Slide 1: 2018 Second Quarter Earnings Conference Call
2018 SECOND QUARTER EARNINGS CONFERENCE CALL James M. Foote President and Chief Executive Officer
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: Executive Summary
EXECUTIVE SUMMARY James M. Foote President and Chief Executive Officer
Slide 5: Second Quarter Highlights
SECOND QUARTER HIGHLIGHTS Volume 1,646K Revenue $3,102M Operating Income $1,283M Operating Ratio 58.6% EPS $1.01 Earnings Per Share Operating Ratio $1.01 67.4% $0.64 63.5% $0.55 58.6% 58% Growth 490 bps Improvement 2017 2017 Adjusted 2018 2017 2017 Adjusted 2018 Note: Adjusted financials exclude a r
Slide 6: Second Quarter Revenue Highlights
SECOND QUARTER REVENUE HIGHLIGHTS Strong Freight Environment Second Quarter Revenue Yielding Volume and Pricing Gains Up Six Percent Year over Year Chemicals increase driven by broad-based Chemicals 7% growth, partially offset by fly ash losses Automotive 7% Auto up in line with U.S. light truck
Slide 7: Second Quarter Operating Highlights
SECOND QUARTER OPERATING HIGHLIGHTS Train Velocity Train Length (miles per hour) (feet) 7,241 16.2 16.2 17.3 17.4 14.0 6,833 6,780 6,886 6,430 2Q17 3Q17 4Q17 1Q18 2Q18 2Q17 3Q17 4Q17 1Q18 2Q18 Terminal Car Dwell Car Miles per Day (hours) 12.1 123.8 10.9 10.6 10.4 9.7 110.5 112.1 107.1 95.7 2Q17 3Q17
Slide 8: Financial Review
FINANCIAL REVIEW Frank A. Lonegro EVP and Chief Financial Officer
Slide 9: Second Quarter Earnings Summary
SECOND QUARTER EARNINGS SUMMARY Second Quarter Income Statement Dollars in millions 2018 2017 Variance Revenue $ 3,102 $ 2,933 6% Expense Labor and Fringe 669 751 11% Materials, Supplies and Other 469 496 5% Depreciation 329 327 (1%) Fuel 270 198 (36%) Equipment and Other Rents 112 105 (7%) Restruct
Slide 10: Key Second Quarter Financial Measures
KEY SECOND QUARTER FINANCIAL MEASURES Adjusted Free Cash Flow Capital Investments Before Dividends Distributions Dollars in Millions Dollars in Millions Dollars in Millions Dividends Buybacks $1,329 $955 $2,194 $823 $737 $1,810* $1,107 $757 14% Reduction 80% Growth 98% Growth $350 $384 Q2 2017 Q2 20
Slide 11: Closing Remarks
CLOSING REMARKS James M. Foote President and Chief Executive Officer
Slide 12: Looking Forward
LOOKING FORWARD Targeting industry-leading safety performance New leadership, comprehensive safety assessment underway Significant opportunity to further improve service metrics Trip Plan Compliance Velocity and Dwell Cars Online Fuel Efficiency Expect mid-single-digit revenue growth in 20
Slide 13: Appendix
APPENDIX 2017 Non-GAAP Income Statement Reconciliation Non-GAAP Adjusted Free Cash Flow Reconciliation
Slide 14: 2017 Non-GAAP Income Statement Reconciliation
2017 NON-GAAP INCOME STATEMENT RECONCILIATION Second Quarter 2017 Income Statement Dollars in millions GAAP Adjustments Non-GAAP Revenue $ 2,933 $ - $ 2,933 Expense Labor and Fringe 751 - 751 Materials, Supplies and Other 496 - 496 Depreciation 327 - 327 Fuel 198 - 198 Equipment and Other Rents 105
Slide 15: Non-GAAP Adjusted Free Cash Flow Reconciliation
NON-GAAP ADJUSTED FREE CASH FLOW RECONCILIATION Adjusted Free Cash Flow Six Months Ended Dollars in millions June 30, 2018 June 30, 2017 Net Cash Provided by Operating Activities $ 2,009 $ 1,566 Property Additions (823) (955) Other Investing Activities 133 41 Free Cash Flow (before payment of divide
Slide 16: CSX.com / Investors
|, osx ] CSX.COM / INVESTORS