Railroad profits down with weak coal demand
Railroad operators CSX Corp. and Norfolk Southern Corp. Tuesday both reported quarterly earnings down because of continued weak coal demand.
But both companies beat Wall Street expectations.
The Jacksonville, Fla.-based CSX reported net income of $443 million, or 43 cents per share, in the last three months of 2012. That's down 3 percent from $457 million, or 43 cents per share, in the previous year's quarter.
CSX says its revenue declined 2 percent to $2.9 billion from $2.95 billion a year earlier. It says declines in coal shipments more than offset gains in intermodal and merchandise shipments.
Analysts surveyed by FactSet expected CSX to report earnings of 39 cents per share on revenue of $2.84 billion.
Norfolk Southern Corp.'s fourth-quarter profit fell 14 percent because coal shipment revenues dropped 23 percent. The railroad reported its quarterly profit was $413 million, or $1.30 per share, at the end of 2012. That's down from $480 million, or $1.42 per share, a year earlier.
Its quarterly revenue dipped to $2.68 billion from the previous year's $2.8 billion.
According to FactSet, analysts had expected Norfolk Southern to post earnings of $1.19 per share on $2.67 billion in revenue.
Norfolk Southern CEO Wick Moorman says increases in shipments of chemical, automotive and housing-related materials helped partially offset the coal decline.