Greater efficiency, higher rates sent CSX's 4th-quarter...

BY THE NUMBERS

January 03, 1991|By John Gormley

Greater efficiency, higher rates sent CSX's 4th-quarter net income up 3.2%

CSX Corp., a Richmond, Va.-based transportation company, posted a 3.2 percent increase in net income during the quarter that just ended, as greater operating efficiencies and higher rates allowed the company to increase its profits despite a downturn in the nation's economy.

Net income for the fourth quarter was $129 million, or $1.31 a share, compared with $125 million, or $1.25 a share, for the same quarter last year.

CSX Transportation Inc., the railroad unit that forms the core of the CSX's business, was the primary reason for the improved performance.

"The railroad's strong showing this quarter demonstrates the effectiveness of its management team in controlling costs and reducing expenses," said John W. Snow, president and chief executive officer. "Emphasis on operating efficiency enabled it to perform well despite higher fuel prices and a weakening economy."

The improved earnings exceeded the expectations of most Wall Street analysts.

Jeffrey S. Medford, who follows CSX for Wheat First Securities, said the company's results for the fourth quarter indicate the its strategy of emphasizing margins and rates rather than market share is succeeding.

"They are moving in the right direction," Mr. Medford said. "They've done a very good job in improving the performance," despite what he called "not an easy environment."

The company reported that rail revenues increased about 2 percent for the quarter, even though traffic, as measured by car loadings, declined about 2 percent.

For the year, the company's net income fell to $4.15 a share, about 4 percent less than the $4.34 a share posted in 1989.

However, all of the CSX transportation units actually showed improved performances for the year, according to the company.

After adjusting the figures to eliminate non-recurring gains and charges, earnings per share rose 19 percent, from $3.36 in 1989 to $4 in 1990, the company said.

CSX stock closed at $31.75 yesterday, unchanged.

Three months ended 12/31/90

..........Revenue........ Net........ Share

'90. 1,944,000,000 ..129,000,000... 1.31

'89 .1,759,000,000 ..125,000,000... 1.25

% change... +10.5......... +3.2....... +4.8

12 months ended 12/31/90

.........Revenue......... Net........ Share

'90.. 7,390,000,000.. 416,000,000.. 4.15

'89.. 6,876,000,000.. 452,000,000.. 4.34

% change... +7.5........... 8.0........ 4.4

Rite Aid Corp.

This Shiremanstown, Pa.-based drugstore chain operator and retailer of discount auto parts and books reported that sales for third quarter, which ended Dec. 1, were $858,244,000, an 8.4 percent increase over the $791,716,000 in the 1989 third quarter.

Income from continuing operations, however, reached a record $21,576,000, or 52 cents a share, up from $4,100,000, or 10 cents a share, for the year-earlier period, the company said in a statement.

In the third quarter of 1989, Rite Aid took a $22 million, one-time, pretax charge to earnings for a provision to close its video rental departments. Those discontinued operations had income of $18,370,000, or 44 cents a share, during the year-earlier quarter, the statement said.

Year-to-date sales increased 8.6 percent, to $2,514,936,000, from $2,315,196,000 during the nine months of 1989. Income from continuing operations during the three quarters of 1990 was $68,300,000, or $1.65 a share, up from $67,107,000, or $1.62 a share, during the same period a year ago. The latter figures include income from discontinued operations of $20,165,000 or 49 cents per share.

Three months ended 12/01/90

.............Revenue....... Net........... Share

'90..... 858,244,000 ...21,576,000...... $0.52

'89..... 791,716,000... 22,470,000...... 0.54

% change.... +8.4........... 4.0............ 3.7

Nine months ended 12/01/90

............Revenue........ Net ...........Share

'90... 2,514,936,000... 68,300,000 ......1.65

'89... 2,315,196,000... 67,107,000...... 1.62

% change..... +8.6.......... +1.8.......... +1.9

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