CSX (CSX) 25 Jan 232022 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by. My name is Lisa, and I'll be your conference operator today. At this time, I would like to welcome everyone to the CSX Corporation Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions]

Before beginning, the Company would like to remind you that the forward-looking disclosures have been provided on slide 2, and non-GAAP disclosures are on slide 3.

to Joe call Hinrichs. like President to now CEO, and would turn over the CSX I

You begin may your call.

Sean Boone, Hello, joining everyone, on views Boychuk, our Kevin our and update on our for we and Jamie initial conference call. quarter excited and I'm here you thank to Pelkey, and you the share year. are results with upcoming

challenges work want and diligently in of CSX and as to been employees first has for through faced our all that very run performance to customers uncertainties all the behalf we XXXX. on their they network thank of efforts, safely our I has strong. financial dedication Because our our continued

Coast my accomplished labor last many make unions. out over the of colleagues bolts difference reached railroads solution finalized a to I And a on in at nuts four positive our our the have employees' the for field, joined the customers, in lot We big life. agreements started our and to make attendance This the and visits with updates with policies Amtrak. our investors visit our since and to We we our inventory government, a we our partners to months the quality Gulf for Company.

very I show trend upward in am service real this our quarter particularly to continued starting proud And progress month. a clear the are to metrics improvement we fourth continue pleased report throughout that fall. after into this the early

more time. successes us capture better service allow customer anticipated, over to our deliver hiring with business that As allowed have to us we more will volume

leveraging and this are focused railroad. on momentum, our operating industry-leading model we growing Looking building on forward, our

we I you the ahead share great answer all for opportunities your get believe that CSX. across energy the we go a details and organization the the and optimism As of that through sense of will questions,

from $X.X strong other revenue. operating Operating billion higher to storage previous X.X our the year. in billion XX.X%. from quarter. X% in the carloads for over fuel benefited the turn was and CSX pricing, and fourth revenue, review year higher to ratio our full to core let's Revenues quarter and generated up surcharges, Now, X% presentation on $X.XX the income highlights year-over-year million increased the and

you $X.XX. Quality OR. trucking XXX reminded our we've XX% Carriers our increased adds basis to roughly As per before, business to share Earnings points

at our revenues looking of $XX year Quickly compared XX% XXXX. full XXXX, up were billion to nearly the almost

billion X%. full year of $X Our operating increased income

operating with the Operating Excluding XX.X% real estate our our with grew in the Virginia, for transaction from line double-digit guidance Commonwealth gains for income XXXX growth. XXXX. of the was ratio

share per in earnings $X.XX. XXXX Finally, to XX% increased

Kevin, over me let to details. Jamie turn Now, Sean for it and

you, Thank Joe.

to slide X. Turning

quarter, Merchandise decline a a X% volume. revenue increased than as X% in in revenue more X% increase offset unit per the in

volume. year, increased combined full increasing the surcharge as For lower X% X% pricing year. merchandise merchandise on an with growth by XXXX inflation was driven revenue through the fuel accelerated environment higher

strength service. weaker by This year, opportunity have scores. where is to as customers in solid This gains our XXXX, we to customer by significant share we be in service into customers. year. plastics opportunities offset the partially growth housing-related led with growing chemical and leverage as domestic improvement improving we customer to for We for network start likely overall have seen volume growth year, see export as growth industry-leading and is merchandise forward continued our reflected and the surveys to began the business we respond Looking satisfaction a expect in we our momentum significant in shipments automotive, recent our

increase markets. X% on quarter the met grow unit. fourth on per volumes in thermal a lower and Full year increased unit. X, both, coal revenue coal you expect XXXX, export X% XX% to revenue and volume XX% revenue we slide per increase XX% In revenue increase higher a in in volume On see and can X%

indexes So, positive benchmark China's decline the impact we XXXX. reopening. We're do about demand optimistic expect from of of to elevated the potential averages

side, met this coal ton have While supply coming a new on X we year. the million online mine

