Profits of the Washington Post Co. dropped 60 percent in the third quarter from the comparable period last year, while Southern Railway Co. earnings declined 10 percent, the two Washington-based corporations reported yesterday.

The Post Co., citing startup losses associated with a Virginia newsprint mill and a magazine venture, said net income in the recent quarter was $2.5 million (18 cents a share) compared with $6.2 million (40 cents, with more shares outstanding) a year earlier. Revenues rose to $152.5 million from $137.5 million, but higher expenses produced lower pre-tax profits in each of the firm's newspaper, broadcasting and magazine divisions.

Inside Sports, a monthly that was inaugurated last March, suffered a loss of $5 million in the quarter. The other loss reported was $800,000 for the Bear Island Paper Co., in which the Post Co. has a 30 percent limited partnership interest. Production at the Virigina factory began late last year. Losses for these ventures had been forecast earlier by Post Co. executives.

In addition to these factors, a Post Co. statement said Newsweek magazine domestic ad volume declined to 611 pages in the quarter from 671 a year ago, while The Washington Post newspaper ad linage dropped 1.5 percent. However, circulation of the newspaper continued to increase in the six months ended Sept. 30, to 584,500 Monday through Friday from 578,834 a year ago and to 820,452 on Sundays from 809,403, according to data submitted to the Audit Bureau of Circulation and subject to audit.

The third-quarter results brought nine-month Post Co. profits to $18.9 million ($1.35 a share) compared with operating earnings of $28.3 million ($1.79) last year before a special charge in 1979 related to accounting for subscription expenses that reduced that period's net income to $14.8 million (93 cents).Nine-month revenues rose to $474 million from $420 million.

Southern's profits in the recent quarter were $36.2 million ($2.31 a share) compared with a record $40.7 million ($2.63) a year ago, as revenues rose to $396 million from $367 million. Nine-month profits were up 7.4 percent, however, to a record of $137 million ($8.76) from $127 million ($8.27) as revenues rose to $1.21 billion from $1.07 billion.

President Harold Hall said yesterday that "some decline in earnings was to be expected" after the unusually strong 1979 quarter, when profits were up 74 percent from the previous year. In addition, he said freight car loadings started to rebound from recession levels in October. Nine-month coal revenues soared 38 percent, he said.

Allegheny Beverage Corp., the Baltimore bottler of Pepsi-Cola and other soft drinks that plans to acquire Macke Co., reported third-quarter profits of $1.9 million (45 cents a share), a gain of 13 percent from $1.7 million (40 cents) a year ago. Sales rose 16 percent to $40 million.

For the first nine months of 1980, Allegheny earned $4.6 million ($1.08) compared with $3.8 million (89 cents), and revenues rose 5 percent to $105 million. The 1980 earnings include $156,000 of equity in Macke, a Washington-based food services and vending firm.

Allegheny is offering investors $12.5 million of 14 1/2 percent subordinated debentures maturing in 1990, with Offerman & Co. of Minneapolis heading a "best efforts" syndication and Allegheny using proceeds to pay debts incurred in buying one-third of Macke's stock.

Among financial services companies, Baltimore Federal S&L, a billion-dollar thrift institution, said nine-month profits declined 65 percent to $1.4 million from $4 million a year earlier. Third-quarter earnings fell to $346,113 from $911,666. Assets rose $33 million in the first three quarters to $1.05 billion, while mortgage loans in the 1980 period fell by $50 million to $89 million.

"Government economic policies resulting in wide fluctuations in interest rates, and the recent recession have impacted the savings and investment decisions of consumers. . . . [Baltimore Federal] performed well relative to industry standards," said association President Robert Hecht Sr.

Citizens Bank & Trust Co., a big suburban bank in Riverdale, also reported that its earnings sufered from the recent financial climate. Third-quarter earnings were flat as $2.27 million ($1.61 a share) compared with $2.28 million ($1.62) last year. Nine-month profits declined to $6.75 million ($4.78) from $7.35 million ($5.21).

The Riverdale bank attributed the lower nine-month net income to a 29 percent increase in operating expenses, including interest paid on deposits. Total assets rose 4 percent from a year ago to a record $655 million while deposits increased 5 percent to a record $565 million.Citizens recently expanded into Howard County with its 59th branch office in Ellicott City.

Union Trust Bancorp. a Baltimore bank holding company, said third-quarter earnings before securities transactions fell to $2.07 million (84 cents a share) from $2.44 million ($1) last year while nine-month operating profits fell to $5.4 million ($2.21) from $6.8 million ($2.78).

Deposits at Union Trust Co. rose $29 million in the past 12 months to $932.5 million on Sept. 30, while loan volume dipped $1.3 million to $797 million. Chairman J. Stevenson Peck noted yesterday that third-quarter earnings exceeded those of the first and second quarters. He cited higher interest payments on savings accounts, static income from consumer lending and a 14 pecent boost in expenses as factors affecting operations.

First Maryland Bancorp, the Baltimore parent company of First National Bank of Maryland, reported income before securities transactions of $5.1 million ($1.10 a share) for the third quarter compared with $5.04 million ($1.08) a year earlier. Income after securities transactions was $5.04 million ($1.09) compared with $4.98 million ($1.07) in 1979.

Nine-month income before securities transactions amounted to $15.58 million ($3.34) compared with $14.17 million ($3.03) in 1979. After securities transactions, income for the most recent nine months was $15.25 million ($3.27) compared with $13.95 million ($2.98) in 1979.

Bank of Columbia, based in Washington, reported that its nine-month operating earnings rose to $329,688 (75 cents a share) from $254,593 (58 cents) a year ago. Deposits dipped to $44.17 million from $45.50 million, while assets edged higher to $51.53 million from $51.14 milllion.

LogEtronics Inc., a Springfield technology firm, reported third-quarter profits rose 16 percent to $238,000 (22 cents a share) from $205,000 (20 cents) last year, as revenues increased to $7.4 million from $6.6 million. Nine-month profits were $881,000 (82 cents) on revenues of $22.6 million versus $835,000 (80 cents) on revenues of $20.3 million.