8-KRegulation FD

CSX CORP 8-K Report, Regulation FD Disclosure (Sep 7, 2011)

Filed September 7, 2011For Securities:CSX

Summary

CSX Corporation (CSX) filed an 8-K on September 7, 2011, to disclose remarks made by its Executive Vice President and CFO, Oscar Munoz, at the Dahlman Rose & Co. Global Transportation Conference. The primary focus of the disclosure was to reaffirm the company's positive long-term financial guidance, which includes expected compound annual growth rates of 18-20% for EPS and 12-14% for operating income through 2015, using 2010 as a base year. Additionally, CSX reiterated its target of achieving a 65% operating ratio by 2015. While long-term prospects remain strong, supported by the economic and environmental advantages of rail transport, the company acknowledged some near-term impacts from a moderating domestic and global economy. Specifically, projected export coal volumes for the current year were revised to a range of 40 to 42 million tons. The company also indicated that its operating ratio for the current year, while expected to be at a record level, might slightly exceed the high-60's target.

Key Highlights

  • 1CSX reaffirmed its long-term financial guidance, targeting 18-20% EPS compound annual growth rate through 2015 (base year 2010).
  • 2The company also confirmed its commitment to a 12-14% operating income compound annual growth rate through 2015.
  • 3CSX reiterated its strategic goal to achieve a 65% operating ratio by no later than 2015.
  • 4Near-term economic moderation has led to revised projections for export coal volumes, now expected to be between 40-42 million tons for the current year.
  • 5The company anticipates its current year operating ratio may slightly exceed the high-60s target, despite expecting a record level.
  • 6CSX expressed continued confidence in its long-term outlook, citing the inherent economic and environmental benefits of rail and its diverse market portfolio.

Frequently Asked Questions

CSX affirmed its long-term financial guidance, targeting a compound annual growth rate of 18% to 20% for earnings per share and 12% to 14% for operating income, both measured against 2010 results and projected through 2015.

CSX reiterated its target of achieving a 65% operating ratio by no later than 2015. However, for the current year (2011), the operating ratio is expected to be at a record level but may slightly exceed the high-60's target due to moderating economic conditions.

Yes, CSX noted that a moderating domestic and global economy is impacting near-term performance. This includes a revised projection for export coal volumes, now expected to be between 40 to 42 million tons for the current year.

CSX remains confident in its long-term prospects, emphasizing that customers continue to benefit from the economic and environmental advantages of using rail transportation. The company also points to its broad market portfolio and proven ability to achieve strong results across different economic environments as supporting factors.