We lap issues, some and volume Mobile anticipate at Curtis limitations CSX-served reduced including also production opportunity mines export we terminals. as capacity and the at XXXX Bay

by low -- averages. volumes domestic expect remain We stockpiles thermal to below low be be historical driven that

readily benefit as dispatch allow U.S. steel on from U.S. inventory natural reduce higher better to stress industry volatility which and the utilities will in recovery levels to production, as a drives coal the well automotive consumption power capacity Healthy demand. to gas grid. respond to more domestic infrastructure

slide to increase in more quarter decline than revenue unit offset in X. revenue as turning volumes. increased X% X% per intermodal X% Fourth a Now a

first and For declined increase year, on Imports revenue continue markets seen XXXX. by elevated the be revenue flat full volumes due levels. negatively inventory a in to increased International have half activity, XX% warehouses to of the unit. impacted per continue XX% looks to which likely into have intermodal slowing

the us, opportunity these conversions, To initiatives. this, pursue as pursuing has our we on trucking market we truck-to-rail initiatives new business, opportunities see to them softened. markets. solutions team new help customers The domestic largely even bring and focused and more the to now several intermodal is help equipment reach counter existing are to With our behind with team constraints to accelerating has

to and drive those seeing team is great to customers a of the of that and job these spend identifying transportation are doing more are We building this new drive to intermodal rail. strategies relationships The to opportunities their existing adopt growth.

slide Finally, moving to XX.

emissions. in role reducing Let's discuss customers' CSX's our

rail's markets to promoting truck-to-rail pursue our actively the serve, we we customers. advantages environmental conversions are we As across

for measurable their the level supply customers board opportunity trucks to for looking choose reduce provides These are initiatives are own our chain. and over ways savings increasingly entire emissions. the We rail across to real,

need our million keep customers dioxide XX CSX advantages XXXX, to we continue carbon choosing emissions tons ship by customers, with To In versus CSX an of to avoided emitting innovating. truck. providing for

best-in-class to are exploring that of are fuel like only efficiencies. new emerging at We zero delivering but can CSX we that technologies and future the technologies implemented piloting in not the savings be zero, should provide forefront keep

a our priority. Providing insights freight our platform I'm provide help to to launch calculator by also will customers customers about quarter. the updated to to incremental carbon convert we rail will that visibility and in additional utilizing them identify excited first is the

an recognition priority forward Lastly, our year. a received for this we of several on have slide. us several are in industry listed the proud It to our CSX projects underway leader of stewardship, we the on efforts, we more to environmental and has sustainability is sharing details with the look for remain throughout awards

to to discuss it over Now, operations. turn Jamie let me

Kevin, afternoon, good and you, everyone. Thank

priority and our the top remains has Safety service foundation restoration. at CSX been for our

row, a ended during in quarter the personal without a shown year onboarding As runs improved life-changing were second versus safety the and for prior slide, X,XXX results flat and the this culture new importantly, our The rate unchanged ONE we on frequency the year that for year. train from full underscores the conductors Most increased from event. quarter These accident the year. index with year deep third the workforce. FRA CSX our was over delivered the within but injury third

at out to most importance of operating terminals classroom, with in experienced we true impactful in the a department given on X,XXX human culture working accomplishment, focus more recognize the a safety record factor our of experienced our day incidents. operating safely train need safety within history. within recent continue learned reflected will locomotives among and are which instill department, training nature This I our in the and new of hires is commitment work. reduce lessons year accidents CSX's hires, but maintain discipline over on emphasize the CSX. and the to performance culture set and ahead, we employees. the occur for the day to safely number the Now in like interactions employees their daily ballast-level that These the the would lowest to engineering our employees the In and in

Moving to slide. next the

the has levels see around of at trend reached with can the improvement Even success a thresholds. locations service dwell intermodal many the of third sequentially the middle hit that quarter our compliance entire meaningful in You points driving team had staffing the as and with trip clear the percentage plan emerging year, the velocity the towards up key temporary quarter, XX%, several and end our in carload. for both of down XX% by average from was fourth improved weather was

This trend to progress into not stopped has towards pre-pandemic XXXX of late continuing crossed levels we service as early with XXXX. metrics water XXXX and high our

service fluidity network on are network, Our shows delivering team to reliable our will customers on and onto our improving shift encourage consistent, well that we business data and our that the focused way. a is

our resources a conductor minutes long-stated of promotions level the Now training our this pipeline employees. has turning allow quarter in to momentum fourth achieve few robust A the active the Getting X,XXX team discussed Joe over service over to XXX hiring. goal driven ago. to T&E

to continue improved will into We support XXXX. service

forward, locations expect Going for to headcount to offset and continuing key hiring active we with stabilize attrition. targeted T&E

