Slide 1: 2021 Third Quarter Earnings Conference Call
2021 THIRD QUARTER EARNINGS CONFERENCE CALL 10.20.2021
Slide 2: Forward Looking Disclosure
FORWARD LOOKING DISCLOSURE 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, cost
Slide 3: Non-GAAP Measures Disclosure
NON-GAAP MEASURES DISCLOSURE CSX reports its financial results in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). CSX also uses certain non-GAAP measures that fall within the meaning of Securities and Exchange Commission Regulation G and Regulati
Slide 4: Third Quarter Highlights
THIRD QUARTER HIGHLIGHTS 1,563K $3,292M $1,436M Volume Revenue Op. Income Operating Income Operating Ratio Earnings Per Share $0.43 56.9% $1,436M 56.4% $1,141M $0.32 26% Increase 50 bps Decrease 34% Increase Q3 20 Q3 21 Q3 20 Q3 21 Q3 20 Q3 21 2021 THIRD QUARTER EARNINGS CONFERENCE CALL 4
Slide 5: Third Quarter Revenue Highlights
THIRD QUARTER REVENUE HIGHLIGHTS Broad-Based Revenue Gains More Than Offset Q3 Revenue Up 24% Year Over Year Automotive Weakness Chemicals increased due to higher shipments of plastics, sand, waste and other Chemicals 10% core chemicals, partially offset by lower shipments of crude oil Agricultural
Slide 6: Investing in Solutions to Address Supply Chain Challenges
INVESTING IN SOLUTIONS TO ADDRESS SUPPLY CHAIN CHALLENGES New Capacity Solutions 13 overflow container yards at key terminals throughout the network to create additional storage and capacity Detroit, MI Worcester, MA Additional drayage solutions to maintain terminal fluidity Bedford Park & 59th, IL
Slide 7: Creating Capacity Through Operating Initiatives
CREATING CAPACITY THROUGH OPERATING INITIATIVES Intermodal Trip Plan Carload Trip Plan Terminal Car Dwell Train Velocity Performance Performance 88% 68% 10.5 17.7 PERCENT ON TIME PERCENT ON TIME HOURS PER CAR MILES PER HOUR Focused on increasing T&E workforce to address supply chain challenges ‒ Suc
Slide 8: Third Quarter Safety Highlights
THIRD QUARTER SAFETY HIGHLIGHTS FRA Personal Injury Frequency Index Safety is a guiding principle at CSX 0.95 1.02 0.85 Continue to drive positive safety momentum 0.76 0.76 Focused on critical rules compliance and reducing human factor accidents Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Leveraging tablet rollou
Slide 9: Third Quarter Earnings Summary
THIRD QUARTER EARNINGS SUMMARY Third Quarter Income Statement Dollars in Millions 2021 2020 Variance Revenue $ 3,292 $ 2,648 24% Expense 1,856 1,507 (23%) Operating Income $ 1,436 $ 1,141 26% Interest Expense & Other Income – Net (157) (173) 9% Income Tax Expense (311) (232) (34%) Net Earnings $ 968
Slide 10: Third Quarter Expense Overview
THIRD QUARTER EXPENSE OVERVIEW 2021 2020 Expense up 23%, including (~$200M) $631 related to Quality Carriers, ($88M) of higher Labor & Fringe fuel price, and $56M higher real estate gains $574 Purchased $577 Services & Other $382 Non-locomotive fuel inflation remained approximately 3% in the quarter
Slide 11: Third Quarter Cash Flow Summary
THIRD QUARTER CASH FLOW SUMMARY Free Cash Flow Cash and Equivalents Shareholder Before Dividends* Balance Distributions In Millions In Millions In Millions Buybacks Dividends $3,129 $1,272 $2,896 $208 $913 $1,938 $2,179 $764 $212 $213 $401 $1,064 $247 $198 $701 $551 $199 $203 $48 Q3 20 Q3 21 Dec 31,
Slide 12: Looking Forward
LOOKING FORWARD Maintaining prior outlook for double digit revenue growth before impact of Quality Carriers acquisition Expect capital expenditures at top end of $1.7 – $1.8 billion range Continue resourcing network to meet demand Committed to delivering high quality service product to customers 202
Slide 13: Appendix
APPENDIX Non-GAAP Free Cash Flow Reconciliation
Slide 14: Non-GAAP Free Cash Flow Reconciliation
NON-GAAP FREE CASH FLOW RECONCILIATION Free Cash Flow Nine Months Ended Dollars in millions Sep 30, 2021 Sep 30, 2020 Net Cash Provided by Operating Activities $ 3,819 $ 3,128 Property Additions (1,220) (1,209) Other Investing Activities 297 19 Free Cash Flow Before Dividends (non-GAAP) $ 2,896 $ 1,
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