Slide 1: 2020 Second Quarter Earnings Conference Call
2020 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 1,257K Revenue $2,255M Operating Income $828M Operating Ratio 63.3% EPS $0.65 Earnings Per Share Operating Ratio $1.08 63.3% 57.4% $0.65 40% Decline 590 bps Increase 2019 2020 2019 2020 5 2020 CSX SECOND QUARTER EARNINGS CONFERENCE CALL
Slide 6: Second Quarter Revenue Highlights
SECOND QUARTER REVENUE HIGHLIGHTS All Markets Negatively Impacted by Second Quarter Revenue Economic Effects of COVID-19 Down 26% Percent Year over Year Chemicals decreased due to lower shipments of industrial chemicals, energy, and waste Chemicals (10%) Agricultural & Food Products declined due
Slide 7: Second Quarter Safety Highlights
SECOND QUARTER SAFETY HIGHLIGHTS FRA Personal Injury Frequency Index 1.13 1.16 Safety is a guiding principle at CSX 0.83 0.85 0.59 Frequency rates increased on lower volumes; lowest total number of train accidents in a quarter 2Q19 3Q19 4Q19 1Q20 2Q20 FRA Train Accident Rate Remain focused on
Slide 8: Second Quarter Operating Highlights
SECOND QUARTER OPERATING HIGHLIGHTS Train Velocity Cars Processed per Hour Worked (miles per hour) 21.3 21.2 21.2 11.6 20.0 20.3 11.1 10.8 10.5 10.5 2Q19 3Q19 4Q19 1Q20 2Q20 2Q19 3Q19 4Q19 1Q20 2Q20 Terminal Car Dwell Gallons of Fuel per kGTM (hours) 1.01 8.7 8.9 8.9 0.99 8.4 8.3 0.99 0.98 0.96 2Q19
Slide 9: Adjusted Resources in Response to Lower Volumes
ADJUSTED RESOURCES IN RESPONSE TO LOWER VOLUMES Change in Volume and Key Resources Since March 1, 2020 Rolling 7-Day Averages 5% Volume Active Locos Total Starts Road Starts 0% (5%) (10%) (15%) (20%) (25%) (30%) (35%) 3/1 3/8 3/15 3/22 3/29 4/5 4/12 4/19 4/26 5/3 5/10 5/17 5/24 5/31 6/7 6/14 6/21 6/
Slide 10: Second Quarter Service Highlights
SECOND QUARTER SERVICE HIGHLIGHTS Carload Trip Plan Performance* Intermodal Trip Plan Performance* Carload Intermodal 95.5% 96.2% 94.2% 94.0% 89.8% 82.5% 80.7% 80.5% 74.4% 75.7% 2Q19 3Q19 4Q19 1Q20 2Q20 2Q19 3Q19 4Q19 1Q20 2Q20 *Trip Plan Performance measures success in meeting end-to-end customer c
Slide 11: Financial Review
FINANCIAL REVIEW Kevin S. Boone EVP and Chief Financial Officer
Slide 12: Second Quarter Earnings Summary
SECOND QUARTER EARNINGS SUMMARY Second Quarter Income Statement Dollars in millions 2020 2019 Variance Revenue $ 2,255 $ 3,061 (26%) Expense Labor and Fringe 507 648 22% Materials, Supplies and Other 407 445 9% Depreciation 344 337 (2%) Fuel 91 234 61% Equipment and Other Rents 78 92 15% Total Expen
Slide 13: Year to Date Financial Measures
SECOND QUARTER YEAR TO DATE FINANCIAL MEASURES Free Cash Flow Cash and Short-Term Capital Investments Before Dividends* Investments Balance Dollars in Millions Dollars in Millions Dollars in Millions $801 $1,628 $2,594 $769 $1,386 $1,731 Q2 2019 Q2 2020 Q2 2019 Q2 2020 Jun 30, 2019 Jun 30, 2020 YTD
Slide 14: Closing Remarks
CLOSING REMARKS James M. Foote President and Chief Executive Officer
Slide 15: Looking Forward
LOOKING FORWARD Continue to monitor pace of recovery from May trough Adjust resources as needed to optimize network to prevailing economic environment ― Deliver high quality service product to customers ― Leverage structural cost savings created in the second quarter Expect capital expenditure
Slide 16: Appendix
APPENDIX Non-GAAP Free Cash Flow Reconciliation
Slide 17: Non-GAAP Free Cash Flow Reconciliation
NON-GAAP FREE CASH FLOW RECONCILIATION Free Cash Flow Six Months Ended Dollars in millions June 30, 2020 June 30, 2019 Net Cash Provided by Operating Activities $ 2,184 $ 2,267 Property Additions (801) (769) Other Investing Activities 3 130 Free Cash Flow Before Dividends (non-GAAP) $ 1,386 $ 1,628
Slide 18: investors.csx.com
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