Earnings Labs

CSX Corporation (CSX)

Q4 2012 Earnings Call· Wed, Jan 23, 2013

$44.73

-1.08%

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Transcript

Operator

Operator

Thank you Pat and good morning everyone and again welcome to CSX Corporation’s fourth quarter 2012 earnings presentation. The presentation material that we’ll review this morning along with our quarter financial report and our safety and service measurements are available on our website at csx.com under the investor section. In addition, following the presentation, a webcast and podcast replay will be available on the same website.Here, representing CSX this morning are Michael Ward, the Company's Chairman, President and Chief Executive Officer; Clarence Gooden, Chief Sales and Marketing Officer; Oscar Munoz, Chief Operating Officer; and Fredrik Eliasson, Chief Financial Officer.

David Baggs

Management

Thank you Pat and good morning everyone and again welcome to CSX Corporation’s fourth quarter 2012 earnings presentation. The presentation material that we’ll review this morning along with our quarter financial report and our safety and service measurements are available on our website at csx.com under the investor section. In addition, following the presentation, a webcast and podcast replay will be available on the same website.Here, representing CSX this morning are Michael Ward, the Company's Chairman, President and Chief Executive Officer; Clarence Gooden, Chief Sales and Marketing Officer; Oscar Munoz, Chief Operating Officer; and Fredrik Eliasson, Chief Financial Officer.

Michael Ward

Management

Clarence Gooden

Management

Oscar Munoz

Chief Operating Officer

Now from a system performance let’s turn to the next slide, terminal dwell is a strong indicator of how well we are utilizing our assets. Looking at the chart on the left, you see dwell improved 4% to 24.3 hours. Looking at the chart on the right, velocity again showed improvement up 7% to 23.3 miles per hour. This is the clear example of where great customer service builds great shareholder value. Assets moving through the network quickly and reliably, handling the customers receiving outstanding service and over the long term allows for more efficient capital deployment.Let’s go to velocity on the next slide, as a further reflection of the operating improvement, velocity was once again up against across all three networks. In coal we’re driving improvements and service and efficiency, with volume down 19% CSX adjusted operating plans and maximize loadings to increase both train length and tons per car.Turning to intermodal, velocity continued to reach high levels with a record fourth quarter volume. Higher velocity in the intermodal network gives us the ability to reach end market more quickly and to meet or exceed customer expectations. Across the network container and trailer availability to the customer in the terminal was at 86% and in the high 90s for our expedited product. Finally the merchandize network also continues to perform well with velocity up 5% to 21.9 miles per hour, car cycle times improved 8%. This means we’re making more final deliveries to customers on time requiring fewer local motives, cars and crew starts.Over the course of the year service has improved significantly in all the markets we serve including those that we have absorbed strong growth. Turn to the next slide, we will look at productivity. Over the past five years, CSX has delivered nearly $850 million of…

Fredrik Eliasson

Chief Financial Officer

Michael Ward

Management

Operator

Operator

Scott Group - Wolfe Trahan and Company

Management

Clarence Gooden

Management

Scott Group - Wolfe Trahan and Company

Management

Clarence Gooden

Management

Scott Group - Wolfe Trahan and Company

Management

Fredrik Eliasson

Chief Financial Officer

Scott Group - Wolfe Trahan and Company

Management

Michael Ward

Management

Operator

Operator

Michael Ward

Management

Tom Wadewitz - JPMorgan

Management

Clarence Gooden

Management

Tom Wadewitz - JPMorgan

Management

Clarence Gooden

Management

Tom Wadewitz - JPMorgan

Management

Operator

Operator

Michael Ward

Management

Bill Greene - Morgan Stanley

Management

Michael Ward

Management

Bill Greene - Morgan Stanley

Management

Oscar Munoz

Chief Operating Officer

Bill Greene - Morgan Stanley

Management

Operator

Operator

Michael Ward

Management

Kevin Crissey - UBS

Management

Clarence Gooden

Management

Kevin Crissey - UBS

Management

Fredrik Eliasson

Chief Financial Officer

Operator

Operator

Ken Hoexter - Bank of America Merrill Lynch

Management

Michael Ward

Management

Ken Hoexter - Bank of America Merrill Lynch

Management

Michael Ward

Management

Ken Hoexter - Bank of America Merrill Lynch

Management

Michael Ward

Management

Ken Hoexter - Bank of America Merrill Lynch

Management

:

