CSX Profit Down, But Tops View

(RTTNews) - Railroad operator CSX Corp. (CSX), Tuesday reported a 5 percent drop in profit for the fourth quarter, as revenues dropped 13 percent hurt largely by lower fuel recovery. Nevertheless, earnings for the quarter trumped Wall Street estimates, while revenues fell short.

Jacksonville, Florida-based CSX's fourth-quarter profit dropped to $466 million or $0.48 per share from $491 million or $0.49 per share last year. On average, 26 analysts polled by Thomson Reuters estimated earnings of $0.46 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter dropped 13 percent to $2.78 billion from $3.19 billion last year. Analysts had a consensus revenue estimate of $2.86 billion for the quarter.

Total volumes dropped 6 percent to 1.66 million units, while revenue per unit dropped 7 percent to $1,680 from $1,811 last year.

Coal revenues plunged 32 percent to $218 million from $320 million a year ago, as volumes dropped 38 percent. Total merchandise revenues, which includes agricultural, industrial products and construction products, dropped 5 percent to $708 million, while intermodal revenues rose 4 percent to $729 million.

Total expenses declined 13 percent to $1.99 billion reflecting the collective effect of low fuel prices, lower volume-related costs and efficiency gains.

"CSX delivered solid results in 2015 by balancing strong service with compelling cost control and efficiency gains despite a market challenged by low commodity prices and global impacts of the strong U.S. dollar." said CEO Michael Ward.

Moving ahead, CSX expects 2016 earnings to be down compared to 2015, as global and industrial market trends are predicted to be negative.

CSX closed Tuesday's trading at $23.70, up $0.18 or 0.77%, on the NYSE. The stock further dropped $0.43 or 1.81% in the after-hours trade.