CSX Corporation · NASDAQ:CSX
CSX — Bear Stearns Global Transportation Conference 2007
17 slides from CSX's conference presentation, May 8, 2007
Slide 1: CSX Corporation Bear Stearns Global Transportation Conference May 2007
CSX Corporation Bear Stearns Global Transportation Conference May 2007
Slide 2: Forward Looking Disclosure
Forward Looking Disclosure This presentation and other statements by the Company contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to, among other items: projections and estimates of earnings, revenues, cost-savings, expenses, or other
Slide 3: CSX has created significant shareholder value
CSX has created significant shareholder value Stock Performance Indexed: Year-end 2004 = 100 250 225 200 175 150 125 100 75 Dec-2004 Dec-2005 Dec-2006 CSX S&P 500 Dow Jones Transports delivering. CSX 3
Slide 4: Stock performance reflects improving results
Stock performance reflects improving results Surface Transportation Operating Income $902M $1,064M $1,549M $1,958M 2003 2004 2005 2006 Surface Transportation Operating Ratio 87.9% 86.8% 82.0% 79.5% 2003 2004 2005 2006 Note: Excludes provision for casualty claims, management restructuring and insuran
Slide 5: First quarter earnings call conveyed . . .
First quarter earnings call conveyed . . . Earning power continuing to improve despite softer economy Dynamic environment propelling long-term financials above 2006-2010 targets Maintaining double-digit growth on higher base Stronger results creating new investing opportunities Continue balanced use
Slide 6: Double-digit growth targeted on higher base
Double-digit growth targeted on higher base Operating Income Dollars in Billions $1.5 $2.0 10%-12% CAGR 2005 2006 2007 2008 2009 2010 Earnings Per Share $1.70 $2.22 15%-17% CAGR 2005 2006 2007 2008 2009 2010 Note: Excludes debt repurchases expenses, insurance recoveries, gain on Conrail property and
Slide 7: Operating ratio improving further
Operating ratio improving further Surface Transportation Operating Ratio 87.9% 86.8% 82.0% 79.5% Mid-low 70’s 2003 2004 2005 2006 2007 2008 2009 2010 Note: Excludes provision for casualty claims, management restructuring and insurance recoveries delivering. CSX 7
Slide 8: Stronger returns on targeted investments
Stronger returns on targeted investments Return on Invested Capital Improving 7% 9% Exceed COC 2005 2006 2007 2008 2009 2010 Capital Investment Dollars in Billions $1.06 $1.43 $1.47 $1.60 $1.63 $1.65 2005 2006 2007 2008 2009 2010 Note: Core surface transportation capital only. 2006/2007 exclude Katr
Slide 9: Capital investment is strategic and focused
Capital investment is strategic and focused Chicago New York Charlotte Atlanta Jacksonville Orlando Miami Tampa New Orleans Infrastructure spending supports safety/reliability Facility, locomotive and car spending support growth Technology supports safety and productivity Overall spending supports c
Slide 10: Tight capacity and strong service drive pricing
Tight capacity and strong service drive pricing Tight Capacity Future Highway Congestion CSX Territory + Strong Service On-time Originations 51% 76% 80% 84% 2005 2006 2007 2008 = Pricing Strength “Same Store Sales” Price Increase 5.7% 6.6% 6-7% 5-6% Pricing environment strong through 2008+ 2005 2006
Slide 11: New targets established through 2010
New targets established through 2010 2007-2010 CAGR Surface Transport Operating Income 10%-12% Earnings Per Share 15%-17% Operating Ratio Mid-low 70’s ROIC Exceed COC Set goals Create plans Execute and Monitor Progress Consistent continuous improvement Note: Growth target for Free Cash Flow remains
Slide 12: Balanced use of cash drives further value
Balanced use of cash drives further value Growing Free Cash Flow and Improving ROIC Capital Investment Dividends Share Buybacks Focused, strategic investment for long-term growth Competitive yields reflecting improving earning power Supported by free cash flow and leverage . . . While maintaining an
Slide 13: Recent actions reinforce shareholder focus
Recent actions reinforce shareholder focus Expanded Share Buyback Program to $3.0 Billion Consistent with capital structure objectives Represents 15% of current market capitalization Targeting year-end 2008 completion Tripled Annualized Dividend Since 2005 $0.20 $0.26 $0.40 $0.48 $0.60 Q3 Q4 Q3 Q1 Q
Slide 14: Wrap up . . .
Wrap up . . . Substantial shareholder value being delivered Core earning power now growing from higher base Operating ratio improving to mid-low 70’s by 2010 improving returns with focused capital investment Capitalizing on long-term transportation environment delivering. CSX 14
Slide 15: GAAP Reconciliation Disclosure
GAAP Reconciliation Disclosure CSX reports its financial results in accordance with generally accepted accounting principles (“GAAP”). However, management believes that certain non-GAAP financial measures used to manage the Company’s business that fall within the meaning of Regulation G (Disclosure
Slide 16: GAAP Reconciliation Calculation
GAAP Reconciliation Calculation Dollars in million, except per share amounts 2003 2004 2005 2006 Surface Transportation Operating Revenue $7,446 $8,040 $8,618 $9,566 Surface Transportation Operating Expense $6,795 7,047 7,069 7,440 Surface Transportation Operating Income $651 $993 $1,549 $2,126 Plus
Slide 17: CSX Corporation Bear Stearns Global Transportation Conference May 2007
CSX Corporation Bear Stearns Global Transportation Conference May 2007
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