CSX CSX Corporation

By Patrick Thomas 

CSX Corp. reported a sharp increase in profit in the latest quarter as the railroad operator benefited from cost cuts and higher freight rates after a tumultuous 2017.

The Jacksonville, Fla., company said net income was $877 million in the second quarter, a 72% increase from the $510 million it earned in the same period a year ago.

CSX's revenue increased about 6% to $3.1 billion, boosted by higher volumes.

The results come after a year that included layoffs, management departures and widespread service disruptions that prompted Chief Executive Jim Foote to embark on an apology tour.

Mr. Foote took over the job shortly after former CEO Hunter Harrison died last December. Mr. Harrison had put in place a strategy to increase efficiency that included closing some freight yards and running trains on a tighter schedule. The changes contributed to bottlenecks across the railroad's network, and Mr. Foote visited customers earlier this year to promise improvements.

"The environment for us right now compared to where we were at the end of last year is dramatically different," Mr. Foote said in an earnings call. "In terms of the pricing environment and the capacity environment, it's a good time to be in the railroad business."

The company cut expenses by 8% from the previous quarter, and capital investments were down 14%. CSX had said at the end of the previous fiscal year that it was planning to cut costs by eliminating another 2,000 positions this year. After cutting 4,700 positions in 2017, CSX finished last year with 24,000 employees.

(END) Dow Jones Newswires

July 17, 2018 19:51 ET (23:51 GMT)

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