I will the turn to over to it discuss financials. Sean

Jamie, you, and afternoon. good Thank

more slide. quarter outpaced to line detail that next X% increased in the gain as income results, financial I fourth $X.X at on discuss billion revenue operating Looking X% and will increased several top headwinds expense

to a prior favorable tax XX.X% and quarter other taxes. $XX compared Interest deferred expense rate million was year the increased $X income in and as to the effective million. expense favorable state of The tax by adjustments was result

to from which be quarter continues real up top Operating XX.X%. X%, $X X% were gains. for net billion, adjusting XXXX X-point grew by earnings the income estate resulting highlighted Fourth Virginia in growth expected transaction, to results growth XX%. rate when Our impact going tax year Full of XX% while XX%. forward a increased was includes EPS these line

Total of slide most the increased due fourth expense will somewhat Let's Labor million costs, was driver increased continue million expense to and near fourth higher higher headcount partially additional $XXX as year, compared now to due to and driven inflation. offset improve. fringe to prior primarily wage the quarter expense. PS&O increased turn Fuel the closer terminal compensation. primarily look operating expense a elevated by take million, at to incentive $XX lower were quarter operations higher as and fuel support $XXX inflation and impacts million of $XX by the costs prices. term significant which remain and next

Depreciation increased running a also quarterly ongoing from the impact included and and is about about to by in $XX which completion $XX technology the study. million inventory the write-offs. of inflation PS&O an of includes $XX million expense periodic equipment million of X% related quarter, obsolete quarter around

approximately As and $XX a gains million. a prior in result on flat relatively up of depreciation year the net year XXXX. versus was higher study will million be increased rents $XXX Equipment dispositions full and expense this and property asset base,

are have always a leverage we for small to looking While likely opportunities we'll estate, few real gains. excess

storms efficiency XXXX at pay expenses were fourth point. inflation to at expect in terminal in we quarter, the activity aren't the strong during incurred headcount, XXXX, We costs, other as sales elevated and better end this throughout period. of Overall, the part expecting $XX million deliver overtime fluidity increased was significant of any and winter cost reduces slightly expenses. above congestion-related cost Despite and that

cash $XXX fully focus prior the year $X.X results from returned After free well $XXX share Now billion funding as billion million shareholders million flow capital we strategic flow $X.X to than on on turning more additional cash over $XXX over $XXX and in XX. including of million reliability our for on dividends. Operating and $X.X executing $XXX earnings, but high-return continued offsetting XXXX, network, of Full in repurchases as nearly was adjusting long-term needs, decreased higher for approximately capital both, cash transaction. year identifying above our slide billion projects. investing Virginia approximately flow to of increased million of million the spend

including a and We year cash strong exited position, investments. of liquidity sheet the short-term $X.X and billion with balance

to we Looking shareholders. returning and to balanced remain to cash committed a approach opportunistic forward, excess

With me for to turn his it closing that, Joe back remarks. let

Sean. you, Thank

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slide For top across quite operating us, based is see of on really principles you X philosophy simple it the that XX. the

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business. customers healthy If growing all you and the can't world deliver a in won't service your cost well reliably, control the

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at a And with We goal. have collective principles clear, our have tremendous we talent map, road here. these

our review as XX. a for shown with 'XX of outlook conclude slide let's on Now,

achieve year, coal, service Kevin year, and by largely which as said, believe we recovered. over merchandise do our volume and growth, growth have GDP contributions overall particularly will levels First, to that the the keep volume have slowed That retailer as levels for half discussed. expect international of improving, first the imports be is intermodal as from real outpace to soft, inventory we driven strong likely

for favorable remains environment pricing the Next, us.

agreements. a and Our our line to cost customers of performance. said, couple will which inflation labor for the substantial including transparency That our helped face has we there This our have agreements, effects things of own that note we understand experienced are support XXXX. as renew recent pressures, us pricing top the important

We First, to reduction of million revenues to last currently would from seen through see we in the storage it as to is reasonable do conditions intermodal intermodal quarterly believe we year decline expect imply year, XXXX. storage $XXX expect in chain compared will which a average supply improve. levels revenue approximately a close to early

benchmarks fall, have year this sits Second, from XXXX likely their impact RPU in will is coal today. It Australia will of our at and volatile. $XXX international that lows our met coal coal year-over-year, $XXX averaged roughly met revenue. which remained recovered but be last quality and average the lower total High

we that we and through makes we that make sense, costs will will we of is the in efficiency carrying it to we Now have better it period. effort know to some post-pandemic of Where congestion realize operationally. gains regarding extra possible reduce profitability, face resource cost that can been and constraints manage the but where and XXXX, pressures get every

