the Supreme Court. In February 2018, the Supreme Court decided not to hear the case and remanded the SAT’s appeal back to the circuit court for a decision. In July 2018, the circuit court ordered the tax court to consider certain arguments made by the SAT in the original court proceeding that were not addressed in the tax court’s December 2016 resolution. On October 2, 2018, the tax court issued a decision confirming the 2008 Ruling. The SAT has appealed this decision. The Company believes it is more likely than not that it will continue to prevail in this matter. Further, as of the date of this filing, the SAT has not implemented any new criteria regarding the assessment of VAT on international import transportation services. The Company believes it is probable that any unexpected nullification of the 2008 Ruling and the implementation of any new VAT criteria would be applied on a prospective basis, in which case, due to the pass-through nature of VAT, KCSM would begin to assess its customers for VAT on international import transportation services, resulting in no material impact to the Company’s consolidated financial statements. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Information regarding the Company’s capital stock at December 31 follows: Shares Authorized Shares Issued 2018 2017 2018 2017 $25 par, 4% noncumulative, preferred stock 840,000 840,000 649,736 649,736 $1 par, preferred stock 2,000,000 2,000,000 — — $.01 par, common stock 400,000,000 400,000,000 123,352,185 123,352,185 Shares outstanding at December 31: 2018 2017 $25 par, 4% noncumulative, preferred stock 228,395 242,170 $.01 par, common stock 100,896,678 103,036,805 Share Repurchases. In August 2017, the Company announced a new common share repurchase program authorizing the Company to purchase up to $800.0 million of its outstanding shares of common stock through June 30, 2020 (the “2017 Program”). Share repurchases may be made in the open market, through privately negotiated transactions, or through an accelerated share repurchase (“ASR”) program limited to $200.0 million . The Company entered into and settled an ASR program for the full ASR amount authorized under the 2017 Program during the second half of 2017. During 2018, the Company repurchased 2,272,213 shares of common stock at an average price of $106.98 per share and a total cost of $243.1 million . Since inception of the 2017 Program, the Company has repurchased 4,691,682 shares at an average price of $106.20 per share and a total cost of $498.3 million . During 2018, the Company repurchased 13,775 shares of its $25 par preferred stock for $0.4 million at an average price of $26.23 per share. Treasury Stock. Shares of common and preferred stock in treasury and related activity follow: 2018 2017 2016 Balance at beginning of year 20,315,380 16,745,566 14,891,041 Shares repurchased 2,285,988 3,759,678 2,127,612 Shares issued to fund stock option exercises (24,024 ) (9,110 ) (15,264 ) Employee stock purchase plan shares issued (62,866 ) (76,401 ) (82,372 ) Nonvested shares issued (51,191 ) (124,519 ) (179,309 ) Nonvested shares forfeited 5,995 20,166 3,858 Balance at end of year 22,469,282 20,315,380 16,745,566 Cash Dividends on Common Stock. The following table presents the amount of cash dividends declared per common share by the Company’s Board of Directors: 2018 2017 2016 Cash dividends declared per common share $ 1.44 $ 1.38 $ 1.32 |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation [Abstract] | |
Share-Based Compensation | Share-Based Compensation On May 4, 2017, the Company’ stockholders approved the Kansas City Southern 2017 Equity Incentive Plan (the “2017 Plan”), which replaced the Kansas City Southern 2008 Stock Option and Performance Award Plan (the “2008 Plan”). The Board of Directors and its Compensation and Organization Committee had previously adopted the 2017 Plan, subject to stockholder approval, on January 26, 2017, and February 17, 2017, respectively. The 2017 Plan provides for the granting of up to 3,750,000 shares of the Company’s common stock to eligible persons as defined in the 2017 Plan. Outstanding equity awards granted under the 2008 Plan and the 2017 Plan (the “Plans”) are to be governed by the terms and conditions of each individual plan and the related award agreements. Stock Options. The exercise price for options granted under the Plans equals the closing market price of the Company’s stock on the date of grant. Options generally have a 3 -year vesting period and are exercisable over the 10 -year contractual term, except that options outstanding become immediately exercisable upon certain defined circumstances constituting a change in control of the Company. The grant date fair value is recorded to expense on a straight-line basis over the vesting period. The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model. The weighted-average assumptions used were as follows: 2018 2017 2016 Expected dividend yield 1.36 % 1.52 % 1.60 % Expected volatility 27.09 % 30.74 % 32.29 % Risk-free interest rate 2.80 % 2.20 % 1.51 % Expected term (years) 6.0 6.0 6.0 Weighted-average grant date fair value of stock options granted $ 28.52 $ 24.49 $ 22.98 The expected dividend yield is calculated as the ratio of dividends paid per share of common stock to the stock price on the date of grant. The expected volatility is based on the historical volatility of the Company’s stock price over a term equal to the estimated life of the options. The risk-free interest rate is determined based on U.S. Treasury rates for instruments with terms approximating the expected term of the options granted, which represents the period of time the awards are expected to be outstanding and is based on the historical experience of similar awards. A summary of stock option activity is as follows: Number of Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value In years In millions Options outstanding at December 31, 2017 500,624 $ 78.74 Granted 93,070 105.83 Exercised (24,024 ) 74.57 Forfeited or expired (5,155 ) 94.32 Options outstanding at December 31, 2018 564,515 $ 83.24 5.8 $ 9.1 Exercisable at December 31, 2018 385,774 $ 77.26 4.6 $ 8.3 The aggregate intrinsic value in the table above, which is the amount by which the market value of the underlying stock exceeded the exercise price of outstanding options, represents the amount optionees would have realized if all in-the-money options had been exercised on the last business day of the period indicated. Compensation cost of $2.5 million , $2.3 million , and $2.5 million was recognized for stock option awards for the years ended December 31, 2018 , 2017 , and 2016 , respectively. The total income tax benefit recognized in the consolidated statements of income was $0.6 million , $0.8 million , and $0.9 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. Additional information regarding stock option exercises appears in the table below (in millions) : 2018 2017 2016 Aggregate grant-date fair value of stock options vested $ 1.9 $ 2.8 $ 1.8 Intrinsic value of stock options exercised 1.0 0.2 0.6 Cash received from option exercises 1.8 0.7 0.9 Tax benefit from options exercised during the annual period 0.2 0.1 0.2 As of December 31, 2018 , $1.3 million of unrecognized compensation cost relating to nonvested stock options is expected to be recognized over a weighted-average period of 1.0 year. At December 31, 2018 , there were 3,468,741 shares available for future grants under the 2017 Plan. Nonvested Stock. The Plans provide for the granting of nonvested stock awards to officers and other designated employees. The grant date fair value is based on the closing market price on the date of the grant. These awards are subject to forfeiture if employment terminates during the vesting period, which is generally 3 year or 5 year vesting for employees. Awards granted to the Company’s directors vest immediately on date of grant. The grant date fair value of nonvested shares is recorded to compensation expense on a straight-line basis over the vesting period. On February 19, 2016 the Company granted 66,320 shares of nonvested stock (“the market-based award”) under the 2008 Plan that contained a market condition that accelerated the vesting in three tranches if the twenty trading day volume-weighted average price of the Company’s common stock was above certain targets, which fully vested on January 5, 2018. The fair value and requisite service period of nonvested market-based awards were estimated on the date of grant using the Monte Carlo simulation model. The assumptions used in the Monte Carlo simulation model are consistent with those used to value stock options and were as follows: Nonvested Stock Expected dividend yield 1.58 % Expected volatility 31.68 % Risk-free interest rate 0.53% - 1.89% Expected term (years) 1.9 Weighted-average grant date fair value $ 70.95 A summary of nonvested stock activity is as follows: Number of Shares Weighted- Average Grant Date Fair Value Aggregate Intrinsic Value In millions Nonvested stock at December 31, 2017 276,679 $ 93.28 Granted 83,099 106.52 Vested (96,162 ) 95.75 Forfeited (5,995 ) 94.20 Nonvested stock at December 31, 2018 257,621 $ 96.61 $ 24.6 The fair value (at vest date) of shares vested during the years ended December 31, 2018 , 2017 , and 2016 was $10.4 million , $5.9 million , and $7.0 million , respectively. The weighted-average grant date fair value of nonvested stock granted during 2018 , 2017 , and 2016 was $106.52 , $93.29 and $80.92 , respectively. Compensation cost for nonvested stock and market-based awards was $10.8 million , $9.3 million , and $9.6 million for the years ended December 31, 2018 , 2017 , and 2016 , respectively. The total income tax benefit recognized in the consolidated statements of income was $2.6 million , $3.5 million , and $3.5 million for the years ended December 31, 2018 , 2017 , and 2016 , respectively. As of December 31, 2018 , $11.3 million of unrecognized compensation costs related to nonvested stock is expected to be recognized over a weighted-average period of 1.1 years. Performance Based Awards. The Company granted performance based nonvested stock awards during 2018 (the “2018 Awards”), 2017 (the “2017 Awards”) and 2016 (the “2016 Awards”). The awards granted provide a target number of shares that generally vest at the end of a 3 -year requisite service period following the grant date. In addition to the service condition, the number of nonvested shares to be received depends on the attainment of defined Company-wide performance goals based on operating ratio (“OR”) and return on invested capital (“ROIC”) over a three -year performance period. The awards are also subject to a revenue growth multiplier based on a three -year performance period calculated as defined in the related award agreement that can range from 80% to 140% of the award earned based on the OR and ROIC achieved. The number of nonvested shares ultimately earned will range between zero to 200% of the target award. A summary of performance based nonvested stock activity at target is as follows: Target Number of Shares * Weighted-Average Grant Date Fair Value Nonvested stock, at December 31, 2017 139,502 $ 93.05 Granted 50,162 105.83 Vested (32,219 ) 119.35 Forfeited (4,466 ) 91.89 Nonvested stock, at December 31, 2018 152,979 $ 91.74 _____________________ * For the 2018 Awards and the 2017 Awards, participants in the aggregate can earn up to a maximum of 99,594 and 104,220 shares, respectively. For the 2016 Awards, the performance shares earned were 102,144 . The weighted-average grant date fair value of performance based nonvested stock granted during 2018 , 2017 and 2016 was $105.83 , $87.09 and $82.71 , respectively. The Company expenses the grant date fair value of the awards which are probable of being earned over the performance periods. Compensation cost on performance based awards was $5.8 million , $6.0 million and $5.7 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. Total income tax benefit recognized in the consolidated statements of income for performance based awards was $1.5 million , $2.2 million and $2.1 million for the years ended December 31, 2018 , 2017 and 2016 , respectively. As of December 31, 2018 , $4.9 million of unrecognized compensation cost related to performance based awards is expected to be recognized over a weighted-average period of eleven months . The fair value (at vest date) of shares vested for the year ended December 31, 2018 was $3.5 million . Employee Stock Purchase Plan. The employee stock purchase plan (“ESPP”) provides substantially all U.S. full-time employees of the Company, certain subsidiaries and certain other affiliated entities, with the right to subscribe to an aggregate of 4.0 million shares of common stock of the Company. Under the ESPP, eligible employees may contribute, through payroll deductions, up to 10% of their regular base compensation during six -month purchase periods at a purchase price equal to 85% of the closing market price on either the exercise date or the offering date, whichever is lower. At the end of each purchase period, the accumulated deductions are applied toward the purchase of the Company’s common stock. Both the discount in grant price and the share option purchase price are valued to derive the award’s fair value. The awards vest and the expense is recognized ratably over the offering period. The following table summarizes activity related to the various ESPP offerings: Exercise Date Received from Employees(i) In millions Date Issued Purchase Price Shares Issued July 2018 offering January 3, 2019 $ 81.13 35,972 $ 2.9 January 2018 offering July 2, 2018 90.07 32,271 2.9 July 2017 offering January 4, 2018 89.18 30,595 2.7 January 2017 offering July 5, 2017 68.70 40,293 2.8 July 2016 offering January 12, 2017 72.12 36,108 2.6 January 2016 offering July 11, 2016 62.66 41,895 2.6 _____________________ (i) Represents amounts received from employees through payroll deductions for share purchases under applicable offering. The fair value of the ESPP stock purchase rights is estimated on the date of grant using the Black-Scholes option pricing model. The weighted-average assumptions used for each of the respective periods were as follows: Year Ended December 31, 2018 2017 2016 Expected dividend yield 1.22 % 1.47 % 1.65 % Expected volatility 13.29 % 17.09 % 23.84 % Risk-free interest rate 1.73 % 0.89 % 0.46 % Expected term (years) 0.5 0.5 0.5 Weighted-average grant date fair value $ 18.66 $ 17.90 $ 17.29 Compensation expense of $1.3 million , $1.3 million , and $1.4 million was recognized for ESPP option awards for the years ended December 31, 2018 , 2017 , and 2016 , respectively. At December 31, 2018 , there were 3.5 million remaining shares available for future ESPP offerings under the plan. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Concession Duty. Under KCSM’s 50 -year Concession, which could expire in 2047 unless extended, KCSM pays annual concession duty expense of 1.25% of gross revenues. For the year ended December 31, 2018 , the concession duty expense, which is recorded within materials and other in operating expenses, was $17.8 million , compared to $17.0 million and $14.9 million for the same periods in 2017 and 2016 , respectively. Litigation. The Company is a party to various legal proceedings and administrative actions, all of which are of an ordinary, routine nature and incidental to its operations. Included in these proceedings are various tort claims brought by current and former employees for job-related injuries and by third parties for injuries related to railroad operations. KCS aggressively defends these matters and has established liability provisions, which management believes are adequate to cover expected costs. Although it is not possible to predict the outcome of any legal proceeding, in the opinion of management, such proceedings and actions should not, individually, or in the aggregate, have a material adverse effect on the Company’s consolidated financial statements. Environmental Liabilities. The Company’s U.S. operations are subject to extensive federal, state and local environmental laws and regulations. The major U.S. environmental laws to which the Company is subject include, among others, the Federal Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA,” also known as the Superfund law), the Toxic Substances Control Act, the Federal Water Pollution Control Act, and the Hazardous Materials Transportation Act. CERCLA can impose joint and several liabilities for cleanup and investigation costs, without regard to fault or legality of the original conduct, on current and predecessor owners and operators of a site, as well as those who generate, or arrange for the disposal of, hazardous substances. The Company does not believe that compliance with the requirements imposed by the environmental legislation will impair its competitive capability or result in any material additional capital expenditures, operating or maintenance costs. The Company is, however, subject to environmental remediation costs as described in the following paragraphs. The Company’s Mexico operations are subject to Mexican federal and state laws and regulations relating to the protection of the environment through the establishment of standards for water discharge, water supply, emissions, noise pollution, hazardous substances and transportation and handling of hazardous and solid waste. The Mexican government may bring administrative and criminal proceedings, impose economic sanctions against companies that violate environmental laws, and temporarily or even permanently close non-complying facilities. The risk of incurring environmental liability is inherent in the railroad industry. As part of serving the petroleum and chemicals industry, the Company transports hazardous materials and has a professional team available to respond to and handle environmental issues that might occur in the transport of such materials. The Company performs ongoing reviews and evaluations of the various environmental programs and issues within the Company’s operations, and, as necessary, takes actions intended to limit the Company’s exposure to potential liability. Although these costs cannot be predicted with certainty, management believes that the ultimate outcome of identified matters will not have a material adverse effect on the Company’s consolidated financial statements. Personal Injury. The Company’s personal injury liability is based on semi-annual actuarial studies performed on an undiscounted basis by an independent third party actuarial firm and reviewed by management. This liability is based on personal injury claims filed and an estimate of claims incurred but not yet reported. Actual results may vary from estimates due to the number, type and severity of the injury, costs of medical treatments and uncertainties in litigation. Adjustments to the liability are reflected within operating expenses in the period in which changes to estimates are known. Personal injury claims in excess of self-insurance levels are insured up to certain coverage amounts, depending on the type of claim and year of occurrence. The personal injury liability as of December 31, 2018 , is based on an updated actuarial study of personal injury claims through November 30, 2018, and review of December 2018 experience. For the years ended December 31, 2018 and 2017 , the Company recognized a $2.4 million increase and $3.6 million reduction, respectively, in personal injury liability, due to changes in estimates as a result of the Company’s claims development and settlement experience. The personal injury liability activity was as follows (in millions): 2018 2017 Balance at beginning of year $ 19.3 $ 23.8 Accruals 5.3 4.8 Changes in estimate 2.4 (3.6 ) Payments (7.4 ) (5.7 ) Balance at end of year $ 19.6 $ 19.3 Tax Contingencies. Information regarding tax contingencies is included in Note 13 , Income Taxes — Tax Contingencies. Contractual Agreements. In the normal course of business, the Company enters into various contractual agreements related to commercial arrangements and the use of other railroads’ or governmental entities’ infrastructure needed for the operations of the business. The Company is involved or may become involved in certain disputes involving transportation rates, product loss or damage, charges, and interpretations related to these agreements. While the outcome of these matters cannot be predicted with certainty, the Company believes that, when resolved, these disputes will not have a material effect on its consolidated financial statements. Credit Risk. The Company continually monitors risks related to economic changes and certain customer receivables concentrations. Significant changes in customer concentration or payment terms, deterioration of customer creditworthiness, bankruptcy, insolvency or liquidation of a customer, or weakening in economic trends could have a significant impact on the collectability of the Company’s receivables and its operating results. If the financial condition of the Company’s customers were to deteriorate and result in an impairment of their ability to make payments, additional allowances may be required. The Company has recorded provisions for uncollectability based on its best estimate as of December 31, 2018 . Panama Canal Railway Company (”PCRC”) Guarantees and Indemnities. At December 31, 2018 , the Company had issued and outstanding $5.6 million under a standby letter of credit to fulfill its obligation to fund fifty percent of the debt service reserve and liquidity reserve established by PCRC in connection with the issuance of the 7.0% Senior Secured Notes due November 1, 2026 (the “PCRC Notes”). Additionally, KCS has pledged its shares of PCRC as security for the PCRC Notes. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data [Abstract] | |
