CSX Corp. (CSX) CFO Eliasson Says Q2 Volume Tracking Below Expectations; Affirms FY15 EPS Outlook

CSX Corp. (NYSE: CSX) Chief Financial Officer Fredrik Eliasson today discussed the company's performance and second quarter volume and earnings projections at the Bank of America Merrill Lynch 2015 Transportation Conference in Boston.

Eliasson highlighted CSX's financial performance over the past decade, during which the company delivered a compound annual growth rate in earnings per share of 20 percent, despite the loss of nearly $900 million in coal revenue over the last few years.

"We have delivered strong shareholder value by remaining focused on our three key value levers: pricing above inflation, driving ever more efficient operations, and growing our merchandise and intermodal businesses faster than the economy," Eliasson said. "CSX is emerging from the energy transition a stronger company with a more diversified business mix, which has been evident over the last three quarters in which we have delivered double-digit earnings growth and significant margin expansion."

Eliasson outlined the company's view of second quarter volume, which is tracking slightly below expected levels due to very strong comparisons to last year. However, thanks to improving service levels and asset utilization, the company still expects second quarter EPS growth that is flat to slightly up compared to last year.

For the full year, CSX continues to expect EPS growth in the mid-to-high single digit range, as well as meaningful margin expansion as the company makes progress toward a mid-60s operating ratio. Earnings growth this year will be driven predominantly by accelerating pricing performance and productivity gains approaching $200 million as the company cycles strong volume comparisons and additional headwinds coal.

The foundation of CSX's strategy is delivering excellent service to customers. To that end, the company is making key resource investments to enhance service to the levels it produced prior to last year, and position CSX to take advantage of the long-term growth opportunities present across nearly all of the markets it serves.

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