CSX reinforces FY 2015 guidance despite weak energy demand

Chief Financial Officer Frank Lonegro reiterated the railway’s 2015 financial projections and outlined expectations for key markets in 2016 at the Baird Industrial Conference in Chicago Tuesday.    CSX Corp. has reiterated its 2015 financial projections despite weak demand in energy markets that is likely to continue into 2016 and could effect results, according to a statement from the company.
   Due to “continued headwinds” in energy markets, CSX said it expects fourth quarter 2015 earnings per share to decline slightly compared to the fourth quarter of 2014. The company is targeting mid-single digit full-year EPS growth “as intermodal growth and efficiency initiatives offset about $450 million in coal revenue declines.”
   CSX said it “also continues to expect meaningful margin expansion in 2015 and a mid-60s operating ratio longer term as the company leverages longer trains, drives industrial development to leverage merchandise growth, continues investing in intermodal, and matches resources to business demand across its coal network.”
   The company is projecting its intermodal segment will growth in 2016, as it “continues to drive highway-to-rail conversions to capture a share of the estimated 9 million loads in the East that are well-positioned for intermodal service. At the same time, efficient service for automotive customers will lead industrial market growth as North American Light Vehicle production increases.”
   Frank Lonegro, Chief Financial Officer of the Jacksonville, Fla.-based railway, drove home the message at the Baird Industrial Conference in Chicago Tuesday.
   “CSX has leveraged its diverse portfolio and network reach to consistently deliver record earnings per share growth, despite declines in coal revenue of more than $1 billion over the past four years,” Lonegro said. “While we expect the energy market headwinds to continue in 2016, we are focused on capturing opportunities in intermodal and industrial markets, and on delivering excellent service for customers to support our pricing, growth and efficiency targets.”