(Adds details of freight volumes, coal, background on new CEO)
By Nick Carey
CHICAGO, April 19 No. 3 U.S. railroad CSX Corp
on Wednesday reported a better-than-expected quarterly
net profit driven by rising freight volumes across most of the
markets it covers and said it plans to cut costs and boost
profitability moving forward.
CSX shares rose nearly 3 percent in after-hours trading.
After almost two years in which the Jacksonville,
Florida-based railroad experienced precipitous declines in coal
freight volumes, CSX experienced a 3 percent increase in coal
during the first quarter.
Like the other major U.S. railroads, CSX's coal volumes had
been hit by low energy prices that have encouraged utilities to
switch to burning cheaper natural gas and by the strong U.S.
dollar which reduced coal exports.
These were also the first quarterly results for CSX since
the appointment of veteran railroad executive Hunter Harrison as
chief executive officer in March.
Harrison has won renown among investors for turning around
three rail companies so far including Canadian National Railway
Co and most recently Canadian Pacific Railway Ltd
using his concept of "precision scheduled railroading."
The concept has been a revolutionary departure from the
traditional practice of waiting until a train was full to move
it. Under his model, railroads move faster and on schedule, full
or not, which Harrison argues increases productivity and cuts
"I am pleased to join the CSX team and working together we
are going to make this company the best North American railroad,
capable of consistently meeting and exceeding the expectations
of our customers and our shareholders," Harrison said in a
CSX posted first-quarter net profit of $362 million or 39
cents a share, up from $356 million or 37 cents per share a year
Excluding a one-time restructuring charge of $173 million,
the company posted earnings per share of 51 cents. Analysts on
average had expected earnings per share of 42 cents.
Revenue in the first quarter increased 10 percent to $2.87
billion from $2.62 billion. That beat analyst expectations of
Overall, freight volumes in the first quarter were 3 percent
higher than in the same period in 2016.
In after-market trading, CSX shares were up 2.8 percent at
(Editing by Peter Cooney and Matthew Lewis)