Quarterly Financial Data (Unaudited) | Quarterly Financial Data (Unaudited) Fourth Third Second First (In millions, except per share amounts) 2018 Revenues $ 694.0 $ 699.0 $ 682.4 $ 638.6 Operating income (i) 256.4 265.4 245.8 218.7 Net income (ii) 161.8 174.0 148.7 144.9 Net income attributable to Kansas City Southern and subsidiaries 161.1 173.6 148.2 144.5 Per share data: Basic earnings per common share $ 1.59 $ 1.71 $ 1.45 $ 1.41 Diluted earnings per common share 1.59 1.70 1.45 1.40 2017 Revenues $ 660.4 $ 656.6 $ 656.4 $ 609.5 Operating income 237.8 233.8 239.3 210.7 Net income (iii) 552.4 129.9 134.7 146.9 Net income attributable to Kansas City Southern and subsidiaries 551.7 129.3 134.4 146.6 Per share data: Basic earnings per common share $ 5.35 $ 1.24 $ 1.27 $ 1.38 Diluted earnings per common share 5.33 1.23 1.27 1.38 _____________________ (i) During the third and fourth quarters of 2018, the Company recognized a pre-tax gain of $9.4 million and $8.5 million , respectively, within operating expense for insurance recoveries related to damage from Hurricane Harvey in 2017. (ii) During the second and third quarters of 2018, the Company recognized discrete tax benefits of $4.3 million and $16.6 million , respectively, for adjustments to the provisional tax impacts of the Tax Reform Act. (iii) During the fourth quarter of 2017, the Company recognized a provisional $413.0 million net tax benefit as a result of the Tax Reform Act, which was signed into law December 22, 2017. |
Geographic Information
Geographic Information | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Geographic Information | Geographic Information The Company strategically manages its rail operations as one reportable business segment over a single coordinated rail network that extends from the midwest and southeast portions of the United States south into Mexico and connects with other Class I railroads. Financial information reported at this level, such as revenues, operating income and cash flows from operations, is used by corporate management, including the Company’s chief operating decision-maker, in evaluating overall financial and operational performance, market strategies, as well as the decisions to allocate capital resources. The Company’s chief operating decision-maker is the chief executive officer. The following tables provide information by geographic area (in millions) : Years ended December 31, 2018 2017 2016 Revenues U.S. $ 1,424.8 $ 1,359.5 $ 1,210.8 Mexico 1,289.2 1,223.4 1,123.4 Total revenues $ 2,714.0 $ 2,582.9 $ 2,334.2 December 31, 2018 2017 Property and equipment (including concession assets), net U.S. $ 5,401.3 $ 5,227.3 Mexico 3,289.8 3,176.5 Total property and equipment (including concession assets), net $ 8,691.1 $ 8,403.8 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Foreign Currency Hedging As of December 31, 2018, the Company had outstanding foreign currency option contracts known as zero-cost collars with an aggregate notional amount of $120.0 million , to hedge its exposure to fluctuations in the Mexican cash tax obligation due to changes in the value of the Mexican peso against the U.S. dollar. During January 2019, these contracts matured, resulting in cash received of $0.3 million . During January 2019, the Company entered into several foreign currency forward contracts with an aggregate notional amount of $290.0 million and maturity dates throughout 2019. These contracts obligate the Company to purchase a total of Ps.5,754.9 million at a weighted-average exchange rate of Ps.19.84 to each U.S. dollar. The Company has not designated these foreign currency derivative instruments as hedging instruments for accounting purposes. The Company will measure the foreign currency derivative instruments at fair value each period and will recognize any change in fair value in foreign exchange gain (loss) within the consolidated statements of income. |
Condensed Consolidating Financi
Condensed Consolidating Financial Information | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Consolidating Financial Information [Abstract] | |
Condensed Consolidating Financial Information | Condensed Consolidating Financial Information Pursuant to Securities and Exchange Commission (“SEC”) Regulation S-X Rule 3-10 “Financial statements of guarantors and issuers of guaranteed securities registered or being registered”, the Company is required to provide condensed consolidating financial information for issuers of certain of its senior notes that are guaranteed. As of December 31, 2018 , KCS, the parent, had outstanding $2,593.5 million senior notes due through 2048 . The senior notes are unsecured obligations of KCS, and are also jointly and severally and fully and unconditionally guaranteed on an unsecured senior basis by KCSR and certain 100% owned domestic subsidiaries of KCS (the “Guarantor Subsidiaries”). As of December 31, 2018 , KCSR had outstanding $2.7 million principal amount of senior notes due through 2045. The senior notes are unsecured obligations of KCSR, and are also jointly and severally and fully and unconditionally guaranteed on an unsecured senior basis by KCS and the Guarantor Subsidiaries. The following condensed and consolidating financial information ( in millions ) of KCS, KCSR, the Guarantor Subsidiaries and the other KCS subsidiaries that are not guarantors (the "Non-Guarantor Subsidiaries") are being presented in order to meet the reporting requirements under Rule 3-10 of Regulation S-X. Pursuant to Rule 3-10(d) and (f) of Regulation S-X, separate financial statements for the Issuer, the Parent and the Guarantor Subsidiaries are not required to be filed with the SEC as the subsidiary debt issuer and the guarantors are directly or indirectly 100% owned by the Parent and the guarantees are full and unconditional and joint and several. Condensed Consolidating Statements of Comprehensive Income 2018 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Revenues $ — $ 1,279.2 $ 45.2 $ 1,433.5 $ (43.9 ) $ 2,714.0 Operating expenses 5.2 877.2 38.7 848.4 (41.8 ) 1,727.7 Operating income (loss) (5.2 ) 402.0 6.5 585.1 (2.1 ) 986.3 Equity in net earnings (losses) of affiliates 635.6 (1.1 ) 4.5 0.3 (636.7 ) 2.6 Interest expense (96.1 ) (78.8 ) — (28.6 ) 93.5 (110.0 ) Debt retirement costs — — — (2.2 ) — (2.2 ) Foreign exchange gain — — — 7.8 — 7.8 Other income, net 92.5 1.6 — 1.9 (93.6 ) 2.4 Income before income taxes 626.8 323.7 11.0 564.3 (638.9 ) 886.9 Income tax expense (benefit) (0.6 ) 69.7 2.6 186.3 (0.5 ) 257.5 Net income 627.4 254.0 8.4 378.0 (638.4 ) 629.4 Less: Net income attributable to noncontrolling interest — — — 2.0 — 2.0 Net income attributable to Kansas City Southern and subsidiaries 627.4 254.0 8.4 376.0 (638.4 ) 627.4 Other comprehensive income 2.7 — — 0.1 (0.1 ) 2.7 Comprehensive income attributable to Kansas City Southern and subsidiaries $ 630.1 $ 254.0 $ 8.4 $ 376.1 $ (638.5 ) $ 630.1 Condensed Consolidating Statements of Comprehensive Income—(Continued) 2017 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Revenues $ — $ 1,220.8 $ 43.5 $ 1,359.0 $ (40.4 ) $ 2,582.9 Operating expenses 5.7 862.8 39.1 791.0 (37.3 ) 1,661.3 Operating income (loss) (5.7 ) 358.0 4.4 568.0 (3.1 ) 921.6 Equity in net earnings of affiliates 974.8 19.0 4.5 9.6 (996.4 ) 11.5 Interest expense (81.3 ) (72.2 ) — (34.4 ) 87.7 (100.2 ) Debt retirement costs — — — — — — Foreign exchange gain — — — 41.7 — 41.7 Other income (expense), net 86.7 (0.6 ) — 1.2 (87.6 ) (0.3 ) Income before income taxes 974.5 304.2 8.9 586.1 (999.4 ) 874.3 Income tax expense (benefit) 9.9 (310.6 ) (42.5 ) 254.2 (0.6 ) (89.6 ) Net income 964.6 614.8 51.4 331.9 (998.8 ) 963.9 Less: Net income attributable to noncontrolling interest — — — 1.9 — 1.9 Net income attributable to Kansas City Southern and subsidiaries 964.6 614.8 51.4 330.0 (998.8 ) 962.0 Other comprehensive income (loss) (6.7 ) — — 0.5 (0.5 ) (6.7 ) Comprehensive income attributable to Kansas City Southern and subsidiaries $ 957.9 $ 614.8 $ 51.4 $ 330.5 $ (999.3 ) $ 955.3 Condensed Consolidating Statements of Comprehensive Income—(Continued) 2016 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Revenues $ — $ 1,077.3 $ 43.7 $ 1,252.5 $ (39.3 ) $ 2,334.2 Operating expenses 4.7 776.3 38.1 734.0 (37.4 ) 1,515.7 Operating income (loss) (4.7 ) 301.0 5.6 518.5 (1.9 ) 818.5 Equity in net earnings (losses) of affiliates 468.5 (0.2 ) 3.5 12.7 (469.9 ) 14.6 Interest expense (81.9 ) (83.0 ) — (63.1 ) 130.3 (97.7 ) Debt retirement costs — — — — — — Foreign exchange loss — — — (72.0 ) — (72.0 ) Other income (expense), net 104.4 (0.2 ) — 24.1 (129.0 ) (0.7 ) Income before income taxes 486.3 217.6 9.1 420.2 (470.5 ) 662.7 Income tax expense 7.1 84.3 3.1 89.2 (0.9 ) 182.8 Net income 479.2 133.3 6.0 331.0 (469.6 ) 479.9 Less: Net income attributable to noncontrolling interest — — — 1.8 — 1.8 Net income attributable to Kansas City Southern and subsidiaries 479.2 133.3 6.0 329.2 (469.6 ) 478.1 Other comprehensive loss (1.5 ) — — (2.5 ) 2.5 (1.5 ) Comprehensive income attributable to Kansas City Southern and subsidiaries $ 477.7 $ 133.3 $ 6.0 $ 326.7 $ (467.1 ) $ 476.6 Condensed Consolidating Balance Sheets December 31, 2018 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Assets: Current assets $ 229.8 $ 257.6 $ 5.0 $ 350.4 $ (207.4 ) $ 635.4 Investments — 3.9 4.4 36.6 — 44.9 Investments in consolidated subsidiaries 4,852.8 4.4 190.2 — (5,047.4 ) — Property and equipment (including concession assets), net — 4,429.2 165.1 4,104.8 (8.0 ) 8,691.1 Other assets 2,523.4 59.3 — 36.8 (2,521.1 ) 98.4 Total assets $ 7,606.0 $ 4,754.4 $ 364.7 $ 4,528.6 $ (7,783.9 ) $ 9,469.8 Liabilities and equity: Current liabilities $ 214.2 $ 109.2 $ 80.1 $ 252.3 $ (208.8 ) $ 447.0 Long-term debt 2,563.0 1,828.8 — 808.5 (2,521.0 ) 2,679.3 Deferred income taxes (4.4 ) 812.8 84.7 188.8 (2.0 ) 1,079.9 Other liabilities 20.2 94.8 0.2 15.8 (0.1 ) 130.9 Stockholders’ equity 4,813.0 1,908.8 199.7 2,943.5 (5,052.0 ) 4,813.0 Noncontrolling interest — — — 319.7 — 319.7 Total liabilities and equity $ 7,606.0 $ 4,754.4 $ 364.7 $ 4,528.6 $ (7,783.9 ) $ 9,469.8 December 31, 2017 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Assets: Current assets $ 292.0 $ 214.1 $ 8.8 $ 475.5 $ (310.3 ) $ 680.1 Investments — 3.9 — 40.7 — 44.6 Investments in consolidated subsidiaries 4,462.4 7.4 182.2 — (4,652.0 ) — Property and equipment (including concession assets), net — 4,283.2 171.6 3,954.9 (5.9 ) 8,403.8 Other assets 2,159.6 46.8 — 252.5 (2,388.7 ) 70.2 Total assets $ 6,914.0 $ 4,555.4 $ 362.6 $ 4,723.6 $ (7,356.9 ) $ 9,198.7 Liabilities and equity: Current liabilities $ 277.9 $ 578.7 $ 94.9 $ 332.0 $ (311.8 ) $ 971.7 Long-term debt 2,066.8 1,517.2 — 1,040.3 (2,388.8 ) 2,235.5 Deferred income taxes (7.1 ) 734.8 84.0 177.0 (1.5 ) 987.2 Other liabilities 13.5 70.0 0.3 55.1 — 138.9 Stockholders’ equity 4,562.9 1,654.7 183.4 2,802.7 (4,654.8 ) 4,548.9 Noncontrolling interest — — — 316.5 — 316.5 Total liabilities and equity $ 6,914.0 $ 4,555.4 $ 362.6 $ 4,723.6 $ (7,356.9 ) $ 9,198.7 Condensed Consolidating Statements of Cash Flows 2018 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Operating activities: Net cash provided $ 223.8 $ 460.9 $ 1.2 $ 501.3 $ (241.5 ) $ 945.7 Investing activities: Capital expenditures — (244.8 ) (1.1 ) (274.4 ) — (520.3 ) Purchase or replacement of equipment under operating leases — (88.4 ) — (10.5 ) — (98.9 ) Property investments in MSLLC — — — (26.1 ) — (26.1 ) Insurance proceeds related to hurricane damage — 7.6 — — — 7.6 Investments in and advances to affiliates (7.8 ) — (7.8 ) (15.2 ) 11.6 (19.2 ) Proceeds from repayment of loans to affiliates 4,584.5 — — 125.0 (4,709.5 ) — Loans to affiliates (4,515.6 ) — — (125.0 ) 4,640.6 — Proceeds from disposal of property — 4.1 — 4.6 — 8.7 Other investing activities — (6.1 ) — — 2.4 (3.7 ) Net cash provided (used) 61.1 (327.6 ) (8.9 ) (321.6 ) (54.9 ) (651.9 ) Financing activities: Net short-term borrowings (348.1 ) — — — — (348.1 ) Proceeds from issuance of long-term debt 499.4 — — — — 499.4 Repayment of long-term debt — (3.9 ) (0.1 ) (77.5 ) — (81.5 ) Debt issuance and retirement costs paid (6.2 ) — — (1.8 ) — (8.0 ) Dividends paid (147.5 ) — — (239.1 ) 239.1 (147.5 ) Shares repurchased (243.5 ) — — — — (243.5 ) Proceeds from loans from affiliates 125.0 4,465.6 — 50.0 (4,640.6 ) — Repayment of loans from affiliates (125.0 ) (4,584.5 ) — — 4,709.5 — Contributions from affiliates — — 7.8 3.8 (11.6 ) — Other financing activities 1.8 — — — — 1.8 Net cash provided (used) (244.1 ) (122.8 ) 7.7 (264.6 ) 296.4 (327.4 ) Cash and cash equivalents: Net increase (decrease) 40.8 10.5 — (84.9 ) — (33.6 ) At beginning of year 0.7 17.6 — 115.8 — 134.1 At end of year $ 41.5 $ 28.1 $ — $ 30.9 $ — $ 100.5 Condensed Consolidating Statements of Cash Flows—(Continued) 2017 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Operating activities: Net cash provided $ 220.4 $ 556.6 $ 0.4 $ 266.9 $ (15.9 ) $ 1,028.4 Investing activities: Capital expenditures — (375.2 ) (0.3 ) (209.9 ) — (585.4 ) Purchase or replacement of equipment under operating leases — (42.6 ) — — — (42.6 ) Property investments in MSLLC — — — (26.0 ) — (26.0 ) Insurance proceeds related to hurricane damage — — — — — — Investments in and advances to affiliates (0.6 ) — (0.6 ) (20.4 ) 1.2 (20.4 ) Proceeds from repayment of loans to affiliates 12,241.7 — — — (12,241.7 ) — Loans to affiliates (12,102.6 ) — — — 12,102.6 — Proceeds from disposal of property — 6.0 — 2.8 — 8.8 Other investing activities — (17.2 ) — (1.7 ) 3.4 (15.5 ) Net cash provided (used) 138.5 (429.0 ) (0.9 ) (255.2 ) (134.5 ) (681.1 ) Financing activities: Net short-term borrowings 159.0 — — — — 159.0 Proceeds from issuance of long-term debt — — — — — — Repayment of long-term debt — (3.5 ) (0.1 ) (21.8 ) — (25.4 ) Debt issuance and retirement costs paid — — — — — — Dividends paid (142.5 ) — — (12.5 ) 12.5 (142.5 ) Shares repurchased (375.6 ) — — — — (375.6 ) Proceeds from loans from affiliates — 12,102.6 — — (12,102.6 ) — Repayment of loans from affiliates — (12,241.7 ) — — 12,241.7 — Contribution from affiliates — — 0.6 0.6 (1.2 ) — Other financing activities 0.7 — — — — 0.7 Net cash provided (used) (358.4 ) (142.6 ) 0.5 (33.7 ) 150.4 (383.8 ) Cash and cash equivalents: Net increase (decrease) 0.5 (15.0 ) — (22.0 ) — (36.5 ) At beginning of year 0.2 32.6 — 137.8 — 170.6 At end of year $ 0.7 $ 17.6 $ — $ 115.8 $ — $ 134.1 Condensed Consolidating Statements of Cash Flows—(Continued) 2016 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Operating activities: Net cash provided $ 434.1 $ 235.4 $ 0.6 $ 482.7 $ (233.8 ) $ 919.0 Investing activities: Capital expenditures — (372.2 ) (0.6 ) (190.8 ) — (563.6 ) Purchase or replacement of equipment under operating leases — (26.6 ) — — — (26.6 ) Property investments in MSLLC — — — (33.1 ) — (33.1 ) Insurance proceeds related to hurricane damage — — — — — — Investments in and advances to affiliates (153.4 ) — (6.5 ) (0.9 ) 159.9 (0.9 ) Proceeds from repayment of loans to affiliates 9,067.7 — — — (9,067.7 ) — Loans to affiliates (9,123.4 ) — — — 9,123.4 — Proceeds from disposal of property — 2.0 — 3.1 (0.1 ) 5.0 Other investing activities — (14.9 ) — 3.9 2.0 (9.0 ) Net cash used (209.1 ) (411.7 ) (7.1 ) (217.8 ) 217.5 (628.2 ) Financing activities: Net short-term borrowings 100.8 — — — — 100.8 Proceeds from issuance of long-term debt 248.7 — — — — 248.7 Repayment of long-term debt (244.8 ) (3.4 ) (0.1 ) (28.1 ) — (276.4 ) Debt issuance and retirement costs paid (2.4 ) — — (0.2 ) — (2.6 ) Dividends paid (142.8 ) — — (230.2 ) 230.2 (142.8 ) Shares repurchased (185.4 ) — — — — (185.4 ) Proceeds from loans from affiliates — 9,123.4 — — (9,123.4 ) — Repayment of loans from affiliates — (9,067.7 ) — — 9,067.7 — Contribution from affiliates — 146.6 6.5 6.8 (159.9 ) — Other financing activities 0.9 (0.1 ) — (1.6 ) 1.7 0.9 Net cash provided (used) (225.0 ) 198.8 6.4 (253.3 ) 16.3 (256.8 ) Cash and cash equivalents: Net increase (decrease) — 22.5 (0.1 ) 11.6 — 34.0 At beginning of year 0.2 10.1 0.1 126.2 — 136.6 At end of year $ 0.2 $ 32.6 $ — $ 137.8 $ — $ 170.6 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation Policy | Principles of Consolidation. The accompanying consolidated financial statements are presented using the accrual basis of accounting and include the Company and its majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Certain prior year amounts have been reclassified to conform to the current year presentation. The equity method of accounting is used for all entities in which the Company or its subsidiaries have significant influence, but not a controlling interest. The Company evaluates less-than-majority-owned investments for consolidation pursuant to consolidation and variable interest entity guidance. The Company does not have any less-than-majority-owned investments requiring consolidation. During the first quarter of 2018, the Company adopted Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers, which is also known as Accounting Standard Codification ("ASC") Topic 606, for all contracts, using the modified retrospective method. Results from reporting periods beginning after January 1, 2018, are presented under ASC Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Company's historical accounting under ASC Topic 605, Revenue Recognition . The adoption of this guidance did not have a significant impact on the Company's consolidated financial statements; thus no adjustment was made to the opening balance of equity at January 1, 2018. See Note 3, Revenue for additional information. During the first quarter of 2018, the Company adopted ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which allows for a reclassification from accumulated other comprehensive loss to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The Company applied the guidance as of the beginning of the period of adoption and reclassified $0.7 million , due to the change in federal corporate tax rate, from accumulated other comprehensive loss to retained earnings. It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach. |
Use of Estimates Policy | Use of Estimates. The accounting and financial reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include those related to the recoverability and useful lives of assets, litigation provisions, and income taxes. Changes in facts and circumstances may result in revised estimates and actual results could differ from those estimates. |
Revenue Recognition Policy | Revenue Recognition. The primary performance obligation for the Company is to move customers’ freight from an origin to a destination. A performance obligation is created when a customer under a transportation contract or public tariff submits a bill of lading for the transport of goods. The Company recognizes revenue proportionally as a shipment moves from origin to destination, using the distance shipped to measure progress, as the customer simultaneously receives and consumes the benefit over time. Related expenses are recognized as incurred. Revenue associated with in-transit shipments at period end is recognized based on the distance shipped as of the balance sheet date. Payment is received at or shortly after the performance obligation is satisfied. The transaction price is generally in the form of a fixed fee determined at the inception of the transportation contract or the inception of the bill of lading. Certain customer agreements have variable consideration that are based on milestone achievements in the form of rebates, discounts or incentives. The Company makes judgments to determine whether the variable consideration is probable of occurring and should be included in the estimated transaction price at the beginning of the period to apply a more consistent rate throughout the year based on an analysis of historical experience with the customer, forecasted shipments and other economic indicators. The Company adjusts the estimate on a quarterly basis. Other revenues, including switching, storage, and demurrage are distinct services and are recognized as services are performed or as contractual obligations are fulfilled. The consideration for other revenue is allocated between the separate services based upon the stand-alone transaction price. |
Foreign Exchange Gain (Loss) Policy | Foreign Exchange Gain (Loss). For financial reporting purposes, foreign subsidiaries maintain records in U.S. dollars, which is the functional currency. The dollar is the currency that reflects the economic substance of the underlying events and circumstances relevant to the entity. Monetary assets and liabilities denominated in pesos are remeasured into dollars using current exchange rates. The difference between the exchange rate on the date of the transaction and the exchange rate on the settlement date, or balance sheet date if not settled, is included in the income statement as foreign exchange gain or loss. |
Cash Equivalents Policy | Cash Equivalents. Short-term liquid investments with an initial maturity of three months or less are classified as cash and cash equivalents. |
Accounts Receivable, net Policy | Accounts Receivable, net. Accounts receivable are net of an allowance for uncollectible accounts as determined by historical experience and adjusted for economic uncertainties or known trends. Accounts are charged to the allowance when a customer enters bankruptcy, when an account has been transferred to a collection agent or submitted for legal action, or when a customer is significantly past due and all available means of collection have been exhausted. |
Materials and Supplies Policy | Materials and Supplies. Materials and supplies consisting of diesel fuel, items to be used in the maintenance of rolling stock and items to be used in the maintenance or construction of road property are valued at the lower of average cost or net realizable value. |
Derivative Instruments Policy | Derivative Instruments. Derivatives are measured at fair value and recorded on the balance sheet as either assets or liabilities. Changes in the fair value of derivatives are recorded either through current earnings or as other comprehensive income, depending on hedge designation. Gains and losses on derivative instruments classified as cash flow hedges are reported in other comprehensive income and are reclassified into earnings in the periods in which earnings are impacted by the variability of the cash flow of the hedged item. |
Property and Equipment (including Concession Assets) Policy | Property and Equipment (including Concession Assets). KCS capitalizes costs for self-constructed additions and improvements to property including direct labor and material, indirect overhead costs, and interest during long-term construction projects. For purchased assets, all costs necessary to make the asset ready for its intended use are capitalized. Expenditures that significantly increase asset values, productive capacity, efficiency, safety or extend useful lives are capitalized. Repair and maintenance costs are expensed as incurred. Property and equipment are carried at cost and are depreciated primarily on the group method of depreciation, which the Company believes closely approximates a straight line basis over the estimated useful lives of the assets measured in years. The group method of depreciation applies a composite rate to classes of similar assets rather than to individual assets. Composite depreciation rates are based upon the Company’s estimates of the expected average useful lives of assets as well as expected net salvage value at the end of their useful lives. In developing these estimates, the Company utilizes periodic depreciation studies performed by an independent engineering firm. Depreciation rate studies are performed at least every three years for equipment and at least every six years for road property (rail, ties, ballast, etc.). The Company performed depreciation studies for KCSR in 2018 and KCSM in 2016. The impacts of the studies were immaterial to the consolidated financial results for all periods. Under the group method of depreciation, the cost of railroad property and equipment (net of salvage or sales proceeds) retired or replaced in the normal course of business is charged to accumulated depreciation with no gain or loss recognized. Gains or losses on dispositions of land or non-group property and abnormal retirements of railroad property are recognized through income. A retirement of railroad property would be considered abnormal if the cause of the retirement is unusual in nature and its actual life is significantly shorter than what would be expected for that group based on the depreciation studies. An abnormal retirement could cause the Company to re-evaluate the estimated useful life of the impacted asset class. Costs incurred by the Company to acquire the concession rights and related assets, as well as subsequent improvements to the concession assets, are capitalized and amortized using the group method of depreciation over the lesser of the current expected Concession term, including probable renewal of an additional 50-year term, or the estimated useful lives of the assets and rights. Long-lived assets are reviewed for impairment when events or circumstances indicate that the carrying amount of an asset may not be recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the long-lived assets, the carrying value would be reduced to the estimated fair value. Future cash flow estimates for an impairment review would be based on the lowest level of identifiable cash flows, which are the Company’s U.S. and Mexican operations. |
Goodwill Policy | Goodwill. Goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in business combinations. As of December 31, 2018 and 2017 , the goodwill balance was $13.2 million , which is included in other assets in the consolidated balance sheets. Goodwill is not amortized, but is reviewed at least annually, or more frequently as indicators warrant, for impairment. An impairment loss would be recognized to the extent that the carrying amount exceeds the assets’ fair values. |
Investments and Impairment Policy | Investments and Impairment. The Company reviews equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable in accordance with generally accepted accounting principles. This determination requires significant judgment. In making this judgment, the Company considers available quantitative and qualitative evidence in evaluating potential impairment of these investments. If it is determined that an indicator of impairment exists, the Company assesses whether the carrying value exceeds the fair value of the asset. If the carrying value of the investment exceeds its fair value, the Company will evaluate, among other factors, general market conditions, the duration and extent to which the carrying value is greater than the fair value, and KCS’s intent and ability to hold, or plans to sell, the investment. The Company also considers specific adverse conditions related to the financial health of and business outlook for the investee, including industry and sector performance, changes in technology, and operational and financing cash flow factors. Once a decline in fair value is determined to be other-than-temporary, an impairment charge will be recorded and a new carrying basis in the investment will be established. |
Fair Value of Financial Instruments Policy | Fair Value of Financial Instruments. Non-financial assets and liabilities are recognized at fair value on a nonrecurring basis. These assets and liabilities are measured at fair value on an ongoing basis but are subject to recognition in the financial statements only in certain circumstances. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company determines the fair values of its financial instruments based on the fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The hierarchy is broken down into three levels based upon the observability of inputs. Fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value in its entirety requires judgment and considers factors specific to the asset or liability. |
Environmental Liabilities Policy | Environmental Liabilities. The Company recognizes liabilities for remediation and restoration costs related to past activities when the Company’s obligation is probable and the costs can be reasonably estimated. Costs of future expenditures for environmental remediation are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. Costs of ongoing compliance activities related to current operations are expensed as incurred. |
Personal Injury Claims Policy | Personal Injury Claims. Personal injury claims in excess of self-insurance levels are insured up to certain coverage amounts, depending on the type of claim and year of occurrence. The Company’s personal injury liability is based on actuarial studies performed on an undiscounted basis by an independent third party actuarial firm and reviewed by management. The liability is based on claims filed and an estimate of claims incurred but not yet reported. Adjustments to the liability are reflected as operating expenses in the period in which the adjustments are known. Legal fees related to personal injury claims are recognized in operating expense in the period incurred. |
Health and Welfare and Postemployment Benefits Policy | Health and Welfare and Postemployment Benefits. The Company provides certain medical, life and other postemployment benefits to certain active employees and retirees. The Company uses actuaries to assist management in measuring the benefit obligation and cost based on the current plan provisions, employee demographics, and assumptions about financial and demographic factors affecting the probability, timing and amount of expected future benefit payments. Significant assumptions include the discount rate, rate of increase in compensation levels, and the health care cost trend rate. Actuarial gains and losses determined at the measurement date (December 31) are recognized immediately in the consolidated statements of income. |
Share-Based Compensation Policy | Share-Based Compensation. The Company accounts for all share-based compensation in accordance with fair value recognition provisions. Under this method, compensation expense is measured at grant date fair value and is recognized over the requisite service period in which the award is earned. Forfeitures are recognized as they occur. The Company issues treasury stock to settle share-based awards. |
Income Taxes Policy | Income Taxes. Deferred income tax effects of transactions reported in different periods for financial reporting and income tax return purposes are recognized under the asset and liability method of accounting for income taxes. This method gives consideration to the future tax consequences of the deferred income tax items and immediately recognizes changes in income tax laws in the year of enactment. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (the “Tax Reform Act”). Further information on the tax impacts of the Tax Reform Act is included in Note 12, Income Taxes. The Company has recognized a deferred tax asset, net of a valuation allowance, for net operating loss and tax credit carryovers. The Company projects sufficient future taxable income to realize the deferred tax asset recorded less the valuation allowance. These projections take into consideration assumptions about future income, future capital expenditures and inflation rates. If assumptions or actual conditions change, the deferred tax asset, net of the valuation allowance, will be adjusted to properly reflect the expected tax benefit. |
Treasury Stock Policy | Treasury Stock. The excess of repurchase price over par value of shares held in treasury is allocated between additional paid-in capital and retained earnings. |
New Accounting Pronouncements | New Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases , which requires lessees to recognize for all leases a right-to-use asset and a lease obligation in the consolidated balance sheet. Expenses are recognized in the consolidated statement of income in a manner similar to current accounting guidance. Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less. Lessor accounting under the new standard is substantially unchanged. Additional qualitative and quantitative disclosures, including significant judgments made by management, will be required. The new standard will become effective for the Company beginning with the first quarter 2019. The Company will adopt the accounting standard using a prospective transition approach, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. The Company is finalizing its evaluation of the impacts that the adoption of this accounting guidance will have on the consolidated financial statements, and estimates approximately $175.0 million of right-to-use assets and lease liabilities will be recognized in the consolidated balance sheet upon adoption. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table presents revenues disaggregated by the major commodity groups as well as the product types included within the major commodity groups (in millions) . The Company believes disaggregation by product type best depicts how cash flows are affected by economic factors. See Note 18 , Geographic Information for revenues by geographical area. Years ended December 31, 2018 (ASC 606) 2017 (ASC 605) 2016 (ASC 605) Chemical & Petroleum Chemicals $ 236.3 $ 225.1 $ 204.7 Petroleum 241.9 186.0 142.5 Plastics 143.9 128.8 128.2 Total 622.1 539.9 475.4 Industrial & Consumer Products Forest Products 268.0 255.8 250.2 Metals & Scrap 208.2 223.3 211.2 Other 114.8 109.2 92.6 Total 591.0 588.3 554.0 Agriculture & Minerals Grain 289.9 278.1 262.9 Food Products 145.7 151.1 149.8 Ores & Minerals 20.9 19.9 19.6 Stone, Clay & Glass 29.9 28.3 28.7 Total 486.4 477.4 461.0 Energy Utility Coal 117.3 166.3 125.8 Coal & Petroleum Coke 44.3 40.8 37.9 Frac Sand 37.4 51.8 24.8 Crude Oil 57.3 24.9 14.2 Total 256.3 283.8 202.7 Intermodal 382.8 363.8 357.6 Automotive 253.2 230.8 189.9 Total Freight Revenues 2,591.8 2,484.0 2,240.6 Other Revenue 122.2 98.9 93.6 Total Revenues $ 2,714.0 $ 2,582.9 $ 2,334.2 |
Schedule of Changes in Contract Liabilities | The following tables summarize the changes in contract liabilities (in millions) : Contract liabilities Years ended December 31, 2018 (ASC 606) 2017 (ASC 605) Beginning balance $ 26.8 $ 13.7 Revenue recognized that was included in the contract liability balance at the beginning of the period (26.8 ) (13.7 ) Increases due to consideration received, excluding amounts recognized as revenue during the period 32.4 26.8 Ending balance $ 32.4 $ 26.8 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Reconciliation of Basic Earnings Per Share Computation to the Diluted Earnings Per Share Computation | The following table reconciles the basic earnings per share computation to the diluted earnings per share computation (in millions, except share and per share amounts) : 2018 2017 2016 Net income available to common stockholders for purposes of computing basic and diluted earnings per share $ 627.2 $ 961.8 $ 477.9 Weighted-average number of shares outstanding (in thousands) : Basic shares 101,852 104,728 107,560 Effect of dilution 418 312 201 Diluted shares 102,270 105,040 107,761 Earnings per share: Basic earnings per share $ 6.16 $ 9.18 $ 4.44 Diluted earnings per share $ 6.13 $ 9.16 $ 4.43 |
Schedule of Potentially Dilutive Shares Excluded from the Calculation | Potentially dilutive shares excluded from the calculation ( in thousands ): 2018 2017 2016 Stock options excluded as their inclusion would be anti-dilutive 117 150 185 |
Property and Equipment (inclu_2
Property and Equipment (including Concession Assets) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property Plant and Equipment by Type | The following tables list the major categories of property and equipment, including concession assets, as well as the weighted-average composite depreciation rate for each category ( in millions ): As of December 31, 2018 Cost Accumulated Depreciation Net Book Value Depreciation Rates for 2018 Land $ 219.3 $ — $ 219.3 N/A Concession land rights 141.2 (27.9 ) 113.3 1.0 % Rail and other track material 2,032.2 (264.2 ) 1,768.0 2.4-2.9% Ties 1,682.9 (450.6 ) 1,232.3 2.0-4.8% Grading 978.2 (169.4 ) 808.8 0.9 % Bridges and tunnels 803.9 (153.8 ) 650.1 1.1 % Ballast 797.9 (221.9 ) 576.0 2.5-4.2% Other (a) 1,367.2 (401.4 ) 965.8 3.2 % Total road property 7,662.3 (1,661.3 ) 6,001.0 2.8 % Locomotives 1,638.1 (436.3 ) 1,201.8 4.9 % Freight cars 1,034.1 (200.9 ) 833.2 2.7 % Other equipment 67.3 (29.0 ) 38.3 5.7 % Total equipment 2,739.5 (666.2 ) 2,073.3 4.1 % Technology and other 305.6 (173.9 ) 131.7 16.6 % Construction in progress 152.5 — 152.5 N/A Total property and equipment (including concession assets) $ 11,220.4 $ (2,529.3 ) $ 8,691.1 N/A _____________ (a) Other includes signals, buildings and other road assets. As of December 31, 2017 Cost Accumulated Depreciation Net Book Value Depreciation Rates for 2017 Land $ 218.6 $ — $ 218.6 N/A Concession land rights 141.2 (26.5 ) 114.7 1.0 % Rail and other track material 1,967.0 (425.9 ) 1,541.1 2.7-3.0% Ties 1,779.6 (441.0 ) 1,338.6 2.0-4.8% Grading 969.9 (162.1 ) 807.8 0.9 % Bridges and tunnels 775.0 (144.9 ) 630.1 1.1 % Ballast 795.2 (222.0 ) 573.2 2.3-4.2% Other (a) 1,270.4 (363.3 ) 907.1 3.2 % Total road property 7,557.1 (1,759.2 ) 5,797.9 2.8 % Locomotives 1,527.9 (375.2 ) 1,152.7 4.7 % Freight cars 937.9 (168.9 ) 769.0 2.7 % Other equipment 69.1 (26.6 ) 42.5 5.9 % Total equipment 2,534.9 (570.7 ) 1,964.2 4.0 % Technology and other 229.1 (144.4 ) 84.7 17.1 % Construction in progress 223.7 — 223.7 N/A Total property and equipment (including concession assets) $ 10,904.6 $ (2,500.8 ) $ 8,403.8 N/A _____________ (a) Other includes signals, buildings and other road assets. |
Other Balance Sheet Captions (T
Other Balance Sheet Captions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Balance Sheet Captions [Abstract] | |
Schedule of Other Current Assets | Other current assets included the following items at December 31 (in millions): 2018 2017 Refundable taxes $ 11.2 $ 81.6 Mexican fuel excise tax credit 30.9 35.1 Prepaid expenses 21.7 18.3 Other 9.6 22.4 Other current assets $ 73.4 $ 157.4 |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable and accrued liabilities included the following items at December 31 (in millions): 2018 2017 Accounts payable $ 180.5 $ 225.1 Income and other taxes 35.2 111.8 Accrued wages and vacation 60.9 89.0 Derailments, personal injury and other claim provisions 44.0 48.0 Dividends payable 36.4 37.2 Other 79.9 76.7 Accounts payable and accrued liabilities $ 436.9 $ 587.8 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of the Company's Financial Instruments | The fair value of the Company’s financial instruments is presented in the following table (in millions) : December 31, 2018 December 31, 2017 Level 2 Level 2 Assets Foreign currency derivative instruments $ 0.3 $ 7.9 Liabilities Debt instruments 2,661.3 2,377.8 Treasury lock agreements 2.0 5.6 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Foreign Currency Derivative Instruments | Below is a summary of the Company’s 2018, 2017 and 2016 foreign currency derivative contracts (amounts in millions, except Ps./USD) : Foreign currency forward contracts Contracts to purchase Ps./pay USD Offsetting contracts to sell Ps./receive USD Notional amount Notional amount Weighted-average exchange rate (in Ps./USD) Maturity date Notional amount Notional amount Weighted-average exchange rate (in Ps./USD) Maturity date Cash received/(paid) on settlement Contracts executed in 2018 and outstanding at December 31, 2018 $ 20.0 Ps. 410.9 Ps. 20.5 9/30/2019 — — — — — Contracts executed in 2016 and settled in 2017 $ 340.0 Ps. 6,207.7 Ps. 18.3 1/17/2017 $ 287.0 Ps. 6,207.7 Ps. 21.6 1/17/2017 $ (53.0 ) Contracts executed in 2016 and settled in 2016 $ 60.0 Ps. 1,057.3 Ps. 17.6 4/29/2016 $ 60.7 Ps. 1,057.3 Ps. 17.4 4/29/2016 $ 0.7 Contracts executed in 2015 and settled in 2016 $ 300.0 Ps. 4,480.4 Ps. 14.9 1/15/2016 $ 251.0 Ps. 4,480.4 Ps. 17.9 1/15/2016 $ (49.0 ) Foreign currency zero-cost collar contracts Notional amount Weighted-average call rate outstanding options (in Ps./USD) Weighted-average put rate outstanding options (in Ps./USD) Cash received/(paid) on settlement Contracts executed in 2018 and outstanding at December 31, 2018 $ 120.0 Ps. 19.2 Ps. 22.6 — Contracts executed in 2018 and settled in 2018 $ 220.0 $ 3.9 Contracts executed in 2017 and settled in 2018 $ 80.0 $ 10.0 Contracts executed in 2017 and settled in 2017 $ 450.0 $ 42.2 Contracts executed in 2015 and settled in 2016 $ 80.0 $ (10.1 ) |
Schedule of Derivative Instruments in Consolidated Balance Sheets, Fair Value | The following table presents the fair value of derivative instruments included in the consolidated balance sheets at December 31 (in millions) : Derivative Assets Balance Sheet Location 2018 2017 Derivatives not designated as hedging instruments: Foreign currency zero-cost collar contracts Other current assets $ 0.3 $ 7.9 Total derivatives not designated as hedging instruments 0.3 7.9 Total derivative assets $ 0.3 $ 7.9 Derivative Liabilities Balance Sheet Location 2018 2017 Derivatives designated as hedging instruments: Treasury lock agreements Other noncurrent liabilities and deferred credits $ 2.0 $ 5.6 Total derivatives designated as hedging instruments 2.0 5.6 Total derivative liabilities $ 2.0 $ 5.6 |
