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 24, 2001


                       KANSAS CITY SOUTHERN INDUSTRIES, INC.
                       -------------------------------------
                (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)


                 114 West 11th 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 Industries, Inc.
                                                dated October 24, 2001 entitled,
                                                "Kansas City Southern Industries
                                                Reports Improved Third Quarter
                                                Operating Results", is attached
                                                hereto as Exhibit 99.1


            99.2                                The following schedules are
                                                attached hereto as Exhibit 99.2-
                                                Combined Kansas City Southern
                                                Railway and Gateway Western
                                                Operating Statements, Combined
                                                Kansas City Southern
                                                Railway/Gateway Western
                                                Carloadings by Commodity and
                                                Kansas City Southern Industries,
                                                Inc. Preliminary Consolidated
                                                Balance Sheets



Item 9.     Regulation FD Disclosure

Kansas City Southern Industries,  Inc. ("KCSI" 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 24, 2001,  announcing  KCSI's third quarter and year to
date 2001 operating  results.  Included in Exhibit 99.2 are schedules  regarding
certain  financial  information  discussed at the  Company's  third quarter 2001
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.


<PAGE>




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 Industries, Inc.


Date: October 31, 2001                     By: /s/  Louis G. Van Horn
                                               ----------------------------
                                                    Louis G. Van Horn
                                              Vice President and Comptroller
                                              (Principal Accounting Officer)


<PAGE>


EXHIBIT 99.1

                                                    Date  October 24, 2001

Kansas City Southern          Media Contact: William Galligan 816-983-1551
Industries, Inc.              william.h.galligan@kcsr.com
114 West 11th Street

Kansas City, MO 64105         NYSE Symbol: KSU

                   Kansas City Southern Industries Reports Improved
                            Third Quarter Operating Results

EARNINGS ANALYSIS AND COMMENTARY

KCSI  reported  third  quarter 2001 income from  continuing  operations  of $9.0
million  (15(cent)  per diluted  share)  compared to $2.6  million  (5(cent) per
diluted share) in the third quarter of 2000. This $6.4 million (246%) quarter to
quarter  increase  resulted  primarily from  improvements in domestic  operating
income of $1.5 million,  equity earnings from Grupo  Transportacion  Ferroviaria
Mexicana S.A. de C.V. ("Grupo TFM") of $4.9 million and interest expense of $5.1
million.  These improvements were partially offset by a $2.7 million increase in
the income  tax  provision.  KCSI's  consolidated  third  quarter  2001  revenue
increased $0.5 million and operating  expenses declined $1.0 million compared to
the  third  quarter  of 2000,  resulting  in the  $1.5  million  improvement  in
operating income.

For the nine months ended September 30, 2001, income from continuing  operations
was $20.0  million  (33(cent)  per  diluted  share)  compared  to $21.8  million
(37(cent) per diluted share) for the nine months ended  September 30, 2000. This
$1.8  million  period to period  decline was  primarily  due to a $15.9  million
decrease  in  domestic  operating  income  partially  offset  by a $4.7  million
increase  in equity  earnings  from  Grupo TFM,  an $11.3  million  decrease  in
interest  expense and a $3.4  million  improvement  in the income tax  provision
(benefit).  Our equity  earnings  for the nine months ended  September  30, 2001
reflect 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.
<TABLE>
<CAPTION>

DILUTED EARNINGS PER SHARE AND COMMON SHARES COMPARISONS (1)
<S>                                         <C>      <C>            <C>      <C>

                                              Third Quarter           Year to Date
                                              -------------           ------------
                                             2001       2000         2001      2000
                                             ----       ----         ----      ----
Income from continuing operations:

  U.S. operations                          $ 0.10     $  0.09       $ 0.17    $ 0.31
  Grupo TFM and PCRC (including
   associated interest)                      0.05       (0.04)        0.16      0.06
                                          --------   --------      -------   -------
  Income from continuing operations          0.15        0.05         0.33      0.37
Extraordinary debt retirement costs, net
 of income tax                               -          (0.05)        -        (0.15)
Cumulative effect of accounting change,
 net of income tax(2)                        -          -            (0.01)     -
                                          --------   --------      -------   -------
      Total diluted earnings per share
       from continuing operations,
       adjusted for the extraordinary
       items and cumulative effect
       of accounting change                  0.15        0.00       $ 0.32    $ 0.22
                                          --------   --------      -------   -------

Common Shares Outstanding
(thousands):

   Weighted Average Diluted                61,171     58,858        60,934    58,104
   Actual                                  58,776     58,123        58,776    58,123
</TABLE>

(1)Earnings per share and common  share  information  for each period  presented
   reflect a  one-for-two  reverse stock split that occurred on July 12, 2000 in
   conjunction  with the  spin-off of Stilwell  Financial  Inc.,  the  Company's
   formerly owned financial services segment.

(2)Reflects the adoption of Statement of Financial Accounting Standard No.
   133, Accounting for Derivative Instruments and Hedging Activities.


<PAGE>


THIRD QUARTER

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

KCSI reported  income from  continuing  operations of $9.0 million for the three
months  ended  September  30,  2001  compared  to $2.6  million in the same 2000
period.

KCSI's  consolidated third quarter 2001 revenues totaled $144.6 million compared
to $144.1  million in the third  quarter of 2000.  This  increase  resulted from
slightly higher  KCSR/Gateway  Western  revenues ($0.2 million) and increases at
certain other subsidiaries ($0.3 million).  KCSR/Gateway  Western revenue growth
was driven primarily by strength in coal revenues, which improved 15% quarter to
quarter. Net tons of coal shipped increased  approximately 8% quarter to quarter
due to certain  utility plants that increased  deliveries to replenish  depleted
stockpiles and to satisfy weather-related demands.  Additionally, a coal-burning
utility  plant  that had been out of service  since  January  1999 began  taking
shipments in the second quarter of 2001.  Quarter to quarter  revenue  increases
also occurred for certain lumber  products,  domestic grain,  plastics,  certain
chemical  products and military  shipments.  These  improvements  were partially
offset by  overall  quarter  to  quarter  revenue  decreases  for  chemical  and
petroleum  products,  agriculture and mineral products and intermodal  products,
primarily reflecting the existing slow economic conditions.

KCSI's  consolidated costs and expenses declined $1 million in the third quarter
of 2001 to $128.6  million  compared to $129.6  million in the third  quarter of
2000.  This  resulted  from a $5.5  million  decrease  in  KCSR/Gateway  Western
expenses  offset  by a $4.5  million  increase  in  expenses  at  certain  other
subsidiaries  (primarily  comprised of a $3.0 million reduction to the allowance
for doubtful  accounts recorded in the third quarter of 2000 at the KCSI Holding
Company). Quarter to quarter declines in salaries and wages ($1.5 million), fuel
($0.7  million),  car hire ($0.6  million) and  casualties  and insurance  ($6.0
million)  were  partially  offset  by  increases  in  purchased  services  ($2.4
million),  fringe  benefits ($0.3  million) and other  expenses ($0.6  million).
Lower costs for salaries and wages  reflect the  employee  headcount  reductions
effected in March 2001,  while lower car hire expense  reflects  the  continuing
reduction in foreign rail cars on the Company's system. Casualties and insurance
expense  improved  quarter  to  quarter  primarily  as a result of $4.2  million
recorded  in the third  quarter of 2000 for the  adverse  judgment in the Duncan
lawsuit.  Excluding this $4.2 million,  KCSR/Gateway  Western costs and expenses
improved $1.3 million quarter to quarter.  The  KCSR/Gateway  Western  operating
ratio for third  quarter 2001 was 85.9%  compared to 89.9% (87.0%  excluding the
impact of the Duncan case) in the same 2000 period.

Excluding the impact of the extraordinary  item in 2000 discussed below,  equity
earnings related to the Company's investment in Grupo TFM increased $4.9 million
to $7.5  million  in the third  quarter  of 2001 from $2.6  million in the third
quarter of 2000. Grupo TFM revenues  increased 2% to $168.0 million in the third
quarter of 2001 from $165.2  million in the third  quarter of 2000,  while total
costs and  expenses  dropped  3%  quarter to  quarter,  leading  to an  improved
operating profit of nearly 20% (computed under accounting  principles  generally
accepted in the United States of America - "U.S.  GAAP").  Lower costs for fuel,
car  hire  and  losses  associated  with the  sale of  operating  property  were
partially offset by higher employee costs, purchased services and lease expense.
Under International  Accounting  Standards,  TFM's operating ratio was 75.6% for
the third  quarter  of 2001  compared  to 76.9% for the third  quarter  of 2000.
Additionally, third quarter 2001 results include a deferred tax benefit of $12.0
million (calculated under U.S. GAAP) compared to a deferred tax expense of $10.7
million  for the  third  quarter  of 2000.  The  variance  in the  deferred  tax
calculation  of Grupo TFM is mostly  attributable  to  fluctuations  in the peso
exchange rate and inflation in Mexico.  The Company  reports its equity in Grupo
TFM under U.S.  GAAP while  Grupo TFM  reports  under  International  Accounting
Standards.

Equity earnings from the Company's  investment in Mexrail  declined $1.2 million
quarter to  quarter,  while  equity  earnings  from  Southern  Capital  improved
slightly.  Additionally,  the  reconstruction  of the rail  line in  Panama  was
completed in July 2001 and the  operations  of PCRC have  commenced.  During the
third quarter of 2001, the Company recorded equity losses of approximately  $0.9
million from its investment in PCRC relating mostly to costs associated with the
start-up of the business.
<PAGE>

KCSI's  consolidated  interest  expense for the third quarter of 2001  decreased
$5.1 million  (28%) from the prior year  quarter  primarily as a result of lower
interest rates on our variable rate debt and lower amortization of debt issuance
costs due to the refinancing of debt in the third quarter of 2000 (see below).

