CSX Corporation Reports Modest Revenue Growth and Mixed Profitability in Q3 2024

CSX Corporation reported its financial results for the third quarter and nine months ended September 30, 2024, showing a modest increase in revenue and a mixed performance in profitability metrics compared to the previous fiscal period.

For the third quarter of 2024, CSX generated revenue of $3,619 million, a 1% increase from $3,572 million in the same quarter of 2023. The revenue growth was primarily driven by higher merchandise and intermodal volumes, alongside pricing gains in merchandise. Notably, the Chemicals segment saw revenue rise to $727 million from $646 million year-over-year. However, this was partially offset by a decline in coal revenue due to decreased global benchmark rates and lower fuel recovery.

Total expenses for the third quarter decreased by 2% to $2,265 million from $2,301 million in the prior year. This reduction was attributed to lower fuel costs, which fell by $73 million due to a 17% decrease in locomotive fuel prices, and a decrease in purchased services and other expenses. Operating income for the quarter increased by 7% to $1,354 million, resulting in an operating margin of 37.4%, up 180 basis points from the previous year. Net earnings for the third quarter rose to $894 million, compared to $828 million in the same period last year, with earnings per diluted share increasing to $0.46 from $0.41.

For the nine months ended September 30, 2024, total revenue reached $11,001 million, a slight increase from $10,977 million in 2023. However, operating income decreased to $4,139 million from $4,184 million, reflecting a 1% decline. Net earnings for the nine-month period were $2,737 million, down from $2,786 million in the previous year.

CSX's cash and cash equivalents increased to $1,644 million as of September 30, 2024, up from $1,353 million at the end of 2023. The company also reported a significant increase in total shareholders' equity, which rose to $12,936 million from $11,985 million, primarily due to net earnings and retained earnings growth.

Strategically, CSX completed a share repurchase program in November 2023 and initiated a new $5 billion program approved in October 2023, with $3.6 billion remaining as of September 30, 2024. The company also authorized a 9% increase in its quarterly cash dividend to $0.12 per share, effective March 2024.

Overall, CSX's performance reflects a combination of revenue growth driven by specific segments, cost management efforts, and strategic financial maneuvers, despite challenges in certain areas such as coal revenue and overall operating income for the nine-month period.