SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


                Date of Report (Date of earliest event reported):
                                October 31, 2002


                              KANSAS CITY SOUTHERN
               (Exact name of company as specified in its charter)


          DELAWARE                     1-4717                 44-0663509
(State or other jurisdiction      (Commission file           (IRS Employer
      of incorporation)                  number)          Identification Number)


                427 West 12th Street, Kansas City, Missouri 64105
               (Address of principal executive offices) (Zip Code)


                Company's telephone number, including area code:
                                (816) 983 - 1303


                                 Not Applicable

          (Former name or former address if changed since last report)



<PAGE>

Item 7.  Financial Statements and Exhibits

(c)              Exhibits

                 Exhibit No.            Document
                 (99)                   Additional Exhibits

                 99.1                   Press Release issued by Kansas City
                                        Southern dated October 31, 2002
                                        entitled, "Kansas City Southern Reports
                                        Third Quarter and Year to Date 2002
                                        Earnings," is attached hereto as Exhibit
                                        99.1

                 99.2                   The following schedules are attached
                                        hereto as Exhibit 99.2 - Kansas City
                                        Southern Railway Operating Statements,
                                        Kansas City Southern Railway Carloadings
                                        by Commodity, Kansas City Southern
                                        Consolidated Balance Sheets




Item 9.  Regulation FD Disclosure

Kansas City Southern  ("KCS" or  "Company")  is furnishing  under Item 9 of this
Current Report on Form 8-K the information  included as Exhibit 99.1 and Exhibit
99.2 of this report.  Exhibit 99.1 is the Company's press release, dated October
31,  2002,  announcing  KCS's third  quarter and year to date 2002  earnings and
operating  results.  Included in Exhibit 99.2 are  schedules  regarding  certain
financial  information  discussed at the Company's third quarter 2002 conference
call.

The information  included in this Current Report on Form 8-K,  including Exhibit
99.1 and Exhibit 99.2,  is furnished  pursuant to Item 9 and shall not be deemed
to be "filed" for the purposes of Section 18 of the  Securities  Exchange Act of
1934 or otherwise subject to the liabilities of that Section.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly  caused  this  Report  to be signed  on its  behalf by the  undersigned
hereunto duly authorized.

                                                 Kansas City Southern

Date: November 5, 2002                   By:         /s/  Louis G. Van Horn
                                                 ------------------------------
                                                        Louis G. Van Horn
                                                 Vice President and Comptroller
                                                 (Principal Accounting Officer)



<PAGE>


EXHIBIT 99.1


Date:                 October 31, 2002

Media Contact:        William H. Galligan                816/983-1551
                      William.h.galligan@kcsr.com


Kansas City Southern Reports Third Quarter and Year to Date 2002 Earnings

Earnings Analysis & Commentary

Kansas  City  Southern  ("KCS" or the  "Company")  reported  net income of $10.6
million  (17(cent)  per  diluted  share) for the third  quarter  of 2002,  a 17%
increase from net income of $9.0 million  (15(cent) per diluted share)  reported
for the third  quarter  of 2001.  This  increase  resulted  from a $5.6  million
increase in other  income,  a $2.3 million  increase in equity in earnings  from
Grupo Transportacion  Ferroviaria  Mexicana,  S.A. de C.V. ("Grupo TFM"), a $1.9
million  reduction in the income tax  provision  and a $1.7  million  decline in
interest expense. These factors were partially offset by a $9.8 million decrease
in  consolidated  operating  income in the third quarter of 2002 compared to the
same period in 2001.  As  previously  announced,  in July 2002,  KCS initiated a
switch-over  from its legacy system  operating  platform to a state-  of-the-art
Management  Control System ("MCS").  Although the issues with the implementation
of MCS have been  largely  resolved,  the initial  difficulties  experienced  by
office  and  field  personnel  in  transitioning  to this  new  platform  led to
congestion issues and operating inefficiencies during the third quarter of 2002,
which contributed to this decline in consolidated operating income.

For the nine months  ended  September  30,  2002,  net income was $36.8  million
(59(cent) per diluted  share)  compared to $19.6  million  (32(cent) per diluted
share) for the nine months ended  September 30, 2001.  This $17.2 million period
to period  increase  resulted from a $12.3 million  increase in other income,  a
$9.6 million  decline in interest  expense,  a $4.4 million gain realized on the
sale of Mexrail,  Inc.  ("Mexrail") to KCS's  affiliate in Mexico,  TFM, S.A. de
C.V.  ("TFM") and a $4.1 million  increase in equity in earnings from Grupo TFM.
These items were partially  offset by an $8.3 million increase in the income tax
provision, a $1.7 million increase in equity in losses from other unconsolidated
affiliates and a $0.9 million  decline in operating  income.  Additionally,  net
income for the nine months ended September 30, 2002 includes  extraordinary debt
retirement  costs  of  $2.7  million  (after-tax)   associated  with  the  early
retirement  of term debt in June 2002.  Equity in earnings for 2001 reflects the
Company's proportionate share ($9.1 million) of the income recorded by Grupo TFM
relating  to  the  reversion  of  certain   concession  assets  to  the  Mexican
government.  Additionally,  net income for 2001  includes a $0.4 million  charge
relating to the implementation of Statement of Financial Accounting Standard No.
133,  Accounting for Derivative  Instruments  and Hedging  Activities,  which is
presented as a cumulative effect of an accounting change in 2001.

Diluted earnings per share information is as follows:

<TABLE>
<S>                                                               <C>            <C>                <C>             <C>

                                                                    Third Quarter                      Year to Date
                                                              ---------------------------       ----------------------------
                                                                 2002            2001              2002             2001
                                                              -----------     -----------       -----------      -----------

U.S. operations                                               $    0.08       $    0.10         $    0.39        $    0.17
Grupo TFM and PCRC (includes allocated interest)                   0.09            0.05              0.24             0.16
                                                              -----------     -----------       -----------      -----------

Income before extraordinary item and cumulative effect
 of accounting change                                              0.17            0.15              0.63             0.33
Extraordinary debt retirement costs, net of income taxes            -               -               (0.04)             -
Cumulative effect of accounting change, net of income taxes         -               -                 -              (0.01)
                                                              -----------     -----------       -----------      -----------
      Diluted earnings per share - Net income                 $    0.17       $    0.15         $    0.59        $    0.32
                                                              -----------     -----------       -----------      -----------
</TABLE>
<PAGE>

Third Quarter

For the third quarter of 2002,  consolidated  revenues declined $7.0 million and
consolidated  operating  expenses  increased $2.8 million  compared to the third
quarter of 2001, resulting in a $9.8 million decline in operating income quarter
to  quarter.   These  fluctuations   resulted  almost  entirely  from  operating
difficulties arising from the implementation of MCS, which contributed to higher
costs and lower revenues at Kansas City Southern Railway Company  ("KCSR"),  the
Company's principal subsidiary.  These operating  difficulties have been largely
resolved and the operation of the railroad is rapidly returning to normal.

During the third quarter of 2002,  KCSR  experienced  revenue  growth in several
commodity  groups,  including  chemical and petroleum  products,  certain forest
products  and  intermodal  traffic  compared  to  the  third  quarter  of  2001,
continuing the positive  revenue trends noted for these  commodities  during the
first  half of  2002  and in  spite  of the MCS  difficulties  encountered  this
quarter. The increase in revenue for these shipments was driven by volume gains,
increased length of haul and price  improvements in key traffic lanes.  Revenues
for these  commodities as well as certain other traffic would have improved even
further,  (approximately  $4.5 million higher based on Company estimates) during
the quarter,  but were adversely affected by lower carloadings  arising from MCS
related  congestion.  The MCS  implementation  slowed the  railroad as employees
learned to respond to the data  discipline  demanded by this new  system.  These
quarter to quarter  revenue  improvements  were  offset by  comparatively  lower
revenues for coal,  automotive and grain business.  Coal revenues  declined $6.7
million  quarter to quarter  primarily  because of a rate  reduction  at a major
customer,  which  took  effect on January  1,  2002,  as well as reduced  volume
associated  with the expiration of another coal  customer's  contract  effective
April 1, 2002.  Automotive  revenues  were $1.6 million lower due to the loss of
certain  business  and grain  revenues  declined  $1.5  million as a result of a
comparatively  weak export  market  quarter to quarter and  MCS-related  service
issues.  As a result,  third  quarter  2002  revenues for KCSR were $6.4 million
lower than the comparable prior year quarter.