In depend our the in volume through our leverage. potential largely and network performance end, driving realizing on margin will success our operating more

additional opportunities, estimate driven truck Finally, high-return and equipment to inflation. projects spending investing our Am, rail for Carriers full billion, to Pan increase a year the approximately that $X.X strategic capital of effects by will we growth Quality expenditures of conversion for in

of is a CSX close, ONE be time we team. of to part it what emphasize to want I an for all before us Now, exciting the

this are and toward to updating making as people ahead, opportunities look goal real the put have the year. am I throughout We into I progress common are achievements we grow we about you to the railroad, and and place. very that that seeing personally on you goal resources profitably a optimistic forward the

you. we Thank your take that, And with now will questions.

of comes the Bank. Amit Thank from first you. question our that, Instructions] line with Deutsche Mehrotra [Operator With

a Thanks, supplemental will guess, standing I on kind today, wanted say headwind. this basis somewhat fuel kind it yield ask be year. of if of be that of yields revenue basis? costs the operator. of would a kind in cost flattish think of fair net offset on Hi, to for consolidated about can and be you. is everyone. are kind just guess, be flat, of And the revenue here I you remind can to the Obviously, to maybe a us the Sean, that of you I system inflation? Thank reversed some

is this Yes. Amit, Sean.

the of at of little think just of a little coal levels terms headwind yields, bit pressures a mix, merchandising versus least expectation in fuel as So, we the lower little with some a Joe our half We'll first laid positive potentially intermodal, basis the specifically a perhaps bit the looking the the coal. comparison of on relative that bit well. yield record year, of here I sort side, on the to a in last out on in have at growth expect

yield the that's So, story.

the down Certainly, in and as a the hung have to costs, the should becoming cycle reduction out as like spinning We good freight here. and as already, see again. should able times that then, spend categories. to fluid in things the the rents car assets start now. moves costs terms maintenance of we're come right and way crews then more ancillary some service very delays I see with think We and some in shape terminals last year locomotive of are traffic our overtime they up terminals its there's improve of of faster getting related in system and costs the different And number intermodal with

improvement say would I we where categories this few expect a ought year. are some those So, to

-- sort a but about of efficiencies I inefficiencies? some of numbers mean, know I those $XX that, quantification in quarter, you've though? any any talked around terms of around Sean, -- million

number, going we in that of I some going be those specific find extra the carried both think, mean, I business. to that as across to headwinds, to No of efficiency to we And range. goal our no. the have out X% last inflation as continuing taking costs we're is gains through probably well much X% to as right? offset can, year as

with next from Justin take We'll question Long our Stephens.

There this the moving of outlook. pieces lot are year in a

income? if the if And get just both was trend directional year, the throughout comment any or going could color just for you could you operating revenue curious could on line things I thoughts. you're are Would additional give maybe like So, look and what year-over-year on change that worse? better us anticipating love some to

Yes.

we're the Justin, half, look specific in the half. than get to first in not going guidance you bit volume coal half of are at terms itself. the first comps on the second little second a in half, tougher When

In of about some on drivers big talked intermodal, here Those little terms a on bit seeing of half side the the the headwinds volume the of the the of sort really are in first year. Kevin international we're side.

of terms than half of was second for in revenue, year, obviously, half million first XXXX. higher that $XXX then, of other the coming about And down XXXX

going facing which there. we factors, we've got given XXXX, the we're be given great going merchandise headcount need, operating of in to that And gains the I we we headwind and a in missed the bigger got in that right? need grow sort some We're in product that above to think we'll and is the of why ability GDP. that we've see So of we think terms service to we've where coal. is, assets recapture share the about I some our income, of out feel laid overall

a got flip opportunities estate got the about. piece, and I've real revenue the we few other lower environment. cost gains. supplemental that, strong the We've We've side talked revenue, of headwinds higher between on the that And depreciation a have probably price

growth So, strong those it are I being that add incremental we margins. expecting growth. that as to But that we're fact system, said, at factors. the think going And are we the to the add

Oglenski next Brandon question Barclays. from from We'll take our

here a know So, we've now, I I that only the was of heard that year for real limitation plus Joe. guess, piggybacking headcount, And there, a more pretty January. through couple there I maybe off strongly answer but start been here you've and data, delivering. quarter resources as you're mean levels we that come importantly, out and fourth seeing service that in I think, the in we're the quarters

your how I the going in to maybe to right carriers. the other So, you're convert can you wrong think that closely even for growing together and that in Kevin working challenges lead growth talk op Because places more teams past, places? we've ensure to come that. and And you're seen how to in are the the can Jamie,

Yes. Thanks, Brandon.

