CSX Corporation Executive Vice President and Chief Operating Officer Cindy Sanborn updated investors and analysts at Baird’s 2016.
Industrial Conference in Chicago regarding the company’s expectations for fourth quarter and full-year performance as well as progress on the company’s long-term strategy.
Through the third quarter, CSX has delivered about $550 million in cost savings through both efficiency initiatives and volume-variable savings. These savings reflect aggressive actions related to three of the company’s major cost drivers – labor, fuel and assets – with gains in train length and crew savings, record fuel efficiency, and improved locomotive productivity and asset reliability. At the same time, CSX is achieving these efficiency improvements while delivering safe, reliable service that meets or exceeds customer needs.
“In the fourth quarter, we expect an eight cent earnings per share impact related to costs associated with refinancing near-term debt,†Sanborn said. “While we now expect fourth-quarter earnings per share to be down, absent the eight-cent impact, the company’s earnings remain consistent with its prior guidance of flat to slightly down from the prior year.â€
Sanborn highlighted the ongoing dynamic business environment, including the company’s expectations that volume will be roughly flat on a reported basis, which includes an extra accounting week in the fourth quarter this year. Strong cost performance is helping to offset those challenges to deliver solid financial performance throughout the year.
CSX continues to focus longer-term on transforming the company into the CSX of Tomorrow as it transitions away from coal and toward more service-sensitive merchandise and intermodal markets. The foundation of that transformation is employee and customer excellence that supports shareholder value creation. At the same time, the company continues to transform its network by redeploying investment from the coal network and other lower density lines to the higher-density outer triangle of the network to drive service efficiency and growth, with investments in longer sidings, technology and intermodal services to maximize new business opportunities.
Technology is supporting CSX becoming a highly-automated railroad, to further improve safety, resource efficiency and service. Together, these initiatives drive service excellence for customers, which enables growth and enhances the company’s ability to achieve pricing that reflects the value of its service product. Combined, this strategy is furthering CSX’s progress toward achieving a mid-60s operating ratio longer-term.
About CSX and its Disclosures
CSX, based in Jacksonville, Florida, is a premier transportation company. It provides rail, intermodal and rail-to-truck transload services and solutions to customers across a broad array of markets, including energy, industrial, construction, agricultural, and consumer products. For nearly 190 years, CSX has played a critical role in the nation’s economic expansion and industrial development. Its network connects every major metropolitan area in the eastern United States, where nearly two-thirds of the nation’s population resides. It also links more than 240 short-line railroads and more than 70 ocean, river and lake ports with major population centers and farming towns alike.
This announcement, as well as additional financial information, is available on the company’s website at http://investors.csx.com. CSX also uses social media channels to communicate information about the company. Although social media channels are not intended to be the primary method of disclosure for material information, it is possible that certain information CSX posts on social media could be deemed to be material. Therefore, we encourage investors, the media, and others interested in the company to review the information we post on Twitter (http://twitter.com/CSX) and on Slideshare (http://www.slideshare.net/HowTomorrowMoves). The social media channels used by CSX may be updated from time to time. More information about the company and its subsidiaries is available at www.csx.com and on Facebook (http://www.facebook.com/OfficialCSX).
Contact:
David Baggs, Investor Relations
904-359-4812
Melanie Cost, Corporate Communications