Third quarter 2002 costs and expenses for KCSR were $5.8 million higher compared
to the prior year quarter resulting mostly from higher compensation and car hire
costs,  which  increased as a direct  result of the MCS  implementation  issues.
Depreciation  expense also  increased due to the  implementation  of MCS.  These
factors  contributed  to a higher  operating  ratio  for  KCSR of 94.2%  for the
quarter ended September 30, 2002 compared to 85.9% for the same period in 2001.

The Company's  equity in earnings from Grupo TFM  increased  approximately  $2.3
million  quarter to quarter.  Exclusive of the results from  Mexrail,  which was
consolidated  into Grupo TFM effective  April 1, 2002,  third quarter 2002 Grupo
TFM revenues  declined  approximately  3% compared to the third quarter of 2001.
Operating  expenses also  declined  approximately  4% quarter to quarter  (under
accounting principles generally accepted in the United States of America - "U.S.
GAAP").  Third  quarter  2002  results  for  Grupo TFM  include a $14.2  million
deferred tax benefit  (calculated  under U.S.  GAAP)  compared to a deferred tax
benefit of $12.0  million  in the third  quarter of 2001.  The  variance  in the
deferred tax calculation of Grupo TFM is mostly  attributable to fluctuations in
the peso exchange rate and tax benefits  derived from the impact of inflation in
Mexico. The Company reports its equity in Grupo TFM under U.S. GAAP, while Grupo
TFM reports under International Accounting Standards ("IAS").

Equity in losses from other unconsolidated  affiliates were $0.7 million for the
third  quarter of 2002  compared to $0.6 million for the third  quarter of 2001.
For both periods, losses from the operations of the Panama Canal Railway Company
("PCRC") were  partially  offset by earnings from Southern  Capital  Corporation
("Southern  Capital").  PCRC is currently  not operating at full capacity due to
delays in the  completion  of  expansion  at the port of Balboa in  Panama.  The
Balboa port expansion is expected to be complete by the summer of 2003, at which
time the revenues of PCRC are anticipated to increase,  which should improve the
financial performance of PCRC.
<PAGE>

KCS's  consolidated  third quarter 2002 interest expense  decreased $1.7 million
from the prior year  quarter as a result of slightly  lower  effective  interest
rates and lower overall debt balances. Other items affecting the Company's third
quarter results include a pre-tax gain of approximately $4.9 million on the sale
of the Company's interest in Wyandotte Garage Corporation, which is reflected in
other income.

Year to Date

For the nine months ended  September  30, 2002,  consolidated  operating  income
declined $0.9 million compared to the same period in 2001 as a result of a $13.8
million  decrease in revenues,  partially  offset by lower  operating  expenses,
which declined $12.9 million period to period.  KCSR's year to date 2002 revenue
dropped  $10.1 million  compared to year to date 2001,  primarily as a result of
lower  coal and  automotive  revenue,  partially  offset by higher  revenue  for
chemical and petroleum  products,  agriculture  and  minerals,  paper and forest
products and  intermodal  business.  These  revenue  fluctuations  resulted from
trends  similar to those  discussed in the third  quarter  analysis,  except for
grain,  which increased period to period on the strength of the export market in
the  first  quarter  of  2002.   Revenue  from  other   subsidiaries   decreased
approximately  $3.7  million  period  to  period  due to  demand  driven  volume
declines.  KCSR's year to date 2002 costs and expenses  were $9.1 million  lower
than the prior year  period due  mostly to a decline  in costs  associated  with
compensation,  fuel, car hire and casualties,  partially offset by higher fringe
benefit  costs and  depreciation  expense.  Despite the overall  improvement  in
operating income,  year to date operating results were adversely impacted by the
MCS  related  congestion  issues  arising in the third  quarter of 2002.  KCSR's
operating  ratio  was  unchanged  at 89.3%  for each of the  nine  months  ended
September  30, 2002 and 2001.

The Company's  equity in earnings from Grupo TFM  increased  approximately  $4.1
million period to period.  In 2001,  however,  equity in earnings  reflected the
Company's proportionate share ($9.1 million) of the income recorded by Grupo TFM
relating  to  the  reversion  of  certain   concession  assets  to  the  Mexican
government.  Exclusive  of this 2001  income,  KCS's year to date 2002 equity in
earnings  from Grupo TFM increased  $13.2  million  compared to same period last
year. Exclusive of Mexrail's results for year to date 2002, Grupo TFM's revenues
were  essentially  flat  compared  to year to date 2001 and  operating  expenses
(under U.S. GAAP) were  approximately  5% lower (exclusive of the 2001 reversion
income).  For the nine months  ended  September  30, 2002,  Grupo TFM's  results
include a $53.1  million  deferred  tax  benefit  (calculated  under U.S.  GAAP)
compared to a deferred tax expense of $12.6  million in the same period in 2001.
This  variance was caused by several  factors,  including a deferred tax expense
recorded in 2001 related to the income from the line reversion, the weakening of
the peso  exchange  rate,  as well as tax  benefits  derived  from the impact of
Mexican  inflation  in 2002.  The  fluctuation  in the peso  exchange  rate also
contributed  to a $14.4 million  exchange loss for year to date 2002 compared to
an exchange loss of $3.0 million for the same period in 2001.

Equity in losses from the Company's other unconsolidated affiliates increased to
$1.9  million for the year to date 2002  compared  to $0.2  million for the same
period in 2001. In 2002,  losses associated with PCRC were $2.9 million compared
to $1.0 million in 2001.  As mentioned in the third  quarter  analysis,  in 2002
PCRC is not operating at full capacity as initially  planned due to the delay in
completion of the port expansion at Balboa.  During 2001,  losses were primarily
related  to the  start-up  of  operations  at PCRC.  Additionally,  the  Company
reported  equity  losses  from  Mexrail  of $0.7  million  in 2001  compared  to
essentially a break-even  amount for 2002 prior to its sale to TFM. These losses
were offset by equity  earnings from  Southern  Capital of $1.0 million and $1.5
million for the nine months ended September 30, 2002 and 2001, respectively.

KCS's  consolidated  year to date interest expense  decreased $9.6 million (22%)
from the same prior year  period as a result of lower  interest  rates and lower
overall debt balances.  Other items affecting the Company's year to date results
include  a  gain  of   approximately   $7.3  million  on  the  sale  of  certain
non-operating  properties at a smaller subsidiary and a $4.9 million gain on the
sale of Wyandotte Garage Corporation as discussed above. Both of these items are
reported as other income. Additionally, the Company reported a $4.4 million gain
on the sale of  Mexrail  as a  separate  item in the  accompanying  consolidated
condensed statements of income.

During the second quarter of 2002,  the Company  refinanced  approximately  $200
million of term debt and other secured indebtedness using proceeds received from
the private  placement  of $200 million of 7 1/2% senior notes due June 15, 2009
("Note  Offering").  In conjunction with the Note Offering,  the Company amended
and restated its credit agreement.  KCS reported an extraordinary charge of $2.7
million (after-tax) related to this refinancing transaction.  The Company's debt
balance at the end of September 30, 2002 was $588.7  million  compared to $684.8
million at September  30, 2001, a reduction of nearly $100 million over the past
twelve months.
<PAGE>

Outlook from the Chairman

Michael R. Haverty, KCS's Chairman,  President and Chief Executive Officer said,
"both the financial and operational  performance of KCS during the third quarter
did not follow the trends experienced during the first two quarters of 2002, due
mostly to congestion  related issues arising from the  implementation  of MCS in
July 2002.  These  congestion  issues had a negative impact on some revenues and
certain  costs  during the third  quarter.  The  struggling  economy and a lower
contractual rate for our major coal customer also adversely  affected  quarterly
revenues.  Despite these  challenges,  we continue to work diligently to improve
our revenue base through  targeted price  improvements,  longer hauls and volume
increases and to enhance our cost structure  through more efficient  operations.
Further, we have recently made progress at reducing congestion, and traffic flow
on the railroad is substantially improved. In the long-term,  the implementation
of MCS will  provide  KCS with a  superior  management  tool to both  manage our
railroad more effectively and better serve our customers.

The Company's  important Mexican  investment,  Grupo TFM,  continues to show why
it's one of the leaders in the North  American  rail  industry.  Even during the
tough economic environment in North America during 2002, Grupo TFM has been able
to maintain its revenue base while continuing to maintain effective control over
its cost structure,  resulting in higher ongoing operating profits year to date.
KCS's ownership percentage of Grupo TFM increased to approximately 46.6% on July
29, 2002 following  completion of the purchase of the Mexican government's 24.6%
ownership  of Grupo TFM by TFM. We are  excited  about our  increased  ownership
position in Grupo TFM,  which we believe will lead to higher  profitability  for
KCS for the foreseeable future.

