JACKSONVILLE — The parent company of Jacksonville’s CSX Transportation announced yesterday that weak coal demand from utility customers will hurt its earnings for the third quarter ending Sept. 27, the Florida Times-Union reported.
Coal carloads for the quarter are expected to be down about 5 percent from a year ago and revenue from the sector will be off by about $35 million from the same period a year ago, CSX Corp. said in a news release.
But the company expects that revenue gains in merchandise, automotive and intermodal carloads will offset the slumping coal revenue.
Total rail and intermodal operating income for the third quarter should be down slightly from last year’s $237 million, the release said. CSX Corp.’s overall earnings should be well above the 47 cents per share reported in the third quarter of 2001, attributable largely to real estate gains and lower interest expense.
In July, CSX, which gets most of its business from its Jacksonville-based railroad operations, reported quarterly earnings that surpassed the previous year’s for the ninth consecutive quarter.
“We have some pretty good momentum right now,” CSXT President Michael Ward said at the time. Ward has been given much of the credit for CSXT’s steady earnings growth. Earlier this year He was named president of CSX in July, and he’s expected to eventually rise to the parent company’s top position.
Yesterday, John W. Snow, CSX’s chairman and chief executive officer, predicted a fourth-quarter rebound in coal revenue.
“Coal stockpiles at our electric utility customers have been dropping at a much slower rate than we anticipated, despite the relatively warm summer weather,” he said. “We believe inventories are approaching normal levels, and unit train coal shipments should pick up in the fourth quarter.
CSX will report third quarter earnings on Oct. 24.
CSX Corp., headquartered in Richmond, Va., operates the third-largest rail networks in the United States. The company has 5,100 employees working on the First Coast.