During the third quarter of 2000,  the Company  refinanced  $200 million of bank
debt  with  a $200  million  offering  of  8-year  senior  unsecured  notes.  In
connection with this refinancing,  KCSI recorded  extraordinary  debt retirement
costs of approximately $1.1 million (net of income taxes). Additionally,  during
the third quarter of 2000, Grupo TFM refinanced $300 million of bank debt with a
U.S.  Commercial  Paper  program.  KCSI  recorded  its  proportionate  share  of
extraordinary  debt  retirement  costs of $1.7  million  (net of  income  taxes)
related to this refinancing by Grupo TFM. Total third quarter 2000 extraordinary
charges of $2.8  million,  or 5(cent) per  diluted  share,  reduced  income from
continuing operations from $2.6 million to a loss of $0.2 million.

YEAR TO DATE

The  Company's  income from  continuing  operations  for the nine  months  ended
September 30, 2001 totaled  $20.0 million  versus $21.8 million in the same 2000
period.

KCSI's  consolidated  revenues  totaled $431.8 million for the nine months ended
September  30,  2001  compared  to  $437.4  million  for the nine  months  ended
September 30, 2000. This $5.6 million decline  resulted from lower  KCSR/Gateway
Western  revenues  of  approximately  $7.8  million  partially  offset by higher
revenues  from certain  other  subsidiaries.  Year to date 2001  revenue  growth
occurred  in  certain  commodities,  including  coal  (6%),  automotive  (102%),
plastics   (13%),   military/other   (41%)  and  certain   forest  and  chemical
commodities.  These  revenue  improvements,  however,  were  offset  by  overall
declines  in chemical  and  petroleum  products  (3%),  agriculture  and mineral
products  (9%),  paper and forest  products (4%) and  intermodal  revenues (12%)
resulting mostly from lower production due to the continued weakness in the U.S.
economy.  Agriculture and mineral  product  revenues were also affected by lower
domestic  grain  shipments  due a general  decline in poultry  production in the
United States,  which resulted in decreased  demand for grain  deliveries to our
customers.

KCSI's  consolidated  costs and expenses  increased $10.3 million (3%) to $396.8
million  for the first nine months of 2001  compared  to $386.5  million for the
same 2000 period,  resulting from higher  KCSR/Gateway  Western expenses of $3.4
million  and higher  expenses  at certain  other  subsidiaries  of $6.9  million
(driven by the $3.0 million  reduction of the  allowance  for doubtful  accounts
discussed  above in the third quarter  analysis).  The increase in  KCSR/Gateway
Western expenses was mostly  attributable to a $4.6 million increase in car hire
costs and a $3.1 million  increase in casualties and insurance  costs  partially
offset by a $2.5 million decline in salaries and wages expense.  Contributing to
the increase in car hire expense was a higher  number of freight cars from other
railroads on the Company's rail line coupled with a lower number of KCSR freight
cars being used by other  railroads.  Also  contributing  to the increase in car
hire  expense  was the  larger  number of auto rack cars being used to serve the
increase in automotive  traffic period to period.  Casualty and insurance  costs
rose primarily due to several significant first quarter 2001 derailments and the
settlement of personal  injury claims.  Excluding the impact of the $4.2 million
judgment in the Duncan case discussed above,  casualty and insurance costs would
have risen $7.3 million  period to period.  Salaries  and wage expense  declined
period to period due mostly to employee headcount reductions in March 2001.

Excluding the impact of the extraordinary  item in 2000 discussed above,  equity
earnings  from the Company's  investment in Grupo TFM increased  $4.7 million to
$23.5 million for the nine months ended  September 30, 2001 versus $18.8 million
for the nine months ended September 30, 2000.  During the first quarter of 2001,
TFM  recorded  approximately  $54  million of  pre-tax  income  relating  to the
reversion of certain concession assets to the Mexican government.  The Company's
year to date 2001 equity earnings from Grupo TFM reflect our proportionate share
of this income of  approximately  $9.1 million.  Grupo TFM's revenues  increased
4.4% to $496.0 million for the first nine months of 2001 from $475.2 million for
the  first  nine  months  of 2000.  These  higher  revenues  were  offset  by an
approximate 9% increase in operating  expenses  (exclusive of the income related
to the  reversion  of  certain  concession  assets  to the  Mexican  government)
resulting  in a  period  to  period  decline  in  ongoing  operating  income  of
approximately  9%. Under U.S.  GAAP,  the deferred tax expense for Grupo TFM was
$12.6  million  for the nine  months  ended  September  30,  2001  compared to a
deferred tax benefit of $18.9 million (excluding the impact of the extraordinary
item) for the same period in 2000.
<PAGE>

Similar to the third  quarter of 2001,  the Company's  interest  expense for the
nine months ended September 30, 2001 declined $11.3 million compared to the nine
months ended September 30, 2000 due to lower borrowing rates.

Effective  January  1,  2001 the  Company  implemented  Statement  of  Financial
Accounting Standard No. 133,  Accounting for Derivative  Instruments and Hedging
Activities  ("FAS 133").  As a result of this change in the method of accounting
for derivative financial  instruments,  the Company recorded an after-tax charge
to  earnings  of $0.4  million  in the first  quarter  of 2001.  This  charge is
presented as a cumulative  effect of an  accounting  change in the  accompanying
consolidated  condensed statements of income for the nine months ended September
30, 2001. In the first quarter of 2000, the Company completed a debt refinancing
whereby it retired  approximately  $400 million of its debt securities  prior to
maturity.   Accordingly,   the  Company   recorded  debt  retirement   costs  of
approximately  $5.9 million  (after-tax)  in the first quarter of 2000.  This is
presented as an extraordinary  item in the accompanying  consolidated  condensed
statements of income for the nine months ended  September  30, 2000.  During the
third  quarter  of 2000,  the  Company  and Grupo TFM  refinanced  certain  debt
instruments and recorded extraordinary debt retirement costs of $1.1 million and
$1.7  million,  respectively,  as further  described  above in the third quarter
analysis.  These items are presented as extraordinary  items in the accompanying
consolidated  condensed statements of income for the nine months ended September
30, 2000.

BUSINESS OUTLOOK

Michael R. Haverty,  KCSI Chairman,  President and Chief Executive Officer said,
"Despite  the  economic  turmoil  currently  facing our  country,  our  domestic
revenues and cost structure showed signs of improvement during the third quarter
of 2001  compared to the third  quarter of 2000 and the previous two quarters of
2001.  Leading  the way has  been  the  strength  of our  coal  revenues,  which
increased  15% for the third quarter of 2001 and 6% for the first nine months of
2001 compared to the same periods in 2000.  Overall,  however,  most commodities
have  remained  weak in the midst of the slumping  economy and we expect  fourth
quarter  revenues to remain  relatively  flat  compared to the third  quarter of
2001. A significant improvement in our various commodity sectors is not expected
to occur until an economic recovery begins.

As the year has unfolded,  our cost  structure  has continued to improve.  Third
quarter costs and expenses for KCSR/Gateway Western have improved 4% compared to
the  third  quarter  of 2000 and 1% and 7%  compared  to the  second  and  first
quarters of 2001, respectively.  Consequently, the operating ratio for the third
quarter of 2001 improved compared to the third quarter of 2000 and the first two
quarters of 2001. We expect  continued  improvement in costs and expenses during
the fourth quarter.

Equity  earnings  from our  investment  in  Grupo  TFM  continue  to  provide  a
significant  contribution to our earnings.  During the third quarter and year to
date 2001,  equity  earnings from our  investment  in Grupo TFM  increased  $4.9
million  and $4.7  million,  respectively.  Grupo  TFM  increased  its  revenues
approximately  2% during the third  quarter  of 2001 and 4% during  year to date
2001  compared  to the  same  periods  in 2000,  despite  the  current  economic
slowdown,  which  affects not only the United States but has also had a profound
impact on the Mexican economy. During this tough economic environment,  it is an
accomplishment  that Grupo TFM has  continued to increase its revenues  while at
the same time has managed its cost  structure to maintain an operating  ratio in
the mid-70% range. Grupo TFM reduced its cost structure during the third quarter
of 2001 compared to the third quarter of 2000 and the first two quarters of 2001
and we expect Grupo TFM  management to continue to focus on cost  containment in
the fourth quarter.

We and our  partner,  Transportacion  Maritima  Mexicana,  S.A.  de  C.V.,  have
announced our intention to exercise our call and cause TFM to purchase the 24.6%
interest in Grupo TFM currently held by the Mexican government. This transaction
was delayed due to the events of September 11, 2001, and we currently expect TFM
to complete the purchase of the Mexican  government's  24.6%  ownership in Grupo
TFM during the fourth  quarter of 2001. We believe this is an opportunity to add
value to a vital component of our NAFTA franchise.  Additionally, we are excited
about the  commencement  of  operations  in Panama in July  2001,  which  should
provide us with opportunities for future earnings growth beginning in the latter
part of 2002.

Following  the tragic  events of September  11, we, like most other  industries,
have  experienced a period of uncertainty.  During this time of national crisis,
our  team of  security  personnel  has done an  excellent  job of  ensuring  the
security and integrity of our operations and we commend them for their continued
efforts.  As we move forward in these uncertain  economic times, we will respond
appropriately.  Our physical plant is currently in excellent  condition,  partly
<PAGE>
because of the  substantial  capital  expenditures  made from  1996-2000,  which
averaged  approximately 17% of revenues during that time span.  Because of this,
until the economy  begins to  recover,  we expect to be able to limit the amount
and nature of our  capital  expenditures  without  compromising  the quality and
safety  of our  physical  plant.  Additionally,  we will  continue  to focus our
efforts on reducing costs without disrupting our service quality.  As always, we
will continue to look for  opportunities to increase our revenue base and reduce
our debt load. As evidenced by the cost reduction strategy we implemented during
the first quarter of 2001, we have been proactive in response to a difficult and
changing environment.

During these volatile times in the equity markets, we appreciate the support and
long-term  commitment of our  shareholders and will continue to take the actions
that we believe are  necessary to improve the value of our NAFTA  franchise  and
build long-term shareholder value."

(Note:  Unless  otherwise  indicated  above,  the operating  results and related
amounts  included  herein for the three and nine months ended September 30, 2000
were derived from the Form 10-Q/A for the third  quarter of 2000.  These amounts
reflect the adjustment made related to the Duncan legal case verdict,  which was
received subsequent to our third quarter 2000 earnings press release.)

