JACKSONVILLE, Fla. (AFX) - Railroad operator CSX Corp. said Tuesday that second-quarter earnings more than doubled year-over-year on hefty insurance gains and tax benefits.
In addition, the company declared a 2-for-1 stock split, raised its dividend and authorized a $500 million stock buyback plan.
CSX said net income surged to $390 million, or $1.66 per share, from $165 million, or 73 cents per share, last year. The latest quarter includes gains of 50 cents per share from Katrina-related insurance recoveries and tax benefits, compared with the year-ago period which included hefty debt repurchase costs that were partially offset by a state income tax benefit.
Excluding items, earnings rose 21 percent to $1.16 per share from 96 cents per share a year ago.
The company posted revenue of $2.4 billion, representing a 12 percent increase from the second quarter last year.
The results were a penny ahead of Wall Street's 15-cent consensus estimate, and revenue topped analysts' estimate of $2.38 billion.
'These financial gains are a result of momentum in our operations, improvements in productivity and service, and our ability to capture price in a strong market environment,' said Michael J. Ward, chairman and CEO.
Based on its strong performance and balance sheet, CSX said its board approved a 2-for-1 stock split and a quarterly dividend of 10 cents per share on the post-split stock, representing a 54 percent increase. The board also authorized a $500 million share buyback program that the company intends to complete over the next 12 months.
The stock split is effective Aug. 15 for all shareholders of record on Aug. 3. The post-split quarterly dividend will be paid on Sept. 15 to shareholders of record as of Aug. 25.
CSX said the repurchase plan can begin on July 24. Under the program, the company may purchase shares from time to time on the open market, through block trades or otherwise.
CSX shares rose $1.57, or 2.5 percent, to close earlier at $65.42 on the NYSE. Shares fell $1.33, or 2 percent, to $64.09 in aftermarket electronic trading.
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