Joe. -- think is I this

for the pretty recognizing into off, significant operating seeing and First continuing service that thanks performance improvements January. we're

great Our team together. works

them you each want that and the how you levels more and it's day them what they're we were conversation comes Jamie worth, that the of run talk talking running next the to of long. pandemic, are strong referenced, the our some some for be is about team. a affected seeing, fact and network, the challenges Kevin, their operating which just it where referenced for network game as So to then offices been performance there's this way I'll to clearly, prior very was from we're fluidity manpower and the that and quite other, all that. let But time levels manpower that

we in them that. we for the that be. about they're want also confident having ability the to have we And you several the continue predictability conversion customers improvements repeatability the have and that, and So, some to now that recognizing with to us. our that optimistic capacity feeling is we last manpower now the levels I'm And have show shown performance our to we're should our demonstrate months. conversations the only around the come we And and in have opportunity back where demonstrate place customers, especially to performance that we've -- to they're

I'll about as look we do And some through that’s year, Jamie our there to if demand markets and meeting still Thanks. for business. And all the talk in it, at carloads more not of the you themselves. the talk we'll go So, we're that. business the let the let -- then operations. out I'll our opportunities Kevin for every about look opportunity for

really we've did it together forward. you our where ideas day, a improvement having talk we're to more and that and of do doing what this that around and discussions can seen, Brandon, key change, Jamie and lot of has of those Joe do do a in things can leverage it's growing. we been real of that have we and a customer Yes. mention a lot organization markets. create some service those and service a about brought ideas going up obviously, new there's of And service-wise part remarkable the lot about I what what the there's about to can with teams and customers less are the our we out those what both, his of every opportunities lot fun less we creatively of can and coming come excitement with interesting do And a that us. and we for lot and

to had a the those conversations, I've a a walk lot or time, And last two. pursue. with out of meet XX% you, more opportunities probably with tell we I'll every lot to over chance month customers of

it think differently. to have that Sometimes we means

what what different, is capable customers of capable or to And have much today a were the We than obviously, of. ago. intermodal what to capable what year is product introduce we're we're we of

spend week to Jamie upside. opportunities with to about to going is team off next those find them. spend the talk with And going But organization. to I'll getting it and to the us and it's to was them races. marketing I whole pursue the so, them. sales time It's is time the up Jamie hand really to together over and

there's out there. thing of can capacity only is really, add that think I the lot to I a

Kevin sell and My can to we how a there the capacity, what talking what that trying is get about have out I they than a to run out talk ensuring with do wherever team or were have customers do in we find is it. we that with where train field, they they capacity, that that. and is here So and are or crew time else. to Previously, ever because more there do

time might and Now of that team his and be that out deal the have any they with grow. there customer sit back demands to helps those Kevin

Some Is improvement the able have mile, for that and been does of are the metrics the looking team put the mile right us. we're with customers look what really world to those it record-breaking just at at has and that are haven't that first unfortunately, exiting together X for are the customer looking discussions we last is for? best that I customer in If 'XX for numbers looking the the really of 'XX seen. back some -- last but years, year service wasn't our we 'XX, us, we haven't record

you commit and producing job team to see is numbers what what Kevin to customers and is there So, and out -- going to sell our sure they get that has those you're making to keep the the see. what need continue to out and there

two between great So some collaboration groups. our

take We'll Wetherbee from Citigroup. our Chris with next question

what margins be some contrasted coal merchandise with thinking sort headwinds $XXX the guess, are I sort very be around the that revenue and optimism of coming the about it on high-margin of whether these perceived have, compared, of to So and coal outlook incremental accessorials the growing against and coming good down that million you or -- half half be down. I year it the to out, or first would the two second ratio be versus those each yields help for helpful. any think the whole how that operating think of relative outcome and whether terms cost about across of potential or guess, maybe about export coming other When to you coal in

those something that we're pieces I struggling headwind margin high think is little perception of with bit. Just on that a

Chris. Yes,

yields, that are out costs to coal move there's the associated yards congestion the as the to containers terminals at obviously, around. rent container well -- So, on on the There cost with as needing accessorials. with in no space those associated

part additional the, of $XXX so costs this of of call So, carried million or we that's it, that the year. course over

at very of is some the grow the strong And as fact we it incrementals. then, in business, our that will down. that So, grow adjust confidence we can

around And I that was together, fact so, weren't really We've didn't OR needed in We happens that now. right to think there demand question year the how got talked growth there those on you out have can that the the the and we places. depends the about meet crews convert. put we to crews we because those we much what last able

real there's of in front opportunity So, a us.