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 KCSI's  December 31, 2000 Form 10-K and the Current
Report on Form  8-K/A  dated June 3, 1997,  each filed by the  Company  with the
Securities  and Exchange  Commission  ("SEC")  (Commission  file no. 1-4717) and
those  factors  identified  in the  "Risk  Factors"  section  of  the  Company's
Registration  Statement on Form S-4, as amended and declared  effective on March
15, 2001, which is on file with the SEC (File No. 333-54262),  and those factors
identified in the "Risk Factors" section of the Company's Registration Statement
on Form S-3, as amended and declared effective on June 5, 2001, which is on file
with  the  SEC  (File  No.   333-61006).   The  Company   will  not  update  any
forward-looking  statements  in this press  release to reflect  future events or
developments.


                        (Financial Information Attached)
<PAGE>
<TABLE>
<CAPTION>

                               KANSAS CITY SOUTHERN INDUSTRIES, INC. and SUBSIDIARY COMPANIES
                                        CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                             (excludes Stilwell Financial Inc.)
                                        (dollars in millions, except per share data)
                                                        (Unaudited)
<S>                                                                         <C>          <C>            <C>          <C>

                                                                             Three Months                  Nine Months
                                                                          Ended September 30,          Ended September 30,
                                                                        ------------------------     ------------------------
                                                                           2001         2000           2001          2000
                                                                        -----------   ----------     ----------    ----------

    Revenues                                                               $ 144.6      $ 144.1        $ 431.8       $ 437.4

    Costs and expenses                                                       113.9        115.8          353.2         344.1
    Depreciation and amortization                                             14.7         13.8           43.6          42.4
                                                                        -----------   ----------     ----------    ----------
    Operating income                                                          16.0         14.5           35.0          50.9

    Equity in net earnings (losses) of unconsolidated affiliates:
        Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V.
          (preliminary)                                                        7.5          2.6           23.5          18.8
        Other                                                                 (0.6)         1.5           (0.2)          3.3
    Interest expense                                                         (13.2)       (18.3)         (42.9)        (54.2)
    Other, net                                                                 0.9          1.2            3.0           4.8
                                                                        -----------   ----------     ----------    ----------

    Income from continuing operations before income taxes,
        extraordinary items and cumulative effect of accounting change        10.6          1.5           18.4          23.6

    Income tax provision (benefit)                                             1.6         (1.1)          (1.6)          1.8
                                                                        -----------   ----------     ----------    ----------
    Income from continuing operations before extraordinary items
          and cumulative effect of accounting change                           9.0          2.6           20.0          21.8

    Extraordinary items, net of income taxes:
       Debt retirement costs                                                    -          (1.1)             -          (7.0)
       Debt retirement costs - TFM                                              -          (1.7)             -          (1.7)

    Cumulative effect of accounting change, net of income taxes                 -           -             (0.4)          -
                                                                        -----------   ----------     ----------    ----------

    Income from continuing operations, net of extraordinary items
     and cumulative effect of accounting change                             $  9.0      $  (0.2)       $  19.6       $  13.1
                                                                        -----------   ----------     ----------    ----------


    Per Share Data:

    Basic Weighted Average Common shares outstanding (in thousands)         58,656       57,478         58,442        56,353

    Basic Earnings (Loss) per Common share from continuing operations       $ 0.15      $  0.05        $  0.34       $  0.38

           Extraordinary items                                                   -        (0.05)            -          (0.15)
           Cumulative effect of accounting change                                -            -          (0.01)           -
                                                                        -----------   ----------     ----------    ----------

    Basic Earnings per Common share, net of extraordinary
     items and cumulative effect operations
       of accounting change                                                 $ 0.15      $  0.00        $  0.33       $  0.23
                                                                        -----------   ----------     ----------    ----------


    Diluted Weighted Average Common shares outstanding (in thousands)       61,171       58,858         60,934        58,104

    Diluted Earnings (Loss) per Common share from continuing                $ 0.15      $  0.05        $  0.33       $  0.37
    operations
           Extraordinary items                                                   -        (0.05)             -         (0.15)
           Cumulative effect of accounting change                                -            -          (0.01)           -
                                                                        -----------   ----------     ----------    ----------

    Diluted Earnings per Common share, net of
     extraordinary items and cumulative effect
    of accounting change                                                    $ 0.15      $  0.00        $  0.32       $  0.22
                                                                        -----------   ----------     ----------    ----------

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                               KANSAS CITY SOUTHERN INDUSTRIES, INC. and SUBSIDIARY COMPANIES
                                        CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                           (includes discontinued operations (1))
                                        (dollars in millions, except per share data)
                                                        (Unaudited)
<S>                                                                          <C>         <C>            <C>          <C>
                                                                             Three Months                  Nine Months
                                                                          Ended September 30,          Ended September 30,
                                                                        ------------------------     ------------------------
                                                                           2001         2000           2001          2000
                                                                        -----------   ----------     ----------    ----------

    Revenues                                                               $ 144.6      $ 144.1        $ 431.8       $ 437.4

    Costs and expenses                                                       113.9        115.8          353.2         344.1
    Depreciation and amortization                                             14.7         13.8           43.6          42.4
                                                                        -----------   ----------     ----------    ----------

    Operating income                                                          16.0         14.5           35.0          50.9

    Equity in net earnings (losses) of unconsolidated affiliates:
        Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V.(preliminary)   7.5          2.6           23.5          18.8
        Other                                                                 (0.6)         1.5           (0.2)          3.3
    Interest expense                                                         (13.2)       (18.3)         (42.9)        (54.2)
    Other, net                                                                 0.9          1.2            3.0           4.8
                                                                        -----------   ----------     ----------    ----------
    Income from continuing operations before income taxes,
        extraordinary items and cumulative effect of accounting change        10.6          1.5           18.4          23.6

    Income tax provision (benefit)                                             1.6         (1.1)          (1.6)          1.8
                                                                        -----------   ----------     ----------    ----------
    Income from continuing operations before extraordinary items
          and cumulative effect of accounting change                           9.0          2.6           20.0          21.8
    Income from discontinued operations (1)  (net of income taxes)               -         23.4              -         363.8
                                                                        -----------   ----------     ----------    ----------

    Income before extraordinary items and cumulative effect of
     accounting change                                                         9.0         26.0           20.0         385.6
    Extraordinary items, net of income taxes:
       Debt retirement costs                                                     -         (1.1)             -          (7.0)
       Debt retirement costs - TFM                                               -         (1.7)             -          (1.7)
    Cumulative effect of accounting change, net of income taxes                  -            -           (0.4)            -
                                                                        -----------   ----------     ----------    ----------

    Net income                                                              $  9.0      $  23.2        $  19.6       $ 376.9
                                                                        -----------   ----------     ----------    ----------


    Per Share Data:

    Basic Weighted Average Common shares outstanding (in thousands)         58,656       57,478         58,442        56,353
    Basic Earnings per Common share
       Continuing operations                                                $ 0.15      $  0.05        $  0.34       $  0.38
       Discontinued operations                                                   -         0.40              -          6.46
                                                                        -----------   ----------     ----------    ----------
    Basic Earnings (Loss) per Common share before extraordinary items
        and cumulative effect of accounting change                            0.15         0.45           0.34          6.84
           Extraordinary items                                                   -        (0.05)             -         (0.15)
           Cumulative effect of accounting change                                -            -           (0.01)          -
                                                                        -----------   ----------     ----------    ----------

    Basic Earnings per Common share                                         $ 0.15      $  0.40        $  0.33       $  6.69
                                                                        -----------   ----------     ----------    ----------

    Diluted Weighted Average Common shares outstanding (in thousands)       61,171       58,858         60,934        58,104

    Diluted Earnings per Common share
       Continuing operations                                                $ 0.15      $  0.05        $  0.33       $  0.37
       Discontinued operations                                                   -         0.39              -          6.17
                                                                        -----------   ----------     ----------    ----------
    Diluted Earnings (Loss) per Common share before extraordinary items
        and cumulative effect of accounting change                            0.15         0.44           0.33          6.54
           Extraordinary items                                                   -        (0.05)             -         (0.15)
           Cumulative effect of accounting change                                -            -          (0.01)            -
                                                                        -----------   ----------     ----------    ----------
    Diluted Earnings per Common share                                       $ 0.15       $ 0.39        $  0.32       $  6.39


    (1) - Stilwell Financial Inc., the Company's formerly owned financial services segment
</TABLE>

<PAGE>

EXHIBIT 99.2

Combined KCSR and Gateway Western
Operating Statements
Dollars in Millions

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


                                           Third Quarter          Third Quarter               Nine Months            Nine Months
                                                2001                  2000*                       2001                  2000*
                                         -------------------    -------------------        -------------------    ------------------
Revenues
    Freight Revenue                           $        87.0          $        87.5             $        253.4         $        265.9
    Intermodal and Automotive Revenue                  14.3                   15.7                       50.9                   46.4
    Unit Coal Revenue                                  30.3                   26.7                       84.8                   81.4
    Haulage Revenue                                     3.4                    2.9                        9.6                    9.0
    Other Revenue                                       7.7                    9.7                       24.3                   28.1
                                         -------------------    -------------------        -------------------    ------------------
      Total Revenues                                  142.7                  142.5                      423.0                  430.8
                                         -------------------    -------------------        -------------------    ------------------

Operating Expenses
    Salaries & Wages                                   33.5                   35.0                      101.1                  103.6
    Fringe Benefits                                    14.1                   13.8                       40.4                   41.3
    Fuel                                               11.5                   12.2                       35.3                   35.3
    Material and Supplies                               7.5                    7.5                       22.1                   23.6
    Car Hire                                            3.5                    4.1                       15.7                   11.1
    Purchased Services                                 13.5                   11.1                       37.0                   35.9
    Casualties & Insurance                              5.8                   11.8                       27.6                   24.5
    Other                                               2.6                    2.0                        7.6                    6.1
                                         -------------------    -------------------        -------------------    ------------------
      Net Operating Expenses                           92.0                   97.5                      286.8                  281.4
                                         -------------------    -------------------        -------------------    ------------------