Schedule of Derivative Instruments, Gain (Loss) in Consolidated Statements of Income and Consolidated Statements of Comprehensive Income | The following table presents the effects of derivative instruments on the consolidated statements of income and consolidated statements of comprehensive income for the years ended December 31 (in millions) : Derivatives in Cash Flow Hedging Relationships Amount of Gain/(Loss) Recognized in OCI on Derivative 2018 2017 2016 Treasury lock agreements $ 3.6 $ (5.6 ) $ — Total $ 3.6 $ (5.6 ) $ — Derivatives Not Designated as Hedging Instruments Location of Gain/(Loss) Recognized in Income on Derivative Amount of Gain/(Loss) Recognized in Income on Derivative 2018 2017 2016 Foreign currency zero-cost collar contracts Foreign exchange gain (loss) $ 6.3 $ 50.1 $ (3.9 ) Foreign currency forward contracts Foreign exchange gain (loss) — (11.9 ) (49.6 ) Total $ 6.3 $ 38.2 $ (53.5 ) |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt Instruments | Long-term debt at December 31 (in millions): 2018 2017 Principal Unamortized Discount and Debt Issuance Costs Net Principal Unamortized Discount and Debt Issuance Costs Net Revolving credit facilities, variable interest rate, due 2020 $ — $ — $ — $ — $ — $ — KCS 2.35% senior notes, due 2020 257.3 0.7 256.6 257.3 1.2 256.1 KCS 3.00% senior notes, due 2023 439.1 3.2 435.9 439.1 4.0 435.1 KCS 3.85% senior notes, due 2023 199.2 1.4 197.8 199.2 1.7 197.5 KCS 3.125% senior notes, due 2026 250.0 2.7 247.3 250.0 3.1 246.9 KCS 4.30% senior notes, due 2043 448.7 9.1 439.6 448.7 9.3 439.4 KCS 4.95% senior notes, due 2045 499.2 7.4 491.8 499.2 7.6 491.6 KCS 4.70% senior notes, due 2048 500.0 6.2 493.8 — — — KCSR senior notes 3.85% to 4.95%, due through 2045 2.7 — 2.7 2.9 — 2.9 KCSM senior notes 2.35% to 3.00%, due through 2023 23.2 0.1 23.1 28.5 0.2 28.3 RRIF loans 2.96% to 4.29%, due serially through 2037 74.1 0.4 73.7 77.8 0.5 77.3 Financing agreements 5.737% to 9.310%, due serially through 2023 15.5 — 15.5 84.2 0.3 83.9 Capital lease obligations, due serially to 2024 11.4 — 11.4 15.0 — 15.0 Other debt obligations 0.2 — 0.2 0.3 — 0.3 Total 2,720.6 31.2 2,689.4 2,302.2 27.9 2,274.3 Less: Debt due within one year 10.1 — 10.1 38.8 — 38.8 Long-term debt $ 2,710.5 $ 31.2 $ 2,679.3 $ 2,263.4 $ 27.9 $ 2,235.5 |
Schedule Of Future Minimum Payments For Long-Term Debt, Capital And Operating Leases | Minimum annual payments and present value thereof under existing capital leases, other debt maturities and minimum annual rental commitments under non-cancelable operating leases are as follows (in millions) : Long- Term Debt Capital Leases Total Debt Years Minimum Lease Payments Less Interest Net Present Value Operating Leases Total 2019 $ 7.4 $ 3.7 $ 1.0 $ 2.7 $ 10.1 $ 57.5 $ 67.6 2020 290.9 2.7 0.8 1.9 292.8 43.6 336.4 2021 4.2 2.7 0.6 2.1 6.3 26.0 32.3 2022 4.3 2.7 0.4 2.3 6.6 18.9 25.5 2023 649.2 2.4 0.1 2.3 651.5 13.3 664.8 Thereafter 1,753.2 0.1 — 0.1 1,753.3 46.0 1,799.3 Total $ 2,709.2 $ 14.3 $ 2.9 $ 11.4 $ 2,720.6 $ 205.3 $ 2,925.9 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | Tax Expense (Benefit). Income tax expense (benefit) consists of the following components (in millions): 2018 2017 2016 Current: Federal $ (10.5 ) $ 47.3 $ 1.0 State and local 0.7 0.6 0.6 Foreign 175.6 163.8 76.4 Total current 165.8 211.7 78.0 Deferred: Federal 77.6 (350.1 ) 92.7 State and local 9.1 11.9 13.1 Foreign 5.0 36.9 (1.0 ) Total deferred 91.7 (301.3 ) 104.8 Total income tax expense (benefit) $ 257.5 $ (89.6 ) $ 182.8 |
Schedule of Income before Income Taxes, Domestic and Foreign | Income before income taxes consists of the following (in millions) : 2018 2017 2016 Income before income taxes: U.S. $ 366.2 $ 331.8 $ 279.9 Foreign 520.7 542.5 382.8 Total income before income taxes $ 886.9 $ 874.3 $ 662.7 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31 follow (in millions): 2018 2017 Assets: Tax credit and loss carryovers $ 28.9 $ 26.9 Reserves not currently deductible for tax 48.0 54.1 Other 26.4 25.2 Gross deferred tax assets before valuation allowance 103.3 106.2 Valuation allowance (2.3 ) (2.1 ) Net deferred tax assets 101.0 104.1 Liabilities: Property (1,099.2 ) (1,012.7 ) Investments (49.7 ) (48.0 ) Other (32.0 ) (30.6 ) Gross deferred tax liabilities (1,180.9 ) (1,091.3 ) Net deferred tax liability $ (1,079.9 ) $ (987.2 ) |
Schedule of Effective Income Tax Rate Reconciliation | Tax Rates. Differences between the Company’s effective income tax rate and the U.S. federal statutory income tax rate of 21% for 2018 and 35% for 2017 and 2016 follow (in millions): 2018 2017 2016 Dollars Percent Dollars Percent Dollars Percent Income tax expense using the statutory rate in effect $ 186.2 21.0 % $ 306.0 35.0 % $ 231.9 35.0 % Tax effect of: Difference between U.S. and foreign tax rate 46.1 5.2 % (26.6 ) (3.0 %) (19.2 ) (2.9 %) Foreign exchange (i) 21.8 2.5 % 31.6 3.6 % (45.0 ) (6.8 %) Tax credits (14.2 ) (1.6 %) (8.4 ) (1.0 %) (14.3 ) (2.2 %) Global intangible low-taxed income (“GILTI”) tax, net 11.8 1.3 % — — — — Withholding tax 11.2 1.3 % 8.1 0.9 % 9.6 1.4 % State and local income tax provision, net 7.5 0.8 % 8.3 1.0 % 8.1 1.2 % Change in U.S. tax rate (2.2 ) (0.3 %) (487.6 ) (55.8 %) — — Deemed mandatory repatriation (18.7 ) (2.1 %) 74.6 8.6 % — — Other, net 8.0 0.9 % 4.4 0.5 % 11.7 1.9 % Income tax expense (benefit) $ 257.5 29.0 % $ (89.6 ) (10.2 %) $ 182.8 27.6 % _____________________ (i) Mexican income taxes are paid in Mexican pesos, and as a result, the effective income tax rate reflects fluctuations in the value of the Mexican peso against the U.S. dollar. The foreign exchange impact on income taxes includes the gain or loss from the revaluation of the Company’s net U.S. dollar-denominated monetary liabilities into Mexican pesos which is included in Mexican taxable income under Mexican tax law. As a result, a strengthening of the Mexican peso against the U.S. dollar for the reporting period will generally increase the Mexican cash tax obligation and the effective income tax rate, and a weakening of the Mexican peso against the U.S. dollar for the reporting period will generally decrease the Mexican cash tax obligation and the effective tax rate. To hedge its exposure to this cash tax risk, the Company enters into foreign currency derivative contracts, which are measured at fair value each period and any change in fair value is recognized in foreign exchange gain (loss) within the consolidated statements of income. Refer to Note 10 , Derivative Instruments for further information. |
Schedule of Change in Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows ( in millions ): 2018 2017 Balance at January 1, $ — $ 3.8 Additions for tax positions of prior years 2.2 — Reductions for tax positions of prior years — (0.1 ) Reductions as a result of lapse of statute of limitations — (3.7 ) Balance at December 31, $ 2.2 $ — |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Capital Stock | Information regarding the Company’s capital stock at December 31 follows: Shares Authorized Shares Issued 2018 2017 2018 2017 $25 par, 4% noncumulative, preferred stock 840,000 840,000 649,736 649,736 $1 par, preferred stock 2,000,000 2,000,000 — — $.01 par, common stock 400,000,000 400,000,000 123,352,185 123,352,185 Shares outstanding at December 31: 2018 2017 $25 par, 4% noncumulative, preferred stock 228,395 242,170 $.01 par, common stock 100,896,678 103,036,805 |
Schedule of Treasury Stock | Shares of common and preferred stock in treasury and related activity follow: 2018 2017 2016 Balance at beginning of year 20,315,380 16,745,566 14,891,041 Shares repurchased 2,285,988 3,759,678 2,127,612 Shares issued to fund stock option exercises (24,024 ) (9,110 ) (15,264 ) Employee stock purchase plan shares issued (62,866 ) (76,401 ) (82,372 ) Nonvested shares issued (51,191 ) (124,519 ) (179,309 ) Nonvested shares forfeited 5,995 20,166 3,858 Balance at end of year 22,469,282 20,315,380 16,745,566 |
Schedule of Cash Dividends Declared per Common Share | The following table presents the amount of cash dividends declared per common share by the Company’s Board of Directors: 2018 2017 2016 Cash dividends declared per common share $ 1.44 $ 1.38 $ 1.32 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The weighted-average assumptions used were as follows: 2018 2017 2016 Expected dividend yield 1.36 % 1.52 % 1.60 % Expected volatility 27.09 % 30.74 % 32.29 % Risk-free interest rate 2.80 % 2.20 % 1.51 % Expected term (years) 6.0 6.0 6.0 Weighted-average grant date fair value of stock options granted $ 28.52 $ 24.49 $ 22.98 |
Schedule of Share-based Compensation, Stock Option Activity | A summary of stock option activity is as follows: Number of Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value In years In millions Options outstanding at December 31, 2017 500,624 $ 78.74 Granted 93,070 105.83 Exercised (24,024 ) 74.57 Forfeited or expired (5,155 ) 94.32 Options outstanding at December 31, 2018 564,515 $ 83.24 5.8 $ 9.1 Exercisable at December 31, 2018 385,774 $ 77.26 4.6 $ 8.3 |
Schedule of Stock Option Exercise Activity | Additional information regarding stock option exercises appears in the table below (in millions) : 2018 2017 2016 Aggregate grant-date fair value of stock options vested $ 1.9 $ 2.8 $ 1.8 Intrinsic value of stock options exercised 1.0 0.2 0.6 Cash received from option exercises 1.8 0.7 0.9 Tax benefit from options exercised during the annual period 0.2 0.1 0.2 |
Schedule Of Share-based Payment Award, Nonvested Stock, Valuation Assumptions | The assumptions used in the Monte Carlo simulation model are consistent with those used to value stock options and were as follows: Nonvested Stock Expected dividend yield 1.58 % Expected volatility 31.68 % Risk-free interest rate 0.53% - 1.89% Expected term (years) 1.9 Weighted-average grant date fair value $ 70.95 |
Schedule of Share-based Compensation, Nonvested Stock Activity | A summary of nonvested stock activity is as follows: Number of Shares Weighted- Average Grant Date Fair Value Aggregate Intrinsic Value In millions Nonvested stock at December 31, 2017 276,679 $ 93.28 Granted 83,099 106.52 Vested (96,162 ) 95.75 Forfeited (5,995 ) 94.20 Nonvested stock at December 31, 2018 257,621 $ 96.61 $ 24.6 |
Schedule of Share-based Compensation, Performance Based Award Activity | A summary of performance based nonvested stock activity at target is as follows: Target Number of Shares * Weighted-Average Grant Date Fair Value Nonvested stock, at December 31, 2017 139,502 $ 93.05 Granted 50,162 105.83 Vested (32,219 ) 119.35 Forfeited (4,466 ) 91.89 Nonvested stock, at December 31, 2018 152,979 $ 91.74 _____________________ * For the 2018 Awards and the 2017 Awards, participants in the aggregate can earn up to a maximum of 99,594 and 104,220 shares, respectively. For the 2016 Awards, the performance shares earned were 102,144 . |
Schedule of Employee Stock Purchase Plan Activity | The following table summarizes activity related to the various ESPP offerings: Exercise Date Received from Employees(i) In millions Date Issued Purchase Price Shares Issued July 2018 offering January 3, 2019 $ 81.13 35,972 $ 2.9 January 2018 offering July 2, 2018 90.07 32,271 2.9 July 2017 offering January 4, 2018 89.18 30,595 2.7 January 2017 offering July 5, 2017 68.70 40,293 2.8 July 2016 offering January 12, 2017 72.12 36,108 2.6 January 2016 offering July 11, 2016 62.66 41,895 2.6 _____________________ (i) Represents amounts received from employees through payroll deductions for share purchases under applicable offering. |
Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions | The weighted-average assumptions used for each of the respective periods were as follows: Year Ended December 31, 2018 2017 2016 Expected dividend yield 1.22 % 1.47 % 1.65 % Expected volatility 13.29 % 17.09 % 23.84 % Risk-free interest rate 1.73 % 0.89 % 0.46 % Expected term (years) 0.5 0.5 0.5 Weighted-average grant date fair value $ 18.66 $ 17.90 $ 17.29 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Personal Injury Liability Activity | The personal injury liability activity was as follows (in millions): 2018 2017 Balance at beginning of year $ 19.3 $ 23.8 Accruals 5.3 4.8 Changes in estimate 2.4 (3.6 ) Payments (7.4 ) (5.7 ) Balance at end of year $ 19.6 $ 19.3 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data [Abstract] | |
Schedule of Quarterly Financial Information | Fourth Third Second First (In millions, except per share amounts) 2018 Revenues $ 694.0 $ 699.0 $ 682.4 $ 638.6 Operating income (i) 256.4 265.4 245.8 218.7 Net income (ii) 161.8 174.0 148.7 144.9 Net income attributable to Kansas City Southern and subsidiaries 161.1 173.6 148.2 144.5 Per share data: Basic earnings per common share $ 1.59 $ 1.71 $ 1.45 $ 1.41 Diluted earnings per common share 1.59 1.70 1.45 1.40 2017 Revenues $ 660.4 $ 656.6 $ 656.4 $ 609.5 Operating income 237.8 233.8 239.3 210.7 Net income (iii) 552.4 129.9 134.7 146.9 Net income attributable to Kansas City Southern and subsidiaries 551.7 129.3 134.4 146.6 Per share data: Basic earnings per common share $ 5.35 $ 1.24 $ 1.27 $ 1.38 Diluted earnings per common share 5.33 1.23 1.27 1.38 _____________________ (i) During the third and fourth quarters of 2018, the Company recognized a pre-tax gain of $9.4 million and $8.5 million , respectively, within operating expense for insurance recoveries related to damage from Hurricane Harvey in 2017. (ii) During the second and third quarters of 2018, the Company recognized discrete tax benefits of $4.3 million and $16.6 million , respectively, for adjustments to the provisional tax impacts of the Tax Reform Act. (iii) During the fourth quarter of 2017, the Company recognized a provisional $413.0 million net tax benefit as a result of the Tax Reform Act, which was signed into law December 22, 2017. |
Geographic Information (Tables)
Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | The following tables provide information by geographic area (in millions) : Years ended December 31, 2018 2017 2016 Revenues U.S. $ 1,424.8 $ 1,359.5 $ 1,210.8 Mexico 1,289.2 1,223.4 1,123.4 Total revenues $ 2,714.0 $ 2,582.9 $ 2,334.2 December 31, 2018 2017 Property and equipment (including concession assets), net U.S. $ 5,401.3 $ 5,227.3 Mexico 3,289.8 3,176.5 Total property and equipment (including concession assets), net $ 8,691.1 $ 8,403.8 |
Condensed Consolidating Finan_2
Condensed Consolidating Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Consolidating Financial Information [Abstract] | |
Condensed Consolidating Statements of Comprehensive Income | Condensed Consolidating Statements of Comprehensive Income 2018 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Revenues $ — $ 1,279.2 $ 45.2 $ 1,433.5 $ (43.9 ) $ 2,714.0 Operating expenses 5.2 877.2 38.7 848.4 (41.8 ) 1,727.7 Operating income (loss) (5.2 ) 402.0 6.5 585.1 (2.1 ) 986.3 Equity in net earnings (losses) of affiliates 635.6 (1.1 ) 4.5 0.3 (636.7 ) 2.6 Interest expense (96.1 ) (78.8 ) — (28.6 ) 93.5 (110.0 ) Debt retirement costs — — — (2.2 ) — (2.2 ) Foreign exchange gain — — — 7.8 — 7.8 Other income, net 92.5 1.6 — 1.9 (93.6 ) 2.4 Income before income taxes 626.8 323.7 11.0 564.3 (638.9 ) 886.9 Income tax expense (benefit) (0.6 ) 69.7 2.6 186.3 (0.5 ) 257.5 Net income 627.4 254.0 8.4 378.0 (638.4 ) 629.4 Less: Net income attributable to noncontrolling interest — — — 2.0 — 2.0 Net income attributable to Kansas City Southern and subsidiaries 627.4 254.0 8.4 376.0 (638.4 ) 627.4 Other comprehensive income 2.7 — — 0.1 (0.1 ) 2.7 Comprehensive income attributable to Kansas City Southern and subsidiaries $ 630.1 $ 254.0 $ 8.4 $ 376.1 $ (638.5 ) $ 630.1 Condensed Consolidating Statements of Comprehensive Income—(Continued) 2017 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Revenues $ — $ 1,220.8 $ 43.5 $ 1,359.0 $ (40.4 ) $ 2,582.9 Operating expenses 5.7 862.8 39.1 791.0 (37.3 ) 1,661.3 Operating income (loss) (5.7 ) 358.0 4.4 568.0 (3.1 ) 921.6 Equity in net earnings of affiliates 974.8 19.0 4.5 9.6 (996.4 ) 11.5 Interest expense (81.3 ) (72.2 ) — (34.4 ) 87.7 (100.2 ) Debt retirement costs — — — — — — Foreign exchange gain — — — 41.7 — 41.7 Other income (expense), net 86.7 (0.6 ) — 1.2 (87.6 ) (0.3 ) Income before income taxes 974.5 304.2 8.9 586.1 (999.4 ) 874.3 Income tax expense (benefit) 9.9 (310.6 ) (42.5 ) 254.2 (0.6 ) (89.6 ) Net income 964.6 614.8 51.4 331.9 (998.8 ) 963.9 Less: Net income attributable to noncontrolling interest — — — 1.9 — 1.9 Net income attributable to Kansas City Southern and subsidiaries 964.6 614.8 51.4 330.0 (998.8 ) 962.0 Other comprehensive income (loss) (6.7 ) — — 0.5 (0.5 ) (6.7 ) Comprehensive income attributable to Kansas City Southern and subsidiaries $ 957.9 $ 614.8 $ 51.4 $ 330.5 $ (999.3 ) $ 955.3 Condensed Consolidating Statements of Comprehensive Income—(Continued) 2016 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Revenues $ — $ 1,077.3 $ 43.7 $ 1,252.5 $ (39.3 ) $ 2,334.2 Operating expenses 4.7 776.3 38.1 734.0 (37.4 ) 1,515.7 Operating income (loss) (4.7 ) 301.0 5.6 518.5 (1.9 ) 818.5 Equity in net earnings (losses) of affiliates 468.5 (0.2 ) 3.5 12.7 (469.9 ) 14.6 Interest expense (81.9 ) (83.0 ) — (63.1 ) 130.3 (97.7 ) Debt retirement costs — — — — — — Foreign exchange loss — — — (72.0 ) — (72.0 ) Other income (expense), net 104.4 (0.2 ) — 24.1 (129.0 ) (0.7 ) Income before income taxes 486.3 217.6 9.1 420.2 (470.5 ) 662.7 Income tax expense 7.1 84.3 3.1 89.2 (0.9 ) 182.8 Net income 479.2 133.3 6.0 331.0 (469.6 ) 479.9 Less: Net income attributable to noncontrolling interest — — — 1.8 — 1.8 Net income attributable to Kansas City Southern and subsidiaries 479.2 133.3 6.0 329.2 (469.6 ) 478.1 Other comprehensive loss (1.5 ) — — (2.5 ) 2.5 (1.5 ) Comprehensive income attributable to Kansas City Southern and subsidiaries $ 477.7 $ 133.3 $ 6.0 $ 326.7 $ (467.1 ) $ 476.6 |
Condensed Consolidating Balance Sheets | Condensed Consolidating Balance Sheets December 31, 2018 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Assets: Current assets $ 229.8 $ 257.6 $ 5.0 $ 350.4 $ (207.4 ) $ 635.4 Investments — 3.9 4.4 36.6 — 44.9 Investments in consolidated subsidiaries 4,852.8 4.4 190.2 — (5,047.4 ) — Property and equipment (including concession assets), net — 4,429.2 165.1 4,104.8 (8.0 ) 8,691.1 Other assets 2,523.4 59.3 — 36.8 (2,521.1 ) 98.4 Total assets $ 7,606.0 $ 4,754.4 $ 364.7 $ 4,528.6 $ (7,783.9 ) $ 9,469.8 Liabilities and equity: Current liabilities $ 214.2 $ 109.2 $ 80.1 $ 252.3 $ (208.8 ) $ 447.0 Long-term debt 2,563.0 1,828.8 — 808.5 (2,521.0 ) 2,679.3 Deferred income taxes (4.4 ) 812.8 84.7 188.8 (2.0 ) 1,079.9 Other liabilities 20.2 94.8 0.2 15.8 (0.1 ) 130.9 Stockholders’ equity 4,813.0 1,908.8 199.7 2,943.5 (5,052.0 ) 4,813.0 Noncontrolling interest — — — 319.7 — 319.7 Total liabilities and equity $ 7,606.0 $ 4,754.4 $ 364.7 $ 4,528.6 $ (7,783.9 ) $ 9,469.8 December 31, 2017 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Assets: Current assets $ 292.0 $ 214.1 $ 8.8 $ 475.5 $ (310.3 ) $ 680.1 Investments — 3.9 — 40.7 — 44.6 Investments in consolidated subsidiaries 4,462.4 7.4 182.2 — (4,652.0 ) — Property and equipment (including concession assets), net — 4,283.2 171.6 3,954.9 (5.9 ) 8,403.8 Other assets 2,159.6 46.8 — 252.5 (2,388.7 ) 70.2 Total assets $ 6,914.0 $ 4,555.4 $ 362.6 $ 4,723.6 $ (7,356.9 ) $ 9,198.7 Liabilities and equity: Current liabilities $ 277.9 $ 578.7 $ 94.9 $ 332.0 $ (311.8 ) $ 971.7 Long-term debt 2,066.8 1,517.2 — 1,040.3 (2,388.8 ) 2,235.5 Deferred income taxes (7.1 ) 734.8 84.0 177.0 (1.5 ) 987.2 Other liabilities 13.5 70.0 0.3 55.1 — 138.9 Stockholders’ equity 4,562.9 1,654.7 183.4 2,802.7 (4,654.8 ) 4,548.9 Noncontrolling interest — — — 316.5 — 316.5 Total liabilities and equity $ 6,914.0 $ 4,555.4 $ 362.6 $ 4,723.6 $ (7,356.9 ) $ 9,198.7 |
