OMAHA, Neb. (AP) — CSX Corp.'s second-quarter profit improved 5 percent on lower costs, even though the number of shipments the railroad delivered declined slightly.
Shares rose as earnings beat analyst expectations, even though revenue dropped 6 percent to $3.06 billion, a steeper decline than Wall Street had expected.
Total volume at CSX Corp., which operates more than 21,000 miles of track in 23 Eastern states and two Canadian provinces, slipped 1 percent. Coal revenue fell another 15 percent to $630 million.
Crude oil shipments, which have been a growth area for railroads in recent years, increased modestly, but shipments of fracturing sand declined in the quarter, indicating reduced drilling activity.
Controlled expenses helped profit. The railroad's expenses fell 9 percent to $2.05 billion as fuel costs dropped to $263 million from last year's $416 million.
"I think management did a pretty solid job in light of the headwinds we're seeing," said Edward Jones analyst Logan Purk.
CSX officials maintained their forecast for mid-to-high single-digit earnings per share growth in 2015.
The Jacksonville, Florida-based railroad said Tuesday that it generated $553 million net income, or 56 cents per share, in the second quarter. That was up from $529 million net income, or 53 cents per share, last year.
Revenue fell to $3.06 billion from $3.24 billion.
CSX's profit beat the 53 cents per share that analysts surveyed by Zacks Investment Research were expecting, but revenue fell short of the forecast of $3.14 billion.
The railroad's shares gained $1.11, or 3.5 percent, to $33.18 in after-hours trading Tuesday.
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