A CURENT ARTICLE ON TRAINS NEWS WIRE PAINTS A PRETTY GLOOMY PICTURE OF CSX.
A fast search of MSN brought this link up: http://news.moneycentral.msn.com/provider/providerarticle.aspx?Feed=BW&Date=20071016&ID=7636507
An English Investor group/stockholder takes CSX's CEO Mike Ward to task as an over compensated, self-interested, and his railroad only leads the American railroad industry in the area of executive compensation.
"The inescapable conclusion is whatever CSX is doing, it could be doing it better and its competitors, in fact, are. Since Michael Ward was appointed CEO, the gap in operating ratio between CSX and both Norfolk Southern and Canadian National, the industry leaders, has actually widened. Yet somehow the Board has found it acceptable to make Michael Ward the highest compensated CEO in the industry over the past two years. We must question the Board's judgment." {quoted from the above link}
And from time to time in this Forum there have been comments about CSX's corporate culture in employee relations; sometimes equated to the "Attilla the Hun" management approach. One of the last paragraphs in the above link seems to confirm the same:
"Yet, in our experience, and those relayed to us by others, CSX management has too often taken an 'us versus them' approach, resulting in tension instead of solutions. We strongly urge the Board and management to re-evaluate this adversarial approach, as workers will be more productive, shippers more accommodating, and shareholders more understanding if management fosters an open, collaborative and constructive relationship with all of them. All of our interests should be, largely, aligned." {quoted from above link}
[I purposly stayed away from the website "CSX SUCKS.com" as it seems to add nothing but annecdotal individual ax grinding.]
I don't see where this article says CSX is in financial troubled waters. Not at all.
What I get from it is that a 4 percent shareholder (British) believes it should be receiving bigger dividends and seeing CSX stock price rise and it is calling upon CSX to somehow cut expenses so more profit goes to the shareholders. Huh. What a surprise.
IMHO this is a lot of gum flapping, but it also may be a fishing expedition to see if any other large shareholders might be interested in pooling resources in advance of a buyout or hostile takeover. If the fund would like to have stock performing like that of some of the other Class 1s, it should dump its CSX stock and use the monies to buy BNSF or UP shares.
If there is the employee morale problem at CSX that the fund alleges, most of it would go away quickly if CSX upped its pay scale and hired more employees. But that flies in the face of cutting expenses to increase profit, right?
http://seekingalpha.com/article/50516-ubs-can-t-see-a-downside-for-csx-investors?source=yahoo
When it comes to finances...Figures Lie and Liars Figure. Give 10 Finance analysts a book of figures on a company and you will get 10 different assessments on the financial health of the company....each has their own axe to grind.....
Never too old to have a happy childhood!
Poppa_Zit wrote: I don't see where this article says CSX is in financial troubled waters. Not at all.What I get from it is that a 4 percent shareholder (British) believes it should be receiving bigger dividends and seeing CSX stock price rise and it is calling upon CSX to somehow cut expenses so more profit goes to the shareholders. Huh. What a surprise.IMHO this is a lot of gum flapping, but it also may be a fishing expedition to see if any other large shareholders might be interested in pooling resources in advance of a buyout or hostile takeover. If the fund would like to have stock performing like that of some of the other Class 1s, it should dump its CSX stock and use the monies to buy BNSF or UP shares. If there is the employee morale problem at CSX that the fund alleges, most of it would go away quickly if CSX upped its pay scale and hired more employees. But that flies in the face of cutting expenses to increase profit, right?
Csx increased their profits by deferred maintenance(which the FRA is looking into now).and instead of hiring they are laying off personel.now it takes longer for crews to switch out cars and more trains are waiting for crews.makes me wonder
stay safe
Joe
Deshler Ohio-crossroads of the B&O Matt eats your fries.YUM! Clinton st viaduct undefeated against too tall trucks!!!(voted to be called the "Clinton St. can opener").
CSX has just reported their earnings are up, as traffic has dropped, relieving congestion.
http://www.theglobeandmail.com/servlet/story/LAC.20071017.RTICKER17-3/TPStory/?query=csx
nanaimo73 wrote: CSX has just reported their earnings are up, as traffic has dropped, relieving congestion.http://www.theglobeandmail.com/servlet/story/LAC.20071017.RTICKER17-3/TPStory/?query=csx
Dale, TCI is run by a bunch of slightly-radical, activist hedge fund guys. Not to be taken seriously.