As previously  announced,  a three-judge panel of the Court of the First Circuit
in Mexico  City has ruled in favor of Grupo TFM with  respect to its Value Added
Tax ("VAT") lawsuit. Although we must await the conclusion of the legal process,
we are  optimistic  about the  ultimate  outcome of this matter and,  upon final
resolution,  it is  expected  to  provide  both  KCS  and  Grupo  TMM  with  the
opportunity  to enhance and further grow the value of the  investment in TFM and
the NAFTA rail network.  Because the legal process has not been  finalized,  KCS
has not reflected the recovery of the VAT in its  financial  statements  for the
quarter and year to date periods ended September 30, 2002.

During the remainder of 2002, we will focus on improving our domestic operations
under the newly implemented operating system to ensure that we are ready to take
advantage of an economic recovery when it occurs, which we hope will be sometime
in early  2003.  We  believe  that our MCS  technology  is second to none in the
industry and now that the operational difficulties are resolved in the field, we
are poised to capitalize on this  competitive  advantage.  We continue to strive
toward reducing our operating ratio through  improved  revenues and cost control
and are committed to taking the necessary  actions to accomplish  this task. Our
long-term goal continues to be to maximize  shareholder  value through  improved
performance, and we are committed and focused to achieve this goal."

KCS is comprised of, among  others,  The Kansas City  Southern  Railway  Company
("KCSR")  and equity  investments  in Grupo TFM,  Southern  Capital  Corporation
("Southern Capital") and Panama Canal Railway Company ("PCRC").

This press  release  includes  statements  concerning  potential  future  events
involving  the  Company,  which  could  materially  differ  from the events that
actually occur. The differences could be caused by a number of factors including
those  factors  identified  in  Company's  December  31,  2001 Form 10-K and the
Current  Report on Form 8-K dated  December 11, 2001,  each filed by the Company
with  the  Securities  and  Exchange  Commission  ("SEC")  (Commission  file no.
1-4717).  The Company  will not update any  forward-looking  statements  in this
press release to reflect future events or developments.

                        (Financial Information Attached)


<PAGE>

<TABLE>
                                                         KANSAS CITY SOUTHERN
                                             CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                             (dollars in millions, except per share data)
                                                             (Unaudited)

<S>                                                                          <C>           <C>              <C>           <C>

                                                                                Three Months                  Nine Months
                                                                            Ended September 30,           Ended September 30,
                                                                          -------------------------     -------------------------
                                                                            2002            2001          2002            2001
                                                                          ----------      ---------     ---------       ---------
     Revenues                                                             $   137.6       $  144.6      $  418.0        $  431.8
     Costs and expenses                                                       115.6          113.9         338.6           353.2
     Depreciation and amortization                                             15.8           14.7          45.3            43.6
                                                                          ----------      ---------     ---------       ---------
     Operating income                                                           6.2           16.0          34.1            35.0

     Equity in net earnings (losses) of unconsolidated affiliates:
      Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V.
       (preliminary)                                                            9.8            7.5          27.6            23.5
      Other                                                                    (0.7)          (0.6)         (1.9)           (0.2)
     Gain on sale of Mexrail, Inc.                                                -              -           4.4               -
     Interest expense                                                         (11.5)         (13.2)        (33.3)          (42.9)
     Other income                                                               6.5            0.9          15.3             3.0
                                                                          ----------      ---------     ---------       ---------
     Income before income taxes, extraordinary item and
      Cumulative effect of accounting change                                   10.3           10.6          46.2            18.4
     Income tax provision (benefit)                                            (0.3)           1.6           6.7            (1.6)
                                                                          ----------      ---------     ---------       ---------
     Income before extraordinary item and cumulative effect of
      accounting change                                                        10.6            9.0          39.5            20.0
     Extraordinary item, net of income taxes                                      -              -          (2.7)              -
     Cumulative effect of accounting change, net of income taxes                  -              -             -            (0.4)
                                                                          ----------      ---------     ---------       ---------
     Net Income                                                           $    10.6       $    9.0      $   36.8        $   19.6
                                                                          =========       ========      ========        ========


     Per Share Data:

     Basic Weighted Average Common shares outstanding (in thousands)          60,481         58,656        60,123          58,442

     Basic Earnings (Loss) per Common share

            Income before extraordinary item and cumulative effect of
              accounting change                                             $   0.17        $  0.15       $  0.65         $  0.34
            Extraordinary item, net of income taxes                               -              -          (0.04)             -
            Cumulative effect of accounting change                                -              -             -            (0.01)
                                                                            =========       ========      ========        ========
     Net Income                                                             $   0.17        $  0.15       $  0.61         $  0.33
                                                                            =========       ========      ========        ========

     Diluted Weighted Average Common shares outstanding (in thousands)        62,453         61,171        62,213          60,934

     Diluted Earnings (Loss) per Common share

            Income before extraordinary item and cumulative effect of
             accounting change                                              $    0.17       $  0.15       $  0.63         $  0.33
            Extraordinary item, net of income taxes                              -              -           (0.04)            -
            Cumulative effect of accounting change                               -              -             -             (0.01)
                                                                            ---------       --------      --------        --------
     Net Income                                                             $   0.17        $  0.15       $  0.59         $  0.32
                                                                            =========       ========      ========        ========
</TABLE>

<PAGE>


EXHIBIT 99.2

Kansas City Southern Railway
Operating Statements
Dollars in Millions
<TABLE>
<S>                                                <C>                   <C>                        <C>                   <C>

                                         Third Quarter         Third Quarter               Year to Date          Year to Date
                                              2002                  2001                  Sept. 30, 2002        Sept. 30, 2001
                                        -----------------    -------------------        -------------------   --------------------
Revenues
    Freight Revenue                          $      87.3           $       87.0               $      264.0          $       253.4
    Intermodal and Automotive Revenue               14.0                   14.3                       43.4                   50.9
    Unit Coal Revenue                               23.7                   30.3                       72.9                   84.8
    Haulage Revenue                                  4.1                    3.4                       10.5                    9.6
    Other Revenue                                    7.2                    7.7                       22.1                   24.3
                                        -----------------    -------------------        -------------------   --------------------
      Total Revenues                               136.3                  142.7                      412.9                  423.0
                                        -----------------    -------------------        -------------------   --------------------

Operating Expenses
    Compensation                                    35.4                   33.5                      100.1                  101.1
    Fringe Benefits                                 14.9                   14.1                       43.8                   40.4
    Fuel                                             9.0                   11.5                       27.7                   35.3
    Material and Supplies                            7.1                    7.5                       22.8                   22.1
    Car Hire                                         5.6                    3.5                       14.9                   15.7
    Purchased Services                              14.3                   13.5                       37.7                   37.0
    Casualties & Insurance                           6.3                    5.8                       20.3                   27.6
    Other                                            3.8                    2.6                        8.2                    7.6
                                        -----------------    -------------------        -------------------   --------------------
      Net Operating Expenses                        96.4                   92.0                      275.5                  286.8
                                        -----------------    -------------------        -------------------   --------------------

Fixed Expenses
    Leases, Net                                     13.3                   13.6                       39.6                   40.9
    Depreciation                                    15.0                   13.7                       42.6                   40.7
    Taxes (Other Than Income)                        3.7                    3.3                       11.1                    9.5
                                        -----------------    -------------------        -------------------   --------------------
      Total Fixed Expenses                          32.0                   30.6                       93.3                   91.1
                                        -----------------    -------------------        -------------------   --------------------
    Total Expenses                                 128.4                  122.6                      368.8                  377.9
                                        -----------------    -------------------        -------------------   --------------------

Operating Income                              $      7.9           $       20.1               $       44.1           $       45.1
                                        =================    ===================        ===================   ====================

</TABLE>
<PAGE>

Kansas City Southern Railway
Carloadings By Commodity - Year To Date September 30,2002
Dollars in Thousands
<TABLE>
<S>                     <C>          <C>               <C>                           <C>               <C>          <C>

         Carloadings                                                                     Revenue
        Year to Date                %                                                    Year to Date               %
------------------------------                                                   ----------------------------

    2002             2001         Change                                            2002            2001          Change
--------------   -------------   ---------                                       ------------   -------------   -----------
                                               Coal
     152,203          144,267        5.5%         Unit Coal                       $  72,907       $  84,836         (14.1)%
       3,153            3,726      (15.4)%        Other Coal                          1,748           2,120         (17.5)%
--------------   -------------                                                   ------------   -------------
     155,356          147,993        5.0%         Total                              74,655          86,956         (14.1)%
--------------   -------------                                                   ------------   -------------

