WASHINGTON (dpa-AFX) - Railroad operator CSX Corp (CSX) on Tuesday reported an increase in second-quarter profit, despite a six percent drop in revenue, driven partly by lower fuel prices and cost savings. Quarterly earnings topped Wall Street estimates, while revenue fell short of expectations.
CSX said still expects to deliver mid-to-high single digit earnings per share growth for 2015, adding that the upper end of that range has become more tough due to the current energy environment.
The company noted that in the latest quarter, it benefited from continued low fuel prices and savings from efficiency initiatives.
That offset a six percent drop in revenue as pricing gains were more than offset by the impact of lower fuel recovery, a 1 percent volume decline and changing business mix, the company said.
Overall, CSX reported second-quarter net earnings of $553 million or $0.56 per share compared with $529 million or $0.53 per share last year.
On average, 25 analysts polled by Thomson Reuters estimated earnings of $0.53 per share for the quarter. Analysts' estimates typically exclude special items.
The Jacksonville, Florida-based company's revenue declined 6 percent to $3.06 billion from $3.24 billion in the prior year, as pricing gains were more than offset by the impact of lower fuel recovery, a 1 percent volume decline and changing business mix.
Seventeen analysts had a consensus revenue estimate of $3.12 billion for the quarter.
Coal volume in the quarter slid 11 percent from last year, merchandise volume dropped 3 percent, while intermodal gained 5 percent, CSX said.
Expenses for the quarter declined 9 percent to $2.05 billion.
Operating ratio for the quarter improved to a record 66.8 percent from 69.3 percent last year, the company said.
In fiscal year 2015, CSX expects domestic coal volume to decline by about 10 percent and the outlook for export coal volume remains about 30 million tons for the year.
The company expects meaningful margin expansion as it progresses towards a full-year operating ratio in the mid-60s longer term.
CSX is the first among major railroad operators to report quarterly earnings.
CSX closed Tuesday at $32.07, up $0.17 or 0.53%, on a volume of 11 million shares on the NYSE. In after hours, the stock gained $1.14 or 3.55% at $33.21. In the past year, the stock traded in the range of $29.07 - $37.99.
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