Csx Corporation · NASDAQ:CSX
Csx — Dahlman Rose & Co Global Transportation Conference 2012
11 slides from Csx's conference presentation, Sep 5, 2012
Slide 1: Forward-Looking Statements
1 Forward-Looking Statements This information and other statements by the company may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to, among other items: projections and estimates of earnings, revenues, margins, volumes, rates, co
Slide 2: Executive summary / First-half earnings improve and margin expands
Executive summary . . . Delivered first-half earnings growth/margin expansion — Achieved improvement in EBIT, EBIT margin and earnings per share Economic outlook has moderated recently — Moderating U.S. and foreign economies impacting overall volume Service platform continues to operate at rec
Slide 3: Business levels were mixed during first half
Business levels were mixed during first half Year-over-year Change in First-half Volume Volume (000) Export Coal 239 26% Industrial Sector 592 9% Intermodal 1,229 8% Construction Sector 341 (3%) Agricultural Sector 418 (3%) Domestic Coal 423 (27%) Total 3,242 0% 5 Indicators point to moderating seco
Slide 4: Export coal has moderated; domestic coal declines beginning to moderate
Export coal has moderated from first half levels Export Coal CSX expects to exceed 40 Average Weekly Volume million tons in 2012 in Thousands 2011 2012 Capacity is in place near-term 9.9 and scalable longer-term 8.5 7.5 7.2 7.1 5.8 Long-term trends favorable, uncertainty in near-term Up Up Up
Slide 5: Drought impacting agricultural sector; strong automotive demand driving industrial
Drought conditions impacting agricultural sector Agricultural Sector Midwest drought conditions Average Weekly Volume are causing prices to rise in Thousands — Utilization of existing supplies 2011 2012 and substitution occurring 16.7 16.4 16.6 15.8 15.7 15.1 Phosphate and fertilizer shipments s
Slide 6: Construction sector weakness broad based; intermodal growth
Construction sector weakness is broad based Construction Sector Weakness in aggregate Average Weekly Volume shipments continues in Thousands 2011 2012 Salt shipments remain weak, 14.4 13.6 14.4 13.7 driven by high inventories 12.6 12.6 — High inventories driven by mild winter weather Flat Down D
Slide 7: On-time performance is at or near record levels
On-time performance is at or near record levels On-time Originations On-time Arrivals Quarterly 6-month MA 12-month MA Quarterly 6-month MA 12-month MA 79% 80% 89% 82% 69% 77% 72% 61% Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Note: Third quarter 2012 reflects actuals through we
Slide 8: Service and productivity drive margin expansion
Service and productivity drive margin expansion Operating Ratio Productivity savings expected to exceed $180 million 75.2% — Labor efficiencies across all operating departments 72.8% — High service levels improving 70.9% freight car cycle times 69.9% — Fuel efficiency increasing Adjusting coal r
Slide 9: Managing labor costs through improved efficiency
Managing labor costs through improved efficiency Train & Engine Average Weekly Resource investments are Overtime Hours yielding returns 18,582 19,316 17,431 16,168 16,078 15,205 — T&E headcount up 3%, but at a lower cost per employee Q1 Q2 Q3 Q4 Q1 Q2 Costs are down while service 2011 2011 2011
Slide 10: Fuel efficiency programs gaining traction
Fuel efficiency programs are gaining traction Fuel Efficiency First half fuel efficiency Gallons per KGTM’s roughly flat versus last year — First half active locomotives up 4%, but placing units in storage 1.23 1.23 1.24 1.16 1.17 1.15 Fuel initiatives are yielding measurable results — Trailing
Slide 11: Wrap-up
Wrap-up . . . First half results set strong foundation going forward — Although more modest economic environment expected in second half Domestic utility coal declines expected to moderate — Export coal growth expected to moderate from strong first half level Price, productivity, customer serv
CSX — Dahlman Rose & Co Global Transportation Conference 2012 on 6ix