JACKSONVILLE, Fla. (AP) â¿¿ Higher rates helped freight railroad CSX Corp. boost profits by 14 percent despite a drop in coal shipments.
CSX said Tuesday that it earned $449 million, or 43 cents per share, in the first quarter, up from $395 million, or 35 cents per share, a year ago.
Analysts expected 38 cents per share, according to FactSet.
Revenue rose 6 percent to $2.97 billion. Analysts expected $2.91 billion.CSX is the first large railroad to report first-quarter results. Railroads are a snapshot of the economy because so many consumer goods, from autos to yard fertilizer, move by train. CSX said freight volumes rose just 1 percent in the first quarter compared with a year ago, but overall rates rose 5 percent. Coal accounts for more than one-fourth of CSX revenue, and shipment volumes of that were down by 14 percent. But the company said it was able to boost coal rates by 10 percent to offset the decline. Demand for coal used in generating power was hurt by a big drop in natural gas prices, which made that fuel more attractive to utilities. Mild winter weather didn't increase demand, either. CSX said the market for utility coal is likely to be even weaker in the second quarter, but the Jacksonville, Fla., company said it's on track to top 2011 earnings this year. Shipments of agricultural products dipped 1 percent as demand for ethanol, which is made from corn, dropped because motorists have been buying less gasoline. Ethanol is added to much of the gasoline used in the U.S. Auto shipments, while a small portion of CSX revenue, jumped 18 percent. The railroad saw smaller increases for metals, forest products and food and consumer products. CSX charged higher rates in all those categories. Chairman and CEO Michael J. Ward said the company was "off to a fast start in a year that will be dynamic and challenging." He said most transportation markets were performing very well.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV