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Class 1 freight railroad CSX Corp. on July 16 reported second-quarter net earnings of $870 million, or $1.01 a share, compared with $877 million, or $1.08 a share — a 1% dip from the same period a year ago.
Revenues for the Jacksonville, Fla.-based railroad also declined 1%, to $3.06 billion compared with $3.1 billion a year ago. The company’s operating ratio fell to a quarterly record of 57.4 from 58.6, CSX reported. Operating ratio, or operating expenses as a percentage of revenue, is a crucial industry metric used to measure efficiency. The lower the ratio, the greater the company’s ability to generate a profit.
The railroad said its expenses decreased by 3% from the second quarter of last year to $1.76 billion from $1.82 billion in 2018 as the carrier seeks to improve overall efficiency.
Labor costs dropped by $21 million, fuel costs fell $36 million, and equipment and rental costs decreased by $9 million. Depreciation increased by $8 million, and equity earnings of affiliates went up $9 million.
“I am extremely proud of our dedicated CSX employees for once again achieving new record levels of efficiency this quarter while also driving a significant improvement in safety,” CEO James Foote said. “These results reflect the strength of our operating model, and combined with continued improvements in our best-in-class customer service, represent significant progress toward our goal of being the best-run railroad in North America.”