                                               Chemical & Petroleum Products
        4,404           4,927      (10.6)%        Agri Chemicals                       3,173           3,913        (18.9)%
       10,671           8,404       27.0%         Gases                               10,469           7,674         36.4%
       16,839          16,779        0.4%         Organic                             17,474          16,864          3.6%
       15,153          14,594        3.8%         Inorganic                           16,296          15,373          6.0
       40,252          46,979      (14.3)%        Petroleum                           28,963          29,742         (2.6)%
       21,980          20,142        9.1%         Plastics                            21,758          20,257          7.4%
--------------   -------------                                                   ------------   -------------
      109,299         111,825       (2.3)%                    Total                   98,133          93,823          4.6%
--------------   -------------                                                   ------------   -------------

                                               Agriculture and Minerals
       34,641          35,809       (3.3)%        Domestic Grain                      24,634          24,569          0.3%
        9,782           8,471       15.5%         Export Grain                         7,027           5,595         25.6%
       20,762          19,766        5.0%         Food Products                       17,106          16,260          5.2
       16,399          17,951       (8.6)%        Ores and Minerals                    9,233           9,570         (3.5)%
       11,924          11,479        3.9%         Stone, Clay & Glass                  9,188           8,482          8.3%
--------------   -------------                                                   ------------   -------------
       93,508          93,476        0.0%                     Total                   67,188          64,476          4.2%
--------------   -------------                                                   ------------   -------------

                                               Paper & Forest Products
       65,608          63,248        3.7%         Pulp/Paper                          49,698          44,665         11.3%
        4,597           5,078       (9.5)%        Scrap Paper                          2,708           2,740         (1.2)%
       24,424          26,946       (9.4)%        Pulpwood/Logchips                   10,112          11,185         (9.6)%
       20,869          19,967        4.5%         Lumber/Plywood                      19,183          17,364         10.5%
       13,904          16,286      (14.6)%        Metal/Scrap                         11,487          12,622         (9.0)%
        5,425           5,625       (3.6)%        Military/Other Carloads              7,569           7,821         (3.2)%
--------------   -------------                                                   ------------   -------------
      134,827         137,150       (1.7)%                     Total                 100,757          96,397          4.5%
--------------   -------------                                                   ------------   -------------

                                               Intermodal & Automotive
       11,177          28,642      (61.0)%        Automotive                           7,800          17,783        (56.1)%
      202,427         192,042        5.4%         Intermodal                          35,545          33,137          7.3%
--------------   -------------                                                   ------------   -------------
      213,604         220,684       (3.2)%                     Total                  43,345          50,920         (14.9)
--------------   -------------                                                   ------------   -------------

      706,594         711,128       (0.6)%     TOTAL FOR BUSINESS UNITS              384,078         392,572         (2.2)%

       26,666          25,565        4.3%      Haulage                                10,531           9,644          9.2

      (4,934)         (7,028)       29.8%      Adjustments                            (3,815)         (3,481)        (9.6)%
--------------   -------------                                                   ------------   -------------

      728,326         729,665       (0.2)%                     TOTAL               $ 390,794       $ 398,735         (2.0)%
==============   =============                                                   ============   =============
</TABLE>

<PAGE>

Kansas City Southern Railway
Carloadings By Commodity - Third Quarter 2002
Dollars in Thousands
<TABLE>
<S>                     <C>          <C>               <C>                           <C>               <C>          <C>

          Carloadings                                                                     Revenue
        Third Quarter               %                                                   Third Quarter               %
------------------------------                                                   ----------------------------

    2002             2001         Change                                            2002            2001          Change
--------------   -------------   ---------                                       ------------   -------------   -----------

                                                Coal
       49,108          51,953       (5.5)%        Unit Coal                        $  23,701       $  30,321        (21.8)%
        1,141           1,322      (13.7)%        Other Coal                             666             773        (13.8)%
--------------   -------------                                                  ------------   -------------
       50,249          53,275       (5.7)%                                            24,367          31,094        (21.6)%
--------------   -------------                                                  ------------   -------------

                                               Chemical & Petroleum Products
        1,191           1,336      (10.9)%        Agri Chemicals                         836           1,067        (21.6)%
        3,843           2,743       40.1%         Gases                                3,762           2,509         49.9%
        5,447           5,392        1.0%         Organic                              5,944           5,514          7.8%
        4,917           4,933       (0.3)%        Inorganic                            5,431           5,424          0.1%
       13,099          13,049        0.4%         Petroleum                            9,309           9,298          0.1%
        7,101           6,503        9.2%         Plastics                             7,179           6,605          8.7%
--------------   -------------                                                   ------------   -------------
       35,598          33,956        4.8%                     Total                   32,461          30,417          6.7%
--------------   -------------                                                   ------------   -------------

                                               Agriculture and Minerals
       10,376          11,313       (8.3)%        Domestic Grain                       7,467           8,120         (8.0)
        2,336           3,422      (31.7)%        Export Grain                         1,453           2,397        (39.4)%
        6,907           6,557        5.3%         Food Products                        5,678           5,609          1.2
        5,352           6,366      (15.9)%        Ores and Minerals                    3,052           3,276         (6.8)%
        4,123           3,923        5.1%         Stone, Clay & Glass                  3,154           2,906          8.5%
--------------   -------------                                                   ------------   -------------
       29,094          31,581       (7.9)%                    Total                   20,804          22,308         (6.7)%
--------------   -------------                                                   ------------   -------------

                                               Paper & Forest Products
       22,979          22,217        3.4%         Pulp/Paper                          17,732          16,230          9.3%
        1,671           1,658        0.8%         Scrap Paper                            978             968          1.0%
        7,320           9,214      (20.6)%        Pulpwood/Logs/Chips                  3,151           3,788        (16.8)%
        7,103           7,143       (0.6)%        Lumber/Plywood                       6,577           6,293          4.5%
        4,960           4,997       (0.7)%        Metal/Scrap                          3,945           3,892          1.4%
        1,926           2,250      (14.4)%        Military/Other carloads              2,294           3,392        (32.4)%
--------------   -------------                                                   ------------   -------------
       45,959          47,479       (3.2)%                     Total                  34,677          34,563          0.3%
--------------   -------------                                                   ------------   -------------

                                               Intermodal & Automotive
        1,696           4,899      (65.4)%        Automotive                           1,472           3,084        (52.3)%
       73,637          65,469       12.5%         Intermodal                          12,555          11,278         11.3%
--------------   -------------                                                   ------------   -------------
       75,333          70,368        7.1%                      Total                  14,027          14,362         (2.3)%
--------------   -------------                                                   ------------   -------------

      236,233         236,659       (0.2)%     TOTAL FOR BUSINESS UNITS              126,336         132,744         (4.8)%

        8,538           8,361        2.1%      Haulage                                 4,049           3,353         20.8%

       (1,411)         (2,031)      30.5%      Adjustments                            (1,275)         (1,129)       (12.9)%
--------------   -------------                                                   ------------   -------------

      243,360         242,989        0.2%                  TOTAL                   $ 129,110       $ 134,968         (4.3)%
==============   =============                                                   ============   =============
</TABLE>
<PAGE>

Kansas City Southern

<TABLE>
<S>                                                                         <C>                                  <C>
                                                                                                       ------------------------
Consolidated Balance Sheets                                                                                  Preliminary
(Dollars in Millions)                                                                                  ------------------------


                                                                  September 30, 2002                      December 31, 2001
                                                                     (Unaudited)
Assets

  Cash                                                                      $       35.5                          $       24.7
  Accounts receivable                                                              112.3                                 130.0
  Inventories                                                                       35.3                                  27.9
  Other current assets                                                              38.3                                  71.8
                                                              ---------------------------              ------------------------
     Total current assets                                                          221.4                                 254.4

  Investments held for operating purposes                                          404.6                                 386.8
  Properties, net of depreciation                                                1,336.3                               1,327.4
  Other assets                                                                      33.4                                  42.3
                                                              ---------------------------              ------------------------
      Total assets                                                          $    1,995.7                          $    2,010.9
                                                              ===========================              ========================

Liabilities and Stockholders' Equity
  Current portion of long-term debt                                         $       10.0                          $       46.7
  Accounts payable                                                                  40.3                                  50.4
  Accrued liabilities                                                              168.9                                 160.4
                                                              ---------------------------              ------------------------
     Total current liabilities                                                     219.2                                 257.5

  Long-term debt                                                                   578.7                                 611.7
  Deferred income taxes                                                            374.3                                 370.2
  Other                                                                             93.9                                  91.2
  Stockholders' equity                                                             729.6                                 680.3
                                                              ---------------------------              ------------------------
    Total liabilities and stockholders' equity                              $    1,995.7                          $    2,010.9
                                                              ===========================              ========================

