CSX’s Q3 2016 Earnings Review: Cost Reduction Partially Offsets Impact Of Lower Revenue
CSX reported an 8% year-over-year decline in its earnings per share in Q3, with top line headwinds negatively impacting the company’s profits. However, lower volume-related expenses and the impact of CSX’s cost reduction initiatives partially offset the impact of the decline in revenue on the company’s results, with the company’s operating ratio (operating expenses as a percent of revenue) deteriorating by only 70 basis points. Lower shipment volumes, primarily as a result of a decline in the demand for coal from utilities amid an environment of weak natural gas prices, translated into an 8% decline in CSX’s Q3 shipments. In addition, lower fuel prices negatively impacted the company’s fuel surcharge revenue. CSX’s operating expenses declined 7% year-over-year in Q3, with lower volume-related expenses (including fuel) and the company’s cost reduction initiatives together mitigating the negative impact of lower revenue on results, as illustrated below:
- Is There Any Room For Growth In CSX Stock After An Upbeat Q1?
- What’s Next For CSX Stock After A 12% Rise Last Year?
- What Next For CSX Stock After A 19% Fall In Q3 Earnings?
- Should You Pick Humana Over CSX Stock For The Next Three Years?
- CSX’s Top Line To Decline In Q2?
- Will CSX Stock Recover To Its Pre-Inflation Shock Level?
Have more questions about CSX? See the links below.
- What Is CSX’s Revenue And EBITDA Breakdown?
- What Is CSX’s Fundamental Value Based On 2015 Results?
- By What Percentage Did CSX’s Revenue & EBITDA Grow In The Last 5 Years?
- How Has CSX’s Revenue Composition Changed Over The Last 5 Years?
- By What Percentage Can CSX’s Revenue & EBITDA Grow In The Next 3 Years?
- How Will CSX’s Revenue Composition Change By 2020?
- What Would Be The Impact Of A 100 Basis Points Increase In CSX’s Share Of U.S. Rail Intermodal Shipments?
- CSX: A Look Back At The Year 2015
- CSX’s Q1 2016 Earnings Preview: Decline In Shipment Volumes And Fuel Surcharge Revenue To Negatively Impact Results
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