CSX Corp. Announces First Quarter 2024 Results

Rhea-AI Summary

CSX Corp. announced first quarter 2024 results with operating income of $1.35 billion, net earnings of $893 million, and total volume of 1.53 million units. Revenue declined 1% year-over-year to $3.68 billion, with a decrease in operating income by 8%. Despite the decline, CSX remains optimistic about future growth opportunities.

Positive

• Operating income of $1.35 billion for the quarter.
• Net earnings of $893 million, or $0.46 per diluted share.
• Total volume of 1.53 million units, up 3% compared to Q1 2023.
• Revenue declined 1% year-over-year to $3.68 billion.
• CSX's operating margin was 36.8% for the quarter.
• Diluted EPS of $0.46, down 4% from the prior year.
• CSX executives will conduct a conference call with the investment community.
• A live webcast will be accessible on the company's website.
• Detailed financial information is available on the CSX website and Form 8-K with the SEC.

Negative

• Revenue decline of 1% year-over-year.
• Operating income decreased by 8% compared to the same period in 2023.
• Operating margin declined by 270 basis points year-over-year.
• Lower fuel surcharge, weaker trucking revenue, and reduced export coal prices impacted revenue.
• Despite volume growth in intermodal and coal, merchandise volume remained flat.
• CSX faces challenges in improving reliability and fluidity of its network.

Insights

Financial Analyst

CSX Corp. has reported a decrease in operating income and net earnings year-over-year, which may signify potential headwinds or market challenges. Despite a 3% increase in total volume, the revenue decline suggests that higher volumes are not translating into proportional revenue gains, potentially due to price reductions or lowered surcharges. The rise in intermodal volume, however, may indicate a shift in transportation trends or an adaptation to market demands. Investors should examine the company's cost management strategies and the potential for operational efficiency improvements to mitigate the impact of declining operating margins. The sequential increases in operating income and EPS may provide a more positive short-term view, reflecting a possible turnaround or seasonal effects.

Transportation Industry Analyst

The data from CSX Corp. points to nuanced trends within the logistics sector. An increase in intermodal and coal volumes suggests that certain segments are experiencing growth, likely tied to broader economic factors such as energy demands and shifts in shipping preferences. However, the flat merchandise volume indicates stagnation in other markets, which could be a signal of underlying economic trends or competitive pressures. It's also important to take into consideration the broader implications of fluctuating fuel costs, as they can have a significant impact on transportation companies' surcharges and pricing strategies. The balance between volume growth and revenue performance will be pivotal for CSX's future and investors should keep an eye on the company's ability to capitalize on market trends and convert volume gains into sustainable revenue.

Market Research Analyst

For investors, the declining year-over-year revenue and operating margin presented by CSX Corp. could be indicative of competitive or operational challenges. The flat sequential revenue, despite increased volumes, suggests that CSX is facing difficulties in extracting higher returns from increased operations. Furthermore, the company’s future performance is likely to be influenced by its ability to navigate the external factors such as export coal prices and trucking revenue competencies. Monitoring the company's operational strategies and innovation in the face of an evolving transportation landscape will be essential. Given the positive outlook suggested by the CEO, investors should weigh the company's long-term strategies and market opportunities against the current financial headwinds.

JACKSONVILLE, Fla., April 17, 2024 (GLOBE NEWSWIRE) -- CSX Corp. (NASDAQ: CSX) today announced first quarter 2024 operating income of $1.35 billion compared to $1.46 billion in the prior year period. Net earnings were $893 million, or $0.46 per diluted share, compared to $987 million, or $0.48 per diluted share, in the same period last year. Total volume of 1.53 million units for the quarter was 3% higher compared to first quarter 2023, with intermodal volume up 7%, coal volume up 2%, and merchandise volume flat.

“Working together, the ONE CSX team delivered a good start to the year that was in-line with our expectations,” said Joe Hinrichs, president and chief executive officer. “We were pleased to see our consistent customer service performance lead to volume growth, and we remain focused on improving the reliability and fluidity of our network. Looking ahead, with favorable trends across many of the markets we serve, we are eager to build on our momentum over the rest of the year and beyond.”

First Quarter Financial Highlights

• Revenue totaled $3.68 billion for the quarter, declining 1% year-over-year as lower fuel surcharge, a decline in other revenue, weaker trucking revenue, and reduced export coal prices offset gains in merchandise pricing and higher intermodal and coal volumes. First quarter revenue was flat sequentially.
• Operating income of $1.35 billion decreased 8% compared to the same period in 2023 but increased 3% from Q4 2023. CSX’s operating margin was 36.8% for the quarter, declining 270 basis points year-over-year but increasing 90 basis points sequentially.
• Diluted EPS of $0.46 decreased 4% from $0.48 in the prior year but increased 2% compared to the previous quarter.
  

