CSX Fourth-Quarter Net Income Falls; Weaker 2016 Results Expected
CSX Corp. reported fourth-quarter net income fell 5% to $466 million, or 48 cents per share, and announced that this year’s earnings are expected to trail 2015.
CSX, whose results were the first fourth-quarter earnings announcement in the transport industry, tied them to weak industrial and commodity markets, such as a 32% decline in coal shipments. Earnings last year were $2 per share. CSX didn’t estimate how much the 2016 results would lag last year.
Truck-rail freight was a bright spot, with shipments rising 4% to 729,000, powered by a 14% increase in domestic intermodal that was tied to conversion of longhaul freight from highway to rail. International intermodal slumped 9% due to competitive losses and lack of a fourth-quarter freight peak.
Revenue fell 13% to $2.78 billion from $3.19 billion. Net income in the final quarter of 2015 was $491 million, or 49 cents. Full-year net income rose 2% to $1.97 billion despite a 7% drop in revenue.
“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.” CEO Michael Ward said in a statement.
“With negative global and industrial market trends projected for 2016, full-year earnings per share are expected to be down compared to 2015. CSX will continue to be rigorous about efficiency, resources and service quality in order to maximize shareholder value.”
Total shipments fell 6%, with declines in every freight category except automotive and minerals traffic. Intermodal accounted for 43% of all freight, up from 40%.