Condensed Consolidating Statements of Cash Flows | Condensed Consolidating Statements of Cash Flows 2018 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Operating activities: Net cash provided $ 223.8 $ 460.9 $ 1.2 $ 501.3 $ (241.5 ) $ 945.7 Investing activities: Capital expenditures — (244.8 ) (1.1 ) (274.4 ) — (520.3 ) Purchase or replacement of equipment under operating leases — (88.4 ) — (10.5 ) — (98.9 ) Property investments in MSLLC — — — (26.1 ) — (26.1 ) Insurance proceeds related to hurricane damage — 7.6 — — — 7.6 Investments in and advances to affiliates (7.8 ) — (7.8 ) (15.2 ) 11.6 (19.2 ) Proceeds from repayment of loans to affiliates 4,584.5 — — 125.0 (4,709.5 ) — Loans to affiliates (4,515.6 ) — — (125.0 ) 4,640.6 — Proceeds from disposal of property — 4.1 — 4.6 — 8.7 Other investing activities — (6.1 ) — — 2.4 (3.7 ) Net cash provided (used) 61.1 (327.6 ) (8.9 ) (321.6 ) (54.9 ) (651.9 ) Financing activities: Net short-term borrowings (348.1 ) — — — — (348.1 ) Proceeds from issuance of long-term debt 499.4 — — — — 499.4 Repayment of long-term debt — (3.9 ) (0.1 ) (77.5 ) — (81.5 ) Debt issuance and retirement costs paid (6.2 ) — — (1.8 ) — (8.0 ) Dividends paid (147.5 ) — — (239.1 ) 239.1 (147.5 ) Shares repurchased (243.5 ) — — — — (243.5 ) Proceeds from loans from affiliates 125.0 4,465.6 — 50.0 (4,640.6 ) — Repayment of loans from affiliates (125.0 ) (4,584.5 ) — — 4,709.5 — Contributions from affiliates — — 7.8 3.8 (11.6 ) — Other financing activities 1.8 — — — — 1.8 Net cash provided (used) (244.1 ) (122.8 ) 7.7 (264.6 ) 296.4 (327.4 ) Cash and cash equivalents: Net increase (decrease) 40.8 10.5 — (84.9 ) — (33.6 ) At beginning of year 0.7 17.6 — 115.8 — 134.1 At end of year $ 41.5 $ 28.1 $ — $ 30.9 $ — $ 100.5 Condensed Consolidating Statements of Cash Flows—(Continued) 2017 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Operating activities: Net cash provided $ 220.4 $ 556.6 $ 0.4 $ 266.9 $ (15.9 ) $ 1,028.4 Investing activities: Capital expenditures — (375.2 ) (0.3 ) (209.9 ) — (585.4 ) Purchase or replacement of equipment under operating leases — (42.6 ) — — — (42.6 ) Property investments in MSLLC — — — (26.0 ) — (26.0 ) Insurance proceeds related to hurricane damage — — — — — — Investments in and advances to affiliates (0.6 ) — (0.6 ) (20.4 ) 1.2 (20.4 ) Proceeds from repayment of loans to affiliates 12,241.7 — — — (12,241.7 ) — Loans to affiliates (12,102.6 ) — — — 12,102.6 — Proceeds from disposal of property — 6.0 — 2.8 — 8.8 Other investing activities — (17.2 ) — (1.7 ) 3.4 (15.5 ) Net cash provided (used) 138.5 (429.0 ) (0.9 ) (255.2 ) (134.5 ) (681.1 ) Financing activities: Net short-term borrowings 159.0 — — — — 159.0 Proceeds from issuance of long-term debt — — — — — — Repayment of long-term debt — (3.5 ) (0.1 ) (21.8 ) — (25.4 ) Debt issuance and retirement costs paid — — — — — — Dividends paid (142.5 ) — — (12.5 ) 12.5 (142.5 ) Shares repurchased (375.6 ) — — — — (375.6 ) Proceeds from loans from affiliates — 12,102.6 — — (12,102.6 ) — Repayment of loans from affiliates — (12,241.7 ) — — 12,241.7 — Contribution from affiliates — — 0.6 0.6 (1.2 ) — Other financing activities 0.7 — — — — 0.7 Net cash provided (used) (358.4 ) (142.6 ) 0.5 (33.7 ) 150.4 (383.8 ) Cash and cash equivalents: Net increase (decrease) 0.5 (15.0 ) — (22.0 ) — (36.5 ) At beginning of year 0.2 32.6 — 137.8 — 170.6 At end of year $ 0.7 $ 17.6 $ — $ 115.8 $ — $ 134.1 Condensed Consolidating Statements of Cash Flows—(Continued) 2016 Parent KCSR Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating Adjustments Consolidated KCS Operating activities: Net cash provided $ 434.1 $ 235.4 $ 0.6 $ 482.7 $ (233.8 ) $ 919.0 Investing activities: Capital expenditures — (372.2 ) (0.6 ) (190.8 ) — (563.6 ) Purchase or replacement of equipment under operating leases — (26.6 ) — — — (26.6 ) Property investments in MSLLC — — — (33.1 ) — (33.1 ) Insurance proceeds related to hurricane damage — — — — — — Investments in and advances to affiliates (153.4 ) — (6.5 ) (0.9 ) 159.9 (0.9 ) Proceeds from repayment of loans to affiliates 9,067.7 — — — (9,067.7 ) — Loans to affiliates (9,123.4 ) — — — 9,123.4 — Proceeds from disposal of property — 2.0 — 3.1 (0.1 ) 5.0 Other investing activities — (14.9 ) — 3.9 2.0 (9.0 ) Net cash used (209.1 ) (411.7 ) (7.1 ) (217.8 ) 217.5 (628.2 ) Financing activities: Net short-term borrowings 100.8 — — — — 100.8 Proceeds from issuance of long-term debt 248.7 — — — — 248.7 Repayment of long-term debt (244.8 ) (3.4 ) (0.1 ) (28.1 ) — (276.4 ) Debt issuance and retirement costs paid (2.4 ) — — (0.2 ) — (2.6 ) Dividends paid (142.8 ) — — (230.2 ) 230.2 (142.8 ) Shares repurchased (185.4 ) — — — — (185.4 ) Proceeds from loans from affiliates — 9,123.4 — — (9,123.4 ) — Repayment of loans from affiliates — (9,067.7 ) — — 9,067.7 — Contribution from affiliates — 146.6 6.5 6.8 (159.9 ) — Other financing activities 0.9 (0.1 ) — (1.6 ) 1.7 0.9 Net cash provided (used) (225.0 ) 198.8 6.4 (253.3 ) 16.3 (256.8 ) Cash and cash equivalents: Net increase (decrease) — 22.5 (0.1 ) 11.6 — 34.0 At beginning of year 0.2 10.1 0.1 126.2 — 136.6 At end of year $ 0.2 $ 32.6 $ — $ 137.8 $ — $ 170.6 |
Description of the Business (De
Description of the Business (Details) | 12 Months Ended |
Dec. 31, 2018 | |
MSLLC [Member] | |
Description Of The Business [Line Items] | |
Ownership percentage of MSLLC | 70.00% |
PCRC [Member] | |
Description Of The Business [Line Items] | |
Equity investment ownership percentage | 50.00% |
TCM [Member] | |
Description Of The Business [Line Items] | |
Equity investment ownership percentage | 45.00% |
FTVM [Member] | |
Description Of The Business [Line Items] | |
Equity investment ownership percentage | 25.00% |
PTC-220 [Member] | |
Description Of The Business [Line Items] | |
Equity investment ownership percentage | 14.00% |
KCSM [Member] | |
Description Of The Business [Line Items] | |
Percentage of gross revenue payable under railroad Concession to Mexican government | 1.25% |
KCSM [Member] | Maximum [Member] | |
Description Of The Business [Line Items] | |
Additional Concession renewal period | 50 years |
KCSR [Member] | Unionized Employees Concentration Risk [Member] | Number of Employees, Total [Member] | |
Description Of The Business [Line Items] | |
Percentage of employees covered by collective bargaining or labor agreements | 75.00% |
KCSM Servicios [Member] | Unionized Employees Concentration Risk [Member] | Number of Employees, Total [Member] | |
Description Of The Business [Line Items] | |
Percentage of employees covered by collective bargaining or labor agreements | 80.00% |
Significant Accounting Polici_3
Significant Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Reclassification due to adoption of ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | $ 0 | |||
Allowance for doubtful accounts | 4.1 | $ 4.6 | ||
Bad debt expense | 0.3 | 1.6 | $ 1.2 | |
Estimated amount of right-to-use assets to be recognized on the consolidated balance sheet | 175 | |||
Estimated amount of lease liabilities to be recognized on the consolidated balance sheet | 175 | |||
Other Assets [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Goodwill | 13.2 | $ 13.2 | ||
Retained Earnings [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Reclassification due to adoption of ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | $ 0.7 | 0.7 | ||
Accumulated Other Comprehensive Loss [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Reclassification due to adoption of ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | $ (0.7) | $ (0.7) |
Mexican Fuel Excise Tax Credit
Mexican Fuel Excise Tax Credit (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Mexican Fuel Excise Tax Credit [Abstract] | |||
Benefit recognized by the Company relating to a Mexican fuel excise tax credit | $ 37.7 | $ 44.1 | $ 62.8 |
Revenue Disaggregation of Reven
Revenue Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 694 | $ 699 | $ 682.4 | $ 638.6 | $ 660.4 | $ 656.6 | $ 656.4 | $ 609.5 | $ 2,714 | $ 2,582.9 | $ 2,334.2 |
ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 2,582.9 | 2,334.2 | |||||||||
Freight Revenues [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 2,591.8 | ||||||||||
Freight Revenues [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 2,484 | 2,240.6 | |||||||||
Chemical and Petroleum [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 622.1 | ||||||||||
Chemical and Petroleum [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 539.9 | 475.4 | |||||||||
Chemicals [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 236.3 | ||||||||||
Chemicals [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 225.1 | 204.7 | |||||||||
Petroleum [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 241.9 | ||||||||||
Petroleum [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 186 | 142.5 | |||||||||
Plastics [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 143.9 | ||||||||||
Plastics [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 128.8 | 128.2 | |||||||||
Industrial and Consumer Products [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 591 | ||||||||||
Industrial and Consumer Products [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 588.3 | 554 | |||||||||
Forest Products [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 268 | ||||||||||
Forest Products [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 255.8 | 250.2 | |||||||||
Metals and Scrap [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 208.2 | ||||||||||
Metals and Scrap [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 223.3 | 211.2 | |||||||||
Other Industrial and Consumer Products [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 114.8 | ||||||||||
Other Industrial and Consumer Products [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 109.2 | 92.6 | |||||||||
Agriculture and Minerals [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 486.4 | ||||||||||
Agriculture and Minerals [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 477.4 | 461 | |||||||||
Grain [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 289.9 | ||||||||||
Grain [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 278.1 | 262.9 | |||||||||
Food Products [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 145.7 | ||||||||||
Food Products [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 151.1 | 149.8 | |||||||||
Ores and Minerals [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 20.9 | ||||||||||
Ores and Minerals [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 19.9 | 19.6 | |||||||||
Stone, Clay and Glass [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 29.9 | ||||||||||
Stone, Clay and Glass [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 28.3 | 28.7 | |||||||||
Energy [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 256.3 | ||||||||||
Energy [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 283.8 | 202.7 | |||||||||
Utility Coal [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 117.3 | ||||||||||
Utility Coal [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 166.3 | 125.8 | |||||||||
Coal and Petroleum Coke [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 44.3 | ||||||||||
Coal and Petroleum Coke [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 40.8 | 37.9 | |||||||||
Frac Sand [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 37.4 | ||||||||||
Frac Sand [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 51.8 | 24.8 | |||||||||
Crude Oil [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 57.3 | ||||||||||
Crude Oil [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 24.9 | 14.2 | |||||||||
Intermodal [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 382.8 | ||||||||||
Intermodal [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 363.8 | 357.6 | |||||||||
Automotive [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 253.2 | ||||||||||
Automotive [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 230.8 | 189.9 | |||||||||
Other Revenue [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 122.2 | ||||||||||
Other Revenue [Member] | ASC 605 [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 98.9 | $ 93.6 |
Revenue Narrative (Details)
Revenue Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue from Contract with Customer [Abstract] | ||
Amount of revenue recognized from performace obligations partially satisfied in previous year | $ 20 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Accounts receivable, net | 301.2 | $ 237.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Performance obligations that were unsatisfied or partially satisfied | $ 21.9 | |
Performance obligations that were unsatisfied or partially satisfied, expected timing of satisfaction | 1 month |
Revenue Changes in Contract Lia
Revenue Changes in Contract Liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Contract Liability [Roll Forward] | ||
Beginning balance | $ 26.8 | |
Revenue recognized that was included in the contract liability balance at the beginning of the period | (26.8) | |
Increases due to consideration received, excluding amounts recognized as revenue during the period | 32.4 | |
Ending balance | 32.4 | $ 26.8 |
ASC 605 [Member] | ||
Contract Liability [Roll Forward] | ||
Beginning balance | $ 26.8 | 13.7 |
Revenue recognized that was included in the contract liability balance at the beginning of the period | (13.7) | |
Increases due to consideration received, excluding amounts recognized as revenue during the period | 26.8 | |
Ending balance | $ 26.8 |
Hurricane Harvey (Details)
Hurricane Harvey (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Unusual or Infrequent Item, or Both [Line Items] | |||||
Gain on insurance recoveries related to hurricane damage | $ 8.5 | $ 9.4 | $ 17.9 | $ 0 | $ 0 |
Hurricane Harvey [Member] | |||||
Unusual or Infrequent Item, or Both [Line Items] | |||||
Partial settlement of insurance claim, gross | $ 35.5 | 35.5 | |||
Gain on insurance recoveries related to hurricane damage | $ 17.9 |
Earnings Per Share Reconciliati
Earnings Per Share Reconciliation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share Reconciliation [Abstract] | |||||||||||
Net income available to common stockholders for purposes of computing basic earnings per share | $ 627.2 | $ 961.8 | $ 477.9 | ||||||||
Net income available to common stockholders for purposes of computing diluted earnings per share | $ 627.2 | $ 961.8 | $ 477.9 | ||||||||
Weighted-average number of shares outstanding reconciliation | |||||||||||
Basic shares | 101,852 | 104,728 | 107,560 | ||||||||
Effect of dilution | 418 | 312 | 201 | ||||||||
Diluted | 102,270 | 105,040 | 107,761 | ||||||||
Earnings per Share [Abstract] | |||||||||||
Basic earnings per share | $ 1.59 | $ 1.71 | $ 1.45 | $ 1.41 | $ 5.35 | $ 1.24 | $ 1.27 | $ 1.38 | $ 6.16 | $ 9.18 | $ 4.44 |
Diluted earnings per share | $ 1.59 | $ 1.70 | $ 1.45 | $ 1.40 | $ 5.33 | $ 1.23 | $ 1.27 | $ 1.38 | $ 6.13 | $ 9.16 | $ 4.43 |
Stock Options [Member] | |||||||||||
Potentially dilutive shares excluded from the calculation [Abstract] | |||||||||||
Stock options excluded as their inclusion would be anti-dilutive | 117 | 150 | 185 |
Property and Equipment (inclu_3
Property and Equipment (including Concession Assets) (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Accumulated amortization | $ 596.1 | $ 638.2 | |
Concession assets, net of accumulated amortization | 2,260.4 | 2,208.1 | |
Capitalized interest during period | 0.2 | 0.3 | $ 0.5 |
Depreciation and amortization | $ 346.7 | $ 320.9 | $ 305 |
Property and Equipment (inclu_4
Property and Equipment (including Concession Assets) Schedule of Property and Equipment (including Concession Assets) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 11,220.4 | $ 10,904.6 | |
Accumulated Depreciation | (2,529.3) | (2,500.8) | |
Net Book Value | 8,691.1 | 8,403.8 | |
Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 219.3 | 218.6 | |
Accumulated Depreciation | 0 | 0 | |
Net Book Value | 219.3 | 218.6 | |
Concession land rights [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 141.2 | 141.2 | |
Accumulated Depreciation | (27.9) | (26.5) | |
Net Book Value | $ 113.3 | $ 114.7 | |
Depreciation Rates | 1.00% | 1.00% | |
Road property [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 7,662.3 | $ 7,557.1 | |
Accumulated Depreciation | (1,661.3) | (1,759.2) | |
Net Book Value | $ 6,001 | $ 5,797.9 | |
Depreciation Rates | 2.80% | 2.80% | |
Rail and other track material [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 2,032.2 | $ 1,967 | |
Accumulated Depreciation | (264.2) | (425.9) | |
Net Book Value | $ 1,768 | $ 1,541.1 | |
Rail and other track material [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation Rates | 2.40% | 2.70% | |
Rail and other track material [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation Rates | 2.90% | 3.00% | |
Ties [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 1,682.9 | $ 1,779.6 | |
Accumulated Depreciation | (450.6) | (441) | |
Net Book Value | $ 1,232.3 | $ 1,338.6 | |
Ties [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation Rates | 2.00% | 2.00% | |
Ties [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation Rates | 4.80% | 4.80% | |
Grading [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 978.2 | $ 969.9 | |
Accumulated Depreciation | (169.4) | (162.1) | |
Net Book Value | $ 808.8 | $ 807.8 | |
Depreciation Rates | 0.90% | 0.90% | |
Bridges and tunnels [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 803.9 | $ 775 | |
Accumulated Depreciation | (153.8) | (144.9) | |
Net Book Value | $ 650.1 | $ 630.1 | |
Depreciation Rates | 1.10% | 1.10% | |
Ballast [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 797.9 | $ 795.2 | |
Accumulated Depreciation | (221.9) | (222) | |
Net Book Value | $ 576 | $ 573.2 | |
Ballast [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation Rates | 2.50% | 2.30% | |
Ballast [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation Rates | 4.20% | 4.20% | |
Other road property [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | [1] | $ 1,367.2 | $ 1,270.4 |
Accumulated Depreciation | [1] | (401.4) | (363.3) |
Net Book Value | [1] | $ 965.8 | $ 907.1 |
Depreciation Rates | [1] | 3.20% | 3.20% |
Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 2,739.5 | $ 2,534.9 | |
Accumulated Depreciation | (666.2) | (570.7) | |
Net Book Value | $ 2,073.3 | $ 1,964.2 | |
Depreciation Rates | 4.10% | 4.00% | |
Locomotives [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 1,638.1 | $ 1,527.9 | |
Accumulated Depreciation | (436.3) | (375.2) | |
Net Book Value | $ 1,201.8 | $ 1,152.7 | |
Depreciation Rates | 4.90% | 4.70% | |
Freight cars [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 1,034.1 | $ 937.9 | |
Accumulated Depreciation | (200.9) | (168.9) | |
Net Book Value | $ 833.2 | $ 769 | |
Depreciation Rates | 2.70% | 2.70% | |
Other equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 67.3 | $ 69.1 | |
Accumulated Depreciation | (29) | (26.6) | |
Net Book Value | $ 38.3 | $ 42.5 | |
Depreciation Rates | 5.70% | 5.90% | |
Technology and other [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 305.6 | $ 229.1 | |
Accumulated Depreciation | (173.9) | (144.4) | |
Net Book Value | $ 131.7 | $ 84.7 | |
Depreciation Rates | 16.60% | 17.10% | |
Construction in progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 152.5 | $ 223.7 | |
Accumulated Depreciation | 0 | 0 | |
Net Book Value | $ 152.5 | $ 223.7 | |
[1] | Other includes signals, buildings and other road assets. |
Other Balance Sheet Captions Ot
Other Balance Sheet Captions Other Current Assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Other Balance Sheet Captions [Abstract] | ||
Refundable taxes | $ 11.2 | $ 81.6 |
Mexican fuel excise tax credit | 30.9 | 35.1 |
Prepaid expenses | 21.7 | 18.3 |
Other | 9.6 | 22.4 |
Other current assets | $ 73.4 | $ 157.4 |
Other Balance Sheet Captions Ac
Other Balance Sheet Captions Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Other Balance Sheet Captions [Abstract] | ||
Accounts payable | $ 180.5 | $ 225.1 |
Income and other taxes | 35.2 | 111.8 |
Accrued wages and vacation | 60.9 | 89 |
Derailments, personal injury and other claim provisions | 44 | 48 |
Dividends payable | 36.4 | 37.2 |
Other | 79.9 | 76.7 |
Accounts payable and accrued liabilities | $ 436.9 | $ 587.8 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying value of Company's debt | $ 2,689.4 | $ 2,274.3 |
Fair value of derivative assets | 0.3 | 7.9 |
Fair value of derivative liabilities | 2 | 5.6 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of debt instruments | 2,661.3 | 2,377.8 |
Foreign Currency Derivative Instruments [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of derivative assets | 0.3 | 7.9 |
Treasury Lock Agreements [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of derivative liabilities | $ 2 | $ 5.6 |
Derivative Instruments Interest
Derivative Instruments Interest Rate Derivative Instruments (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2018USD ($) | May 31, 2017USD ($)Treasury_Lock_Agreements | |
Derivative [Line Items] | ||
Long-term debt instrument, gross | $ 2,709.2 | |
Senior Notes [Member] | 2.35% Senior Notes Due May 15, 2020 [Member] | ||
Derivative [Line Items] | ||
Long-term debt instrument, gross | $ 275 | |
Debt instrument, stated interest rate | 2.35% | |
Debt instrument, maturity date | May 15, 2020 | |
Treasury Lock Agreements [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative [Line Items] | ||
Number of treasury lock agreements executed | Treasury_Lock_Agreements | 4 | |
Aggregate notional value of treasury lock agreements | $ 275 | |
Weighted-average interest rate of treasury lock agreements | 2.85% |
Derivative Instruments Summary
Derivative Instruments Summary of Foreign Currency Derivative Contracts (Details) $ in Millions, $ in Millions | Jan. 17, 2017USD ($)$ / $ | Apr. 29, 2016USD ($)$ / $ | Jan. 15, 2016USD ($)$ / $ | Dec. 31, 2018USD ($)$ / $ | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2018MXN ($)$ / $ | Jan. 17, 2017MXN ($)$ / $ | Apr. 29, 2016MXN ($)$ / $ | Jan. 15, 2016MXN ($)$ / $ | Dec. 31, 2015USD ($) |
Derivative [Line Items] | |||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ 13.9 | $ (10.8) | $ (58.4) | ||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | $ 340 | $ 60 | $ 300 | $ 20 | $ 410.9 | $ 6,207.7 | $ 1,057.3 | $ 4,480.4 | |||
Weighted-average exchange rate of foreign currency forward contracts | $ / $ | 18.3 | 17.6 | 14.9 | 20.5 | 20.5 | 18.3 | 17.6 | 14.9 | |||
Maturity date of foreign currency contracts | Jan. 17, 2017 | Apr. 29, 2016 | Jan. 15, 2016 | Sep. 30, 2019 | |||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | Foreign Exchange Gain (Loss) [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ (53) | $ 0.7 | $ (49) | ||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | Offsetting Derivative Instrument [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | $ 287 | $ 60.7 | $ 251 | $ 6,207.7 | $ 1,057.3 | $ 4,480.4 | |||||
Weighted-average exchange rate of foreign currency forward contracts | $ / $ | 21.6 | 17.4 | 17.9 | 21.6 | 17.4 | 17.9 | |||||
