Gains Boost CSX Quarter

But before items, higher costs lead to lower earnings.
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Rail operator

CSX

(CSX) - Get Report

posted a first-quarter rise in profit thanks to an after-tax credit. Minus the gain, however, higher expenses cut into the company's quarterly profit, reducing it by almost half.

The Jacksonville, Fla.-based company earned $99 million, or 46 cents a share, higher than the $25 million, or 12 cents a share, the company earned in the previous-year quarter. Both quarters included the effect of accounting changes due to goodwill and asset write-offs, resulting in a gain of $57 million, or 26 cents a share, for the 2003 quarter and a charge of $43 million, or 20 cents a share, for the year-ago period.

Excluding the accounting changes, the company earned $42 million, or 20 cents a share, compared with $68 million, or 32 cents a share, in the first quarter of 2002. Analysts were expecting earnings of 17 cents a share.

Fuel expenses were up $54 million year-over-year and the severe winter weather affected the fluidity of the network negatively, the company said. This caused significant labor and equipment expense increases.

Revenue was up to $2.02 billion, from $1.96 billion.

Shares of the company were recently up 0.54% to $31.59 on the news.