Fixed Expenses
    Leases, Net                                        13.6                   13.9                       40.9                   42.5
    Depreciation                                       13.7                   13.0                       40.7                   39.4
    Taxes (Other Than Income)                           3.3                    3.7                        9.5                   11.2
                                         -------------------    -------------------        -------------------    ------------------
      Total Fixed Expenses                             30.6                   30.6                       91.1                   93.1
                                         -------------------    -------------------        -------------------    ------------------
    Total Expenses                                    122.6                  128.1                      377.9                  374.5
                                         -------------------    -------------------        -------------------    ------------------

Operating Income                              $        20.1          $        14.4              $        45.1          $        56.3


* 2000 Casualites and Insurance Expense includes $4.2 million adjustment related to Duncan legal case.
</TABLE>

<PAGE>

Combined Kansas City Southern Railway/Gateway Western
Carloadings By Commodity - Year to Date September 30, 2001
Dollars in Thousands
<TABLE>

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

               Carloadings                                                                           Revenue

                 Year to Date                                                                         Year to Date
-----------------------------------------------                                        ---------------------------------------------
     2001             2000          % Change                                               2001             2000          % Change
---------------   --------------   ------------                                        -------------    -------------    -----------

                                                    Coal
       144,267          141,498         2.0%          Unit Coal                           $  84,836        $  81,406           4.2%
         3,726            2,302        61.9%          Other Coal                              2,120              866         144.8%

---------------   --------------                                                       -------------    -------------
       147,993          143,800         2.9%                       Total                     86,956           82,272           5.7%


                                                   Chemical & Petroleum Products
         4,927            6,989      (29.5)%          Agri Chemicals                          3,913            4,934        (20.7)%
         8,404           10,516      (20.1)%          Gases                                   7,674            9,547        (19.6)%
        16,779           19,697      (14.8)%          Organic                                16,864           18,651         (9.6)%
        14,594           12,933        12.8%          Inorganic                              15,373           15,077           2.0%
        45,882           47,572       (3.6)%          Petroleum                              28,870           29,536         (2.3)%
        20,006           19,810         1.0%          Plastics                               20,257           17,999          12.5%
---------------   --------------                                                       -------------    -------------
       110,592          117,517       (5.9)%                       Total                     92,951           95,744         (2.9)%
---------------   --------------                                                       -------------    -------------

                                                   Agriculture and Minerals
        35,809           38,208       (6.3)%          Domestic Grain                         24,569           27,746        (11.5)%
         8,471            8,386         1.0%          Export Grain                            5,595            5,912         (5.4)%
        19,766           22,264      (11.2)%          Food Products                          16,260           17,631         (7.8)%
        17,951           20,018      (10.3)%          Ores and Minerals                       9,570           10,056         (4.8)%
        11,479           12,925      (11.2)%          Stone, Clay & Glass                     8,482            9,511        (10.8)%
---------------   --------------                                                       -------------    -------------
        93,476          101,801       (8.2)%                       Total                     64,476           70,856         (9.0)%
---------------   --------------                                                       -------------    -------------

                                                   Paper & Forest Products
        63,248           68,974       (8.3)%          Pulp/Paper                             44,665           48,067         (7.1)%
         5,078            5,243       (3.1)%          Scrap Paper                             2,740            2,846         (3.7)%
        26,946           26,038         3.5%          Pulpwood/Logchips                      11,185           10,336           8.2%
        19,967           21,688       (7.9)%          Lumber/Plywood                         17,364           19,092         (9.1)%
        16,286           19,519      (16.6)%          Metal/Scrap                            12,661           14,559        (13.0)%
         6,858            5,960        15.1%          Military/Other Carloads                 8,692            6,182          40.6%
---------------   --------------                                                       -------------    -------------
       138,383          147,422       (6.1)%                       Total                     97,307          101,082         (3.7)%

---------------   --------------                                                       -------------    -------------

                                                   Intermodal & Automotive
        28,642           14,987        91.1%          Automotive                             17,743            8,771         102.3%
       192,042          179,678         6.9%          Intermodal                             33,137           37,617        (11.9)%
---------------   --------------                                                       -------------    -------------
       220,684          194,665        13.4%                       Total                     50,880           46,388           9.7%
---------------   --------------                                                       -------------    -------------

       711,128          705,205         0.8%       TOTAL FOR BUSINESS UNITS                 392,570          396,342         (1.0)%


        25,565           32,636      (21.7)%       Haulage                                    9,644            9,021           6.9%


        (7,028)          (5,840)       20.3%       Adjustments                               (3,479)          (2,665)         30.5%

---------------   --------------                                                       -------------    -------------

       729,665          732,001       (0.3)%                    TOTAL                     $ 398,735        $ 402,698         (1.0)%
===============   ==============                                                       =============    =============

</TABLE>
<PAGE>

<TABLE>

Combined Kansas City Southern Railway/Gateway Western
Carloadings By Commodity - Third Quarter 2001
Dollars in Thousands
<S>                      <C>             <C>            <C>                                   <C>              <C>             <C>

                    Carloadings                                                                            Revenue

                Third Quarter                                                                         Third Quarter
-----------------------------------------------                                        ---------------------------------------------
     2001             2000          % Change                                               2001             2000          % Change
---------------   --------------   ------------                                        -------------    -------------    -----------

                                                    Coal
        51,953           48,522         7.1%          Unit Coal                         $    30,321      $    26,689          13.6%
         1,322              734        80.1%          Other Coal                                773              334         131.4%
---------------   --------------                                                       -------------    -------------
        53,275           49,256         8.2%                                                 31,094           27,023          15.1%

                                                   Chemical & Petroleum Products
         1,336            2,281      (41.4)%          Agri Chemicals                          1,067            1,613        (33.8)%
         2,743            3,442      (20.3)%          Gases                                   2,509            3,096        (19.0)%
         5,392            6,400      (15.8)%          Organic                                 5,514            6,050         (8.9)%
         4,933            4,228        16.7%          Inorganic                               5,424            4,893          10.9%
        12,697           16,168      (21.5)%          Petroleum                               9,064            9,599         (5.6)%
         6,503            6,822       (4.7)%          Plastics                                6,605            6,328           4.4%
---------------   --------------                                                       -------------    -------------
        33,604           39,341      (14.6)%                       Total                     30,183           31,579         (4.4)%
---------------   --------------                                                       -------------    -------------

                                                   Agriculture and Minerals
        11,313           11,417       (0.9)%          Domestic Grain                          8,120            8,054           0.8%
         3,422            3,419         0.1%          Export Grain                            2,397            2,623         (8.6)%
         6,557            7,719      (15.1)%          Food Products                           5,609            6,005         (6.6)%
         6,366            6,841       (6.9)%          Ores and Minerals                       3,276            3,319         (1.3)%
         3,923            4,069       (3.6)%          Stone, Clay & Glass                     2,906            2,958         (1.8)%
---------------   --------------                                                       -------------    -------------
        31,581           33,465       (5.6)%                       Total                     22,308           22,959         (2.8)%
---------------   --------------                                                       -------------    -------------

                                                   Paper & Forest Products
        22,217           22,855       (2.8)%          Pulp/Paper                             16,230           16,567         (2.0)%
         1,658            1,839       (9.8)%          Scrap Paper                               968            1,026         (5.7)%
         9,214            7,984        15.4%          Pulpwood/Logs/Chips                     3,788            3,102          22.1%
         7,143            6,996         2.1%          Lumber/Plywood                          6,293            6,145           2.4%
         4,997            5,612      (11.0)%          Metal/Scrap                             3,931            4,200         (6.4)%
         2,602            2,050        26.9%          Military/Other carloads                 3,625            2,550          42.2%
---------------   --------------                                                       -------------    -------------
        47,831           47,336         1.0%                       Total                     34,835           33,590           3.7%
---------------   --------------                                                       -------------    -------------

                                                   Intermodal & Automotive
         4,899            4,969       (1.4)%          Automotive                              3,044            3,104         (1.9)%
        65,469           68,414       (4.3)%          Intermodal                             11,278           12,612        (10.6)%
---------------   --------------                                                       -------------    -------------
        70,368           73,383       (4.1)%                       Total                     14,322           15,716         (8.9)%
---------------   --------------                                                       -------------    -------------

       236,659          242,781       (2.5)%       TOTAL FOR BUSINESS UNITS                 132,742          130,867           1.4%

         8,361            9,990      (16.3)%       Haulage                                    3,353            2,904          15.5%

        (2,031)          (2,240)      (9.3)%       Adjustments                               (1,127)            (932)
---------------   --------------                                                       -------------    -------------

       242,989          250,531       (3.0)%                    TOTAL                   $   134,968      $   132,839           1.6%
===============   ==============                                                       =============    =============
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

Kansas City Southern Industries, Inc.
Consolidated Balance Sheets                                                                               Preliminary
Unaudited
(Dollars in Millions)
<S>                                                                          <C>                              <C>
                                                                   September 30, 2001                  December 31, 2000
                                                               ---------------------------         ---------------------------
Assets
  Cash                                                                      $        26.9                       $        21.5
  Accounts receivable                                                               141.4                               135.0
  Inventories                                                                        28.8                                34.0
  Other current assets                                                               19.0                                25.9
                                                               ---------------------------         ---------------------------
     Total current assets                                                           216.1                               216.4

  Investments held for operating purposes                                           379.9                               358.2
  Properties, net of depreciation                                                 1,323.0                             1,327.8
  Other assets                                                                       43.4                                42.1
                                                               ---------------------------         ---------------------------

      Total assets                                                          $     1,962.4                       $     1,944.5
                                                               ===========================         ===========================

Liabilities and Stockholders' Equity
  Current portion of long-term debt                                         $        42.8                       $        36.2
  Accounts payable                                                                   48.3                                52.9
  Accrued liabilities                                                               120.7                               159.9
                                                               ---------------------------         ---------------------------
     Total current liabilities                                                      211.8                               249.0

  Long-term debt                                                                    642.0                               638.4
  Deferred income taxes                                                             347.4                               332.2
  Other                                                                              96.2                                81.5
  Stockholders' equity                                                              665.0                               643.4
                                                               ---------------------------         ---------------------------

    Total liabilities and stockholders' equity                              $     1,962.4                       $     1,944.5
                                                               ===========================         ===========================
</TABLE>
[{"type": "8-K", "sequence": "1", "filename": "earnings3q2001.txt", "description": "EARNINGS 3Q 2001", "secsgml_size_bytes": 61666}]
{"company-data": {"conformed-name": "KANSAS CITY SOUTHERN INDUSTRIES INC", "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": "1771668"}, "business-address": {"street1": "114 W 11TH ST", "city": "KANSAS CITY", "state": "MO", "zip": "64105", "phone": "8169831303"}, "mail-address": {"street1": "114 WEST 11TH STREET", "city": "KANSAS CITY", "state": "MO", "zip": "64105"}}
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 24, 2001

                       KANSAS CITY SOUTHERN INDUSTRIES, INC.
                       -------------------------------------
                (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)

                 114 West 11th 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 Industries, Inc.
                                                dated October 24, 2001 entitled,
                                                "Kansas City Southern Industries
                                                Reports Improved Third Quarter
                                                Operating Results", is attached
                                                hereto as Exhibit 99.1

            99.2                                The following schedules are
                                                attached hereto as Exhibit 99.2-
                                                Combined Kansas City Southern
                                                Railway and Gateway Western
                                                Operating Statements, Combined
                                                Kansas City Southern
                                                Railway/Gateway Western
                                                Carloadings by Commodity and
                                                Kansas City Southern Industries,
                                                Inc. Preliminary Consolidated
                                                Balance Sheets

Item 9.     Regulation FD Disclosure

Kansas City Southern Industries,  Inc. ("KCSI" 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 24, 2001,  announcing  KCSI's third quarter and year to
date 2001 operating  results.  Included in Exhibit 99.2 are schedules  regarding
certain  financial  information  discussed at the  Company's  third quarter 2001
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 Industries, Inc.

Date: October 31, 2001                     By: /s/  Louis G. Van Horn
                                               ----------------------------
                                                    Louis G. Van Horn
                                              Vice President and Comptroller
                                              (Principal Accounting Officer)
EXHIBIT 99.1

                                                    Date  October 24, 2001

Kansas City Southern          Media Contact: William Galligan 816-983-1551
Industries, Inc.              william.h.galligan@kcsr.com
114 West 11th Street

Kansas City, MO 64105         NYSE Symbol: KSU

                   Kansas City Southern Industries Reports Improved
                            Third Quarter Operating Results

EARNINGS ANALYSIS AND COMMENTARY

KCSI  reported  third  quarter 2001 income from  continuing  operations  of $9.0
million  (15(cent)  per diluted  share)  compared to $2.6  million  (5(cent) per
diluted share) in the third quarter of 2000. This $6.4 million (246%) quarter to
quarter  increase  resulted  primarily from  improvements in domestic  operating
income of $1.5 million,  equity earnings from Grupo  Transportacion  Ferroviaria
Mexicana S.A. de C.V. ("Grupo TFM") of $4.9 million and interest expense of $5.1
million.  These improvements were partially offset by a $2.7 million increase in
the income  tax  provision.  KCSI's  consolidated  third  quarter  2001  revenue
increased $0.5 million and operating  expenses declined $1.0 million compared to
the  third  quarter  of 2000,  resulting  in the  $1.5  million  improvement  in
operating income.

For the nine months ended September 30, 2001, income from continuing  operations
was $20.0  million  (33(cent)  per  diluted  share)  compared  to $21.8  million
(37(cent) per diluted share) for the nine months ended  September 30, 2000. This
$1.8  million  period to period  decline was  primarily  due to a $15.9  million
decrease  in  domestic  operating  income  partially  offset  by a $4.7  million
increase  in equity  earnings  from  Grupo TFM,  an $11.3  million  decrease  in
interest  expense and a $3.4  million  improvement  in the income tax  provision
(benefit).  Our equity  earnings  for the nine months ended  September  30, 2001
reflect 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.
DILUTED EARNINGS PER SHARE AND COMMON SHARES COMPARISONS (1)
Third Quarter           Year to Date
                                              -------------           ------------
                                             2001       2000         2001      2000
                                             ----       ----         ----      ----
Income from continuing operations:

  U.S. operations                          $ 0.10     $  0.09       $ 0.17    $ 0.31
  Grupo TFM and PCRC (including
   associated interest)                      0.05       (0.04)        0.16      0.06
                                          --------   --------      -------   -------
  Income from continuing operations          0.15        0.05         0.33      0.37
Extraordinary debt retirement costs, net
 of income tax                               -          (0.05)        -        (0.15)
Cumulative effect of accounting change,
 net of income tax(2)                        -          -            (0.01)     -
                                          --------   --------      -------   -------
      Total diluted earnings per share
       from continuing operations,
       adjusted for the extraordinary
       items and cumulative effect
       of accounting change                  0.15        0.00       $ 0.32    $ 0.22
                                          --------   --------      -------   -------

Common Shares Outstanding
(thousands):

   Weighted Average Diluted                61,171     58,858        60,934    58,104
   Actual                                  58,776     58,123        58,776    58,123
(1)Earnings per share and common  share  information  for each period  presented
   reflect a  one-for-two  reverse stock split that occurred on July 12, 2000 in
   conjunction  with the  spin-off of Stilwell  Financial  Inc.,  the  Company's
   formerly owned financial services segment.

(2)Reflects the adoption of Statement of Financial Accounting Standard No.
   133, Accounting for Derivative Instruments and Hedging Activities.
THIRD QUARTER

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

KCSI reported  income from  continuing  operations of $9.0 million for the three
months  ended  September  30,  2001  compared  to $2.6  million in the same 2000
period.

KCSI's  consolidated third quarter 2001 revenues totaled $144.6 million compared
to $144.1  million in the third  quarter of 2000.  This  increase  resulted from
slightly higher  KCSR/Gateway  Western  revenues ($0.2 million) and increases at
certain other subsidiaries ($0.3 million).  KCSR/Gateway  Western revenue growth
was driven primarily by strength in coal revenues, which improved 15% quarter to
quarter. Net tons of coal shipped increased  approximately 8% quarter to quarter
due to certain  utility plants that increased  deliveries to replenish  depleted
stockpiles and to satisfy weather-related demands.  Additionally, a coal-burning
utility  plant  that had been out of service  since  January  1999 began  taking
shipments in the second quarter of 2001.  Quarter to quarter  revenue  increases
also occurred for certain lumber  products,  domestic grain,  plastics,  certain
chemical  products and military  shipments.  These  improvements  were partially
offset by  overall  quarter  to  quarter  revenue  decreases  for  chemical  and
petroleum  products,  agriculture and mineral products and intermodal  products,
primarily reflecting the existing slow economic conditions.

KCSI's  consolidated costs and expenses declined $1 million in the third quarter
of 2001 to $128.6  million  compared to $129.6  million in the third  quarter of
2000.  This  resulted  from a $5.5  million  decrease  in  KCSR/Gateway  Western
expenses  offset  by a $4.5  million  increase  in  expenses  at  certain  other
subsidiaries  (primarily  comprised of a $3.0 million reduction to the allowance
for doubtful  accounts recorded in the third quarter of 2000 at the KCSI Holding
Company). Quarter to quarter declines in salaries and wages ($1.5 million), fuel
($0.7  million),  car hire ($0.6  million) and  casualties  and insurance  ($6.0
million)  were  partially  offset  by  increases  in  purchased  services  ($2.4
million),  fringe  benefits ($0.3  million) and other  expenses ($0.6  million).
Lower costs for salaries and wages  reflect the  employee  headcount  reductions
effected in March 2001,  while lower car hire expense  reflects  the  continuing
reduction in foreign rail cars on the Company's system. Casualties and insurance
expense  improved  quarter  to  quarter  primarily  as a result of $4.2  million
recorded  in the third  quarter of 2000 for the  adverse  judgment in the Duncan
lawsuit.  Excluding this $4.2 million,  KCSR/Gateway  Western costs and expenses
improved $1.3 million quarter to quarter.  The  KCSR/Gateway  Western  operating
ratio for third  quarter 2001 was 85.9%  compared to 89.9% (87.0%  excluding the
impact of the Duncan case) in the same 2000 period.

Excluding the impact of the extraordinary  item in 2000 discussed below,  equity
earnings related to the Company's investment in Grupo TFM increased $4.9 million
to $7.5  million  in the third  quarter  of 2001 from $2.6  million in the third
quarter of 2000. Grupo TFM revenues  increased 2% to $168.0 million in the third
quarter of 2001 from $165.2  million in the third  quarter of 2000,  while total
costs and  expenses  dropped  3%  quarter to  quarter,  leading  to an  improved
operating profit of nearly 20% (computed under accounting  principles  generally
accepted in the United States of America - "U.S.  GAAP").  Lower costs for fuel,
car  hire  and  losses  associated  with the  sale of  operating  property  were
partially offset by higher employee costs, purchased services and lease expense.
Under International  Accounting  Standards,  TFM's operating ratio was 75.6% for
the third  quarter  of 2001  compared  to 76.9% for the third  quarter  of 2000.
Additionally, third quarter 2001 results include a deferred tax benefit of $12.0
million (calculated under U.S. GAAP) compared to a deferred tax expense of $10.7
million  for the  third  quarter  of 2000.  The  variance  in the  deferred  tax
calculation  of Grupo TFM is mostly  attributable  to  fluctuations  in the peso
exchange rate and inflation in Mexico.  The Company  reports its equity in Grupo
TFM under U.S.  GAAP while  Grupo TFM  reports  under  International  Accounting
Standards.

Equity earnings from the Company's  investment in Mexrail  declined $1.2 million
quarter to  quarter,  while  equity  earnings  from  Southern  Capital  improved
slightly.  Additionally,  the  reconstruction  of the rail  line in  Panama  was
completed in July 2001 and the  operations  of PCRC have  commenced.  During the
third quarter of 2001, the Company recorded equity losses of approximately  $0.9
million from its investment in PCRC relating mostly to costs associated with the
start-up of the business.
KCSI's  consolidated  interest  expense for the third quarter of 2001  decreased
$5.1 million  (28%) from the prior year  quarter  primarily as a result of lower
interest rates on our variable rate debt and lower amortization of debt issuance
costs due to the refinancing of debt in the third quarter of 2000 (see below).

During the third quarter of 2000,  the Company  refinanced  $200 million of bank
debt  with  a $200  million  offering  of  8-year  senior  unsecured  notes.  In
connection with this refinancing,  KCSI recorded  extraordinary  debt retirement
costs of approximately $1.1 million (net of income taxes). Additionally,  during
the third quarter of 2000, Grupo TFM refinanced $300 million of bank debt with a
U.S.  Commercial  Paper  program.  KCSI  recorded  its  proportionate  share  of
extraordinary  debt  retirement  costs of $1.7  million  (net of  income  taxes)
related to this refinancing by Grupo TFM. Total third quarter 2000 extraordinary
charges of $2.8  million,  or 5(cent) per  diluted  share,  reduced  income from
continuing operations from $2.6 million to a loss of $0.2 million.

YEAR TO DATE

The  Company's  income from  continuing  operations  for the nine  months  ended
September 30, 2001 totaled  $20.0 million  versus $21.8 million in the same 2000
period.

KCSI's  consolidated  revenues  totaled $431.8 million for the nine months ended
September  30,  2001  compared  to  $437.4  million  for the nine  months  ended
September 30, 2000. This $5.6 million decline  resulted from lower  KCSR/Gateway
Western  revenues  of  approximately  $7.8  million  partially  offset by higher
revenues  from certain  other  subsidiaries.  Year to date 2001  revenue  growth
occurred  in  certain  commodities,  including  coal  (6%),  automotive  (102%),
plastics   (13%),   military/other   (41%)  and  certain   forest  and  chemical
commodities.  These  revenue  improvements,  however,  were  offset  by  overall
declines  in chemical  and  petroleum  products  (3%),  agriculture  and mineral
products  (9%),  paper and forest  products (4%) and  intermodal  revenues (12%)
resulting mostly from lower production due to the continued weakness in the U.S.
economy.  Agriculture and mineral  product  revenues were also affected by lower
domestic  grain  shipments  due a general  decline in poultry  production in the
United States,  which resulted in decreased  demand for grain  deliveries to our
customers.

KCSI's  consolidated  costs and expenses  increased $10.3 million (3%) to $396.8
million  for the first nine months of 2001  compared  to $386.5  million for the
same 2000 period,  resulting from higher  KCSR/Gateway  Western expenses of $3.4
million  and higher  expenses  at certain  other  subsidiaries  of $6.9  million
(driven by the $3.0 million  reduction of the  allowance  for doubtful  accounts
discussed  above in the third quarter  analysis).  The increase in  KCSR/Gateway
Western expenses was mostly  attributable to a $4.6 million increase in car hire
costs and a $3.1 million  increase in casualties and insurance  costs  partially
offset by a $2.5 million decline in salaries and wages expense.  Contributing to
the increase in car hire expense was a higher  number of freight cars from other
railroads on the Company's rail line coupled with a lower number of KCSR freight
cars being used by other  railroads.  Also  contributing  to the increase in car
hire  expense  was the  larger  number of auto rack cars being used to serve the
increase in automotive  traffic period to period.  Casualty and insurance  costs
rose primarily due to several significant first quarter 2001 derailments and the
settlement of personal  injury claims.  Excluding the impact of the $4.2 million
judgment in the Duncan case discussed above,  casualty and insurance costs would
have risen $7.3 million  period to period.  Salaries  and wage expense  declined
period to period due mostly to employee headcount reductions in March 2001.

Excluding the impact of the extraordinary  item in 2000 discussed above,  equity
earnings  from the Company's  investment in Grupo TFM increased  $4.7 million to
$23.5 million for the nine months ended  September 30, 2001 versus $18.8 million
for the nine months ended September 30, 2000.  During the first quarter of 2001,
TFM  recorded  approximately  $54  million of  pre-tax  income  relating  to the
reversion of certain concession assets to the Mexican government.  The Company's
year to date 2001 equity earnings from Grupo TFM reflect our proportionate share
of this income of  approximately  $9.1 million.  Grupo TFM's revenues  increased
4.4% to $496.0 million for the first nine months of 2001 from $475.2 million for
the  first  nine  months  of 2000.  These  higher  revenues  were  offset  by an
approximate 9% increase in operating  expenses  (exclusive of the income related
to the  reversion  of  certain  concession  assets  to the  Mexican  government)
resulting  in a  period  to  period  decline  in  ongoing  operating  income  of
approximately  9%. Under U.S.  GAAP,  the deferred tax expense for Grupo TFM was
$12.6  million  for the nine  months  ended  September  30,  2001  compared to a
deferred tax benefit of $18.9 million (excluding the impact of the extraordinary
item) for the same period in 2000.
Similar to the third  quarter of 2001,  the Company's  interest  expense for the
nine months ended September 30, 2001 declined $11.3 million compared to the nine
months ended September 30, 2000 due to lower borrowing rates.

Effective  January  1,  2001 the  Company  implemented  Statement  of  Financial
Accounting Standard No. 133,  Accounting for Derivative  Instruments and Hedging
Activities  ("FAS 133").  As a result of this change in the method of accounting
for derivative financial  instruments,  the Company recorded an after-tax charge
to  earnings  of $0.4  million  in the first  quarter  of 2001.  This  charge is
presented as a cumulative  effect of an  accounting  change in the  accompanying
consolidated  condensed statements of income for the nine months ended September
30, 2001. In the first quarter of 2000, the Company completed a debt refinancing
whereby it retired  approximately  $400 million of its debt securities  prior to
maturity.   Accordingly,   the  Company   recorded  debt  retirement   costs  of
approximately  $5.9 million  (after-tax)  in the first quarter of 2000.  This is
presented as an extraordinary  item in the accompanying  consolidated  condensed
statements of income for the nine months ended  September  30, 2000.  During the
third  quarter  of 2000,  the  Company  and Grupo TFM  refinanced  certain  debt
instruments and recorded extraordinary debt retirement costs of $1.1 million and
$1.7  million,  respectively,  as further  described  above in the third quarter
analysis.  These items are presented as extraordinary  items in the accompanying
consolidated  condensed statements of income for the nine months ended September
30, 2000.

BUSINESS OUTLOOK

Michael R. Haverty,  KCSI Chairman,  President and Chief Executive Officer said,
"Despite  the  economic  turmoil  currently  facing our  country,  our  domestic
revenues and cost structure showed signs of improvement during the third quarter
of 2001  compared to the third  quarter of 2000 and the previous two quarters of
2001.  Leading  the way has  been  the  strength  of our  coal  revenues,  which
increased  15% for the third quarter of 2001 and 6% for the first nine months of
2001 compared to the same periods in 2000.  Overall,  however,  most commodities
have  remained  weak in the midst of the slumping  economy and we expect  fourth
quarter  revenues to remain  relatively  flat  compared to the third  quarter of
2001. A significant improvement in our various commodity sectors is not expected
to occur until an economic recovery begins.

As the year has unfolded,  our cost  structure  has continued to improve.  Third
quarter costs and expenses for KCSR/Gateway Western have improved 4% compared to
the  third  quarter  of 2000 and 1% and 7%  compared  to the  second  and  first
quarters of 2001, respectively.  Consequently, the operating ratio for the third
quarter of 2001 improved compared to the third quarter of 2000 and the first two
quarters of 2001. We expect  continued  improvement in costs and expenses during
the fourth quarter.

Equity  earnings  from our  investment  in  Grupo  TFM  continue  to  provide  a
significant  contribution to our earnings.  During the third quarter and year to
date 2001,  equity  earnings from our  investment  in Grupo TFM  increased  $4.9
million  and $4.7  million,  respectively.  Grupo  TFM  increased  its  revenues
approximately  2% during the third  quarter  of 2001 and 4% during  year to date
2001  compared  to the  same  periods  in 2000,  despite  the  current  economic
slowdown,  which  affects not only the United States but has also had a profound
impact on the Mexican economy. During this tough economic environment,  it is an
accomplishment  that Grupo TFM has  continued to increase its revenues  while at
the same time has managed its cost  structure to maintain an operating  ratio in
the mid-70% range. Grupo TFM reduced its cost structure during the third quarter
of 2001 compared to the third quarter of 2000 and the first two quarters of 2001
and we expect Grupo TFM  management to continue to focus on cost  containment in
the fourth quarter.

We and our  partner,  Transportacion  Maritima  Mexicana,  S.A.  de  C.V.,  have
announced our intention to exercise our call and cause TFM to purchase the 24.6%
interest in Grupo TFM currently held by the Mexican government. This transaction
was delayed due to the events of September 11, 2001, and we currently expect TFM
to complete the purchase of the Mexican  government's  24.6%  ownership in Grupo
TFM during the fourth  quarter of 2001. We believe this is an opportunity to add
value to a vital component of our NAFTA franchise.  Additionally, we are excited
about the  commencement  of  operations  in Panama in July  2001,  which  should
provide us with opportunities for future earnings growth beginning in the latter
part of 2002.

Following  the tragic  events of September  11, we, like most other  industries,
have  experienced a period of uncertainty.  During this time of national crisis,
our  team of  security  personnel  has done an  excellent  job of  ensuring  the
security and integrity of our operations and we commend them for their continued
efforts.  As we move forward in these uncertain  economic times, we will respond
appropriately.  Our physical plant is currently in excellent  condition,  partly
because of the  substantial  capital  expenditures  made from  1996-2000,  which
averaged  approximately 17% of revenues during that time span.  Because of this,
until the economy  begins to  recover,  we expect to be able to limit the amount
and nature of our  capital  expenditures  without  compromising  the quality and
safety  of our  physical  plant.  Additionally,  we will  continue  to focus our
efforts on reducing costs without disrupting our service quality.  As always, we
will continue to look for  opportunities to increase our revenue base and reduce
our debt load. As evidenced by the cost reduction strategy we implemented during
the first quarter of 2001, we have been proactive in response to a difficult and
changing environment.

