CSX Corp. saw its third-quarter earnings fall 23% from the comparable period a year ago due to the continued effects of the economic slowdown. CSX earned $293 million in the third quarter on revenue of $2.29 billion, also down 23%. But earnings of 74 cents per share still beat Wall Street consensus estimates of 71 cents per share for the quarter.
The performance contributed to a strong performance by CSX shares Wednesday, up 5.76%, or $2.55, to $46.83 in midafternoon trading on the New York Stock Exchange.
Though CSX cautioned that demand for coal will remain weak well into next year, it also noted that the decline in third-quarter volume wasn't as steep as had occurred in the second quarter of 2009, suggesting that freight traffic losses were nearing a bottom. "The third quarter reinforces our view that the worst of the recession is likely behind us," Chairman, President and CEO Michael J. Ward said in a statement.
CSX offset some slower business in the third quarter by drastically cutting expenses, resulting in a 24% decline in total operating costs. Fuel costs were less than half what they were a year ago. The company said "pricing remained strong and consistent with prior quarters," although it made less money per unit of freight than it did at the same point last year.