CSX Corporation (CSX) reported fourth quarter 2012 earnings of 43 cents per share, ahead of the Zacks Consensus Estimate of 39 cents and in line with the year-ago quarter. For the full year, earnings per share leaped 7% year over year to $1.79.
The company’s fourth quarter revenues of $2,884 million remained marginally below the Zacks Consensus Estimate of $2,886 million and declined 2% year over year due to lower volume, partially offset by higher pricing and fuel surcharge recoveries. Revenues for the year remained flat year over year at $11,756.
Fourth quarter operating income was down by 4% at $804 million, resulting in operating ratio (defined as operating expenses as a percentage of revenue) that increased 60 basis points year over year to 72.1%. Operating expense inched up 1% year over year to $2,080 million.
For fiscal 2012, operating income rose 1% year over year to $3,457 million resulting in an operating ratio of 70.6%, down 30 basis points. Operating expense remained flat year over year at $8,299 million.
Performance Across Business Lines
Merchandise revenues increased 4% year over year to $1,661 million in the reported quarter driven by 5% increase in revenue per unit (RPU). However, volumes for the segment registered a 1% year over year decline given significant drop in Agricultural Products (down 12%), Metals (down 7%) and Emerging Markets (down 6%) on a year-over year basis.
Coal revenues were down by 18% year over year at $747 million on 19% volume declines. RPU remained flat on a year-over-year basis. The poor performance by Coal was due to lower domestic coal shipments given lower electrical generation, higher utility stockpiles and low natural gas prices. Export coal also suffered a significant setback due to lower shipments of U.S. metallurgical coal to overseas markets.
Intermodal revenues rose 6% year over year to $398 million driven by highway-to-rail conversions in the domestic market, increase in service lanes and increase in existing customers. International intermodal business also performed well given the rise in customers, offset by disruptions by Hurricane Sandy.