During these volatile times in the equity markets, we appreciate the support and
long-term  commitment of our  shareholders and will continue to take the actions
that we believe are  necessary to improve the value of our NAFTA  franchise  and
build long-term shareholder value."

(Note:  Unless  otherwise  indicated  above,  the operating  results and related
amounts  included  herein for the three and nine months ended September 30, 2000
were derived from the Form 10-Q/A for the third  quarter of 2000.  These amounts
reflect the adjustment made related to the Duncan legal case verdict,  which was
received subsequent to our third quarter 2000 earnings press release.)

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 KCSI's  December 31, 2000 Form 10-K and the Current
Report on Form  8-K/A  dated June 3, 1997,  each filed by the  Company  with the
Securities  and Exchange  Commission  ("SEC")  (Commission  file no. 1-4717) and
those  factors  identified  in the  "Risk  Factors"  section  of  the  Company's
Registration  Statement on Form S-4, as amended and declared  effective on March
15, 2001, which is on file with the SEC (File No. 333-54262),  and those factors
identified in the "Risk Factors" section of the Company's Registration Statement
on Form S-3, as amended and declared effective on June 5, 2001, which is on file
with  the  SEC  (File  No.   333-61006).   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 INDUSTRIES, INC. and SUBSIDIARY COMPANIES
                                        CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                             (excludes Stilwell Financial Inc.)
                                        (dollars in millions, except per share data)
                                                        (Unaudited)
Three Months                  Nine Months
                                                                          Ended September 30,          Ended September 30,
                                                                        ------------------------     ------------------------
                                                                           2001         2000           2001          2000
                                                                        -----------   ----------     ----------    ----------

    Revenues                                                               $ 144.6      $ 144.1        $ 431.8       $ 437.4

    Costs and expenses                                                       113.9        115.8          353.2         344.1
    Depreciation and amortization                                             14.7         13.8           43.6          42.4
                                                                        -----------   ----------     ----------    ----------
    Operating income                                                          16.0         14.5           35.0          50.9

    Equity in net earnings (losses) of unconsolidated affiliates:
        Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V.
          (preliminary)                                                        7.5          2.6           23.5          18.8
        Other                                                                 (0.6)         1.5           (0.2)          3.3
    Interest expense                                                         (13.2)       (18.3)         (42.9)        (54.2)
    Other, net                                                                 0.9          1.2            3.0           4.8
                                                                        -----------   ----------     ----------    ----------

    Income from continuing operations before income taxes,
        extraordinary items and cumulative effect of accounting change        10.6          1.5           18.4          23.6

    Income tax provision (benefit)                                             1.6         (1.1)          (1.6)          1.8
                                                                        -----------   ----------     ----------    ----------
    Income from continuing operations before extraordinary items
          and cumulative effect of accounting change                           9.0          2.6           20.0          21.8

    Extraordinary items, net of income taxes:
       Debt retirement costs                                                    -          (1.1)             -          (7.0)
       Debt retirement costs - TFM                                              -          (1.7)             -          (1.7)

    Cumulative effect of accounting change, net of income taxes                 -           -             (0.4)          -
                                                                        -----------   ----------     ----------    ----------

    Income from continuing operations, net of extraordinary items
     and cumulative effect of accounting change                             $  9.0      $  (0.2)       $  19.6       $  13.1
                                                                        -----------   ----------     ----------    ----------

    Per Share Data:

    Basic Weighted Average Common shares outstanding (in thousands)         58,656       57,478         58,442        56,353

    Basic Earnings (Loss) per Common share from continuing operations       $ 0.15      $  0.05        $  0.34       $  0.38

           Extraordinary items                                                   -        (0.05)            -          (0.15)
           Cumulative effect of accounting change                                -            -          (0.01)           -
                                                                        -----------   ----------     ----------    ----------

    Basic Earnings per Common share, net of extraordinary
     items and cumulative effect operations
       of accounting change                                                 $ 0.15      $  0.00        $  0.33       $  0.23
                                                                        -----------   ----------     ----------    ----------

    Diluted Weighted Average Common shares outstanding (in thousands)       61,171       58,858         60,934        58,104

    Diluted Earnings (Loss) per Common share from continuing                $ 0.15      $  0.05        $  0.33       $  0.37
    operations
           Extraordinary items                                                   -        (0.05)             -         (0.15)
           Cumulative effect of accounting change                                -            -          (0.01)           -
                                                                        -----------   ----------     ----------    ----------

    Diluted Earnings per Common share, net of
     extraordinary items and cumulative effect
    of accounting change                                                    $ 0.15      $  0.00        $  0.32       $  0.22
                                                                        -----------   ----------     ----------    ----------
KANSAS CITY SOUTHERN INDUSTRIES, INC. and SUBSIDIARY COMPANIES
                                        CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                           (includes discontinued operations (1))
                                        (dollars in millions, except per share data)
                                                        (Unaudited)
Three Months                  Nine Months
                                                                          Ended September 30,          Ended September 30,
                                                                        ------------------------     ------------------------
                                                                           2001         2000           2001          2000
                                                                        -----------   ----------     ----------    ----------

    Revenues                                                               $ 144.6      $ 144.1        $ 431.8       $ 437.4

    Costs and expenses                                                       113.9        115.8          353.2         344.1
    Depreciation and amortization                                             14.7         13.8           43.6          42.4
                                                                        -----------   ----------     ----------    ----------

    Operating income                                                          16.0         14.5           35.0          50.9

    Equity in net earnings (losses) of unconsolidated affiliates:
        Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V.(preliminary)   7.5          2.6           23.5          18.8
        Other                                                                 (0.6)         1.5           (0.2)          3.3
    Interest expense                                                         (13.2)       (18.3)         (42.9)        (54.2)
    Other, net                                                                 0.9          1.2            3.0           4.8
                                                                        -----------   ----------     ----------    ----------
    Income from continuing operations before income taxes,
        extraordinary items and cumulative effect of accounting change        10.6          1.5           18.4          23.6

    Income tax provision (benefit)                                             1.6         (1.1)          (1.6)          1.8
                                                                        -----------   ----------     ----------    ----------
    Income from continuing operations before extraordinary items
          and cumulative effect of accounting change                           9.0          2.6           20.0          21.8
    Income from discontinued operations (1)  (net of income taxes)               -         23.4              -         363.8
                                                                        -----------   ----------     ----------    ----------

    Income before extraordinary items and cumulative effect of
     accounting change                                                         9.0         26.0           20.0         385.6
    Extraordinary items, net of income taxes:
       Debt retirement costs                                                     -         (1.1)             -          (7.0)
       Debt retirement costs - TFM                                               -         (1.7)             -          (1.7)
    Cumulative effect of accounting change, net of income taxes                  -            -           (0.4)            -
                                                                        -----------   ----------     ----------    ----------

    Net income                                                              $  9.0      $  23.2        $  19.6       $ 376.9
                                                                        -----------   ----------     ----------    ----------

    Per Share Data:

    Basic Weighted Average Common shares outstanding (in thousands)         58,656       57,478         58,442        56,353
    Basic Earnings per Common share
       Continuing operations                                                $ 0.15      $  0.05        $  0.34       $  0.38
       Discontinued operations                                                   -         0.40              -          6.46
                                                                        -----------   ----------     ----------    ----------
    Basic Earnings (Loss) per Common share before extraordinary items
        and cumulative effect of accounting change                            0.15         0.45           0.34          6.84
           Extraordinary items                                                   -        (0.05)             -         (0.15)
           Cumulative effect of accounting change                                -            -           (0.01)          -
                                                                        -----------   ----------     ----------    ----------

    Basic Earnings per Common share                                         $ 0.15      $  0.40        $  0.33       $  6.69
                                                                        -----------   ----------     ----------    ----------

    Diluted Weighted Average Common shares outstanding (in thousands)       61,171       58,858         60,934        58,104

    Diluted Earnings per Common share
       Continuing operations                                                $ 0.15      $  0.05        $  0.33       $  0.37
       Discontinued operations                                                   -         0.39              -          6.17
                                                                        -----------   ----------     ----------    ----------
    Diluted Earnings (Loss) per Common share before extraordinary items
        and cumulative effect of accounting change                            0.15         0.44           0.33          6.54
           Extraordinary items                                                   -        (0.05)             -         (0.15)
           Cumulative effect of accounting change                                -            -          (0.01)            -
                                                                        -----------   ----------     ----------    ----------
    Diluted Earnings per Common share                                       $ 0.15       $ 0.39        $  0.32       $  6.39

    (1) - Stilwell Financial Inc., the Company's formerly owned financial services segment
EXHIBIT 99.2

Combined KCSR and Gateway Western
Operating Statements
Dollars in Millions
Third Quarter          Third Quarter               Nine Months            Nine Months
                                                2001                  2000*                       2001                  2000*
                                         -------------------    -------------------        -------------------    ------------------
Revenues
    Freight Revenue                           $        87.0          $        87.5             $        253.4         $        265.9
    Intermodal and Automotive Revenue                  14.3                   15.7                       50.9                   46.4
    Unit Coal Revenue                                  30.3                   26.7                       84.8                   81.4
    Haulage Revenue                                     3.4                    2.9                        9.6                    9.0
    Other Revenue                                       7.7                    9.7                       24.3                   28.1
                                         -------------------    -------------------        -------------------    ------------------
      Total Revenues                                  142.7                  142.5                      423.0                  430.8
                                         -------------------    -------------------        -------------------    ------------------

Operating Expenses
    Salaries & Wages                                   33.5                   35.0                      101.1                  103.6
    Fringe Benefits                                    14.1                   13.8                       40.4                   41.3
    Fuel                                               11.5                   12.2                       35.3                   35.3
    Material and Supplies                               7.5                    7.5                       22.1                   23.6
    Car Hire                                            3.5                    4.1                       15.7                   11.1
    Purchased Services                                 13.5                   11.1                       37.0                   35.9
    Casualties & Insurance                              5.8                   11.8                       27.6                   24.5
    Other                                               2.6                    2.0                        7.6                    6.1
                                         -------------------    -------------------        -------------------    ------------------
      Net Operating Expenses                           92.0                   97.5                      286.8                  281.4
                                         -------------------    -------------------        -------------------    ------------------