</TABLE>
[{"type": "8-K", "sequence": "1", "filename": "thirdq02earn8k.txt", "secsgml_size_bytes": 50020}]
{"company-data": {"conformed-name": "KANSAS CITY SOUTHERN", "cik": "0000054480", "assigned-sic": "4011", "irs-number": "440663509", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-04717", "film-number": "02810088"}, "business-address": {"street1": "427 WEST 12TH STREET", "city": "KANSAS CITY", "state": "MO", "zip": "64105", "phone": "8169831303"}, "mail-address": {"street1": "427 WEST 12TH STREET", "city": "KANSAS CITY", "state": "MO", "zip": "64105"}, "former-company": {"former-conformed-name": "KANSAS CITY SOUTHERN INDUSTRIES INC", "date-changed": "19920703"}}
SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                Date of Report (Date of earliest event reported):
                                October 31, 2002

                              KANSAS CITY SOUTHERN
               (Exact name of company as specified in its charter)

          DELAWARE                     1-4717                 44-0663509
(State or other jurisdiction      (Commission file           (IRS Employer
      of incorporation)                  number)          Identification Number)

                427 West 12th Street, Kansas City, Missouri 64105
               (Address of principal executive offices) (Zip Code)

                Company's telephone number, including area code:
                                (816) 983 - 1303

                                 Not Applicable

          (Former name or former address if changed since last report)
Item 7.  Financial Statements and Exhibits

(c)              Exhibits

                 Exhibit No.            Document
                 (99)                   Additional Exhibits

                 99.1                   Press Release issued by Kansas City
                                        Southern dated October 31, 2002
                                        entitled, "Kansas City Southern Reports
                                        Third Quarter and Year to Date 2002
                                        Earnings," is attached hereto as Exhibit
                                        99.1

                 99.2                   The following schedules are attached
                                        hereto as Exhibit 99.2 - Kansas City
                                        Southern Railway Operating Statements,
                                        Kansas City Southern Railway Carloadings
                                        by Commodity, Kansas City Southern
                                        Consolidated Balance Sheets

Item 9.  Regulation FD Disclosure

Kansas City Southern  ("KCS" or  "Company")  is furnishing  under Item 9 of this
Current Report on Form 8-K the information  included as Exhibit 99.1 and Exhibit
99.2 of this report.  Exhibit 99.1 is the Company's press release, dated October
31,  2002,  announcing  KCS's third  quarter and year to date 2002  earnings and
operating  results.  Included in Exhibit 99.2 are  schedules  regarding  certain
financial  information  discussed at the Company's third quarter 2002 conference
call.

The information  included in this Current Report on Form 8-K,  including Exhibit
99.1 and Exhibit 99.2,  is furnished  pursuant to Item 9 and shall not be deemed
to be "filed" for the purposes of Section 18 of the  Securities  Exchange Act of
1934 or otherwise subject to the liabilities of that Section.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly  caused  this  Report  to be signed  on its  behalf by the  undersigned
hereunto duly authorized.

                                                 Kansas City Southern

Date: November 5, 2002                   By:         /s/  Louis G. Van Horn
                                                 ------------------------------
                                                        Louis G. Van Horn
                                                 Vice President and Comptroller
                                                 (Principal Accounting Officer)
EXHIBIT 99.1

Date:                 October 31, 2002

Media Contact:        William H. Galligan                816/983-1551
                      William.h.galligan@kcsr.com

Kansas City Southern Reports Third Quarter and Year to Date 2002 Earnings

Earnings Analysis & Commentary

Kansas  City  Southern  ("KCS" or the  "Company")  reported  net income of $10.6
million  (17(cent)  per  diluted  share) for the third  quarter  of 2002,  a 17%
increase from net income of $9.0 million  (15(cent) per diluted share)  reported
for the third  quarter  of 2001.  This  increase  resulted  from a $5.6  million
increase in other  income,  a $2.3 million  increase in equity in earnings  from
Grupo Transportacion  Ferroviaria  Mexicana,  S.A. de C.V. ("Grupo TFM"), a $1.9
million  reduction in the income tax  provision  and a $1.7  million  decline in
interest expense. These factors were partially offset by a $9.8 million decrease
in  consolidated  operating  income in the third quarter of 2002 compared to the
same period in 2001.  As  previously  announced,  in July 2002,  KCS initiated a
switch-over  from its legacy system  operating  platform to a state-  of-the-art
Management  Control System ("MCS").  Although the issues with the implementation
of MCS have been  largely  resolved,  the initial  difficulties  experienced  by
office  and  field  personnel  in  transitioning  to this  new  platform  led to
congestion issues and operating inefficiencies during the third quarter of 2002,
which contributed to this decline in consolidated operating income.

For the nine months  ended  September  30,  2002,  net income was $36.8  million
(59(cent) per diluted  share)  compared to $19.6  million  (32(cent) per diluted
share) for the nine months ended  September 30, 2001.  This $17.2 million period
to period  increase  resulted from a $12.3 million  increase in other income,  a
$9.6 million  decline in interest  expense,  a $4.4 million gain realized on the
sale of Mexrail,  Inc.  ("Mexrail") to KCS's  affiliate in Mexico,  TFM, S.A. de
C.V.  ("TFM") and a $4.1 million  increase in equity in earnings from Grupo TFM.
These items were partially  offset by an $8.3 million increase in the income tax
provision, a $1.7 million increase in equity in losses from other unconsolidated
affiliates and a $0.9 million  decline in operating  income.  Additionally,  net
income for the nine months ended September 30, 2002 includes  extraordinary debt
retirement  costs  of  $2.7  million  (after-tax)   associated  with  the  early
retirement  of term debt in June 2002.  Equity in earnings for 2001 reflects the
Company's proportionate share ($9.1 million) of the income recorded by Grupo TFM
relating  to  the  reversion  of  certain   concession  assets  to  the  Mexican
government.  Additionally,  net income for 2001  includes a $0.4 million  charge
relating to the implementation of Statement of Financial Accounting Standard No.
133,  Accounting for Derivative  Instruments  and Hedging  Activities,  which is
presented as a cumulative effect of an accounting change in 2001.

Diluted earnings per share information is as follows:
Third Quarter                      Year to Date
                                                              ---------------------------       ----------------------------
                                                                 2002            2001              2002             2001
                                                              -----------     -----------       -----------      -----------

U.S. operations                                               $    0.08       $    0.10         $    0.39        $    0.17
Grupo TFM and PCRC (includes allocated interest)                   0.09            0.05              0.24             0.16
                                                              -----------     -----------       -----------      -----------

Income before extraordinary item and cumulative effect
 of accounting change                                              0.17            0.15              0.63             0.33
Extraordinary debt retirement costs, net of income taxes            -               -               (0.04)             -
Cumulative effect of accounting change, net of income taxes         -               -                 -              (0.01)
                                                              -----------     -----------       -----------      -----------
      Diluted earnings per share - Net income                 $    0.17       $    0.15         $    0.59        $    0.32
                                                              -----------     -----------       -----------      -----------
Third Quarter

For the third quarter of 2002,  consolidated  revenues declined $7.0 million and
consolidated  operating  expenses  increased $2.8 million  compared to the third
quarter of 2001, resulting in a $9.8 million decline in operating income quarter
to  quarter.   These  fluctuations   resulted  almost  entirely  from  operating
difficulties arising from the implementation of MCS, which contributed to higher
costs and lower revenues at Kansas City Southern Railway Company  ("KCSR"),  the
Company's principal subsidiary.  These operating  difficulties have been largely
resolved and the operation of the railroad is rapidly returning to normal.

During the third quarter of 2002,  KCSR  experienced  revenue  growth in several
commodity  groups,  including  chemical and petroleum  products,  certain forest
products  and  intermodal  traffic  compared  to  the  third  quarter  of  2001,
continuing the positive  revenue trends noted for these  commodities  during the
first  half of  2002  and in  spite  of the MCS  difficulties  encountered  this
quarter. The increase in revenue for these shipments was driven by volume gains,
increased length of haul and price  improvements in key traffic lanes.  Revenues
for these  commodities as well as certain other traffic would have improved even
further,  (approximately  $4.5 million higher based on Company estimates) during
the quarter,  but were adversely affected by lower carloadings  arising from MCS
related  congestion.  The MCS  implementation  slowed the  railroad as employees
learned to respond to the data  discipline  demanded by this new  system.  These
quarter to quarter  revenue  improvements  were  offset by  comparatively  lower
revenues for coal,  automotive and grain business.  Coal revenues  declined $6.7
million  quarter to quarter  primarily  because of a rate  reduction  at a major
customer,  which  took  effect on January  1,  2002,  as well as reduced  volume
associated  with the expiration of another coal  customer's  contract  effective
April 1, 2002.  Automotive  revenues  were $1.6 million lower due to the loss of
certain  business  and grain  revenues  declined  $1.5  million as a result of a
comparatively  weak export  market  quarter to quarter and  MCS-related  service
issues.  As a result,  third  quarter  2002  revenues for KCSR were $6.4 million
lower than the comparable prior year quarter.

