(The Associated Press circulated the following by Ron Word on April 15.)
JACKSONVILLE, Fla. — Rail giant CSX Corp. said Tuesday that fuel surcharges along with rising ethanol and grain volumes helped its first-quarter profit soar 46 percent.
CSX Corp. said it earned $351 million, or 85 cents per share, in the three months that ended in March, compared with $240 million, or 52 cents per share, in the same period last year.
Revenue rose 12 percent to a record $2.7 billion.
The earnings included 5 cents per share for non-cash equity earnings adjustment and 2 cents per share for insurance recoveries. Excluding those items, profit was up 60 percent from a year ago.
Analysts forecast earnings of 74 cents per share on revenue of $2.63 billion, according to Thomson Financial.
“Our highly focused work force continue to drive shareholder value at a record setting pace in the first quarter by delivering outstanding safety, customer service and financial results,” said Michael Ward, chairman, president and chief executive officer.
Ward noted that despite the current economic conditions the company overcame softness in the housing and automotive sectors through yield management, fuel recovery and market drivers including growth in ethanol and grain shipments, increased demand for export coal and a stable industrial economy.
The Jacksonville-based company also expects to reach the “upper end” of its previous full-year guidance, set at $3.40 to $3.60 per share.
CSX shares were up $1.29, or 2.2 percent, in after-hours trading following the earnings release. The shares gained 66 cents to $57.77 in Tuesday’s regular session.
CSX has been locked in a legal battle with a London-based hedge fund, The Children’s Investment Fund, which has been critical of CSX’s board and management, but the controversy was not addressed in the quarterly report.
In March, CSX sued TCI and another hedge fund, 3G Capital Partners, in federal court in New York accusing it of using swap agreements to evade federal securities filing requirements. CSX claims TCI acquired more than 5 percent of its common stock without making disclosures required by law.
In a countersuit, the hedge funds accused the company of misleading stockholders and violating its corporate insider trading policy.
CSX said TCI’s counterclaims lack merit and are an attempt to distract stockholders from the railroad’s lawsuit.
TCI, which owns about 4.4 percent of the CSX stock, and 3G Capital Partners, have nominated five men to join the company’s 12-member board.
CSX has defended its board, pointing to increased earnings and improvements to its stock price. It has rejected TCI’s proposal to allow shareholders to call special meetings to elect board members.
The legal action comes as CSX prepares for its annual meeting, which was moved from early May in Indianapolis to June 25 in New Orleans.
CSX is one of the nation’s leading transportation companies, providing rail, intermodal and rail-to-truck transload services. The company’s transportation network spans approximately 21,000 miles, with service to 23 eastern states and the District of Columbia, and connects to more than 70 ocean, river and lake ports.