Slide 1: 2024 Second Quarter Conference Call
2024 SECOND QUARTER CONFERENCE CALL 8.5.2024
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 Joe Hinrichs President and Chief Executive Officer
Slide 5: Second Quarter Financial and Operational Highlights
Second Quarter Financial and Operational Highlights +2% +5% 39.1% +280 bps Total Volume Intermodal Volume Operating Margin Q/Q Op Margin Growth Revenue Operating Income Earnings Per Share $3,699M $3,681M $3,701M $1,466M $0.49 $0.49 $1,448M $1,337M $0.45 +1% Q/Q Increase +8% Q/Q Increase +9% Q/Q Incr
Slide 6: Operations Review
OPERATIONS REVIEW Mike Cory Executive Vice President and Chief Operating Officer
Slide 7: Second Quarter Safety Highlights
Second Quarter Safety Highlights FRA Personal Injury Frequency Index 1.25 Safety is a core principle at CSX 1.20 1.05 0.91 0.71 Injury rate is a key area of focus Positive improvement in our accident rate as CSX fosters a fundamental safety culture Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 centered on effective
Slide 8: Emphasis on Improving Key Metrics and Network Design
Emphasis on Improving Key Metrics and Network Design MPH Train Velocity 20 Velocity improved compared to last year 2Q23 Avg: 17.7 18 2Q24 Aligning dwell with customer service needs Avg: 18.2 and cost 16 14 Identifying specific, strategic infrastructure 2Q23 3Q23 4Q23 1Q24 2Q24 opportunities to reduc
Slide 9: Customer Service Metrics Remain Consistent and Favorable
Customer Service Metrics Remain Consistent and Favorable Intermodal Trip Plan Performance Carload Trip Plan Performance 100% 100% 2Q23 90% Avg: 84.5% 2Q24 95% Avg: 80.3% 2Q23 Avg: 95.6% 2Q24 80% 90% Avg: 94.2% 70% 85% 60% 80% 50% 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 Customer Switch Data
Slide 10: Sales & Marketing Review
SALES & MARKETING REVIEW Kevin Boone Executive Vice President and Chief Commercial Officer
Slide 11: Merchandise Volume & Revenue Summary
Merchandise Volume & Revenue Summary Q2 Merchandise Revenue 2H24 Expectations $2,296M Merchandise volume sustained by ramping of $2,196M business wins, customer engagement, and strong operational execution +5% ‒ Positive market trends supporting Chemicals, Forest Products, and Ag & Food Q2 23 Q2 24
Slide 12: Coal Volume & Revenue Summary
Coal Volume & Revenue Summary Q2 Coal Revenue 2H24 Expectations $637M Export coal volumes supported by strong $563M operational flexibility and steady demand ‒ Curtis Bay fully operational at end of May (12%) ‒ Pricing reflective of modest easing of global benchmarks Q2 23 Q2 24 Domestic coal somewh
Slide 13: Intermodal Volume & Revenue Summary
Intermodal Volume & Revenue Summary Q2 Intermodal Revenue 2H24 Expectations $492M $506M International intermodal stabilizing, supported by strong import activity, favorable partnerships +3% Potential for modest domestic intermodal improvement, benefiting from incremental modal conversions, expanding
Slide 14: Financial Review
FINANCIAL REVIEW Sean Pelkey Executive Vice President and Chief Financial Officer
Slide 15: Second Quarter Earnings Summary
Second Quarter Earnings Summary Second Quarter Income Statement Dollars in Millions 2024 2023 Variance Revenue $3,701 $3,699 Flat Expense 2,253 2,233 (1%) Operating Income $1,448 $1,466 (1%) Interest Expense & Other Income - Net (181) (170) (6%) Income Tax Expense (304) (312) 3% Net Earnings $963 $9
Slide 16: Second Quarter Expense Comparisons
Second Quarter Expense Comparisons Labor & Fringe Purchased Services & Other Depreciation & Amortization $805M $721M $410M $410M $404M $748M $766M $699M $691M $39M Decrease $22M Decrease Flat ($18M) Increase ($8M) Increase ($6M) Increase Q2 23 Q1 24 Q2 24 Q2 23 Q1 24 Q2 24 Q2 23 Q1 24 Q2 24 Fuel Equ
Slide 17: Second Quarter Cash Flow and Distributions
Second Quarter Cash Flow and Distributions Free Cash Flow Shareholder Economic Profit Before Dividends* Distributions (CSX Cash Earnings)* In Millions In Millions In Millions Buybacks Dividends $1,528 $448 $1,435 $1,930 $1,268 $1,150 $468 $810 Q2 23 YTD Q2 24 YTD Q2 23 YTD Q2 24 YTD Q2 23 YTD Q2 24
Slide 18: Closing Remarks
CLOSING REMARKS Joe Hinrichs President and Chief Executive Officer
Slide 19: Full Year 2024 Guidance Update
Full Year 2024 Guidance Update ▪ Low to mid-single digit total volume and revenue growth in 2H 2024 – Continued opportunities across Merchandise, Intermodal and Export Coal ▪ Profitability supported by solid pricing, improving efficiency, and lower cost inflation – Favorable set-up for strong increm
Slide 20: Appendix: Non-GAAP Reconciliations
APPENDIX Non-GAAP Reconciliations
Slide 21: Non-GAAP Free Cash Flow Reconciliation
Non-GAAP Free Cash Flow Reconciliation Free Cash Flow Six Months Ended Dollars in millions June 30, 2024(a) June 30, 2023(a) Net Cash Provided by Operating Activities $ 2,173 $ 2,473 Property Additions (1,066) (997) Proceeds and Advances from Property Dispositions 43 52 Free Cash Flow Before Dividen
Slide 22: Non-GAAP Economic Profit Reconciliation
Non-GAAP Economic Profit Reconciliation Economic Profit Six Months Ended (a) Reflects adjustment of prior period financial statements; see form 10-Q for details. Dollars in millions June 30, 2024(a) June 30, 2023(a) (b) Unusual items are defined by management as Operating Income $ 2,785 $ 2,913 uniq
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