Slide 1: 2020 Third Quarter Earnings Conference Call
2020 THIRD QUARTER EARNINGS CONFERENCE CALL 10.21.2020
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: Third Quarter Highlights
THIRD QUARTER HIGHLIGHTS Volume 1,522K Revenue $2,648M Operating Income $1,141M Operating Ratio 56.9% EPS $0.96 Earnings Per Share Operating Ratio $1.08 $0.96 56.8% 56.9% 11% Decline 10 bps Increase 2019 2020 2019 2020 5 2020 CSX THIRD QUARTER EARNINGS CONFERENCE CALL
Slide 6: Third Quarter Revenue Highlights
THIRD QUARTER REVENUE HIGHLIGHTS Carload Traffic Challenged by Economic Third Quarter Revenue Impacts of COVID-19 Down 11% Percent Year over Year Chemicals declined due to lower shipments of frac sand and other industrial chemicals, partially offset by increases in crude oil and plastics shipments
Slide 7: Third Quarter Safety Highlights
THIRD QUARTER SAFETY HIGHLIGHTS FRA Personal Injury Frequency Index Safety is a guiding principle at CSX 1.15 1.12 0.85 0.77 0.61 Record Q3 low FRA personal injury frequency rate and number of injuries 3Q19 4Q19 1Q20 2Q20 3Q20 FRA Train Accident Rate Record Q3 low number of FRA reportable trai
Slide 8: Committed to Sustainable Operations
COMMITTED TO SUSTAINABLE OPERATIONS 1.14 Gallons of Fuel per kGTM CSX is expanding the inherent benefits of rail 1.10 1.07 1.05 1.01 1.01 Commitment to industry-leading ESG and 0.96 0.93 sustainability profile Further reducing emissions by converting additional trucks off the highway 2015 2016
Slide 9: Third Quarter Operating Highlights
THIRD QUARTER OPERATING HIGHLIGHTS Train Velocity Cars Processed per Hour Worked* Miles per Hour 3.90 20.3 21.3 21.2 21.2 19.6 3.61 3.46 3.27 3.28 3Q19 4Q19 1Q20 2Q20 3Q20 3Q19 4Q19 1Q20 2Q20 3Q20 Terminal Car Dwell Distributed Power Trains Hours Daily Average 93 87 85 84 8.9 8.9 9.7 75 8.4 8.3 3Q19
Slide 10: Realizing Strong Operating Leverage
REALIZING STRONG OPERATING LEVERAGE Change in Volume and Key Resources Since March 1, 2020 % Change Rolling 7-Day Average End of Quarter vs. March 1 Active Volume Active T&E Active Locomotives Train Starts Volume Active T&E Locomotives Train Starts 10% 3% 5% 0% (5%) (10%) (15%) (6%) (8%) (20%) (25%)
Slide 11: Third Quarter Service Highlights
THIRD QUARTER SERVICE HIGHLIGHTS Carload Trip Plan Performance Intermodal Trip Plan Performance 95.5% 96.2% 94.2% 94.0% 80.7% 80.5% 87.4% 82.5% 75.7% 73.0% 3Q19 4Q19 1Q20 2Q20 3Q20 3Q19 4Q19 1Q20 2Q20 3Q20 Trip Plan Performance measures success in meeting end-to-end customer commitments based on a s
Slide 12: Financial Review
FINANCIAL REVIEW Kevin S. Boone EVP and Chief Financial Officer
Slide 13: Third Quarter Earnings Summary
THIRD QUARTER EARNINGS SUMMARY Third Quarter Income Statement Dollars in millions 2020 2019 Variance Revenue $ 2,648 $ 2,978 (11%) Expense Labor and Fringe 574 638 10% Materials, Supplies and Other 378 407 7% Depreciation 348 338 (3%) Fuel 119 223 47% Equipment and Other Rents 88 85 (4%) Total Expen
Slide 14: Year-to-Date Cash and Free Cash Flow
YEAR-TO-DATE CASH AND FREE CASH FLOW Free Cash Flow Cash and Short-Term Capital Investments Before Dividends* Investments Balance Dollars in Millions Dollars in Millions Dollars in Millions $1,209 $2,783 $2,899 $1,191 $1,938 $1,954 Q3 2019 Q3 2020 Q3 2019 Q3 2020 Dec 31, 2019 Sep 30, 2020 YTD YTD YT
Slide 15: Closing Remarks
CLOSING REMARKS James M. Foote President and Chief Executive Officer
Slide 16: Looking Forward
LOOKING FORWARD Continue to monitor economic environment Focused on delivering best-in-class service while maximizing operating leverage Capital expenditure outlook remains at low end of initial $1.6-1.7 billion guidance Maintaining industry-leading free cash flow profile Incremental $5B s
Slide 17: Appendix
APPENDIX Non-GAAP Free Cash Flow Reconciliation
Slide 18: Non-GAAP Free Cash Flow Reconciliation
NON-GAAP FREE CASH FLOW RECONCILIATION Free Cash Flow Nine Months Ended Dollars in millions September 30, 2020 September 30, 2019 Net Cash Provided by Operating Activities $ 3,128 $ 3,737 Property Additions (1,209) (1,191) Other Investing Activities 19 237 Free Cash Flow Before Dividends (non-GAAP)
Slide 19: investors.csx.com
Csx INVESTORS.CSX.COM