By Eric M. Johnson
March 1 (Reuters) - CSX Corp's CSX.O management team willprovide investors on Thursday with the railroad's longer-termplan for boosting profitability and streamlining operationsfollowing the death of Chief Executive Officer Hunter Harrison.
Harrison, a favorite of investors for leading turnarounds oftwo Canadian railroads, died in December just eight months intoan overhaul that included shutting multiple rail yards, deep jobcuts, mothballing locomotives and running trains on tightschedules rather than based on customer needs.
The new CEO, Jim Foote, and his management team are due toaddress investors at a conference in New York on Thursday, whereinvestors will be eager for details on how much work is left tobe done.
The railroad said earlier this month it would substantiallylower its operating ratio - a closely watched measurement ofprofitability – to 60 percent by 2020 from 67.9 percent atyear-end 2017. The operating ratio is a measure of operatingexpenses as a percentage of revenue.
CSX shares have risen about 50 percent since January 2017 and about 12 percent since March 2017 after Harrison took overas CEO following a high-stakes push by activist investor PaulHilal of investment fund Mantle Ridge LP. CSX's share growth has come with depleted rail service.Many rail customers have seen persistent service disruptions anddelays that have raised shipping costs.
Several shippers have told Reuters that service has beensteadily improving from a nadir last summer, although companieslike U.S. agricultural firm Cargill Inc CAG.UL and coalcompany Murray Energy Corp are still struggling with crew andrail car shortages. L2N1QG1IE