JoeKoh wrote: Poppa_Zit wrote: I don't see where this article says CSX is in financial troubled waters. Not at all.What I get from it is that a 4 percent shareholder (British) believes it should be receiving bigger dividends and seeing CSX stock price rise and it is calling upon CSX to somehow cut expenses so more profit goes to the shareholders. Huh. What a surprise.IMHO this is a lot of gum flapping, but it also may be a fishing expedition to see if any other large shareholders might be interested in pooling resources in advance of a buyout or hostile takeover. If the fund would like to have stock performing like that of some of the other Class 1s, it should dump its CSX stock and use the monies to buy BNSF or UP shares. If there is the employee morale problem at CSX that the fund alleges, most of it would go away quickly if CSX upped its pay scale and hired more employees. But that flies in the face of cutting expenses to increase profit, right? Csx increased their profits by deferred maintenance(which the FRA is looking into now).and instead of hiring they are laying off personel.now it takes longer for crews to switch out cars and more trains are waiting for crews.makes me wonderstay safeJoe
B I N G O, NO BINGO WAS NOT HIS NAME OH!
Jo you hit the hammer on the nail. The company continues to hire more and more people and as soon as they complete training they lay them off. Jobs are now through the modernization process going to RCO's, however what used to require 2 men on a certain job, now has been cut back to one.
As far as I can tell, we are to continue to hold for the next round of UTU/Common Carrier Conductor Contracts. The "OLD HEADS" are holding on before comitting to retirement in hopes of having their contracts bought out for cash. Then we have the issue with different terminals requiring track upgrades within each corridor. Personally, I would say the reason for the third quarter profit being high is because the company laid off all of its new hires for late 2006 and all of 2007.
In the mean time myself and the rest of the guys that got hired and now laid off, must draw a little employment and hope that it dosen't run out before we are called back.
Poppa_Zit wrote: nanaimo73 wrote: CSX has just reported their earnings are up, as traffic has dropped, relieving congestion.http://www.theglobeandmail.com/servlet/story/LAC.20071017.RTICKER17-3/TPStory/?query=csx Dale, TCI is run by a bunch of slightly-radical, activist hedge fund guys. Not to be taken seriously.
P.Z. and Dale, and Joe: 'The Children's Fund' letter enclosed in the link I posted intimates that it is the Corporate Board of CSX and It CEO Ward who are misgoverning the CSX Corp. They note as Joe noted that there is a culture at CSX of adversarial labor relations and as I noted a culture of 'screw' the middle to lower end employees.[ my2cents]
Essentially, as Papa Z noted the Corporation still put fourth a rosey financial picture, but the English investor group contends that an insipient corporate culture of financial shenigans is threatening the business of CSX. The posted letter on my link is a long but pretty interesting link. I was hoping to get a good discussion going. Thanks for your responses.
One of the entities that was questioning CSX's ability to manage itself was actually questioning the higher amounts recently earmarked for maintenance and infrastructure. That, IMHO, is one thing that CSX has finally gotten right.
Carl
Railroader Emeritus (practiced railroading for 46 years--and in 2010 I finally got it right!)
CAACSCOCOM--I don't want to behave improperly, so I just won't behave at all. (SM)
Poppa, your statement does not seem to relate to my statement.
"CSX has just reported their earnings are up, as traffic has dropped, relieving congestion."
Well TCI says that CSX is spending too much money on capital improvments, not too little. As for laying off people, traffic IS down, not just on CSX but all railroads. I agree that this is nothing but crap from some people that are not interested in the success of CSX as a company, but CSX as a stock.
An "expensive model collector"
nanaimo73 wrote:Sam, I'm not sure treatment of employees has a lot to do with financial results. CSX will never match NS's or CN's results because they have a bowl of spagetti for a route structure. They really need to concetrate on the line south of Richmond and get it running smoothly.
DALE:
The treatment of employees seems to be a part of a larger corporate culture of ridding roughshod over the troops, and would contribute to a poorer attitude as it goes down the line. As for CSX along side the other Class Ones, You are right, they are way down on the pecking order. TCI makes an acknowledgement of that in their letter. NS and CN are definitely leading CSX in multiple catagories of performance.
My feeling is that with all the different mergers that make up the current system, they have somehow failed to make the operation gel into a cohesive unit.
