Net income was up in the first quarter of 2002 at two major railroads serving North America, though one had much of its income wiped out by accounting charges.
Richmond, VA-based CSX Corp. said its net earnings of $25 million this quarter topped the $20 million it earned in the same period last year. However, CSX's earnings were eliminated after it took a $43 million charge to cover the adopting of new accounting standards this year.
Still, CSX chairman & CEO John Snow said the company's business is improving, especially in the intermodal arena, where it competes with long-haul trucking.
"All of our businesses performed well in a struggling economy. Our railroad and intermodal operations, which are the core of CSX today, continue to produce higher year-over-year earnings," he said.
Snow added that CSX revenues for this quarter were $1.96 billion vs. $2.03 billion a year ago. However, operating earnings for its rail and intermodal businesses jumped up to $194 million vs. $182 million a year ago. Overall, revenues were down 3% and carloads were 4% lower than in the first quarter of 2001, he said.
Canadian National (CN) also reported healthy first-quarter 2002 results, with net income rising to $144.9 million from $127.2 million in the same quarter of 2001. CN originally reported $173.2 million in net income for the first quarter of 2001 from the sale of its interest in the Detroit River Tunnel Company but had to restate those numbers due to accounting changes.
CN president & CEO Paul M. Tellier said CN had double-digit gains in earnings and earnings per share on an adjusted basis, with cash flow rising to $120.9 million from $24.5 million for the same period of 2001. The acquisition of Wisconsin Central – part of CN's growth strategy – also played a key role in increasing revenue for CN's automotive, forest products, petroleum and chemicals units.
Tellier added that CN's intermodal unit experienced a 1% decrease in revenues, mainly from losing freight headed overseas, losses partly offset by continued increases in the Canadian domestic segment.