Fixed Expenses
    Leases, Net                                        13.6                   13.9                       40.9                   42.5
    Depreciation                                       13.7                   13.0                       40.7                   39.4
    Taxes (Other Than Income)                           3.3                    3.7                        9.5                   11.2
                                         -------------------    -------------------        -------------------    ------------------
      Total Fixed Expenses                             30.6                   30.6                       91.1                   93.1
                                         -------------------    -------------------        -------------------    ------------------
    Total Expenses                                    122.6                  128.1                      377.9                  374.5
                                         -------------------    -------------------        -------------------    ------------------

Operating Income                              $        20.1          $        14.4              $        45.1          $        56.3

* 2000 Casualites and Insurance Expense includes $4.2 million adjustment related to Duncan legal case.
Combined Kansas City Southern Railway/Gateway Western
Carloadings By Commodity - Year to Date September 30, 2001
Dollars in Thousands
Carloadings                                                                           Revenue

                 Year to Date                                                                         Year to Date
-----------------------------------------------                                        ---------------------------------------------
     2001             2000          % Change                                               2001             2000          % Change
---------------   --------------   ------------                                        -------------    -------------    -----------

                                                    Coal
       144,267          141,498         2.0%          Unit Coal                           $  84,836        $  81,406           4.2%
         3,726            2,302        61.9%          Other Coal                              2,120              866         144.8%

---------------   --------------                                                       -------------    -------------
       147,993          143,800         2.9%                       Total                     86,956           82,272           5.7%

                                                   Chemical & Petroleum Products
         4,927            6,989      (29.5)%          Agri Chemicals                          3,913            4,934        (20.7)%
         8,404           10,516      (20.1)%          Gases                                   7,674            9,547        (19.6)%
        16,779           19,697      (14.8)%          Organic                                16,864           18,651         (9.6)%
        14,594           12,933        12.8%          Inorganic                              15,373           15,077           2.0%
        45,882           47,572       (3.6)%          Petroleum                              28,870           29,536         (2.3)%
        20,006           19,810         1.0%          Plastics                               20,257           17,999          12.5%
---------------   --------------                                                       -------------    -------------
       110,592          117,517       (5.9)%                       Total                     92,951           95,744         (2.9)%
---------------   --------------                                                       -------------    -------------

                                                   Agriculture and Minerals
        35,809           38,208       (6.3)%          Domestic Grain                         24,569           27,746        (11.5)%
         8,471            8,386         1.0%          Export Grain                            5,595            5,912         (5.4)%
        19,766           22,264      (11.2)%          Food Products                          16,260           17,631         (7.8)%
        17,951           20,018      (10.3)%          Ores and Minerals                       9,570           10,056         (4.8)%
        11,479           12,925      (11.2)%          Stone, Clay & Glass                     8,482            9,511        (10.8)%
---------------   --------------                                                       -------------    -------------
        93,476          101,801       (8.2)%                       Total                     64,476           70,856         (9.0)%
---------------   --------------                                                       -------------    -------------

                                                   Paper & Forest Products
        63,248           68,974       (8.3)%          Pulp/Paper                             44,665           48,067         (7.1)%
         5,078            5,243       (3.1)%          Scrap Paper                             2,740            2,846         (3.7)%
        26,946           26,038         3.5%          Pulpwood/Logchips                      11,185           10,336           8.2%
        19,967           21,688       (7.9)%          Lumber/Plywood                         17,364           19,092         (9.1)%
        16,286           19,519      (16.6)%          Metal/Scrap                            12,661           14,559        (13.0)%
         6,858            5,960        15.1%          Military/Other Carloads                 8,692            6,182          40.6%
---------------   --------------                                                       -------------    -------------
       138,383          147,422       (6.1)%                       Total                     97,307          101,082         (3.7)%

---------------   --------------                                                       -------------    -------------

                                                   Intermodal & Automotive
        28,642           14,987        91.1%          Automotive                             17,743            8,771         102.3%
       192,042          179,678         6.9%          Intermodal                             33,137           37,617        (11.9)%
---------------   --------------                                                       -------------    -------------
       220,684          194,665        13.4%                       Total                     50,880           46,388           9.7%
---------------   --------------                                                       -------------    -------------

       711,128          705,205         0.8%       TOTAL FOR BUSINESS UNITS                 392,570          396,342         (1.0)%

        25,565           32,636      (21.7)%       Haulage                                    9,644            9,021           6.9%

        (7,028)          (5,840)       20.3%       Adjustments                               (3,479)          (2,665)         30.5%

---------------   --------------                                                       -------------    -------------

       729,665          732,001       (0.3)%                    TOTAL                     $ 398,735        $ 402,698         (1.0)%
===============   ==============                                                       =============    =============
Combined Kansas City Southern Railway/Gateway Western
Carloadings By Commodity - Third Quarter 2001
Dollars in Thousands
Carloadings                                                                            Revenue

                Third Quarter                                                                         Third Quarter
-----------------------------------------------                                        ---------------------------------------------
     2001             2000          % Change                                               2001             2000          % Change
---------------   --------------   ------------                                        -------------    -------------    -----------

                                                    Coal
        51,953           48,522         7.1%          Unit Coal                         $    30,321      $    26,689          13.6%
         1,322              734        80.1%          Other Coal                                773              334         131.4%
---------------   --------------                                                       -------------    -------------
        53,275           49,256         8.2%                                                 31,094           27,023          15.1%

                                                   Chemical & Petroleum Products
         1,336            2,281      (41.4)%          Agri Chemicals                          1,067            1,613        (33.8)%
         2,743            3,442      (20.3)%          Gases                                   2,509            3,096        (19.0)%
         5,392            6,400      (15.8)%          Organic                                 5,514            6,050         (8.9)%
         4,933            4,228        16.7%          Inorganic                               5,424            4,893          10.9%
        12,697           16,168      (21.5)%          Petroleum                               9,064            9,599         (5.6)%
         6,503            6,822       (4.7)%          Plastics                                6,605            6,328           4.4%
---------------   --------------                                                       -------------    -------------
        33,604           39,341      (14.6)%                       Total                     30,183           31,579         (4.4)%
---------------   --------------                                                       -------------    -------------

                                                   Agriculture and Minerals
        11,313           11,417       (0.9)%          Domestic Grain                          8,120            8,054           0.8%
         3,422            3,419         0.1%          Export Grain                            2,397            2,623         (8.6)%
         6,557            7,719      (15.1)%          Food Products                           5,609            6,005         (6.6)%
         6,366            6,841       (6.9)%          Ores and Minerals                       3,276            3,319         (1.3)%
         3,923            4,069       (3.6)%          Stone, Clay & Glass                     2,906            2,958         (1.8)%
---------------   --------------                                                       -------------    -------------
        31,581           33,465       (5.6)%                       Total                     22,308           22,959         (2.8)%
---------------   --------------                                                       -------------    -------------

                                                   Paper & Forest Products
        22,217           22,855       (2.8)%          Pulp/Paper                             16,230           16,567         (2.0)%
         1,658            1,839       (9.8)%          Scrap Paper                               968            1,026         (5.7)%
         9,214            7,984        15.4%          Pulpwood/Logs/Chips                     3,788            3,102          22.1%
         7,143            6,996         2.1%          Lumber/Plywood                          6,293            6,145           2.4%
         4,997            5,612      (11.0)%          Metal/Scrap                             3,931            4,200         (6.4)%
         2,602            2,050        26.9%          Military/Other carloads                 3,625            2,550          42.2%
---------------   --------------                                                       -------------    -------------
        47,831           47,336         1.0%                       Total                     34,835           33,590           3.7%
---------------   --------------                                                       -------------    -------------

                                                   Intermodal & Automotive
         4,899            4,969       (1.4)%          Automotive                              3,044            3,104         (1.9)%
        65,469           68,414       (4.3)%          Intermodal                             11,278           12,612        (10.6)%
---------------   --------------                                                       -------------    -------------
        70,368           73,383       (4.1)%                       Total                     14,322           15,716         (8.9)%
---------------   --------------                                                       -------------    -------------

       236,659          242,781       (2.5)%       TOTAL FOR BUSINESS UNITS                 132,742          130,867           1.4%

         8,361            9,990      (16.3)%       Haulage                                    3,353            2,904          15.5%

        (2,031)          (2,240)      (9.3)%       Adjustments                               (1,127)            (932)
---------------   --------------                                                       -------------    -------------

       242,989          250,531       (3.0)%                    TOTAL                   $   134,968      $   132,839           1.6%
===============   ==============                                                       =============    =============
Kansas City Southern Industries, Inc.
Consolidated Balance Sheets                                                                               Preliminary
Unaudited
(Dollars in Millions)
September 30, 2001                  December 31, 2000
                                                               ---------------------------         ---------------------------
Assets
  Cash                                                                      $        26.9                       $        21.5
  Accounts receivable                                                               141.4                               135.0
  Inventories                                                                        28.8                                34.0
  Other current assets                                                               19.0                                25.9
                                                               ---------------------------         ---------------------------
     Total current assets                                                           216.1                               216.4

  Investments held for operating purposes                                           379.9                               358.2
  Properties, net of depreciation                                                 1,323.0                             1,327.8
  Other assets                                                                       43.4                                42.1
                                                               ---------------------------         ---------------------------

      Total assets                                                          $     1,962.4                       $     1,944.5
                                                               ===========================         ===========================

Liabilities and Stockholders' Equity
  Current portion of long-term debt                                         $        42.8                       $        36.2
  Accounts payable                                                                   48.3                                52.9
  Accrued liabilities                                                               120.7                               159.9
                                                               ---------------------------         ---------------------------
     Total current liabilities                                                      211.8                               249.0

  Long-term debt                                                                    642.0                               638.4
  Deferred income taxes                                                             347.4                               332.2
  Other                                                                              96.2                                81.5
  Stockholders' equity                                                              665.0                               643.4
                                                               ---------------------------         ---------------------------

    Total liabilities and stockholders' equity                              $     1,962.4                       $     1,944.5
                                                               ===========================         ===========================