Their Southern and Southeastern lines, especially the one ,you mention from Richmond south, is a major capacity problem, and has been. They originally had parallel lines that gave them options, but when they tore up the ACL in northern North Carolina, they shot themselves in the foot.
I personally feel that the problems in their upper management are on-going, and CEO Ward was given a pretty good hand-off on those issues, by John Snow, and his predecessor [Can't remember his name] the guy who engineered the CSX Conrail debacle.
nanaimo73 wrote: Poppa_Zit wrote: nanaimo73 wrote: CSX has just reported their earnings are up, as traffic has dropped, relieving congestion.http://www.theglobeandmail.com/servlet/story/LAC.20071017.RTICKER17-3/TPStory/?query=csx Dale, TCI is run by a bunch of slightly-radical, activist hedge fund guys. Not to be taken seriously.Poppa, your statement does not seem to relate to my statement."CSX has just reported their earnings are up, as traffic has dropped, relieving congestion."
My meaning was that even though the earnings are up, it will never be enough to please everyone, especially the professional aristarches. Maybe I got ahead of myself.
samfp1943 wrote: nanaimo73 wrote:Sam, I'm not sure treatment of employees has a lot to do with financial results. CSX will never match NS's or CN's results because they have a bowl of spagetti for a route structure. They really need to concetrate on the line south of Richmond and get it running smoothly.DALE: The treatment of employees seems to be a part of a larger corporate culture of ridding roughshod over the troops, and would contribute to a poorer attitude as it goes down the line. As for CSX along side the other Class Ones, You are right, they are way down on the pecking order. TCI makes an acknowledgement of that in their letter. NS and CN are definitely leading CSX in multiple catagories of performance.
I might add the that the 'roughshod' employee treatment was imported from NS in the form of Tony Ingram and David Brown....The top two operating officers.
J. Edgar wrote:IMHO...as an ex CSX employee......the line has been waffeling ever since Snow and Carpenter left....and again IMHO csx is experiencing the samething PennCentral faced in the late 60's....major trackage in a major declining area...namely MI
Thanks to Chris / CopCarSS for my avatar.
http://www.progressiverailroading.com/prdailynews/news.asp?id=11561
Link says CSX doing just fine
Murphy Siding wrote: J. Edgar wrote:IMHO...as an ex CSX employee......the line has been waffeling ever since Snow and Carpenter left....and again IMHO csx is experiencing the samething PennCentral faced in the late 60's....major trackage in a major declining area...namely MIIn your opinion, was CSX doing OK when Snow and Carpenter were there?
from a finaincal point of view ....yes.....200 million on the B&O re-double tracking...almost 50 million in new engines....and upto the conrail merger the debt load was low.....the OR wasnt as good as say a BNSF but they paid dividends....granted from an operation point of view they crapped out but thats the difference between a true railroader and a corp. bossman
Some hedge fund ninnies whining about CSX not making them rich certainly doesn't mean that CSX is having financial issues. It is simply having issues with an activist shareholder who opens its mouth to demand cash. Sort of like a mini corporate raider...
LC
BaltACD wrote:TCI also desire the company do incur an increased level of debt, with the proceeds of that to benefit TCI.
TCI also desire the company do incur an increased level of debt, with the proceeds of that to benefit TCI.
Bingo! TCI wants to do an equivalent of an LBO without going through the whole process of a buyout. As discussed a few months back on another thread, the rail industry is cyclical enough that debt financing is a BAD idea.
Poppa first and then others following had this pegged from the start. This all began with a news release from the activist hedge fund people that was specifically timed to coincide with CSX's announcement of increased earnings.Thias is common practice to get free cheap publicity for a fund that is always looking for additional invesment capital.The thread-starter must have misinterpreted what he read and then slapped a misleading title on it.
Chico
CS_heX wrote:As my dear papa said before going to join our maker: Whenever you are unhappy because you didn't get what you want, be dang thankful that you don't always get what you deserve, either."
Your signature picture is misleading....that particular bridge incident occured on the Union Pacific that was operating their local with a CSX engine. That is not a CSX incident.
(The bridge was in Richardson, Texas IIRC)
The TCI nonsense is why you try to keep "Wall Street Trash" out of the boardroom or decision making process in any publicly held corporation. They do not know better, they are not altruistic (as in protecting the best interests of the company) and they are most certainly in it to line their pockets at the company's expense and then bail out when the going gets bad.
