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Rail News: CSX Transportation

CSX sets quarterly revenue record at $2.5 billion, increases income


CSX Corp. is the first Class I out of the gate to report second-quarter financial results and the first to tout a new quarterly revenue record.

Although soft housing and automotive markets played major roles in decreasing CSX’s traffic volume 2 percent in the quarter, the company increased revenue 5 percent to a record $2.5 billion compared with second-quarter 2006.

The primary revenue generators: coal, up 8 percent to $638 million; intermodal, up 4 percent to $343 million; chemicals, up 7 percent to $327 million; and agricultural products, up 16 percent to $191 million. In addition rate increases helped revenue-per-unit post a 7 percent gain to $1.4 billion compared with second-quarter 2006.

“We continue to drive double-digit growth in our financial performance,” said CSX Chairman, President and Chief Executive Officer Michael Ward in a prepared statement.

CSX also reported quarterly net earnings of $324 million, down 17 percent compared with second-quarter 2006, when the company registered an earnings gain from insurance recoveries. Excluding the recoveries, earnings rose about 3 percent.

Surface transportation operating income totaled $603 million, down 6 percent year over year. But excluding insurance recoveries, operating income jumped 16 percent.

Meanwhile, total quarterly operating expenses rose 9 percent to $1.9 billion compared with second-quarter 2006 even though fuel costs remained flat at $289 million. Expenses increased primarily because of higher labor and material costs.

Meanwhile, CSX’s second-quarter surface transportation operating ratio of 76.2 worsened 2.8 points compared with second-quarter 2006, but improved 2.4 points excluding insurance recoveries and other factors from the comparable period. For 2007’s first half, CSX posted a surface transportation operating ratio of 78, which worsened 1.8 points compared with 2006’s first half.

Contact Progressive Railroading editorial staff.

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