Fredrik Eliasson

Chief Financial Officer

Operator

Operator

Tom Kim - Goldman Sachs

Management

Clarence Gooden

Management

Tom Kim - Goldman Sachs

Management

Clarence Gooden

Management

Operator

Operator

Michael Ward

Management

Brandon Oglenski - Barclays

Management

Michael Ward

Management

Brandon Oglenski - Barclays

Management

Michael Ward

Management

Brandon Oglenski - Barclays

Management

Michael Ward

Management

Operator

Operator

Michael Ward

Management

Chris Wetherbee - Citi Investment Research

Management

Clarence Gooden

Management

Chris Wetherbee - Citi Investment Research

Management

Michael Ward

Management

Chris Wetherbee - Citi Investment Research

Management

Operator

Operator

Michael Ward

Management

Chris Ceraso - Credit Suisse

Management

Michael Ward

Management

Chris Ceraso - Credit Suisse

Management

Michael Ward

Management

Chris Ceraso - Credit Suisse

Management

Michael Ward

Management

Chris Ceraso - Credit Suisse

Management

Michael Ward

Management

Operator

Operator

John Larkin - Stifel Nicolaus

Management

Oscar Munoz

Chief Operating Officer

Michael Ward

Management

Oscar Munoz

Chief Operating Officer

John Larkin - Stifel Nicolaus

Management

Clarence Gooden

Management

Operator

Operator

Cherilyn Radbourne - TD Securities

Management

Mr. Ben Hartford with Rob W. Baird

Clarence Gooden

Management

Mr. Ben Hartford with Rob W. Baird

Cherilyn Radbourne - TD Securities

Management

Mr. Ben Hartford with Rob W. Baird

Michael Ward

Management

Mr. Ben Hartford with Rob W. Baird

Cherilyn Radbourne - TD Securities

Management

Mr. Ben Hartford with Rob W. Baird

Michael Ward

Management

Mr. Ben Hartford with Rob W. Baird

Operator

Operator

Mr. Ben Hartford with Rob W. Baird

Michael Ward

Management

Unidentified Analyst

Management

Michael Ward

Management

Unidentified Analyst

Management

Michael Ward

Management

Unidentified Analyst

Management

Operator

Operator

Michael Ward

Management

Jason Seidl - Dahlman Rose

Management

Fredrik Eliasson

Chief Financial Officer

Jason Seidl - Dahlman Rose

Management

Fredrik Eliasson

Chief Financial Officer

Jason Seidl - Dahlman Rose

Management

Michael Ward

Management

Operator

Operator

Michael Ward

Management

David Vernon - Sanford Bernstein

Management

Michael Ward

Management

David Vernon - Sanford Bernstein

Management

Michael Ward

Management

David Vernon - Sanford Bernstein

Management

Operator

Operator

Michael Ward

Management

Sal Vitale - Sterne Agee

Management

Michael Ward

Management

Sal Vitale - Sterne Agee

Management

Michael Ward

Management

Sal Vitale - Sterne Agee

Management

Michael Ward

Management

Sal Vitale - Sterne Agee

Management

Michael Ward

Management

Sal Vitale - Sterne Agee

Management

Operator

Operator

Peter Nesvold - Jefferies and Company

Management

Clarence Gooden

Management

Peter Nesvold - Jefferies and Company

Management

Clarence Gooden

Management

Peter Nesvold - Jefferies and Company

Management

Michael Ward

Management

Operator

Operator

Matt Troy - Susquehanna International

Management

Fredrik Eliasson

Chief Financial Officer

, :

Matt Troy - Susquehanna International

Management

Clarence Gooden

Management

Matt Troy - Susquehanna International

Management

Operator

Operator

Michael Ward

Management

Walter Spracklin - RBC Capital Markets

Management

Clarence Gooden

Management

Walter Spracklin - RBC Capital Markets

Management

Clarence Gooden

Management

Walter Spracklin - RBC Capital Markets

Management

Oscar Munoz

Chief Operating Officer

Walter Spracklin - RBC Capital Markets

Management

Fredrik Eliasson

Chief Financial Officer

Operator

Operator

Keith Schoonmaker – Morningstar:

Clarence Gooden

Management

Keith Schoonmaker – Morningstar:

Clarence Gooden

Management

Michael Ward

Management

Keith Schoonmaker – Morningstar:

Clarence Gooden

Management

Operator

Operator

Justin Yagerman - Deutsche Bank

Management

Clarence Gooden

Management

Justin Yagerman - Deutsche Bank

Management

Clarence Gooden

Management

Justin Yagerman - Deutsche Bank

Management

Clarence Gooden

Management

Justin Yagerman - Deutsche Bank

Management

Clarence Gooden

Management

Justin Yagerman - Deutsche Bank

Management

:

Michael Ward

Management

Justin Yagerman - Deutsche Bank

Management

Michael Ward

Management

Operator

Operator