csx 3Q 08

Download csx  3Q 08

Post on 24-Dec-2014

127 views

Category:

Economy & Finance

3 download

Embed Size (px)

DESCRIPTION

 

TRANSCRIPT

<ul><li> 1. Third Quarter 2008 Earnings Conference Call 1 1 Forward-Looking Disclosure This information and other statements by the company contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to, among other items: projections and estimates of earnings, revenues, cost-savings, expenses, or other financial items; statements of managements plans, strategies and objectives for future operation, and managements expectations as to future performance and operations and the time by which objectives will be achieved; statements concerning proposed new products and services; and statements regarding future economic, industry or market conditions or performance. Forward-looking statements are typically identified by words or phrases such as believe, expect, anticipate, project, estimate and similar expressions. Forward-looking statements speak only as of the date they are made, and the company undertakes no obligation to update or revise any forward-looking statement. If the company does update any forward-looking statement, no inference should be drawn that the company will make additional updates with respect to that statement or any other forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, and actual performance or results could differ materially from that anticipated by these forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by these forward-looking statements include, among others: (i) the companys success in implementing its financial and operational initiatives; (ii) changes in domestic or international economic or business conditions, including those affecting the rail industry (such as the impact of industry competition, conditions, performance and consolidation); (iii) legislative or regulatory changes; (iv) the inherent business risks associated with safety and security; and (v) the outcome of claims and litigation involving or affecting the company. Other important assumptions and factors that could cause actual results to differ materially from those in the forward- looking statements are specified in the companys SEC reports, accessible on the SECs website at www.sec.gov and the companys website at: www.investors.csx.com. 2 2 </li> <li> 2. Executive Summary Michael Ward Chairman, President and Chief Executive Officer Third quarter overview . . . Delivered record revenues, Third Quarter EPS from operating income and EPS Continuing Operations 40% Revenues grow 18% on $0.94 Increase diverse business portfolio $0.67 Performance in safety and service remains strong Operating margin improves 250 bps to record levels 2007 2008 4 4 </li> <li> 3. Operations Review Tony Ingram Executive Vice President Chief Operating Officer Leadership, discipline and execution Strong improvement in safety performance continues Productivity initiatives are Performance delivering results Excellence Service Execution Service Execution Network is stable and service improvement will resume Productivity Discipline Productivity Discipline Safety Leadership Safety Leadership 6 6 </li> <li> 4. Network responded well following storm impacts BNI, UNP, KCS Area Impacted Train operations on New Reroutes Orleans line restored Chicago Interchange reroutes with western roads were effective Indianapolis St Louis Midwest operations back to Louisville normal following flooding Memphis Birmingham NSC Haulage Service is stable and is Rights expected to improve Area Impacted New Orleans 7 7 Helping lead one of the Nations safest industries FRA Personal Injury Rate FRA Train Accident Rate 4.49 1.97 1.56 3.27 3.06 1.27 2.75 1.12 Q3 2005 Q3 2006 Q3 2007 Q3 2008 Q3 2005 Q3 2006 Q3 2007 Q3 2008 8 8 </li> <li> 5. Network efficiency remains resilient Terminal Dwell (hours) Train Velocity (mph) 21.4 28.4 20.1 19.8 19.7 25.0 24.1 22.7 Q3 2005 Q3 2006 Q3 2007 Q3 2008 Q3 2005 Q3 2006 Q3 2007 Q3 2008 9 9 On-time performance continues to be stable On-time Originations On-time Arrivals 76% 83% 77% 77% 67% 63% 51% 43% Q3 2005 Q3 2006 Q3 2007 Q3 2008 Q3 2005 Q3 2006 Q3 2007 Q3 2008 10 10 </li> <li> 6. Operations wrap-up . . . Building on strong safety foundation Driving continuous improvement Focused on delivering greater productivity gains Contributing to further margin expansion Network operations and service levels are stable Continuing positive service momentum 11 11 Sales and Marketing Review Clarence Gooden Executive Vice President Sales and Marketing </li> <li> 7. Revenues increase 18% to nearly $3 billion Record quarterly revenues Third Quarter Revenue in Millions Yield management continues to offset softer volumes $460 $2,961 Consistent service producing strong revenue growth $2,501 Secular strength drives over six years of revenue growth 2007 Growth 2008 13 13 Revenue growth is strong across most markets Third Quarter Year-Over-Year Revenue Growth 36% Agricultural Products 31% Coal 19% Metals 18% Intermodal 16% Phosphates &amp; Fertilizers Chemicals 13% Emerging Markets 9% Forest Products 8% Food &amp; Consumer 6% Automotive (2%) 14 14 </li> <li> 8. Price and fuel cost recovery drive RPU growth Year-Over-Year Change 21.2% 18.3% 14.4% 10.5% 8.1% 8.0% 6.9% 7.1% 6.8% 6.7% 6.5% 6.5% 6.4% 6.2% Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Price Increase on 'Same Store Sales' Total Revenue per Unit Note: Same Store Sales price increases exclude impacts from fuel and mix 15 15 Merchandise revenue increases 16% Higher yields continue to Third Quarter offset softer volumes Year-Over-Year Change Housing-related markets RPU 20% remain challenged Volume (3%) Revenue 16% Strongest growth in Agriculture and Metals 2007 Change 2008 RPU $ 1,861 $ 370 $ 2,231 Chemicals revenue growth overcomes storm impact Volume 676 (23) 653 (thousands) Revenue $ 1,258 $ 199 $ 1,457 (millions) 16 16 </li> <li> 9. Coal revenue increases 31% Strength in the export Third Quarter market continues Year-Over-Year Change Utility inventories remain RPU 30% below prior year levels Volume 1% Revenue 31% Pricing environment remains favorable going forward 2007 Change 2008 RPU $ 1,396 $ 420 $ 1,816 Volume 465 3 468 (thousands) Revenue $ 649 $ 201 $ 850 (millions) 17 17 Automotive revenue declines 2% Manufacturers decreasing Third Quarter production to match demand Year-Over-Year Change Higher yields reflect stronger RPU 27% pricing and fuel recovery Volume (23%) Revenue (2%) 2007 Change 2008 RPU $ 1,941 $ 527 $ 2,468 Volume 102 (23) 79 (thousands) Revenue $ 198 ($ 3) $ 195 (millions) 18 18 </li> <li> 10. Intermodal revenue increases 18% Intermodal revenues increase Third Quarter to record levels Year-Over-Year Change Fuel recovery and favorable RPU...</li></ul>