CSX Corporation

All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, please press star followed by the number one on your telephone keypad. And if you would like to withdraw your question, please press star one. Thank you. Mr. Matt Korn, Head of Investor Relations, you may begin your conference.

Thank you, Krista. Hello, everyone, and welcome to our third quarter earnings call. Joining me this afternoon are Joe Henrichs, President and Chief Executive Officer, Mike Corey, Executive Vice President, Chief Operating Officer, Kevin Boone, Executive Vice President and Chief Commercial Officer, and Sean Pelkey, Executive Vice President and Chief Financial Officer. In the presentation accompanying this call, you will find our forward-looking disclosure on slide two, followed by our non-GAAP disclosure on slide three. And that is now my pleasure to introduce Mr. Joe Henrichs.

All right. Thank you, Matthew. And hello, everyone. Thank you for joining our conference call today. Over this last year, CSX mission and message have remained clear and consistent. We have seen great progress with our one CSX initiatives, which are helping to build a focused, collaborative culture that enables all of our employees to feel engaged, energized and focused on working better together. At the same time, our service levels continue to lead the industry. These successes go hand in hand. And as our customers see that CSX is truly dedicated to providing consistent, reliable service over the long term, they're responding positively. As we look forward to all the opportunities ahead, we are confident that these efforts we are making will drive clear, sustainable, profitable growth. And we took another step forward on this path this quarter. Thanks to the hard work put in by our one CSX team, our railroad is running well. Our merchandise business remained steady, and our cold shipments were very strong. Our domestic intermodal volumes are growing well compared to last year, while our international intermodal business, though down year over year, has stabilized. Overall, our network continues to perform, and I am pleased with how the team has succeeded in managing the things that we can control. I continue to be very excited about all the potential ahead for CSX. Now let's turn to slide five to review the highlights for the third quarter. First, we moved over 1.5 million car loads this quarter, which was down just slightly from a year ago, with flat year-over-year performance in merchandise and 9% growth in coal. Our operating ratio ticked up in the low 60s as we faced challenges that we had been talking about all year, with lower fuel recovery, reduced intermodal storage revenue, lower export coal prices, and higher costs for inflation, most notably with our labor contracts. As in previous quarters, our margin does include the impact of the quality carriers trucking business second we generate $3.6 billion in revenue, which was 8% lower in the previous year. The last year we benefited from high diesel prices and record export coal benchmarks that were both much lower this quarter. Third, even with the year-over-year changes we faced, operating income still came in at $1.3 billion for the quarter compared to a little under $1.6 billion last year. And our earnings per share were 42 cents down from 52 cents. I am proud of what we accomplished this quarter given all the challenges. None of us here are satisfied with these results. We're not sitting back and simply waiting for markets to turn. We are looking throughout the entire network to see where we can operate more efficiently. We continue to work closely with our customers to build our business pipeline and drive more volume onto the railroad. And we are emphasizing the importance of cost discipline to every team in every one of our locations. One of the reasons I am so confident about what is ahead for CSX is the great leadership team that we have in place. As you all saw last month, we were very pleased to announce that Mike Corey has joined our railroad as Chief Operating Officer. Mike brings great experience and a thorough understanding of Skid Row Railroading. And he also shares our deep dedication and appreciation for customer service and the employees who provide that service day in and day out. Mike arrived in Jacksonville a few weeks ago and is now here joining us on this call. And so I will now turn it over to Mike to say a few words and cover our operational performance over the quarter.