Third quarter 2002 costs and expenses for KCSR were $5.8 million higher compared
to the prior year quarter resulting mostly from higher compensation and car hire
costs,  which  increased as a direct  result of the MCS  implementation  issues.
Depreciation  expense also  increased due to the  implementation  of MCS.  These
factors  contributed  to a higher  operating  ratio  for  KCSR of 94.2%  for the
quarter ended September 30, 2002 compared to 85.9% for the same period in 2001.

The Company's  equity in earnings from Grupo TFM  increased  approximately  $2.3
million  quarter to quarter.  Exclusive of the results from  Mexrail,  which was
consolidated  into Grupo TFM effective  April 1, 2002,  third quarter 2002 Grupo
TFM revenues  declined  approximately  3% compared to the third quarter of 2001.
Operating  expenses also  declined  approximately  4% quarter to quarter  (under
accounting principles generally accepted in the United States of America - "U.S.
GAAP").  Third  quarter  2002  results  for  Grupo TFM  include a $14.2  million
deferred tax benefit  (calculated  under U.S.  GAAP)  compared to a deferred tax
benefit of $12.0  million  in the third  quarter of 2001.  The  variance  in the
deferred tax calculation of Grupo TFM is mostly  attributable to fluctuations in
the peso exchange rate and tax benefits  derived from the impact of inflation in
Mexico. The Company reports its equity in Grupo TFM under U.S. GAAP, while Grupo
TFM reports under International Accounting Standards ("IAS").

Equity in losses from other unconsolidated  affiliates were $0.7 million for the
third  quarter of 2002  compared to $0.6 million for the third  quarter of 2001.
For both periods, losses from the operations of the Panama Canal Railway Company
("PCRC") were  partially  offset by earnings from Southern  Capital  Corporation
("Southern  Capital").  PCRC is currently  not operating at full capacity due to
delays in the  completion  of  expansion  at the port of Balboa in  Panama.  The
Balboa port expansion is expected to be complete by the summer of 2003, at which
time the revenues of PCRC are anticipated to increase,  which should improve the
financial performance of PCRC.
KCS's  consolidated  third quarter 2002 interest expense  decreased $1.7 million
from the prior year  quarter as a result of slightly  lower  effective  interest
rates and lower overall debt balances. Other items affecting the Company's third
quarter results include a pre-tax gain of approximately $4.9 million on the sale
of the Company's interest in Wyandotte Garage Corporation, which is reflected in
other income.

Year to Date

For the nine months ended  September  30, 2002,  consolidated  operating  income
declined $0.9 million compared to the same period in 2001 as a result of a $13.8
million  decrease in revenues,  partially  offset by lower  operating  expenses,
which declined $12.9 million period to period.  KCSR's year to date 2002 revenue
dropped  $10.1 million  compared to year to date 2001,  primarily as a result of
lower  coal and  automotive  revenue,  partially  offset by higher  revenue  for
chemical and petroleum  products,  agriculture  and  minerals,  paper and forest
products and  intermodal  business.  These  revenue  fluctuations  resulted from
trends  similar to those  discussed in the third  quarter  analysis,  except for
grain,  which increased period to period on the strength of the export market in
the  first  quarter  of  2002.   Revenue  from  other   subsidiaries   decreased
approximately  $3.7  million  period  to  period  due to  demand  driven  volume
declines.  KCSR's year to date 2002 costs and expenses  were $9.1 million  lower
than the prior year  period due  mostly to a decline  in costs  associated  with
compensation,  fuel, car hire and casualties,  partially offset by higher fringe
benefit  costs and  depreciation  expense.  Despite the overall  improvement  in
operating income,  year to date operating results were adversely impacted by the
MCS  related  congestion  issues  arising in the third  quarter of 2002.  KCSR's
operating  ratio  was  unchanged  at 89.3%  for each of the  nine  months  ended
September  30, 2002 and 2001.

The Company's  equity in earnings from Grupo TFM  increased  approximately  $4.1
million period to period.  In 2001,  however,  equity in earnings  reflected the
Company's proportionate share ($9.1 million) of the income recorded by Grupo TFM
relating  to  the  reversion  of  certain   concession  assets  to  the  Mexican
government.  Exclusive  of this 2001  income,  KCS's year to date 2002 equity in
earnings  from Grupo TFM increased  $13.2  million  compared to same period last
year. Exclusive of Mexrail's results for year to date 2002, Grupo TFM's revenues
were  essentially  flat  compared  to year to date 2001 and  operating  expenses
(under U.S. GAAP) were  approximately  5% lower (exclusive of the 2001 reversion
income).  For the nine months  ended  September  30, 2002,  Grupo TFM's  results
include a $53.1  million  deferred  tax  benefit  (calculated  under U.S.  GAAP)
compared to a deferred tax expense of $12.6  million in the same period in 2001.
This  variance was caused by several  factors,  including a deferred tax expense
recorded in 2001 related to the income from the line reversion, the weakening of
the peso  exchange  rate,  as well as tax  benefits  derived  from the impact of
Mexican  inflation  in 2002.  The  fluctuation  in the peso  exchange  rate also
contributed  to a $14.4 million  exchange loss for year to date 2002 compared to
an exchange loss of $3.0 million for the same period in 2001.

Equity in losses from the Company's other unconsolidated affiliates increased to
$1.9  million for the year to date 2002  compared  to $0.2  million for the same
period in 2001. In 2002,  losses associated with PCRC were $2.9 million compared
to $1.0 million in 2001.  As mentioned in the third  quarter  analysis,  in 2002
PCRC is not operating at full capacity as initially  planned due to the delay in
completion of the port expansion at Balboa.  During 2001,  losses were primarily
related  to the  start-up  of  operations  at PCRC.  Additionally,  the  Company
reported  equity  losses  from  Mexrail  of $0.7  million  in 2001  compared  to
essentially a break-even  amount for 2002 prior to its sale to TFM. These losses
were offset by equity  earnings from  Southern  Capital of $1.0 million and $1.5
million for the nine months ended September 30, 2002 and 2001, respectively.

KCS's  consolidated  year to date interest expense  decreased $9.6 million (22%)
from the same prior year  period as a result of lower  interest  rates and lower
overall debt balances.  Other items affecting the Company's year to date results
include  a  gain  of   approximately   $7.3  million  on  the  sale  of  certain
non-operating  properties at a smaller subsidiary and a $4.9 million gain on the
sale of Wyandotte Garage Corporation as discussed above. Both of these items are
reported as other income. Additionally, the Company reported a $4.4 million gain
on the sale of  Mexrail  as a  separate  item in the  accompanying  consolidated
condensed statements of income.

During the second quarter of 2002,  the Company  refinanced  approximately  $200
million of term debt and other secured indebtedness using proceeds received from
the private  placement  of $200 million of 7 1/2% senior notes due June 15, 2009
("Note  Offering").  In conjunction with the Note Offering,  the Company amended
and restated its credit agreement.  KCS reported an extraordinary charge of $2.7
million (after-tax) related to this refinancing transaction.  The Company's debt
balance at the end of September 30, 2002 was $588.7  million  compared to $684.8
million at September  30, 2001, a reduction of nearly $100 million over the past
twelve months.
Outlook from the Chairman

Michael R. Haverty, KCS's Chairman,  President and Chief Executive Officer said,
"both the financial and operational  performance of KCS during the third quarter
did not follow the trends experienced during the first two quarters of 2002, due
mostly to congestion  related issues arising from the  implementation  of MCS in
July 2002.  These  congestion  issues had a negative impact on some revenues and
certain  costs  during the third  quarter.  The  struggling  economy and a lower
contractual rate for our major coal customer also adversely  affected  quarterly
revenues.  Despite these  challenges,  we continue to work diligently to improve
our revenue base through  targeted price  improvements,  longer hauls and volume
increases and to enhance our cost structure  through more efficient  operations.
Further, we have recently made progress at reducing congestion, and traffic flow
on the railroad is substantially improved. In the long-term,  the implementation
of MCS will  provide  KCS with a  superior  management  tool to both  manage our
railroad more effectively and better serve our customers.