Maturity date of foreign currency contracts | Jan. 17, 2017 | Apr. 29, 2016 | Jan. 15, 2016 | ||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | $ 120 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Call Option [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Weighted-average rate outstanding options | $ / $ | 19.2 | 19.2 | |||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Put Option [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Weighted-average rate outstanding options | $ / $ | 22.6 | 22.6 | |||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2018 and Settled in 2018 [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | $ 220 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2018 and Settled in 2018 [Member] | Foreign Exchange Gain (Loss) [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Cash received (paid) on settlement of foreign currency contracts | 3.9 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2017 and Settled in 2018 [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | 80 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2017 and Settled in 2018 [Member] | Foreign Exchange Gain (Loss) [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ 10 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2017 and Settled in 2017 [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | 450 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2017 and Settled in 2017 [Member] | Foreign Exchange Gain (Loss) [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ 42.2 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2015 and Settled in 2016 [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Notional amount of foreign currency contracts | $ 80 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Contracts Executed in 2015 and Settled in 2016 [Member] | Foreign Exchange Gain (Loss) [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ (10.1) |
Derivative Instruments Fair Val
Derivative Instruments Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 0.3 | $ 7.9 |
Derivative liabilities, fair value | 2 | 5.6 |
Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0.3 | 7.9 |
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0.3 | 7.9 |
Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 2 | 5.6 |
Designated as Hedging Instrument [Member] | Treasury Lock Agreements [Member] | Other Noncurrent Liabilities and Deferred Credits [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | $ 2 | $ 5.6 |
Derivative Instruments Derivati
Derivative Instruments Derivative Instruments Affecting the Consolidated Statements of Income and Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain/(Loss) Recognized in OCI on Derivative | $ 3.6 | $ (5.6) | $ 0 |
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Treasury Lock Agreements [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain/(Loss) Recognized in OCI on Derivative | 3.6 | (5.6) | 0 |
Not Designated as Hedging Instrument [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain/(Loss) Recognized in Income on Derivative | 6.3 | 38.2 | (53.5) |
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Foreign Exchange Gain (Loss) [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain/(Loss) Recognized in Income on Derivative | 6.3 | 50.1 | (3.9) |
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | Foreign Exchange Gain (Loss) [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain/(Loss) Recognized in Income on Derivative | $ 0 | $ (11.9) | $ (49.6) |
Short-Term Borrowings (Details)
Short-Term Borrowings (Details) - KCS [Member] - Commercial Paper [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Short-term Borrowings [Line Items] | |||
Amount of commercial paper outstanding | $ 0 | $ 345.1 | |
Discount on commercial paper outstanding | $ 0.1 | ||
Weighted-average interest rate of commercial paper outstanding | 1.846% | ||
Maximum [Member] | |||
Short-term Borrowings [Line Items] | |||
Commercial paper, days outstanding | 90 days | 90 days | 90 days |
Long-Term Debt Schedule of Long
Long-Term Debt Schedule of Long-Term Debt (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Feb. 21, 2012 | Dec. 31, 2011 |
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 2,709.2 | |||
Unamortized discount and debt issuance costs | 31.2 | $ 27.9 | ||
Total, gross | 2,720.6 | 2,302.2 | ||
Total | 2,689.4 | 2,274.3 | ||
Less: Debt due within one year, gross | 10.1 | 38.8 | ||
Unamortized discount and debt issuance costs, current | 0 | 0 | ||
Less: Debt due within one year | 10.1 | 38.8 | ||
Long-term debt, gross | 2,710.5 | 2,263.4 | ||
Unamortized discount and debt issuance costs, noncurrent | 31.2 | 27.9 | ||
Long-term debt | 2,679.3 | 2,235.5 | ||
KCS [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | 2,563 | 2,066.8 | ||
Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | 0 | 0 | ||
Unamortized discount and debt issuance costs | 0 | 0 | ||
Long-term debt instrument | 0 | 0 | ||
Senior Notes [Member] | KCSR [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | 2.7 | 2.9 | ||
Unamortized discount and debt issuance costs | 0 | 0 | ||
Long-term debt instrument | $ 2.7 | 2.9 | ||
Senior Notes [Member] | KCSR [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 3.85% | |||
Senior Notes [Member] | KCSR [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 4.95% | |||
Senior Notes [Member] | KCSM [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 23.2 | 28.5 | ||
Unamortized discount and debt issuance costs | 0.1 | 0.2 | ||
Long-term debt instrument | $ 23.1 | 28.3 | ||
Senior Notes [Member] | KCSM [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 2.35% | |||
Senior Notes [Member] | KCSM [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 3.00% | |||
Senior Notes [Member] | KCS [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 2,593.5 | |||
Senior Notes [Member] | KCS [Member] | 2.35% senior notes due 2020 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | 257.3 | 257.3 | ||
Unamortized discount and debt issuance costs | 0.7 | 1.2 | ||
Long-term debt instrument | $ 256.6 | 256.1 | ||
Debt instrument, stated interest rate | 2.35% | |||
Senior Notes [Member] | KCS [Member] | 3.00% senior notes due 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 439.1 | 439.1 | ||
Unamortized discount and debt issuance costs | 3.2 | 4 | ||
Long-term debt instrument | $ 435.9 | 435.1 | ||
Debt instrument, stated interest rate | 3.00% | |||
Senior Notes [Member] | KCS [Member] | 3.85% senior notes due 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 199.2 | 199.2 | ||
Unamortized discount and debt issuance costs | 1.4 | 1.7 | ||
Long-term debt instrument | $ 197.8 | 197.5 | ||
Debt instrument, stated interest rate | 3.85% | |||
Senior Notes [Member] | KCS [Member] | 3.125% senior notes due 2026 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 250 | 250 | ||
Unamortized discount and debt issuance costs | 2.7 | 3.1 | ||
Long-term debt instrument | $ 247.3 | 246.9 | ||
Debt instrument, stated interest rate | 3.125% | |||
Senior Notes [Member] | KCS [Member] | 4.30% senior notes due 2043 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 448.7 | 448.7 | ||
Unamortized discount and debt issuance costs | 9.1 | 9.3 | ||
Long-term debt instrument | $ 439.6 | 439.4 | ||
Debt instrument, stated interest rate | 4.30% | |||
Senior Notes [Member] | KCS [Member] | 4.95% senior notes due 2045 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 499.2 | 499.2 | ||
Unamortized discount and debt issuance costs | 7.4 | 7.6 | ||
Long-term debt instrument | $ 491.8 | 491.6 | ||
Debt instrument, stated interest rate | 4.95% | |||
Senior Notes [Member] | KCS [Member] | 4.70% senior notes due 2048 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 500 | 0 | ||
Unamortized discount and debt issuance costs | 6.2 | 0 | ||
Long-term debt instrument | $ 493.8 | 0 | ||
Debt instrument, stated interest rate | 4.70% | |||
Secured Debt [Member] | RRIF loans due serially through 2037 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 74.1 | 77.8 | ||
Unamortized discount and debt issuance costs | 0.4 | 0.5 | ||
Long-term debt instrument | $ 73.7 | 77.3 | ||
Secured Debt [Member] | RRIF loans due serially through 2037 [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 2.96% | |||
Secured Debt [Member] | RRIF loans due serially through 2037 [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 4.29% | |||
Secured Debt [Member] | Financing agreements due serially through 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | $ 15.5 | 84.2 | ||
Unamortized discount and debt issuance costs | 0 | 0.3 | ||
Long-term debt instrument | $ 15.5 | 83.9 | ||
Secured Debt [Member] | Financing agreements due serially through 2023 [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 5.737% | |||
Secured Debt [Member] | Financing agreements due serially through 2023 [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 9.31% | |||
Secured Debt [Member] | KCSR [Member] | RRIF loans due serially through 2037 [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 2.96% | |||
Secured Debt [Member] | KCSM [Member] | Financing agreements due serially through 2023 [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 5.737% | |||
Secured Debt [Member] | KCSM [Member] | Financing agreements due serially through 2023 [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, stated interest rate | 9.31% | |||
Capital Lease Obligations [Member] | ||||
Debt Instrument [Line Items] | ||||
Capital lease obligations | $ 11.4 | 15 | ||
Other Debt Obligations [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt instrument, gross | 0.2 | 0.3 | ||
Unamortized discount and debt issuance costs | 0 | 0 | ||
Long-term debt instrument | $ 0.2 | $ 0.3 |
Long-Term Debt Revolving Credit
Long-Term Debt Revolving Credit Facility (Details) - KCS [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
KCS Commercial Paper Program [Member] | Commercial Paper [Member] | ||
Debt Instrument [Line Items] | ||
Commercial paper maximum borrowing capacity | $ 800 | |
Revolving Credit Facility [Member] | KCS Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Credit facility maximum borrowing capacity | $ 800 | |
Revolving credit facility maturity date | Dec. 9, 2020 | |
Outstanding borrowings under the revolving credit facility | $ 0 | $ 0 |
Revolving Credit Facility [Member] | KCS Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||
Debt Instrument [Line Items] | ||
Margin KCS pays or would pay above the LIBOR | 1.25% | |
Revolving Credit Facility [Member] | KCS Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Margin KCS pays or would pay above the LIBOR | 1.125% | |
Revolving Credit Facility [Member] | KCS Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Margin KCS pays or would pay above the LIBOR | 2.00% | |
Revolving Credit Facility [Member] | KCS Revolving Credit Facility [Member] | Letter of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Credit facility maximum borrowing capacity | $ 25 |
Long-Term Debt Senior Notes (De
Long-Term Debt Senior Notes (Details) - USD ($) $ in Millions | May 03, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | May 02, 2018 |
Debt Instrument [Line Items] | |||||
Outstanding principal amount of the senior notes | $ 2,709.2 | ||||
Debt retirement benefits (costs) | (2.2) | $ 0 | $ 0 | ||
KCS [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt retirement benefits (costs) | $ 0 | 0 | $ 0 | ||
Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Redemption option senior notes, price expressed as a percent of principal amount | 100.00% | ||||
Senior Notes [Member] | KCS [Member] | |||||
Debt Instrument [Line Items] | |||||
Outstanding principal amount of the senior notes | $ 2,593.5 | ||||
Senior Notes [Member] | KCS [Member] | 4.70% Senior Notes due May 1, 2048 [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 500 | ||||
Debt instrument, maturity date | May 1, 2048 | ||||
Debt instrument, stated interest rate | 4.70% | ||||
Debt instrument, unamortized discount | $ 0.6 | ||||
Debt instrument, yield to maturity | 4.707% | ||||
Senior Notes [Member] | KCSM [Member] | |||||
Debt Instrument [Line Items] | |||||
Additional redemption option KCSM senior notes, price expressed as percent of principal amount | 100.00% | ||||
Outstanding principal amount of the senior notes | $ 23.2 | $ 28.5 | |||
Senior Notes [Member] | KCSM [Member] | 3.0% Senior Notes due May 15, 2023 [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, maturity date | May 15, 2023 | ||||
Debt instrument, stated interest rate | 3.00% | ||||
Debt instrument, extinguishment amount | $ 5.3 | ||||
Outstanding principal amount of the senior notes | $ 10.9 | ||||
Redemption price expressed as a percent of principal amount | 95.91% | ||||
Senior Notes [Member] | KCSM [Member] | 3.0% Senior Notes due May 15, 2023 [Member] | Debt Retirement Costs [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt retirement benefits (costs) | $ 0.2 |
Long-Term Debt RRIF Loan Agreem
Long-Term Debt RRIF Loan Agreements (Details) - Secured Debt [Member] - RRIF Loan Agreement [Member] $ in Millions | Feb. 21, 2012USD ($)locomotives | Jun. 28, 2005USD ($) |
KCSR [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount of debt | $ 54.6 | |
Number of new locomotives acquired | locomotives | 30 | |
Debt instrument, stated interest rate | 2.96% | |
Debt instrument, maturity date | Feb. 24, 2037 | |
Tex Mex [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount of debt | $ 50 | |
Debt instrument, stated interest rate | 4.29% | |
Debt instrument, maturity date | Jul. 13, 2030 |
Long-Term Debt Locomotive Finan
Long-Term Debt Locomotive Financing Agreements (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||
May 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2011 | |
Debt Instrument [Line Items] | |||||
Debt retirement benefits (costs) | $ (2.2) | $ 0 | $ 0 | ||
Secured Debt [Member] | Financing Agreement [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, stated interest rate | 5.737% | ||||
Secured Debt [Member] | Financing Agreement [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, stated interest rate | 9.31% | ||||
KCSM [Member] | Secured Debt [Member] | Financing Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal amount of debt | $ 216 | ||||
KCSM [Member] | Secured Debt [Member] | Financing Agreement [Member] | Debt Retirement Costs [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt retirement benefits (costs) | $ (2.4) | ||||
KCSM [Member] | Secured Debt [Member] | Financing Agreement [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, stated interest rate | 5.737% | ||||
KCSM [Member] | Secured Debt [Member] | Financing Agreement [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, stated interest rate | 9.31% | ||||
KCSM [Member] | Secured Debt [Member] | Export Development Canada Financing Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, extinguishment amount | 23 | ||||
KCSM [Member] | Secured Debt [Member] | DVB Bank AG Financing Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, extinguishment amount | $ 19.1 |
Long-Term Debt Leases and Debt
Long-Term Debt Leases and Debt Maturities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |||
Rental expenses under operating leases | $ 49.3 | $ 59.5 | $ 61 |
Long-Term Debt | |||
Long-Term Debt, Payments Due in 2019 | 7.4 | ||
Long-Term Debt, Payments Due in 2020 | 290.9 | ||
Long-Term Debt, Payments Due in 2021 | 4.2 | ||
Long-Term Debt, Payments Due in 2022 | 4.3 | ||
Long-Term Debt, Payments Due in 2023 | 649.2 | ||
Long-Term Debt, Payments Due Thereafter | 1,753.2 | ||
Total Long-Term Debt | 2,709.2 | ||
Capital Leases, Minimum Lease Payments | |||
Capital Leases, Minimum Lease Payments Due in 2019 | 3.7 | ||
Capital Leases, Minimum Lease Payments Due in 2020 | 2.7 | ||
Capital Leases, Minimum Lease Payments Due in 2021 | 2.7 | ||
Capital Leases, Minimum Lease Payments Due in 2022 | 2.7 | ||
Capital Leases, Minimum Lease Payments Due in 2023 | 2.4 | ||
Capital Leases, Minimum Lease Payments Due Thereafter | 0.1 | ||
Capital Leases, Minimum Lease Payments Total Due | 14.3 | ||
Capital Leases, Minimum Interest Payments | |||
Capital Leases, Minimum Interest Payments Due in 2019 | 1 | ||
Capital Leases, Minimum Interest Payments Due in 2020 | 0.8 | ||
Capital Leases, Minimum Interest Payments Due in 2021 | 0.6 | ||
Capital Leases, Minimum Interest Payments Due in 2022 | 0.4 | ||
Capital Leases, Minimum Interest Payments Due in 2023 | 0.1 | ||
Capital Leases, Minimum Interest Payments Due Thereafter | 0 | ||
Capital Leases, Minimum Interest Payments Total Due | 2.9 | ||
Capital Leases, Net Present Value | |||
Capital Leases, Net Present Value Due in 2019 | 2.7 | ||
Capital Leases, Net Present Value Due in 2020 | 1.9 | ||
Capital Leases, Net Present Value Due in 2021 | 2.1 | ||
Capital Leases, Net Present Value Due in 2022 | 2.3 | ||
Capital Leases, Net Present Value Due in 2023 | 2.3 | ||
Capital Leases, Net Present Value Due Thereafter | 0.1 | ||
Capital Leases, Net Present Value Total Due | 11.4 | ||
Total Debt | |||
Total Debt Due in 2019 | 10.1 | ||
Total Debt Due in 2020 | 292.8 | ||
Total Debt Due in 2021 | 6.3 | ||
Total Debt Due in 2022 | 6.6 | ||
Total Debt Due in 2023 | 651.5 | ||
Total Debt Due Thereafter | 1,753.3 | ||
Total | 2,720.6 | $ 2,302.2 | |
Operating Leases, Minimum Lease Payments | |||
Operating Leases, Minimum Lease Payments Due in 2019 | 57.5 | ||
Operating Leases, Minimum Lease Payments Due in 2020 | 43.6 | ||
Operating Leases, Minimum Lease Payments Due in 2021 | 26 | ||
Operating Leases, Minimum Lease Payments Due in 2022 | 18.9 | ||
Operating Leases, Minimum Lease Payments Due in 2023 | 13.3 | ||
Operating Leases, Minimum Lease Payments Due Thereafter | 46 | ||
Operating Leases, Minimum Lease Payments Total Due | 205.3 | ||
Total Debt and Operating Leases | |||
Total Debt and Operating Leases, Payments Due in 2019 | 67.6 | ||
Total Debt and Operating Leases, Payments Due in 2020 | 336.4 | ||
Total Debt and Operating Leases, Payments Due in 2021 | 32.3 | ||
Total Debt and Operating Leases, Payments Due in 2022 | 25.5 | ||
Total Debt and Operating Leases, Payments Due in 2023 | 664.8 | ||
Total Debt and Operating Leases, Payments Due Thereafter | 1,799.3 | ||
Total Debt and Operating Leases, Payments Due Total | $ 2,925.9 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Sep. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Line Items] | ||||||
U.S. corporate income tax rate | 21.00% | 35.00% | 35.00% | |||
Tax benefit, net, recognized related to the deemed repatriated earnings and change in U.S. tax rate under the Tax Reform Act | $ 16.6 | $ 4.3 | $ 413 | |||
Tax benefit recognized related to deemed repatriated earnings under the Tax Reform Act | $ 18.7 | $ (74.6) | ||||
Tax benefit recognized due to change in U.S. corporate income tax rate under the Tax Reform Act | 2.2 | 487.6 | ||||
Tax expense recognized related to an uncertain tax position on tax credits generated in prior tax years | 2.2 | $ 2.2 | $ 0 | |||
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
U.S. corporate income tax rate | 21.00% | 35.00% | ||||
Tax benefit, net, recognized related to the deemed repatriated earnings and change in U.S. tax rate under the Tax Reform Act | 16.6 | $ 413 | ||||
Tax benefit recognized related to deemed repatriated earnings under the Tax Reform Act | 14.4 | $ 4.3 | ||||
Tax benefit recognized due to change in U.S. corporate income tax rate under the Tax Reform Act | $ 2.2 | |||||
Undistributed foreign earnings subject to deemed mandatory repatriation under the Tax Reform Act | $ 1,395.7 | |||||
GILTI income recognized | $ 226.1 | |||||
Percent dividends received deduction provided for in Tax Reform Act | 100.00% | |||||
Repatriated earnings previously taxed in the U.S. | $ 233.8 | |||||
State and Local Jurisdiction [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
Net operating loss carryover, amount | 443.3 | |||||
Net operating loss carryover, deferred tax asset | $ 26.2 | |||||
State and Local Jurisdiction [Member] | Minimum [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
Net operating loss carryover, period | 5 years | |||||
State and Local Jurisdiction [Member] | Maximum [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
Net operating loss carryover, period | 20 years | |||||
Foreign Tax Authority [Member] | Mexican Tax Authority [Member] | ||||||
Income Tax Disclosure [Line Items] | ||||||
Net operating loss carryover, amount | $ 7.9 | |||||
Tax credit carryover, amount | $ 5.1 |
Income Taxes Schedule of Income
Income Taxes Schedule of Income Tax Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current: | |||
Federal | $ (10.5) | $ 47.3 | $ 1 |
State and local | 0.7 | 0.6 | 0.6 |
Foreign | 175.6 | 163.8 | 76.4 |
Total current | 165.8 | 211.7 | 78 |
Deferred: | |||
Federal | 77.6 | (350.1) | 92.7 |
State and local | 9.1 | 11.9 | 13.1 |
Foreign | 5 | 36.9 | (1) |
Total deferred | 91.7 | (301.3) | 104.8 |
Income tax expense (benefit) | $ 257.5 | $ (89.6) | $ 182.8 |
Income Taxes Schedule of Inco_2
Income Taxes Schedule of Income Before Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ 366.2 | $ 331.8 | $ 279.9 |
Foreign | 520.7 | 542.5 | 382.8 |
Income before income taxes | $ 886.9 | $ 874.3 | $ 662.7 |
Income Taxes Schedule of Deferr
Income Taxes Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Assets: | ||
Tax credit and loss carryovers | $ 28.9 | $ 26.9 |
Reserves not currently deductible for tax | 48 | 54.1 |
Other | 26.4 | 25.2 |
Gross deferred tax assets before valuation allowance | 103.3 | 106.2 |
Valuation allowance | (2.3) | (2.1) |
Net deferred tax assets | 101 | 104.1 |
Liabilities: | ||
