CSX Revenue Falls as Coal Hurts
13 4월 2016 - 6:40AM
Dow Jones News
CSX Corp. on Tuesday reported revenue fell in the first quarter,
as the volume of coal shipments, a key metric for railroads,
dropped 31% to continue a trend that has hurt the top line for
several quarters.
In February, the Jacksonville, Fla., railroad said earnings in
the latest quarter would drop significantly as the railroad
expected volume to decline in the mid-to-high single digits. On
Tuesday, CSX reported that total volume was down 5% for the
quarter.
CSX expects coal volume to decline more than 20% in 2016 and see
most other markets also declining year-over-year. Some 20% of CSX's
revenue last year came from coal versus an industry average of
about 15%.
The company has responded by cutting costs, laying off workers
and mothballing railcars.
CSX's stock has rebounded some 16% from a three-year low hit in
January but remains more than one-third below its November 2014
high. On Tuesday after hours, the stock edged 0.5% lower to
$24.91.
CSX Corp. is the first of the big freight lines to report
first-quarter earnings, providing a test case for some analysts who
believe that a turnaround could be around the corner. Though
results declined from a year ago, earnings aligned with Wall Street
expectations, though the company fell short of revenue
forecasts.
For the quarter ended March 25, CSX reported a profit of $356
million, or 37 cents a share, down from a year-ago profit of $442
million, or 45 cents a share.
Revenue fell 14% to $2.62 billion.
Analysts surveyed by Thomson Reuters expected earnings to
decline 19% to 37 cents on revenue of $2.68 billion.
Rail stocks have been battered for the past year by a
combination of slowed global trade, a strong dollar, plunging
commodity prices and reduced domestic oil shipments. But recently,
some analysts have predicted the first glimmers of relief as
certain cargo groups hit bottom and the economic outlook
improves.
The first quarter is generally expected to be the toughest for
railroads this year, however, because of difficult comparisons to a
better quarter a year ago and due to flooding in some Southern
states, primarily affecting Union Pacific Corp. and Kansas City
Southern.
Through March, total U.S. volumes for railroads fell about 6.5%
to nearly 6.5 million carloads, trailers and containers, compared
with the same period a year earlier. That compares with an increase
of less than 1% in the same quarter a year ago.
Railroads have been hardest hit by a steep drop in coal
shipments, down more than 30% in the quarter as power plants switch
to cheap natural gas and as exports fall.
Write to Ezequiel Minaya at ezequiel.minaya@wsj.com
(END) Dow Jones Newswires
April 12, 2016 17:25 ET (21:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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