By 24/7 Staff / www.supplychain247.com / July 18th, 2018
CSX rises after stunning Wall Street with rail-efficiency gains including second-quarter operating ratio setting a U.S. record as costs fall and cargo demand for coal and consumer goods fuel sales increase.
Q2 2018 CSX Corporation Earnings
CSX Corporation yesterday announced second quarter 2018 net earnings of $877 million, or $1.01 per share, versus $510 million, or $0.55 per share in the same period last year.
CSX’s operating ratio set an all-time company quarterly record of 58.6 percent from 67.4 percent in the prior year or 63.5 percent on an adjusted basis, excluding restructuring charges.
Compared to 2017 second quarter, the adjusted operating results represent an operating ratio improvement of 490 basis points and a 58 percent increase in earnings per share year over year.
“I could not be more proud of our hardworking CSX employees for achieving these record-setting results,” said James M. Foote, president and chief executive officer.
“I expect continued improvement in our safety, service and financial performance.”
Revenue for the second quarter increased 6 percent over the prior year to $3.10 billion, while expenses declined 8 percent year over year or 2 percent when excluding prior year restructuring charges.
Operating income for the quarter increased 34 percent to $1.28 billion when compared to $957 million in the same period last year or 20 percent when compared to the adjusted operating income of $1.07 billion reported in the second quarter of 2017.
“While we remain in the early stages of the transformation I am more confident this exceptional team can deliver on our long-term outlook,” said Foote.
View: CSX 2018 Q2 Earnings Presentation [PDF]
The efficiency gains rammed through by the late turnaround artist are paying some of their biggest dividends yet since he died unexpectedly in December following a nine-month whirlwind of activity that transformed the railroad.
Harrison shut down switching yards, closed diesel shops and angered shippers by forcing schedules on them to even out the flow of cargo throughout the week.
He also brought in Jim Foote, who took the reins after Harrison’s death and extended the overhaul.
In the second quarter, their efforts yielded a record efficiency level for a U.S. railroad and profit that blew through Wall Street’s expectations.
“When I first got here last fall, I was less than convinced about what it is we were going to be able to accomplish,” Foote said in an interview late Tuesday.
“From the big structural changes, Hunter had done a tremendous amount of that work. I was amazed at how much work Hunter had gotten done.”
The earnings announcement, as well as additional detailed financial information, is contained in the CSX Quarterly Financial Report available through the company’s website and on Form 8-K with the Securities and Exchange Commission.
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