Property | (1,099.2) | (1,012.7) |
Investments | (49.7) | (48) |
Other | (32) | (30.6) |
Gross deferred tax liabilities | (1,180.9) | (1,091.3) |
Net deferred tax liability | $ (1,079.9) | $ (987.2) |
Income Taxes Schedule of Effect
Income Taxes Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Income Tax Disclosure [Abstract] | ||||
Income tax expense using the statutory rate in effect | $ 186.2 | $ 306 | $ 231.9 | |
Tax effect of: | ||||
Difference between U.S. and foreign tax rate | 46.1 | (26.6) | (19.2) | |
Foreign exchange | [1] | 21.8 | 31.6 | (45) |
Tax credits | (14.2) | (8.4) | (14.3) | |
Global intangible low-taxed income (GILTI) tax, net | 11.8 | |||
Withholding tax | 11.2 | 8.1 | 9.6 | |
State and local income tax provision, net | 7.5 | 8.3 | 8.1 | |
Change in U.S. tax rate | (2.2) | (487.6) | ||
Deemed mandatory repatriation | (18.7) | 74.6 | ||
Other, net | 8 | 4.4 | 11.7 | |
Income tax expense (benefit) | $ 257.5 | $ (89.6) | $ 182.8 | |
U.S. federal statutory income tax rate | 21.00% | 35.00% | 35.00% | |
Tax rate effect of: | ||||
Difference between U.S. and foreign tax rate | 5.20% | (3.00%) | (2.90%) | |
Foreign exchange | [1] | 2.50% | 3.60% | (6.80%) |
Tax credits | (1.60%) | (1.00%) | (2.20%) | |
Global intangible low-taxed income (GILTI) tax, net | 1.30% | |||
Withholding tax | 1.30% | 0.90% | 1.40% | |
State and local income tax provision, net | 0.80% | 1.00% | 1.20% | |
Change in U.S. tax rate | (0.30%) | (55.80%) | ||
Deemed mandatory repatriation | (2.10%) | 8.60% | ||
Other, net | 0.90% | 0.50% | 1.90% | |
Effective income tax rate | 29.00% | (10.20%) | 27.60% | |
[1] | Mexican income taxes are paid in Mexican pesos, and as a result, the effective income tax rate reflects fluctuations in the value of the Mexican peso against the U.S. dollar. The foreign exchange impact on income taxes includes the gain or loss from the revaluation of the Company’s net U.S. dollar-denominated monetary liabilities into Mexican pesos which is included in Mexican taxable income under Mexican tax law. As a result, a strengthening of the Mexican peso against the U.S. dollar for the reporting period will generally increase the Mexican cash tax obligation and the effective income tax rate, and a weakening of the Mexican peso against the U.S. dollar for the reporting period will generally decrease the Mexican cash tax obligation and the effective tax rate. To hedge its exposure to this cash tax risk, the Company enters into foreign currency derivative contracts, which are measured at fair value each period and any change in fair value is recognized in foreign exchange gain (loss) within the consolidated statements of income. |
Income Taxes Uncertain Tax Posi
Income Taxes Uncertain Tax Positions (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits [Rollforward] | |||
Balance at January 1, | $ 0 | $ 3.8 | |
Additions for tax positions of prior years | $ 2.2 | 2.2 | 0 |
Reductions for tax positions of prior years | 0 | (0.1) | |
Reductions as a result of lapse of statute of limitations | 0 | (3.7) | |
Balance at December 31, | $ 2.2 | $ 0 |
Stockholders' Equity Capital St
Stockholders' Equity Capital Stock Shares Authorized, Issued and Outstanding (Details) - shares | Dec. 31, 2018 | Dec. 31, 2017 |
Class of Stock [Line Items] | ||
Common Stock, Shares Authorized | 400,000,000 | 400,000,000 |
Common Stock, Shares Issued | 123,352,185 | 123,352,185 |
Common Stock, Shares Outstanding | 100,896,678 | 103,036,805 |
$25 Par Preferred Stock [Member] | ||
Class of Stock [Line Items] | ||
Preferred Stock, Shares Authorized | 840,000 | 840,000 |
Preferred Stock, Shares Issued | 649,736 | 649,736 |
Preferred Stock, Shares Outstanding | 228,395 | 242,170 |
$1 Par Preferred Stock [Member] | ||
Class of Stock [Line Items] | ||
Preferred Stock, Shares Authorized | 2,000,000 | 2,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | |||
Common Stock, Par Value | $ 0.01 | $ 0.01 | |
$25 Par Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred Stock, Par Value | $ 25 | $ 25 | $ 25 |
Preferred Stock, Dividend Rate | 4.00% | 4.00% | |
$1 Par Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred Stock, Par Value | $ 1 | $ 1 |
Stockholders' Equity Share Repu
Stockholders' Equity Share Repurchases (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | 17 Months Ended | ||
Aug. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Shares repurchased (shares) | 2,285,988 | 3,759,678 | 2,127,612 | ||
Shares repurchased | $ 243.5 | $ 375.6 | $ 185.4 | ||
Common Stock [Member] | 2017 Share Repurchase Program [Member] | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Maximum amount of share repurchase program | $ 800 | ||||
Expiration date of share repurchase program | Jun. 30, 2020 | ||||
Shares repurchased (shares) | 2,272,213 | 4,691,682 | |||
Shares repurchased | $ 243.1 | $ 498.3 | |||
Average price of shares repurchased | $ 106.98 | $ 106.20 | |||
Common Stock [Member] | Accelerated Share Repurchase Program [Member] | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Maximum amount of share repurchase program | $ 200 | ||||
$25 Par Preferred Stock [Member] | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Shares repurchased (shares) | 13,775 | ||||
Shares repurchased | $ 0.4 | ||||
Average price of shares repurchased | $ 26.23 |
Stockholders' Equity Treasury S
Stockholders' Equity Treasury Stock (Details) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Equity, Class of Treasury Stock [Line Items] | |||
Balance at beginning of year | 20,315,380 | 16,745,566 | 14,891,041 |
Shares repurchased | 2,285,988 | 3,759,678 | 2,127,612 |
Shares issued to fund stock option exercises | (24,024) | (9,110) | (15,264) |
Employee stock purchase plan shares issued | (62,866) | (76,401) | (82,372) |
Nonvested shares issued | (51,191) | (124,519) | (179,309) |
Nonvested shares forfeited | 5,995 | 20,166 | 3,858 |
Balance at end of year | 22,469,282 | 20,315,380 | 16,745,566 |
Stockholders' Equity Cash Divid
Stockholders' Equity Cash Dividends on Common Stock (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | |||
Cash dividends declared per common share | $ 1.44 | $ 1.38 | $ 1.32 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) | Dec. 31, 2018shares |
2017 Equity Incentive Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares authorized | 3,750,000 |
Share-Based Compensation, Stock
Share-Based Compensation, Stock Options (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Exercised, number of shares | (24,024) | (9,110) | (15,264) |
Cash received from option exercises | $ 1.8 | $ 0.7 | $ 0.9 |
Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Contractual term (years) | 10 years | ||
Expected dividend yield | 1.36% | 1.52% | 1.60% |
Expected volatility | 27.09% | 30.74% | 32.29% |
Risk-free interest rate | 2.80% | 2.20% | 1.51% |
Expected term (years) | 6 years | 6 years | 6 years |
Weighted-average grant date fair value of stock options granted | $ 28.52 | $ 24.49 | $ 22.98 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Options outstanding, number of shares, beginning of period | 500,624 | ||
Options, weighted-average exercise price per share, beginning of period | $ 78.74 | ||
Granted, number of shares | 93,070 | ||
Granted, weighted-average exercise price | $ 105.83 | ||
Exercised, number of shares | (24,024) | ||
Exercised, weighted-average exercise price per share | $ 74.57 | ||
Forfeited or expired, number of shares | (5,155) | ||
Forfeited or expired, weighted-average exercise price per share | $ 94.32 | ||
Options outstanding, number of shares, end of period | 564,515 | 500,624 | |
Options, weighted-average exercise price per share, end of period | $ 83.24 | $ 78.74 | |
Options outstanding, weighted-average remaining contractual term | 5 years 10 months | ||
Options outstanding, aggregate intrinsic value | $ 9.1 | ||
Exercisable, number of shares | 385,774 | ||
Exercisable, weighted-average exercise price per share | $ 77.26 | ||
Exercisable, weighted-average remaining contractual term | 4 years 7 months | ||
Exercisable, aggregate intrinsic value | $ 8.3 | ||
Compensation expense | 2.5 | $ 2.3 | $ 2.5 |
Income tax benefit recognized in the income statement | 0.6 | 0.8 | 0.9 |
Aggregate grant-date fair value of stock options vested | 1.9 | 2.8 | 1.8 |
Intrinsic value of stock options exercised | 1 | 0.2 | 0.6 |
Cash received from option exercises | 1.8 | 0.7 | 0.9 |
Tax benefit from options exercised during the annual period | 0.2 | $ 0.1 | $ 0.2 |
Unrecognized compensation cost relating to nonvested stock options | $ 1.3 | ||
Unrecognized compensation cost weighted-average period of recognition | 1 year | ||
Shares available for future grants | 3,468,741 |
Share-Based Compensation, Nonve
Share-Based Compensation, Nonvested Stock (Details) $ / shares in Units, $ in Millions | Feb. 19, 2016daysTranches$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Forfeited, number of shares | (5,995) | (20,166) | (3,858) | |
Nonvested Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Nonvested stock, number of shares, beginning of period | 276,679 | |||
Nonvested stock, weighted-average grant date fair value, beginning of period | $ / shares | $ 93.28 | |||
Granted, number of shares | 83,099 | |||
Granted, weighted-average grant date fair value | $ / shares | $ 106.52 | $ 93.29 | $ 80.92 | |
Vested, number of shares | (96,162) | |||
Vested, weighted-average grant date fair value | $ / shares | $ 95.75 | |||
Forfeited, number of shares | (5,995) | |||
Forfeited, weighted-average grant date fair value | $ / shares | $ 94.20 | |||
Nonvested stock, number of shares, end of period | 257,621 | 276,679 | ||
Nonvested stock, weighted-average grant date fair value, end of period | $ / shares | $ 96.61 | $ 93.28 | ||
Nonvested stock, aggregate intrinsic value | $ | $ 24.6 | |||
Shares vested, fair value | $ | 10.4 | $ 5.9 | $ 7 | |
Compensation expense | $ | 10.8 | 9.3 | 9.6 | |
Income tax benefit recognized in the income statement | $ | 2.6 | $ 3.5 | $ 3.5 | |
Unrecognized compensation cost relating to nonvested stock | $ | $ 11.3 | |||
Unrecognized compensation cost weighted-average period of recognition | 1 year 1 month | |||
Nonvested Stock [Member] | Minimum [Member] | Employee [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Nonvested Stock [Member] | Maximum [Member] | Employee [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 5 years | |||
Market-based Award [Member] | Nonvested Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of tranches | Tranches | 3 | |||
Market condition, number of trading days | days | 20 | |||
Expected dividend yield | 1.58% | |||
Expected volatility | 31.68% | |||
Risk-free interest rate, minimum | 0.53% | |||
Risk-free interest rate, maximum | 1.89% | |||
Expected term (years) | 1 year 10 months 10 days | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Granted, number of shares | 66,320 | |||
Granted, weighted-average grant date fair value | $ / shares | $ 70.95 |
Share-Based Compensation, Perfo
Share-Based Compensation, Performance Based Awards (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Forfeited, number of shares | (5,995) | (20,166) | (3,858) | |
Performance Based Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Requisite service period | 3 years | |||
OR and ROIC performance period | 3 years | |||
Revenue growth multiplier performance period | 3 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Nonvested stock, number of shares, beginning of period | [1] | 139,502 | ||
Nonvested stock, weighted-average grant date fair value, beginning of period | $ 93.05 | |||
Granted, number of shares | [1] | 50,162 | ||
Granted, weighted-average grant date fair value | $ 105.83 | $ 87.09 | $ 82.71 | |
Vested, number of shares | [1] | (32,219) | ||
Vested, weighted-average grant date fair value | $ 119.35 | |||
Forfeited, number of shares | [1] | (4,466) | ||
Forfeited, weighted-average grant date fair value | $ 91.89 | |||
Nonvested stock, number of shares, end of period | [1] | 152,979 | 139,502 | |
Nonvested stock, weighted-average grant date fair value, end of period | $ 91.74 | $ 93.05 | ||
Compensation expense | $ 5.8 | $ 6 | $ 5.7 | |
Income tax benefit recognized in the income statement | 1.5 | $ 2.2 | $ 2.1 | |
Unrecognized compensation cost relating to nonvested stock | $ 4.9 | |||
Unrecognized compensation cost weighted-average period of recognition | 11 months | |||
Shares vested, fair value | $ 3.5 | |||
Performance Based Awards [Member] | Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Revenue growth multiplier range | 80.00% | |||
Performance based award, earned percentage | 0.00% | |||
Performance Based Awards [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Revenue growth multiplier range | 140.00% | |||
Performance based award, earned percentage | 200.00% | |||
2018 Awards [Member] | Performance Based Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Maximum number of shares | 99,594 | |||
2017 Awards [Member] | Performance Based Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Maximum number of shares | 104,220 | |||
2016 Awards [Member] | Performance Based Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Earned shares | 102,144 | |||
[1] | * For the 2018 Awards and the 2017 Awards, participants in the aggregate can earn up to a maximum of 99,594 and 104,220 shares, respectively. For the 2016 Awards, the performance shares earned were 102,144. |
Share-Based Compensation, Emplo
Share-Based Compensation, Employee Stock Purchase Plan (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, shares issued | 62,866 | 76,401 | 82,372 | |||||||
Employee Stock [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares authorized | 4,000,000 | 4,000,000 | ||||||||
Maximum employee contribution rate | 10.00% | 10.00% | ||||||||
Employee stock purchase plan, purchase price | 85.00% | |||||||||
Expected dividend yield | 1.22% | 1.47% | 1.65% | |||||||
Expected volatility | 13.29% | 17.09% | 23.84% | |||||||
Risk-free interest rate | 1.73% | 0.89% | 0.46% | |||||||
Expected term (years) | 6 months | 6 months | 6 months | |||||||
Weighted-average grant date fair value | $ 18.66 | $ 17.90 | $ 17.29 | |||||||
Compensation expense | $ 1.3 | $ 1.3 | $ 1.4 | |||||||
Shares available for future grants | 3,500,000 | 3,500,000 | ||||||||
July 2018 offering ESPP [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, purchase price | $ 81.13 | |||||||||
Exercised, shares issued | 35,972 | |||||||||
Proceeds received from employees | [1] | $ 2.9 | ||||||||
January 2018 offering ESPP [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, purchase price | $ 90.07 | |||||||||
Exercised, shares issued | 32,271 | |||||||||
Proceeds received from employees | [1] | $ 2.9 | ||||||||
July 2017 offering ESPP [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, purchase price | $ 89.18 | |||||||||
Exercised, shares issued | 30,595 | |||||||||
Proceeds received from employees | [1] | $ 2.7 | ||||||||
January 2017 offering ESPP [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, purchase price | $ 68.70 | |||||||||
Exercised, shares issued | 40,293 | |||||||||
Proceeds received from employees | [1] | $ 2.8 | ||||||||
July 2016 offering ESPP [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, purchase price | $ 72.12 | |||||||||
Exercised, shares issued | 36,108 | |||||||||
Proceeds received from employees | [1] | $ 2.6 | ||||||||
January 2016 offering ESPP [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Exercised, purchase price | $ 62.66 | |||||||||
Exercised, shares issued | 41,895 | |||||||||
Proceeds received from employees | [1] | $ 2.6 | ||||||||
[1] | Represents amounts received from employees through payroll deductions for share purchases under applicable offering. |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financial Guarantee [Member] | |||
Loss Contingencies [Line Items] | |||
Letter of credit outstanding, amount | $ 5.6 | ||
Percent guarantee of unconsolidated affiliate debt | 50.00% | ||
KCSM [Member] | |||
Loss Contingencies [Line Items] | |||
Total period of time for payments due under railroad Concession to Mexican government | 50 years | ||
Percentage of gross revenue payable under railroad Concession to Mexican government | 1.25% | ||
KCSM [Member] | Materials and Other Expense [Member] | |||
Loss Contingencies [Line Items] | |||
Concession duty expense | $ 17.8 | $ 17 | $ 14.9 |
Panama Canal Railway Company [Member] | Financial Guarantee [Member] | 7.0% Senior Secured Notes due November 1, 2026 [Member] | |||
Loss Contingencies [Line Items] | |||
Debt instrument, stated interest rate | 7.00% | ||
Debt instrument, maturity date | Nov. 1, 2026 |
Commitments and Contingencies P
Commitments and Contingencies Personal Injury Liability Activity (Details) - Personal Injury [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Personal Injury Liability Activity [Roll Forward] | ||
Balance at beginning of year | $ 19.3 | $ 23.8 |
Accruals | 5.3 | 4.8 |
Changes in estimate | 2.4 | (3.6) |
Payments | (7.4) | (5.7) |
Balance at end of year | $ 19.6 | $ 19.3 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||||
Quarterly Financial Data [Abstract] | |||||||||||||||
Revenues | $ 694 | $ 699 | $ 682.4 | $ 638.6 | $ 660.4 | $ 656.6 | $ 656.4 | $ 609.5 | $ 2,714 | $ 2,582.9 | $ 2,334.2 | ||||
Operating income | 256.4 | [1] | 265.4 | [1] | 245.8 | 218.7 | 237.8 | 233.8 | 239.3 | 210.7 | 986.3 | 921.6 | 818.5 | ||
Net income | 161.8 | 174 | [2] | 148.7 | [2] | 144.9 | 552.4 | [3] | 129.9 | 134.7 | 146.9 | 629.4 | 963.9 | 479.9 | |
Net income attributable to Kansas City Southern and subsidiaries | $ 161.1 | $ 173.6 | $ 148.2 | $ 144.5 | $ 551.7 | $ 129.3 | $ 134.4 | $ 146.6 | $ 627.4 | $ 962 | $ 478.1 | ||||
Per share data: | |||||||||||||||
Basic earnings per common share | $ 1.59 | $ 1.71 | $ 1.45 | $ 1.41 | $ 5.35 | $ 1.24 | $ 1.27 | $ 1.38 | $ 6.16 | $ 9.18 | $ 4.44 | ||||
Diluted earnings per common share | $ 1.59 | $ 1.70 | $ 1.45 | $ 1.40 | $ 5.33 | $ 1.23 | $ 1.27 | $ 1.38 | $ 6.13 | $ 9.16 | $ 4.43 | ||||
Gain on insurance recoveries related to hurricane damage | $ 8.5 | $ 9.4 | $ 17.9 | $ 0 | $ 0 | ||||||||||
Provisional net tax benefit and adjustments recognized as a result of the Tax Reform Act | $ 16.6 | $ 4.3 | $ 413 | ||||||||||||
[1] | During the third and fourth quarters of 2018, the Company recognized a pre-tax gain of $9.4 million and $8.5 million, respectively, within operating expense for insurance recoveries related to damage from Hurricane Harvey in 2017. | ||||||||||||||
[2] | During the second and third quarters of 2018, the Company recognized discrete tax benefits of $4.3 million and $16.6 million, respectively, for adjustments to the provisional tax impacts of the Tax Reform Act. | ||||||||||||||
[3] | During the fourth quarter of 2017, the Company recognized a provisional $413.0 million net tax benefit as a result of the Tax Reform Act, which was signed into law December 22, 2017. |
Geographic Information (Informa
Geographic Information (Information by Geographic Area) (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)Segments | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Number of reportable business segments of the Company | Segments | 1 | ||||||||||
Revenues | $ 694 | $ 699 | $ 682.4 | $ 638.6 | $ 660.4 | $ 656.6 | $ 656.4 | $ 609.5 | $ 2,714 | $ 2,582.9 | $ 2,334.2 |
Property and equipment (including concession assets), net | 8,691.1 | 8,403.8 | 8,691.1 | 8,403.8 | |||||||
UNITED STATES | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenues | 1,424.8 | 1,359.5 | 1,210.8 | ||||||||
Property and equipment (including concession assets), net | 5,401.3 | 5,227.3 | 5,401.3 | 5,227.3 | |||||||
MEXICO | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenues | 1,289.2 | 1,223.4 | $ 1,123.4 | ||||||||
Property and equipment (including concession assets), net | $ 3,289.8 | $ 3,176.5 | $ 3,289.8 | $ 3,176.5 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions, $ in Millions | Jan. 17, 2017USD ($)$ / $ | Apr. 29, 2016USD ($)$ / $ | Jan. 15, 2016USD ($)$ / $ | Jan. 25, 2019USD ($)$ / $ | Dec. 31, 2018USD ($)$ / $ | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jan. 25, 2019MXN ($)$ / $ | Dec. 31, 2018MXN ($)$ / $ | Jan. 17, 2017MXN ($)$ / $ | Apr. 29, 2016MXN ($)$ / $ | Jan. 15, 2016MXN ($)$ / $ |
Foreign Currency Hedging [Abstract] | ||||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ 13.9 | $ (10.8) | $ (58.4) | |||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | ||||||||||||
Foreign Currency Hedging [Abstract] | ||||||||||||
Notional amount of foreign currency contracts | 120 | |||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Zero-Cost Collar Contracts [Member] | Foreign Exchange Gain (Loss) [Member] | Subsequent Event [Member] | ||||||||||||
Foreign Currency Hedging [Abstract] | ||||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ 0.3 | |||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | ||||||||||||
Foreign Currency Hedging [Abstract] | ||||||||||||
Notional amount of foreign currency contracts | $ 340 | $ 60 | $ 300 | $ 20 | $ 410.9 | $ 6,207.7 | $ 1,057.3 | $ 4,480.4 | ||||
Weighted-average exchange rate of foreign currency forward contracts | $ / $ | 18.3 | 17.6 | 14.9 | 20.5 | 20.5 | 18.3 | 17.6 | 14.9 | ||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | Subsequent Event [Member] | ||||||||||||
