CSX Corp., the country’s third-largest railroad, reported stronger-than-expected earnings April 17 as the company cut costs. First-quarter net earnings were $695 million, or 78 cents per share. That is more than the 66 cents per share analysts had been expecting.
This compares with the first quarter of 2017, when the railroad reported earnings of $362 million, or 39 cent per share.
CSX also reported its operating ratio, which measures operating expenses as a percentage of revenue, for the first quarter improved 950 basis points to 63.7% from 73.2% in 2017. CSX said first-quarter revenue remained flat at $2.88 billion, but expenses fell 13% year-over-year. The company said it saved $99 million by reducing its headcount and implementing scheduled railroading, making the freight carrier more efficient.
First-quarter operating income was up 36% to $1.04 billion compared with $769 million during the first three months of 2017.
James Foote, who took over as CEO after the death of Hunter Harrison last December, told reporters on a conference call the structural changes Harrison and other executives were implementing last year are taking hold.
“CSX employees did a great job of running the railroad and executing the scheduled railroading model during challenging weather conditions,” Foote said. “We’re more confident in our ability to deliver safe, reliable, best-in-class service for our customers and enhanced value for our shareholders.”
Shares of the Jacksonville, Fla.-based company rose 3.7% to $58.65 in after-hours trading.