CSX expects its earnings per share in the fourth quarter of 2016 to be eight cents.
“While we now expect fourth-quarter earnings per share to be down, absent the eight-cent impact, the company’s earnings remain consistent with its prior guidance of flat to slightly down from the prior year,” said Executive Vice President and Chief Operating Officer Cindy Sanborn.
She gave that assessment to analysts attending the Baird’s 2016 Industrial Conference in Chicago on Nov. 9.
Sanborn said volume will be roughly flat on a reported basis, which includes an extra accounting week in the fourth quarter this year.
However, management expects strong cost performance to help offset that and result in a solid financial performance throughout the year.
Sanborn said that through the third quarter CSX has posted about $550 million in cost savings through efficiency initiatives and volume-variable savings.
Cost cutting has been undertaken in labor, fuel and assets expenses through gains achieved with train length and crew savings, record fuel efficiency, and improved locomotive productivity and asset reliability.
In the long term, CSX expects to transition away from coal traffic and toward more service-sensitive merchandise and intermodal markets.
CSX expects to have an operating ratio in the mid-60s.