The Company's  important Mexican  investment,  Grupo TFM,  continues to show why
it's one of the leaders in the North  American  rail  industry.  Even during the
tough economic environment in North America during 2002, Grupo TFM has been able
to maintain its revenue base while continuing to maintain effective control over
its cost structure,  resulting in higher ongoing operating profits year to date.
KCS's ownership percentage of Grupo TFM increased to approximately 46.6% on July
29, 2002 following  completion of the purchase of the Mexican government's 24.6%
ownership  of Grupo TFM by TFM. We are  excited  about our  increased  ownership
position in Grupo TFM,  which we believe will lead to higher  profitability  for
KCS for the foreseeable future.

As previously  announced,  a three-judge panel of the Court of the First Circuit
in Mexico  City has ruled in favor of Grupo TFM with  respect to its Value Added
Tax ("VAT") lawsuit. Although we must await the conclusion of the legal process,
we are  optimistic  about the  ultimate  outcome of this matter and,  upon final
resolution,  it is  expected  to  provide  both  KCS  and  Grupo  TMM  with  the
opportunity  to enhance and further grow the value of the  investment in TFM and
the NAFTA rail network.  Because the legal process has not been  finalized,  KCS
has not reflected the recovery of the VAT in its  financial  statements  for the
quarter and year to date periods ended September 30, 2002.

During the remainder of 2002, we will focus on improving our domestic operations
under the newly implemented operating system to ensure that we are ready to take
advantage of an economic recovery when it occurs, which we hope will be sometime
in early  2003.  We  believe  that our MCS  technology  is second to none in the
industry and now that the operational difficulties are resolved in the field, we
are poised to capitalize on this  competitive  advantage.  We continue to strive
toward reducing our operating ratio through  improved  revenues and cost control
and are committed to taking the necessary  actions to accomplish  this task. Our
long-term goal continues to be to maximize  shareholder  value through  improved
performance, and we are committed and focused to achieve this goal."

KCS is comprised of, among  others,  The Kansas City  Southern  Railway  Company
("KCSR")  and equity  investments  in Grupo TFM,  Southern  Capital  Corporation
("Southern Capital") and Panama Canal Railway Company ("PCRC").

This press  release  includes  statements  concerning  potential  future  events
involving  the  Company,  which  could  materially  differ  from the events that
actually occur. The differences could be caused by a number of factors including
those  factors  identified  in  Company's  December  31,  2001 Form 10-K and the
Current  Report on Form 8-K dated  December 11, 2001,  each filed by the Company
with  the  Securities  and  Exchange  Commission  ("SEC")  (Commission  file no.
1-4717).  The Company  will not update any  forward-looking  statements  in this
press release to reflect future events or developments.

                        (Financial Information Attached)
KANSAS CITY SOUTHERN
                                             CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                             (dollars in millions, except per share data)
                                                             (Unaudited)
Three Months                  Nine Months
                                                                            Ended September 30,           Ended September 30,
                                                                          -------------------------     -------------------------
                                                                            2002            2001          2002            2001
                                                                          ----------      ---------     ---------       ---------
     Revenues                                                             $   137.6       $  144.6      $  418.0        $  431.8
     Costs and expenses                                                       115.6          113.9         338.6           353.2
     Depreciation and amortization                                             15.8           14.7          45.3            43.6
                                                                          ----------      ---------     ---------       ---------
     Operating income                                                           6.2           16.0          34.1            35.0

     Equity in net earnings (losses) of unconsolidated affiliates:
      Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V.
       (preliminary)                                                            9.8            7.5          27.6            23.5
      Other                                                                    (0.7)          (0.6)         (1.9)           (0.2)
     Gain on sale of Mexrail, Inc.                                                -              -           4.4               -
     Interest expense                                                         (11.5)         (13.2)        (33.3)          (42.9)
     Other income                                                               6.5            0.9          15.3             3.0
                                                                          ----------      ---------     ---------       ---------
     Income before income taxes, extraordinary item and
      Cumulative effect of accounting change                                   10.3           10.6          46.2            18.4
     Income tax provision (benefit)                                            (0.3)           1.6           6.7            (1.6)
                                                                          ----------      ---------     ---------       ---------
     Income before extraordinary item and cumulative effect of
      accounting change                                                        10.6            9.0          39.5            20.0
     Extraordinary item, net of income taxes                                      -              -          (2.7)              -
     Cumulative effect of accounting change, net of income taxes                  -              -             -            (0.4)
                                                                          ----------      ---------     ---------       ---------
     Net Income                                                           $    10.6       $    9.0      $   36.8        $   19.6
                                                                          =========       ========      ========        ========

     Per Share Data:

     Basic Weighted Average Common shares outstanding (in thousands)          60,481         58,656        60,123          58,442

     Basic Earnings (Loss) per Common share

            Income before extraordinary item and cumulative effect of
              accounting change                                             $   0.17        $  0.15       $  0.65         $  0.34
            Extraordinary item, net of income taxes                               -              -          (0.04)             -
            Cumulative effect of accounting change                                -              -             -            (0.01)
                                                                            =========       ========      ========        ========
     Net Income                                                             $   0.17        $  0.15       $  0.61         $  0.33
                                                                            =========       ========      ========        ========

     Diluted Weighted Average Common shares outstanding (in thousands)        62,453         61,171        62,213          60,934

     Diluted Earnings (Loss) per Common share

            Income before extraordinary item and cumulative effect of
             accounting change                                              $    0.17       $  0.15       $  0.63         $  0.33
            Extraordinary item, net of income taxes                              -              -           (0.04)            -
            Cumulative effect of accounting change                               -              -             -             (0.01)
                                                                            ---------       --------      --------        --------
     Net Income                                                             $   0.17        $  0.15       $  0.59         $  0.32
                                                                            =========       ========      ========        ========
EXHIBIT 99.2

Kansas City Southern Railway
Operating Statements
Dollars in Millions
Third Quarter         Third Quarter               Year to Date          Year to Date
                                              2002                  2001                  Sept. 30, 2002        Sept. 30, 2001
                                        -----------------    -------------------        -------------------   --------------------
Revenues
    Freight Revenue                          $      87.3           $       87.0               $      264.0          $       253.4
    Intermodal and Automotive Revenue               14.0                   14.3                       43.4                   50.9
    Unit Coal Revenue                               23.7                   30.3                       72.9                   84.8
    Haulage Revenue                                  4.1                    3.4                       10.5                    9.6
    Other Revenue                                    7.2                    7.7                       22.1                   24.3
                                        -----------------    -------------------        -------------------   --------------------
      Total Revenues                               136.3                  142.7                      412.9                  423.0
                                        -----------------    -------------------        -------------------   --------------------

Operating Expenses
    Compensation                                    35.4                   33.5                      100.1                  101.1
    Fringe Benefits                                 14.9                   14.1                       43.8                   40.4
    Fuel                                             9.0                   11.5                       27.7                   35.3
    Material and Supplies                            7.1                    7.5                       22.8                   22.1
    Car Hire                                         5.6                    3.5                       14.9                   15.7
    Purchased Services                              14.3                   13.5                       37.7                   37.0
    Casualties & Insurance                           6.3                    5.8                       20.3                   27.6
    Other                                            3.8                    2.6                        8.2                    7.6
                                        -----------------    -------------------        -------------------   --------------------
      Net Operating Expenses                        96.4                   92.0                      275.5                  286.8
                                        -----------------    -------------------        -------------------   --------------------

Fixed Expenses
    Leases, Net                                     13.3                   13.6                       39.6                   40.9
    Depreciation                                    15.0                   13.7                       42.6                   40.7
    Taxes (Other Than Income)                        3.7                    3.3                       11.1                    9.5
                                        -----------------    -------------------        -------------------   --------------------
      Total Fixed Expenses                          32.0                   30.6                       93.3                   91.1
                                        -----------------    -------------------        -------------------   --------------------
    Total Expenses                                 128.4                  122.6                      368.8                  377.9
                                        -----------------    -------------------        -------------------   --------------------

Operating Income                              $      7.9           $       20.1               $       44.1           $       45.1
                                        =================    ===================        ===================   ====================
Kansas City Southern Railway
Carloadings By Commodity - Year To Date September 30,2002
Dollars in Thousands
Carloadings                                                                     Revenue
        Year to Date                %                                                    Year to Date               %
------------------------------                                                   ----------------------------

    2002             2001         Change                                            2002            2001          Change
--------------   -------------   ---------                                       ------------   -------------   -----------
                                               Coal
     152,203          144,267        5.5%         Unit Coal                       $  72,907       $  84,836         (14.1)%
       3,153            3,726      (15.4)%        Other Coal                          1,748           2,120         (17.5)%
--------------   -------------                                                   ------------   -------------
     155,356          147,993        5.0%         Total                              74,655          86,956         (14.1)%
--------------   -------------                                                   ------------   -------------

                                               Chemical & Petroleum Products
        4,404           4,927      (10.6)%        Agri Chemicals                       3,173           3,913        (18.9)%
       10,671           8,404       27.0%         Gases                               10,469           7,674         36.4%
       16,839          16,779        0.4%         Organic                             17,474          16,864          3.6%
       15,153          14,594        3.8%         Inorganic                           16,296          15,373          6.0
       40,252          46,979      (14.3)%        Petroleum                           28,963          29,742         (2.6)%
       21,980          20,142        9.1%         Plastics                            21,758          20,257          7.4%
--------------   -------------                                                   ------------   -------------
      109,299         111,825       (2.3)%                    Total                   98,133          93,823          4.6%
--------------   -------------                                                   ------------   -------------

                                               Agriculture and Minerals
       34,641          35,809       (3.3)%        Domestic Grain                      24,634          24,569          0.3%
        9,782           8,471       15.5%         Export Grain                         7,027           5,595         25.6%
       20,762          19,766        5.0%         Food Products                       17,106          16,260          5.2
       16,399          17,951       (8.6)%        Ores and Minerals                    9,233           9,570         (3.5)%
       11,924          11,479        3.9%         Stone, Clay & Glass                  9,188           8,482          8.3%
--------------   -------------                                                   ------------   -------------
       93,508          93,476        0.0%                     Total                   67,188          64,476          4.2%
--------------   -------------                                                   ------------   -------------

                                               Paper & Forest Products
       65,608          63,248        3.7%         Pulp/Paper                          49,698          44,665         11.3%
        4,597           5,078       (9.5)%        Scrap Paper                          2,708           2,740         (1.2)%
       24,424          26,946       (9.4)%        Pulpwood/Logchips                   10,112          11,185         (9.6)%
       20,869          19,967        4.5%         Lumber/Plywood                      19,183          17,364         10.5%
       13,904          16,286      (14.6)%        Metal/Scrap                         11,487          12,622         (9.0)%
        5,425           5,625       (3.6)%        Military/Other Carloads              7,569           7,821         (3.2)%
--------------   -------------                                                   ------------   -------------
      134,827         137,150       (1.7)%                     Total                 100,757          96,397          4.5%
--------------   -------------                                                   ------------   -------------

                                               Intermodal & Automotive
       11,177          28,642      (61.0)%        Automotive                           7,800          17,783        (56.1)%
      202,427         192,042        5.4%         Intermodal                          35,545          33,137          7.3%
--------------   -------------                                                   ------------   -------------
      213,604         220,684       (3.2)%                     Total                  43,345          50,920         (14.9)
--------------   -------------                                                   ------------   -------------

      706,594         711,128       (0.6)%     TOTAL FOR BUSINESS UNITS              384,078         392,572         (2.2)%

       26,666          25,565        4.3%      Haulage                                10,531           9,644          9.2

      (4,934)         (7,028)       29.8%      Adjustments                            (3,815)         (3,481)        (9.6)%
--------------   -------------                                                   ------------   -------------

      728,326         729,665       (0.2)%                     TOTAL               $ 390,794       $ 398,735         (2.0)%
==============   =============                                                   ============   =============
Kansas City Southern Railway
Carloadings By Commodity - Third Quarter 2002
Dollars in Thousands
Carloadings                                                                     Revenue
        Third Quarter               %                                                   Third Quarter               %
------------------------------                                                   ----------------------------

    2002             2001         Change                                            2002            2001          Change
--------------   -------------   ---------                                       ------------   -------------   -----------

                                                Coal
       49,108          51,953       (5.5)%        Unit Coal                        $  23,701       $  30,321        (21.8)%
        1,141           1,322      (13.7)%        Other Coal                             666             773        (13.8)%
--------------   -------------                                                  ------------   -------------
       50,249          53,275       (5.7)%                                            24,367          31,094        (21.6)%
--------------   -------------                                                  ------------   -------------

                                               Chemical & Petroleum Products
        1,191           1,336      (10.9)%        Agri Chemicals                         836           1,067        (21.6)%
        3,843           2,743       40.1%         Gases                                3,762           2,509         49.9%
        5,447           5,392        1.0%         Organic                              5,944           5,514          7.8%
        4,917           4,933       (0.3)%        Inorganic                            5,431           5,424          0.1%
       13,099          13,049        0.4%         Petroleum                            9,309           9,298          0.1%
        7,101           6,503        9.2%         Plastics                             7,179           6,605          8.7%
--------------   -------------                                                   ------------   -------------
       35,598          33,956        4.8%                     Total                   32,461          30,417          6.7%
--------------   -------------                                                   ------------   -------------

                                               Agriculture and Minerals
       10,376          11,313       (8.3)%        Domestic Grain                       7,467           8,120         (8.0)
        2,336           3,422      (31.7)%        Export Grain                         1,453           2,397        (39.4)%
        6,907           6,557        5.3%         Food Products                        5,678           5,609          1.2
        5,352           6,366      (15.9)%        Ores and Minerals                    3,052           3,276         (6.8)%
        4,123           3,923        5.1%         Stone, Clay & Glass                  3,154           2,906          8.5%
--------------   -------------                                                   ------------   -------------
       29,094          31,581       (7.9)%                    Total                   20,804          22,308         (6.7)%
--------------   -------------                                                   ------------   -------------

                                               Paper & Forest Products
       22,979          22,217        3.4%         Pulp/Paper                          17,732          16,230          9.3%
        1,671           1,658        0.8%         Scrap Paper                            978             968          1.0%
        7,320           9,214      (20.6)%        Pulpwood/Logs/Chips                  3,151           3,788        (16.8)%
        7,103           7,143       (0.6)%        Lumber/Plywood                       6,577           6,293          4.5%
        4,960           4,997       (0.7)%        Metal/Scrap                          3,945           3,892          1.4%
        1,926           2,250      (14.4)%        Military/Other carloads              2,294           3,392        (32.4)%
--------------   -------------                                                   ------------   -------------
       45,959          47,479       (3.2)%                     Total                  34,677          34,563          0.3%
--------------   -------------                                                   ------------   -------------

                                               Intermodal & Automotive
        1,696           4,899      (65.4)%        Automotive                           1,472           3,084        (52.3)%
       73,637          65,469       12.5%         Intermodal                          12,555          11,278         11.3%
--------------   -------------                                                   ------------   -------------
       75,333          70,368        7.1%                      Total                  14,027          14,362         (2.3)%
--------------   -------------                                                   ------------   -------------

      236,233         236,659       (0.2)%     TOTAL FOR BUSINESS UNITS              126,336         132,744         (4.8)%

        8,538           8,361        2.1%      Haulage                                 4,049           3,353         20.8%

       (1,411)         (2,031)      30.5%      Adjustments                            (1,275)         (1,129)       (12.9)%
--------------   -------------                                                   ------------   -------------

      243,360         242,989        0.2%                  TOTAL                   $ 129,110       $ 134,968         (4.3)%
==============   =============                                                   ============   =============
Kansas City Southern
------------------------
Consolidated Balance Sheets                                                                                  Preliminary
(Dollars in Millions)                                                                                  ------------------------

                                                                  September 30, 2002                      December 31, 2001
                                                                     (Unaudited)
Assets

  Cash                                                                      $       35.5                          $       24.7
  Accounts receivable                                                              112.3                                 130.0
  Inventories                                                                       35.3                                  27.9
  Other current assets                                                              38.3                                  71.8
                                                              ---------------------------              ------------------------
     Total current assets                                                          221.4                                 254.4

  Investments held for operating purposes                                          404.6                                 386.8
  Properties, net of depreciation                                                1,336.3                               1,327.4
  Other assets                                                                      33.4                                  42.3
                                                              ---------------------------              ------------------------
      Total assets                                                          $    1,995.7                          $    2,010.9
                                                              ===========================              ========================

Liabilities and Stockholders' Equity
  Current portion of long-term debt                                         $       10.0                          $       46.7
  Accounts payable                                                                  40.3                                  50.4
  Accrued liabilities                                                              168.9                                 160.4
                                                              ---------------------------              ------------------------
     Total current liabilities                                                     219.2                                 257.5

  Long-term debt                                                                   578.7                                 611.7
  Deferred income taxes                                                            374.3                                 370.2
  Other                                                                             93.9                                  91.2
  Stockholders' equity                                                             729.6                                 680.3
                                                              ---------------------------              ------------------------
    Total liabilities and stockholders' equity                              $    1,995.7                          $    2,010.9
                                                              ===========================              ========================