CSX 3rd-qtr profit beats, shares rise

CHICAGO (Reuters) - CSX Corp (CSX.N), the No. 3 U.S. railroad, reported a stronger-than-expected quarterly profit on Tuesday and said it believed the "worst of the recession is likely behind us," sending its shares higher in afterhours electronic trading

The company reported third-quarter net income from continuing operations of $293 million, or 74 cents a share, compared with $380 million, or 93 cents a share, a year earlier.

On that basis, analysts expected the company to report a profit of 71 cents a share, according to Thomson Reuters I/B/E/S.

CSX said revenue in the quarter fell 23 percent to $2.3 billion, in line with analysts' expectations.

CSX shares rose 2.3 percent in after-hours trade.

The Jacksonville, Florida-based company said that while freight volumes continued to decline during the quarter, "the rate of decline continued to slow in nearly all markets compared to the second quarter."

The largest decline in volume came in metals shipments, where the global downturn has translated into weak demand from the automotive and construction industries. But CSX said the decline in demand moderated during the quarter due to low inventories and "an improvement in automotive production."

CSX said its expenses dropped $537 million, thanks, in part, to dramatically lower fuel costs.

The company said it spent on average about $1.88 a gallon on fuel in the quarter, down from $3.57 a gallon last year.

(Reporting by James B. Kelleher, editing by Matthew Lewis)