UPDATE 2-CSX profit beats estimates despite lower coal shipments
* Q3 shr $0.44 vs. $0.43 expected
* Q3 rev $2.89 bln
* Shares up 2.4 pct after hours
By Nick Zieminski
Oct 16 (Reuters) - Weaker domestic coal shipments hurt profit at U.S. railroad CSX Corp, which fell 2 percent in the third quarter despite growth in export coal and automotive shipments, but results beat estimates and CSX shares rose 2.4 percent after hours.
Net income for the No. 2 publicly-held U.S. railroad operator fell to $455 million, or 44 cents per share, in the third quarter from $464 million, or 43 cents per share, a year ago. The higher per-share figure reflected a stock buyback, CSX said.
Analysts, on average, expected a profit of 43 cents per share, according to Thomson Reuters I/B/E/S.
Lower labor, fuel and other expenses reduced overall costs by about $45 million. Lower volumes and more efficient use of locomotives offset slightly higher fuel prices.
Revenue dipped 2 percent to $2.89 billion, slightly below the average forecast of $2.93 billion.
Coal volumes slumped 16 percent in the quarter, and shipments of farm products such as corn and ethanol also fell. These offset higher shipments of food and consumer goods, chemicals and, especially cars.
Jacksonville, Florida-based CSX generates more than a quarter of its sales from coal shipments. It said economic conditions were moderating but it still expects stronger margins and profits for the full year.
CSX kicked off earnings season for U.S. railroads. It will hold a conference call will analysts before the market opens on Wednesday.
Earnings estimates came down after East Coast peer Norfolk Southern Corp warned about profits last month, citing weak coal shipments and lower fuel surcharge revenue. A shift to low-cost natural gas has boosted utilities' stockpiles of coal, reducing demand for additional supplies to generate electricity.
CSX, whose network stretches from Florida to Chicago and Boston, and connects with major ports, ships about twice as much domestic coal as it does coal for export.
CSX shares this year have outperformed the Dow Jones transports index and Norfolk Southern, but have lagged behind Union Pacific.
In after hours trading, CSX stock was up 2.4 percent at $22.15.
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