J.B. Hunt Transport Services Inc. said Wednesday, Sept. 21 that it would pay Burlington Northern Santa Fe Corp.’s railway unit $16.5 million, about 10 cents per diluted share, to resolve its dispute with the firm.
As a result of a decision by arbitrators, the publicly traded trucking and transportation company will record a one-time charge to net earnings in its 2005 third quarter, according to the Arkansasbusiness.com Daily Report.
Going forward, Lowell, Ark.-based J.B. Hunt estimates a reduction in net earnings of about 2 cents per diluted share in the fourth quarter due to an increase in purchased transportation expense.
The arbitrators’ decision is retroactive to July 7, 2004, when arbitration began. Other details of the settlement between J.B. Hunt and BNSF Railway were confidential, the companies said.
“We are glad to have this proceeding behind us,” said Kirk Thompson, J.B. Hunt’s president and CEO. “With this clear interpretation of our agreement accomplished, we expect to be able to continue to work with [Burlington Northern] to make our relationship even stronger than it was before.”
The companies announced last year that they would arbitrate the dispute over an undisclosed amount of revenue generated from their financial and operating agreement. BNSF Railway provides rail transportation services to J.B. Hunt under a joint-service agreement.