(Dow Jones Newswires circulated the following story by Bob Sechler on January 20, 2010.)
NEW YORK — CSX Corp. (CSX) executives forecast “better overall conditions” in 2010 and said they expect volume growth in most of the railroad’s shipping markets this year.
They cited coal shipments as a continued laggard, however, with Executive Vice President Clarence Gooden telling analysts on a post-earnings conference call Wednesday that “weakness in utility coal should persist for most of 2010.”
Still, the No. 3 U.S. railroad by revenue forecast volume growth this year in its other shipping markets, including its merchandise, automotive and intermodal segments.
Overall volume slumped 7% in the fourth quarter, although business levels ” were essentially flat with last year” in the period after Thanksgiving, Chief Executive Michael Ward told analysts.
The 7% slump in volume nonetheless marked the railroad’s best year-over-year quarterly volume performance of 2009. CSX posted fourth-quarter volume increases in its automotive and intermodal segments, compared to the year-ago period, although the gains were offset by decreases in coal and merchandise volumes.
“We expect better overall conditions in 2010” as the economy continues to improve, Ward said.
CSX also said it expects to push through core price increases of 4% to 5% in 2010. The company raised core prices 5.3% in the fourth quarter, after gains above 6% through the bulk of 2009.
CSX executives said the anticipated price increases are in keeping with their long-term goal of raising prices above inflation.
Late Tuesday, CSX posted a fourth-quarter profit of $305 million, or 77 cents a share, up from $247 million, or 63 cents, a year earlier, when earnings from continuing operations were 92 cents.
Revenue fell to $2.3 billion, amid a 7% decline in overall volumes, which was the best year-to-year volume results in 2009.
Analysts surveyed by Thomson Reuters expected CSX, on average, to earn 76 cents a share in the fourth quarter on revenue of $2.39 billion.