As a recent indication of the Wall Street mentality: Caterpillar is a well-run profitable firm with substantial worldwide sales. When its third-quarter earnings, while quite good, were lower than predicted earlier (in part because of the housing bust), its stock dropped appreciably.
n012944 wrote:CSX is spending too much money on capital improvments, not too little. As for laying off people, traffic IS down, not just on CSX but all railroads. I agree that this is nothing but crap from some people that are not interested in the success of CSX as a company, but CSX as a stock.
Actually, it says :
TCI believes shareholder value is created through sustainable investment in maintenance, infrastructure and training. TCI is concerned that management's current illogical and undisciplined capital spending plan puts at risk CSX's ability to invest long-term because it undermines shareholder confidence and therefore access to capital.
So you see, that is not what they said at all. What they are saying is that the mismanagement of the company is leading to poor decision-making in where the capital is invested. What I see here is that many people on this board distrust "wall st" (in quotes because it's a british firm, not a NY firm). I do as well but from what I can tell, TCI is right on the money. They are not recomending asset stripping, nor are they saying it shoudl be run for wall st alone. Of course they aren't altruistic, but nobody is let alone CSX's management. It's not that they are in trouble financially now, but TCI is alleging that they are setting themselves up for a fall in the long term. The point about Buffett is especially salilent, as he generally invests in longer term trends (as opposed to the Wall St mentality). They also point out that the board is unqualified:
Refresh the Board with new independent directors.The fund says that only one independent CSX directorhas some railroad background, but not a singleindependent director has direct railroad managementexperience, leaving the board unable to crediblychallenge management.
I have a friend who works for Amtk up in Albany and he says disgruntled CSX workers are banging down the door to get hired on there.
Suburban Station wrote: n012944 wrote:CSX is spending too much money on capital improvments, not too little. As for laying off people, traffic IS down, not just on CSX but all railroads. I agree that this is nothing but crap from some people that are not interested in the success of CSX as a company, but CSX as a stock.Actually, it says : TCI believes shareholder value is created through sustainable investment in maintenance, infrastructure and training. TCI is concerned that management's current illogical and undisciplined capital spending plan puts at risk CSX's ability to invest long-term because it undermines shareholder confidence and therefore access to capital. So you see, that is not what they said at all. What they are saying is that the mismanagement of the company is leading to poor decision-making in where the capital is invested. What I see here is that many people on this board distrust "wall st" (in quotes because it's a british firm, not a NY firm). I do as well but from what I can tell, TCI is right on the money. They are not recomending asset stripping, nor are they saying it shoudl be run for wall st alone. Of course they aren't altruistic, but nobody is let alone CSX's management. It's not that they are in trouble financially now, but TCI is alleging that they are setting themselves up for a fall in the long term. The point about Buffett is especially salilent, as he generally invests in longer term trends (as opposed to the Wall St mentality). They also point out that the board is unqualified: Refresh the Board with new independent directors.The fund says that only one independent CSX directorhas some railroad background, but not a singleindependent director has direct railroad managementexperience, leaving the board unable to crediblychallenge management.I have a friend who works for Amtk up in Albany and he says disgruntled CSX workers are banging down the door to get hired on there.
This was exactly the reason for posting this topic; reading this Forum, there seem to be TWo schools of thougt where CSX is concerned--You either love 'em, or hate 'em.
The only other carrier that seems to generate those kinds of passion is Union Pacific--
Right, Lord Atmo? There was some of that ire towards NS when the discussions about their locomotive toilet issues came to light. '
The Children's Fund' seems to have some pretty impressive credentials, when you read about their past activities with other investments on some of the business news services. Make no mistake, I know that their altruism extends no farther than their own vested interests, but where CSX is concerned, there seems to be a common thread that comes thru, in most stories about their Corporation.
Derailments, Personnel issues, and their dealings with Customer Service issues, and that is management somehow missed the call in reading a situation, and its ramifications--In my opinion, seem to point to an upper-level of management who is out of touch with the very operation they are managing. Even in this Forum, there seems to be that kind of intimation as well. These are the kinds of issues that the letter from 'TCF' to the CSX Board of Directors points out.
It is a kind of interesting topic; as with this issue, the various individual takes seem to be all over the map as well.
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