Foreign Currency Hedging [Abstract] | ||||||||||||
Notional amount of foreign currency contracts | $ 290 | $ 5,754.9 | ||||||||||
Weighted-average exchange rate of foreign currency forward contracts | $ / $ | 19.84 | 19.84 | ||||||||||
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward Contracts [Member] | Foreign Exchange Gain (Loss) [Member] | ||||||||||||
Foreign Currency Hedging [Abstract] | ||||||||||||
Cash received (paid) on settlement of foreign currency contracts | $ (53) | $ 0.7 | $ (49) |
Condensed Consolidating Finan_3
Condensed Consolidating Financial Information (Narrative) (Details) $ in Millions | Dec. 31, 2018USD ($) |
Condensed Financial Statements, Captions [Line Items] | |
Outstanding principal amount of the senior notes | $ 2,709.2 |
KCS [Member] | Senior Notes [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Outstanding principal amount of the senior notes | 2,593.5 |
KCSR [Member] | Senior Notes [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Outstanding principal amount of the senior notes | $ 2.7 |
Condensed Consolidating Stateme
Condensed Consolidating Statements of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||||
Condensed Statements of Comprehensive Income Captions [Line Items] | |||||||||||||||
Revenues | $ 694 | $ 699 | $ 682.4 | $ 638.6 | $ 660.4 | $ 656.6 | $ 656.4 | $ 609.5 | $ 2,714 | $ 2,582.9 | $ 2,334.2 | ||||
Operating expenses | 1,727.7 | 1,661.3 | 1,515.7 | ||||||||||||
Operating income | 256.4 | [1] | 265.4 | [1] | 245.8 | 218.7 | 237.8 | 233.8 | 239.3 | 210.7 | 986.3 | 921.6 | 818.5 | ||
Equity in net earnings (losses) of affiliates | 2.6 | 11.5 | 14.6 | ||||||||||||
Interest expense | (110) | (100.2) | (97.7) | ||||||||||||
Debt retirement costs | (2.2) | 0 | 0 | ||||||||||||
Foreign exchange gain (loss) | 7.8 | 41.7 | (72) | ||||||||||||
Other income (expense), net | 2.4 | (0.3) | (0.7) | ||||||||||||
Income before income taxes | 886.9 | 874.3 | 662.7 | ||||||||||||
Income tax expense (benefit) | 257.5 | (89.6) | 182.8 | ||||||||||||
Net income | 161.8 | 174 | [2] | 148.7 | [2] | 144.9 | 552.4 | [3] | 129.9 | 134.7 | 146.9 | 629.4 | 963.9 | 479.9 | |
Less: Net income attributable to noncontrolling interest | 2 | 1.9 | 1.8 | ||||||||||||
Net income attributable to Kansas City Southern and subsidiaries | $ 161.1 | $ 173.6 | $ 148.2 | $ 144.5 | $ 551.7 | $ 129.3 | $ 134.4 | $ 146.6 | 627.4 | 962 | 478.1 | ||||
Other comprehensive income (loss) | 2.7 | (6.7) | (1.5) | ||||||||||||
Comprehensive income attributable to Kansas City Southern and subsidiaries | 630.1 | 955.3 | 476.6 | ||||||||||||
Consolidating Adjustments [Member] | |||||||||||||||
Condensed Statements of Comprehensive Income Captions [Line Items] | |||||||||||||||
Revenues | (43.9) | (40.4) | (39.3) | ||||||||||||
Operating expenses | (41.8) | (37.3) | (37.4) | ||||||||||||
Operating income | (2.1) | (3.1) | (1.9) | ||||||||||||
Equity in net earnings (losses) of affiliates | (636.7) | (996.4) | (469.9) | ||||||||||||
Interest expense | 93.5 | 87.7 | 130.3 | ||||||||||||
Debt retirement costs | 0 | 0 | 0 | ||||||||||||
Foreign exchange gain (loss) | 0 | 0 | 0 | ||||||||||||
Other income (expense), net | (93.6) | (87.6) | (129) | ||||||||||||
Income before income taxes | (638.9) | (999.4) | (470.5) | ||||||||||||
Income tax expense (benefit) | (0.5) | (0.6) | (0.9) | ||||||||||||
Net income | (638.4) | (998.8) | (469.6) | ||||||||||||
Less: Net income attributable to noncontrolling interest | 0 | 0 | 0 | ||||||||||||
Net income attributable to Kansas City Southern and subsidiaries | (638.4) | (998.8) | (469.6) | ||||||||||||
Other comprehensive income (loss) | (0.1) | (0.5) | 2.5 | ||||||||||||
Comprehensive income attributable to Kansas City Southern and subsidiaries | (638.5) | (999.3) | (467.1) | ||||||||||||
Parent [Member] | |||||||||||||||
Condensed Statements of Comprehensive Income Captions [Line Items] | |||||||||||||||
Revenues | 0 | 0 | 0 | ||||||||||||
Operating expenses | 5.2 | 5.7 | 4.7 | ||||||||||||
Operating income | (5.2) | (5.7) | (4.7) | ||||||||||||
Equity in net earnings (losses) of affiliates | 635.6 | 974.8 | 468.5 | ||||||||||||
Interest expense | (96.1) | (81.3) | (81.9) | ||||||||||||
Debt retirement costs | 0 | 0 | 0 | ||||||||||||
Foreign exchange gain (loss) | 0 | 0 | 0 | ||||||||||||
Other income (expense), net | 92.5 | 86.7 | 104.4 | ||||||||||||
Income before income taxes | 626.8 | 974.5 | 486.3 | ||||||||||||
Income tax expense (benefit) | (0.6) | 9.9 | 7.1 | ||||||||||||
Net income | 627.4 | 964.6 | 479.2 | ||||||||||||
Less: Net income attributable to noncontrolling interest | 0 | 0 | 0 | ||||||||||||
Net income attributable to Kansas City Southern and subsidiaries | 627.4 | 964.6 | 479.2 | ||||||||||||
Other comprehensive income (loss) | 2.7 | (6.7) | (1.5) | ||||||||||||
Comprehensive income attributable to Kansas City Southern and subsidiaries | 630.1 | 957.9 | 477.7 | ||||||||||||
KCSR [Member] | |||||||||||||||
Condensed Statements of Comprehensive Income Captions [Line Items] | |||||||||||||||
Revenues | 1,279.2 | 1,220.8 | 1,077.3 | ||||||||||||
Operating expenses | 877.2 | 862.8 | 776.3 | ||||||||||||
Operating income | 402 | 358 | 301 | ||||||||||||
Equity in net earnings (losses) of affiliates | (1.1) | 19 | (0.2) | ||||||||||||
Interest expense | (78.8) | (72.2) | (83) | ||||||||||||
Debt retirement costs | 0 | 0 | 0 | ||||||||||||
Foreign exchange gain (loss) | 0 | 0 | 0 | ||||||||||||
Other income (expense), net | 1.6 | (0.6) | (0.2) | ||||||||||||
Income before income taxes | 323.7 | 304.2 | 217.6 | ||||||||||||
Income tax expense (benefit) | 69.7 | (310.6) | 84.3 | ||||||||||||
Net income | 254 | 614.8 | 133.3 | ||||||||||||
Less: Net income attributable to noncontrolling interest | 0 | 0 | 0 | ||||||||||||
Net income attributable to Kansas City Southern and subsidiaries | 254 | 614.8 | 133.3 | ||||||||||||
Other comprehensive income (loss) | 0 | 0 | 0 | ||||||||||||
Comprehensive income attributable to Kansas City Southern and subsidiaries | 254 | 614.8 | 133.3 | ||||||||||||
Guarantor Subsidiaries [Member] | |||||||||||||||
Condensed Statements of Comprehensive Income Captions [Line Items] | |||||||||||||||
Revenues | 45.2 | 43.5 | 43.7 | ||||||||||||
Operating expenses | 38.7 | 39.1 | 38.1 | ||||||||||||
Operating income | 6.5 | 4.4 | 5.6 | ||||||||||||
Equity in net earnings (losses) of affiliates | 4.5 | 4.5 | 3.5 | ||||||||||||
Interest expense | 0 | 0 | 0 | ||||||||||||
Debt retirement costs | 0 | 0 | 0 | ||||||||||||
Foreign exchange gain (loss) | 0 | 0 | 0 | ||||||||||||
Other income (expense), net | 0 | 0 | 0 | ||||||||||||
Income before income taxes | 11 | 8.9 | 9.1 | ||||||||||||
Income tax expense (benefit) | 2.6 | (42.5) | 3.1 | ||||||||||||
Net income | 8.4 | 51.4 | 6 | ||||||||||||
Less: Net income attributable to noncontrolling interest | 0 | 0 | 0 | ||||||||||||
Net income attributable to Kansas City Southern and subsidiaries | 8.4 | 51.4 | 6 | ||||||||||||
Other comprehensive income (loss) | 0 | 0 | 0 | ||||||||||||
Comprehensive income attributable to Kansas City Southern and subsidiaries | 8.4 | 51.4 | 6 | ||||||||||||
Non-Guarantor Subsidiaries [Member] | |||||||||||||||
Condensed Statements of Comprehensive Income Captions [Line Items] | |||||||||||||||
Revenues | 1,433.5 | 1,359 | 1,252.5 | ||||||||||||
Operating expenses | 848.4 | 791 | 734 | ||||||||||||
Operating income | 585.1 | 568 | 518.5 | ||||||||||||
Equity in net earnings (losses) of affiliates | 0.3 | 9.6 | 12.7 | ||||||||||||
Interest expense | (28.6) | (34.4) | (63.1) | ||||||||||||
Debt retirement costs | (2.2) | 0 | 0 | ||||||||||||
Foreign exchange gain (loss) | 7.8 | 41.7 | (72) | ||||||||||||
Other income (expense), net | 1.9 | 1.2 | 24.1 | ||||||||||||
Income before income taxes | 564.3 | 586.1 | 420.2 | ||||||||||||
Income tax expense (benefit) | 186.3 | 254.2 | 89.2 | ||||||||||||
Net income | 378 | 331.9 | 331 | ||||||||||||
Less: Net income attributable to noncontrolling interest | 2 | 1.9 | 1.8 | ||||||||||||
Net income attributable to Kansas City Southern and subsidiaries | 376 | 330 | 329.2 | ||||||||||||
Other comprehensive income (loss) | 0.1 | 0.5 | (2.5) | ||||||||||||
Comprehensive income attributable to Kansas City Southern and subsidiaries | $ 376.1 | $ 330.5 | $ 326.7 | ||||||||||||
[1] | During the third and fourth quarters of 2018, the Company recognized a pre-tax gain of $9.4 million and $8.5 million, respectively, within operating expense for insurance recoveries related to damage from Hurricane Harvey in 2017. | ||||||||||||||
[2] | During the second and third quarters of 2018, the Company recognized discrete tax benefits of $4.3 million and $16.6 million, respectively, for adjustments to the provisional tax impacts of the Tax Reform Act. | ||||||||||||||
[3] | During the fourth quarter of 2017, the Company recognized a provisional $413.0 million net tax benefit as a result of the Tax Reform Act, which was signed into law December 22, 2017. |
Condensed Consolidating Balance
Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Assets: | ||
Current assets | $ 635.4 | $ 680.1 |
Investments | 44.9 | 44.6 |
Investments in consolidated subsidiaries | 0 | 0 |
Property and equipment (including concession assets), net | 8,691.1 | 8,403.8 |
Other assets | 98.4 | 70.2 |
Total assets | 9,469.8 | 9,198.7 |
Liabilities and equity: | ||
Current liabilities | 447 | 971.7 |
Long-term debt | 2,679.3 | 2,235.5 |
Deferred income taxes | 1,079.9 | 987.2 |
Other liabilities | 130.9 | 138.9 |
Stockholders’ equity | 4,813 | 4,548.9 |
Noncontrolling interest | 319.7 | 316.5 |
Total liabilities and equity | 9,469.8 | 9,198.7 |
Consolidating Adjustments [Member] | ||
Assets: | ||
Current assets | (207.4) | (310.3) |
Investments | 0 | 0 |
Investments in consolidated subsidiaries | (5,047.4) | (4,652) |
Property and equipment (including concession assets), net | (8) | (5.9) |
Other assets | (2,521.1) | (2,388.7) |
Total assets | (7,783.9) | (7,356.9) |
Liabilities and equity: | ||
Current liabilities | (208.8) | (311.8) |
Long-term debt | (2,521) | (2,388.8) |
Deferred income taxes | (2) | (1.5) |
Other liabilities | (0.1) | 0 |
Stockholders’ equity | (5,052) | (4,654.8) |
Noncontrolling interest | 0 | 0 |
Total liabilities and equity | (7,783.9) | (7,356.9) |
Parent [Member] | ||
Assets: | ||
Current assets | 229.8 | 292 |
Investments | 0 | 0 |
Investments in consolidated subsidiaries | 4,852.8 | 4,462.4 |
Property and equipment (including concession assets), net | 0 | 0 |
Other assets | 2,523.4 | 2,159.6 |
Total assets | 7,606 | 6,914 |
Liabilities and equity: | ||
Current liabilities | 214.2 | 277.9 |
Long-term debt | 2,563 | 2,066.8 |
Deferred income taxes | (4.4) | (7.1) |
Other liabilities | 20.2 | 13.5 |
Stockholders’ equity | 4,813 | 4,562.9 |
Noncontrolling interest | 0 | 0 |
Total liabilities and equity | 7,606 | 6,914 |
KCSR [Member] | ||
Assets: | ||
Current assets | 257.6 | 214.1 |
Investments | 3.9 | 3.9 |
Investments in consolidated subsidiaries | 4.4 | 7.4 |
Property and equipment (including concession assets), net | 4,429.2 | 4,283.2 |
Other assets | 59.3 | 46.8 |
Total assets | 4,754.4 | 4,555.4 |
Liabilities and equity: | ||
Current liabilities | 109.2 | 578.7 |
Long-term debt | 1,828.8 | 1,517.2 |
Deferred income taxes | 812.8 | 734.8 |
Other liabilities | 94.8 | 70 |
Stockholders’ equity | 1,908.8 | 1,654.7 |
Noncontrolling interest | 0 | 0 |
Total liabilities and equity | 4,754.4 | 4,555.4 |
Guarantor Subsidiaries [Member] | ||
Assets: | ||
Current assets | 5 | 8.8 |
Investments | 4.4 | 0 |
Investments in consolidated subsidiaries | 190.2 | 182.2 |
Property and equipment (including concession assets), net | 165.1 | 171.6 |
Other assets | 0 | 0 |
Total assets | 364.7 | 362.6 |
Liabilities and equity: | ||
Current liabilities | 80.1 | 94.9 |
Long-term debt | 0 | 0 |
Deferred income taxes | 84.7 | 84 |
Other liabilities | 0.2 | 0.3 |
Stockholders’ equity | 199.7 | 183.4 |
Noncontrolling interest | 0 | 0 |
Total liabilities and equity | 364.7 | 362.6 |
Non-Guarantor Subsidiaries [Member] | ||
Assets: | ||
Current assets | 350.4 | 475.5 |
Investments | 36.6 | 40.7 |
Investments in consolidated subsidiaries | 0 | 0 |
Property and equipment (including concession assets), net | 4,104.8 | 3,954.9 |
Other assets | 36.8 | 252.5 |
Total assets | 4,528.6 | 4,723.6 |
Liabilities and equity: | ||
Current liabilities | 252.3 | 332 |
Long-term debt | 808.5 | 1,040.3 |
Deferred income taxes | 188.8 | 177 |
Other liabilities | 15.8 | 55.1 |
Stockholders’ equity | 2,943.5 | 2,802.7 |
Noncontrolling interest | 319.7 | 316.5 |
Total liabilities and equity | $ 4,528.6 | $ 4,723.6 |
Condensed Consolidating State_2
Condensed Consolidating Statements of Cash Flows (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating activities: | |||
Net cash provided | $ 945.7 | $ 1,028.4 | $ 919 |
Investing activities: | |||
Capital expenditures | (520.3) | (585.4) | (563.6) |
Purchase or replacement of equipment under operating leases | (98.9) | (42.6) | (26.6) |
Property investments in MSLLC | (26.1) | (26) | (33.1) |
Insurance proceeds related to hurricane damage | 7.6 | 0 | 0 |
Investments in and advances to affiliates | (19.2) | (20.4) | (0.9) |
Proceeds from repayment of loans to affiliates | 0 | 0 | 0 |
Loans to affiliates | 0 | 0 | 0 |
Proceeds from disposal of property | 8.7 | 8.8 | 5 |
Other investing activities | (3.7) | (15.5) | (9) |
Net cash provided (used) | (651.9) | (681.1) | (628.2) |
Financing activities: | |||
Net short-term borrowings | (348.1) | 159 | 100.8 |
Proceeds from issuance of long-term debt | 499.4 | 0 | 248.7 |
Repayment of long-term debt | (81.5) | (25.4) | (276.4) |
Debt issuance and retirement costs paid | (8) | 0 | (2.6) |
Dividends paid | (147.5) | (142.5) | (142.8) |
Shares repurchased | (243.5) | (375.6) | (185.4) |
Proceeds from loans from affiliates | 0 | 0 | 0 |
Repayment of loans from affiliates | 0 | 0 | 0 |
Contributions from affiliates | 0 | 0 | 0 |
Other financing activities | 1.8 | 0.7 | 0.9 |
Net cash used for financing activities | (327.4) | (383.8) | (256.8) |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | (33.6) | (36.5) | 34 |
At beginning of year | 134.1 | 170.6 | 136.6 |
At end of year | 100.5 | 134.1 | 170.6 |
Consolidating Adjustments [Member] | |||
Operating activities: | |||
Net cash provided | (241.5) | (15.9) | (233.8) |
Investing activities: | |||
Capital expenditures | 0 | 0 | 0 |
Purchase or replacement of equipment under operating leases | 0 | 0 | 0 |
Property investments in MSLLC | 0 | 0 | 0 |
Insurance proceeds related to hurricane damage | 0 | 0 | 0 |
Investments in and advances to affiliates | 11.6 | 1.2 | 159.9 |
Proceeds from repayment of loans to affiliates | (4,709.5) | (12,241.7) | (9,067.7) |
Loans to affiliates | 4,640.6 | 12,102.6 | 9,123.4 |
Proceeds from disposal of property | 0 | 0 | (0.1) |
Other investing activities | 2.4 | 3.4 | 2 |
Net cash provided (used) | (54.9) | (134.5) | 217.5 |
Financing activities: | |||
Net short-term borrowings | 0 | 0 | 0 |
Proceeds from issuance of long-term debt | 0 | 0 | 0 |
Repayment of long-term debt | 0 | 0 | 0 |
Debt issuance and retirement costs paid | 0 | 0 | 0 |
Dividends paid | 239.1 | 12.5 | 230.2 |
Shares repurchased | 0 | 0 | 0 |
Proceeds from loans from affiliates | (4,640.6) | (12,102.6) | (9,123.4) |
Repayment of loans from affiliates | 4,709.5 | 12,241.7 | 9,067.7 |
Contributions from affiliates | (11.6) | (1.2) | (159.9) |
Other financing activities | 0 | 0 | 1.7 |
Net cash used for financing activities | 296.4 | 150.4 | 16.3 |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | 0 | 0 | 0 |
At beginning of year | 0 | 0 | 0 |
At end of year | 0 | 0 | 0 |
Parent [Member] | |||
Operating activities: | |||
Net cash provided | 223.8 | 220.4 | 434.1 |
Investing activities: | |||
Capital expenditures | 0 | 0 | 0 |
Purchase or replacement of equipment under operating leases | 0 | 0 | 0 |
Property investments in MSLLC | 0 | 0 | 0 |
Insurance proceeds related to hurricane damage | 0 | 0 | 0 |
Investments in and advances to affiliates | (7.8) | (0.6) | (153.4) |
Proceeds from repayment of loans to affiliates | 4,584.5 | 12,241.7 | 9,067.7 |
Loans to affiliates | (4,515.6) | (12,102.6) | (9,123.4) |
Proceeds from disposal of property | 0 | 0 | 0 |
Other investing activities | 0 | 0 | 0 |
Net cash provided (used) | 61.1 | 138.5 | (209.1) |
Financing activities: | |||
Net short-term borrowings | (348.1) | 159 | 100.8 |
Proceeds from issuance of long-term debt | 499.4 | 0 | 248.7 |
Repayment of long-term debt | 0 | 0 | (244.8) |
Debt issuance and retirement costs paid | (6.2) | 0 | (2.4) |
Dividends paid | (147.5) | (142.5) | (142.8) |
Shares repurchased | (243.5) | (375.6) | (185.4) |
Proceeds from loans from affiliates | 125 | 0 | 0 |
Repayment of loans from affiliates | (125) | 0 | 0 |
Contributions from affiliates | 0 | 0 | 0 |
Other financing activities | 1.8 | 0.7 | 0.9 |
Net cash used for financing activities | (244.1) | (358.4) | (225) |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | 40.8 | 0.5 | 0 |
At beginning of year | 0.7 | 0.2 | 0.2 |
At end of year | 41.5 | 0.7 | 0.2 |
KCSR [Member] | |||
Operating activities: | |||
Net cash provided | 460.9 | 556.6 | 235.4 |
Investing activities: | |||
Capital expenditures | (244.8) | (375.2) | (372.2) |
Purchase or replacement of equipment under operating leases | (88.4) | (42.6) | (26.6) |
Property investments in MSLLC | 0 | 0 | 0 |
Insurance proceeds related to hurricane damage | 7.6 | 0 | 0 |
Investments in and advances to affiliates | 0 | 0 | 0 |
Proceeds from repayment of loans to affiliates | 0 | 0 | 0 |
Loans to affiliates | 0 | 0 | 0 |
Proceeds from disposal of property | 4.1 | 6 | 2 |
Other investing activities | (6.1) | (17.2) | (14.9) |
Net cash provided (used) | (327.6) | (429) | (411.7) |
Financing activities: | |||
Net short-term borrowings | 0 | 0 | 0 |
Proceeds from issuance of long-term debt | 0 | 0 | 0 |
Repayment of long-term debt | (3.9) | (3.5) | (3.4) |
Debt issuance and retirement costs paid | 0 | 0 | 0 |
Dividends paid | 0 | 0 | 0 |
Shares repurchased | 0 | 0 | 0 |
Proceeds from loans from affiliates | 4,465.6 | 12,102.6 | 9,123.4 |
Repayment of loans from affiliates | (4,584.5) | (12,241.7) | (9,067.7) |
Contributions from affiliates | 0 | 0 | 146.6 |
Other financing activities | 0 | 0 | (0.1) |
Net cash used for financing activities | (122.8) | (142.6) | 198.8 |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | 10.5 | (15) | 22.5 |
At beginning of year | 17.6 | 32.6 | 10.1 |
At end of year | 28.1 | 17.6 | 32.6 |
Guarantor Subsidiaries [Member] | |||
Operating activities: | |||
Net cash provided | 1.2 | 0.4 | 0.6 |
Investing activities: | |||
Capital expenditures | (1.1) | (0.3) | (0.6) |
Purchase or replacement of equipment under operating leases | 0 | 0 | 0 |
Property investments in MSLLC | 0 | 0 | 0 |
Insurance proceeds related to hurricane damage | 0 | 0 | 0 |
Investments in and advances to affiliates | (7.8) | (0.6) | (6.5) |
Proceeds from repayment of loans to affiliates | 0 | 0 | 0 |
Loans to affiliates | 0 | 0 | 0 |
Proceeds from disposal of property | 0 | 0 | 0 |
Other investing activities | 0 | 0 | 0 |
Net cash provided (used) | (8.9) | (0.9) | (7.1) |
Financing activities: | |||
Net short-term borrowings | 0 | 0 | 0 |
Proceeds from issuance of long-term debt | 0 | 0 | 0 |
Repayment of long-term debt | (0.1) | (0.1) | (0.1) |
Debt issuance and retirement costs paid | 0 | 0 | 0 |
Dividends paid | 0 | 0 | 0 |
Shares repurchased | 0 | 0 | 0 |
Proceeds from loans from affiliates | 0 | 0 | 0 |
Repayment of loans from affiliates | 0 | 0 | 0 |
Contributions from affiliates | 7.8 | 0.6 | 6.5 |
Other financing activities | 0 | 0 | 0 |
Net cash used for financing activities | 7.7 | 0.5 | 6.4 |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | 0 | 0 | (0.1) |
At beginning of year | 0 | 0 | 0.1 |
At end of year | 0 | 0 | 0 |
Non-Guarantor Subsidiaries [Member] | |||
Operating activities: | |||
Net cash provided | 501.3 | 266.9 | 482.7 |
Investing activities: | |||
Capital expenditures | (274.4) | (209.9) | (190.8) |
Purchase or replacement of equipment under operating leases | (10.5) | 0 | 0 |
Property investments in MSLLC | (26.1) | (26) | (33.1) |
Insurance proceeds related to hurricane damage | 0 | 0 | 0 |
Investments in and advances to affiliates | (15.2) | (20.4) | (0.9) |
Proceeds from repayment of loans to affiliates | 125 | 0 | 0 |
Loans to affiliates | (125) | 0 | 0 |
Proceeds from disposal of property | 4.6 | 2.8 | 3.1 |
Other investing activities | 0 | (1.7) | 3.9 |
Net cash provided (used) | (321.6) | (255.2) | (217.8) |
Financing activities: | |||
Net short-term borrowings | 0 | 0 | 0 |
Proceeds from issuance of long-term debt | 0 | 0 | 0 |
Repayment of long-term debt | (77.5) | (21.8) | (28.1) |
Debt issuance and retirement costs paid | (1.8) | 0 | (0.2) |
Dividends paid | (239.1) | (12.5) | (230.2) |
Shares repurchased | 0 | 0 | 0 |
Proceeds from loans from affiliates | 50 | 0 | 0 |
Repayment of loans from affiliates | 0 | 0 | 0 |
Contributions from affiliates | 3.8 | 0.6 | 6.8 |
Other financing activities | 0 | 0 | (1.6) |
Net cash used for financing activities | (264.6) | (33.7) | (253.3) |
Cash and cash equivalents: | |||
Net increase (decrease) during each year | (84.9) | (22) | 11.6 |
At beginning of year | 115.8 | 137.8 | 126.2 |
At end of year | $ 30.9 | $ 115.8 | $ 137.8 |