CSX executives will conduct a conference call with the investment community this afternoon, April 17, at 4:30 p.m. Eastern Time. Investors, media, and the public may listen to the conference call by dialing 1-888-510-2008. For callers outside the U.S., dial 1-646-960-0306. Participants should dial in 10 minutes prior to the call and enter in 3368220 as the passcode.

In conjunction with the call, a live webcast will be accessible and presentation materials will be posted on the company's website at http://investors.csx.com. Following the earnings call, a webcast replay of the presentation will be archived on the company website.

This earnings announcement, as well as additional detailed financial information, is contained in the CSX Quarterly Financial Report available through the company’s website at http://investors.csx.com and on Form 8-K with the Securities and Exchange Commission.

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 200 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 X, formerly known as Twitter, (http://twitter.com/CSX) and on Facebook (http://www.facebook.com/OfficialCSX). The social media channels used by CSX may be updated from time to time. More information about CSX Corporation and its subsidiaries is available at www.csx.com.

Non-GAAP Disclosure

CSX reports its financial results in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). CSX also uses certain non-GAAP measures that fall within the meaning of Securities and Exchange Commission Regulation G and Regulation S-K Item 10(e), which may provide users of the financial information with additional meaningful comparison to prior reported results. Non-GAAP measures do not have standardized definitions and are not defined by U.S. GAAP. Therefore, CSX’s non-GAAP measures are unlikely to be comparable to similar measures presented by other companies. The presentation of these non-GAAP measures should not be considered in isolation from, as a substitute for, or as superior to the financial information presented in accordance with GAAP.

Forward-looking Statements

This information and other statements by the company may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to, among other items: projections and estimates of earnings, revenues, margins, volumes, rates, cost-savings, expenses, taxes, liquidity, capital expenditures, dividends, share repurchases or other financial items, statements of management's plans, strategies and objectives for future operations, and management's expectations as to future performance and operations and the time by which objectives will be achieved, statements concerning proposed new services, and statements regarding future economic, industry or market conditions or performance. Forward-looking statements are typically identified by words or phrases such as “will,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate,” “preliminary” and similar expressions. Forward-looking statements speak only as of the date they are made, and the company undertakes no obligation to update or revise any forward-looking statement. If the company updates any forward-looking statement, no inference should be drawn that the company will make additional updates with respect to that statement or any other forward-looking statements.

Forward-looking statements are subject to a number of risks and uncertainties, and actual performance or results could differ materially from that anticipated by any forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by any forward-looking statements include, among others: (i) the company's success in implementing its financial and operational initiatives; (ii) changes in domestic or international economic, political or business conditions, including those affecting the transportation industry (such as the impact of industry competition, conditions, performance and consolidation); (iii) legislative or regulatory changes; (iv) the inherent business risks associated with safety and security; (v) the outcome of claims and litigation involving or affecting the company; (vi) natural events such as severe weather conditions or pandemic health crises; and (vii) the inherent uncertainty associated with projecting economic and business conditions.

Other important assumptions and factors that could cause actual results to differ materially from those in the forward-looking statements are specified in the company's SEC reports, accessible on the SEC's website at www.sec.gov and the company's website at www.csx.com.

Contact:

Matthew Korn, CFA, Investor Relations
904-366-4515

Bryan Tucker, Corporate Communications
855-955-6397

FAQ

What was CSX Corp.'s operating income for the first quarter of 2024?

CSX Corp.'s operating income for Q1 2024 was $1.35 billion.

How did CSX Corp.'s net earnings compare to the previous year in the first quarter of 2024?

CSX Corp.'s net earnings were $893 million in Q1 2024, compared to $987 million in the same period last year.

What was the total volume for CSX Corp. in the first quarter of 2024?

CSX Corp. had a total volume of 1.53 million units in Q1 2024, up 3% from Q1 2023.

What was the revenue for CSX Corp. in the first quarter of 2024?

CSX Corp.'s revenue for Q1 2024 was $3.68 billion, declining 1% year-over-year.

What was the diluted EPS for CSX Corp. in the first quarter of 2024?

CSX Corp.'s diluted EPS was $0.46 in Q1 2024, down 4% from the prior year.

When will CSX Corp. conduct a conference call with the investment community?

CSX Corp. will conduct a conference call with the investment community this afternoon, April 17, at 4:30 p.m. Eastern Time.

Where can investors, media, and the public listen to the conference call by CSX Corp.?

Investors, media, and the public may listen to the conference call by dialing 1-888-510-2008 or 1-646-960-0306 for callers outside the U.S.

Where can detailed financial information about CSX Corp. be found?

Detailed financial information about CSX Corp. is available on the company's website at http://investors.csx.com and on Form 8-K with the SEC.