CSX Corporation

Thank you for standing by. My name is Jael, and I will be your conference operator today. At this time, I would like to welcome everyone to the CSX Corporation third quarter 2024 earnings conference call. 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, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. I would now like to turn the conference over to Matthew Korn, head of investor relations and strategy. You may begin.

Thank you, operator. Hello, everyone, and good afternoon. Welcome to our third quarter earnings call. Joining me on this call are Joe Hendricks, president and chief executive officer, Mike Corey, executive vice president and chief operating officer, Kevin Boone, executive vice president and chief commercial officer, and Sean Pelkey, executive vice president and chief financial officer. Accompanied in this call and available on our website, you will find slides with our forward-looking disclosures and our non-GAAP disclosures for your review. That is my pleasure to introduce Mr. Joe Hendricks.

All right. Thank you, Matthew, and hello, everyone, and thank you for joining our third quarter call today. First, I want to thank our entire OneCSX team who have been tireless in helping our employees and their communities recover from the hardships caused by two hurricanes in a matter of weeks. Helene, in particular, had a big impact on our network, and we'll talk more about that today. We have largely recovered, and we have made sure that CSX has been there to support our railroaders who have needed assistance for themselves and their families. That said, there's more work that we will need to do to repair and replace some of the physical infrastructure that we lost, which Mike and Sean will discuss later on this call. Stepping back and looking at this entire quarter, I am proud of what we accomplished. Our aim was to grow volume, revenue, and operating margin compared to last year, and that is exactly what we delivered. Our merchandise franchise continues to grow at an impressive pace, benefiting from our service leadership and the numerous initiatives that Kevin and his team are pursuing to bring new business to CSX. Operationally, our efficiency and cost controls remain solid, but we are still only getting started with some of the ways that we are using valuable real-time data to optimize our network. We have had our challenges. This quarter, we had to adapt and respond to significant weather events. Equipment issues at our coal terminal and lower diesel prices. Throughout, we've kept our focus on our long-term goal to deliver consistent, sustainable, profitable growth over time. Now let's go over some of the highlights. On slide one, it shows our key results from our third quarter compared to last year. Despite the severe weather, we were still able to post some very good results across the company. Looking across the highlights listed on this top line, total volume grew by 3% versus last year. led by strong performance in our core merchandise business, where volume also grew by 3%. Merchandise revenue grew by an impressive 6%, supported by 3% growth in volume and favorable pricing. Our operating margin reached 37.4%, inclusive of our trucking business, and improved 180 basis points compared to last year, demonstrating strong year-over-year expansion as our guidance indicated. Now, these charts summarize a solid quarter for CSX. Total revenue reached over $3.6 billion for the quarter, up 1% from the same period last year, even with lower fuel surcharge and coal prices. Operating income increased by 7% compared to last year, as we delivered strong internal margins from top-line growth and cost control. Earnings per share grew by 12%, supported by solid results for the business and our commitment capital returns. Our results this quarter demonstrate strong execution as we build powerful momentum behind our proven operating model. We remain motivated as a team, keeping in mind that I've told you since I joined CSX over two years ago, talented people working together as one CSX team with a common goal can accomplish just about anything. Now I'll turn the call over to Mike to provide details around our operational performance.