CSX Cuts FY Earnings Outlook

(RTTNews) - CSX Corp. (CSX) said that it cut its earnings outlook for the year as coal volumes continue to slump amid cheap natural gas prices, causing a transition in the energy markets.

The company now expects full-year earnings per share growth to be about three percent, which still includes an anticipated fourth quarter property sale worth about five cents per share. Previously, the company targeted mid-single digit full-year earnings per share growth as intermodal growth and efficiency initiatives offset about $450 million in coal revenue declines.

"While we continue to expect to move around 30 million tons of export coal for the full year, domestic coal movements have declined more significantly in the fourth quarter than expected," Chief Financial Officer Frank Lonegro said at the Credit Suisse Global Industrials Conference in Palm Beach, Florida.

CSX said it continues to expect meaningful margin expansion in 2015 and a mid-60s operating ratio longer term. That performance is delivered in a dynamic environment in which low commodity prices and the strength of the U.S. dollar have impacted many of the markets served by CSX, especially coal.