question from We'll with take next our Group Wolfe Research. Scott

And So, to think you try How volume this growth maybe to this pressure to grow do much this there's some year. OR year? able it going then, earnings I'll be need way. you like it be sounds

got some headwinds. You've

that's understood. I guess, out your to thinking to I years. of think I XXXX, just improvement what's understand, several guess, I next beyond kind Joe, OR longer-term the commitment want

number service that can Scott, but we're But, a position on enough now where ability into outperform kind that that going right that pointed economic think fact much we feel about to sell through we factors. it And specific fact indicators growth, there don't we've areas sort we're Yes. are from that we to to a of is merchandise a you that how the the you and are run the market. one I answer we model, whatever of you a I think capacity the give we reflection out of think I as the and your of and given the question standpoint not where meaningfully of coal about to sort in good think there.

is Joe. This

deliver Scott, results. that and I'm will our to points continue question, couple team continue think side, the improvements OR here. a I denominator operating strong there's operating to show confident on On very the of

the last have in tailwinds some that that intermodal helped certainly side see that the storage, fuel -- the But those we'll in there the surcharge, side maybe how et were numerator right On numerator some repeats much last and equation, price, of of coal were in that cetera, year strong there the XXXX. quite of been be year, you're things OR things XXXX. and won't strong as the sense of

operating even side, can the reduction potentially said after the cost numerator growth a and for we effects confidence economy feeling in go inflation opportunities. and feeling are that, knowing feeling cost we our having that But to looking that and the that be now pressures our volume and of have with model our performance on customers opportunity for who are slowing pressures going

to for strongly growth opportunity And very the do to in performance, be so, the that that do that will us. to we business our and us more continue demonstrate we and as wanting business. earn very, year be will beyond, capacity we right that with there have our customers the this And get feel

it we addition, ESGs have advantage to course, comes and the emissions In of of when rail. environmental

optimum OR. we what not of proud our at so We're said mean, admit. we that -- target year, not all know we're year still for going under the it's we So, put as our is operating had a last very was to like Quality there level out with Carriers, performance ratio I XX, being and performance. to an that all for

beyond. in will year this those So, to The a we this delivered. is that believe of pieces there performance company is strong and revenue some inside be of continue uncertainty around

real deliver deliver strong our continue to margins is does incremental control challenge growth to well. our our costs, utilize which in and assets the So, business,

that strong a delivering OR OR. margin the should company time very an focused operating so, profitable margins, good growth of -- performance the with with. over comfortable band delivering should And end within very improvement, be on which we'll is of growth to this with lead At that day, lead to

comes next ISI. Chappell Evercore from with Jon Our question

best intermodal a confusing industry service standards. just last year-over-year on It's watch volumes significantly given than a we since most as your improved lighter around are running Kevin, the disconnect And of maybe XX basis on performance intermodal the little headwinds, of really plan the in consistently intermodal that part other to any these improving trip those be year, may and that and even and ties you middle metrics your shortfalls Can metrics bit those opportunities us unique some some the Xs. between you then that prepared you? maybe strategic a remarks? explain to Class of more explaining help of also noted that in this

Yes.

do outperformed time believe side. X very obviously, through look, of really and that's great a or and us. -- year, international have other of And lot I the a our think that -- we last great, businesses, the we a international work team. we about market years and percentage on two but -- we weeks I of little the over growth doesn't got for that -- came Class pay the before see we've think look we But outlook years railroads, I the do long-term we mentioned you'll of higher don't we that thinking industry and positive a don't lot that so three success, spend a probably to bit we've as pandemic a exposed make three you where had lot at to see a when a

think I we've team recently. on The contributing number that and take will business in to think the seeing to that's share a of performance that later we're initiatives to got some drive the continue win railroad. of we'll things incremental year and obviously the probably So, has in had market. will here the form great But

So excited in do the can what of quarters we ahead.

with question We'll UBS. from Tom take Wadewitz next our

to your the just how I thoughts Does want had just And time? it you wanted saves of I relationships? that? is referring we and help I the you think a wanted I think how to And to change? you're a year, get caught sort that I Is the don't down labor, attritions into service. some question. you terms to if could comment? what relationship X%, on to before cost first, XX% something tying we in if that what's over comments offer to running you to how clarification forecast benefit see do do pay about Joe, us that then, know GDP or of just And you more about assumption which your volume anchor for

relationships do what mean when do that? labor, on thoughts think broader that how you some talk about Just you And what about over by and you does time?

on Tom, we're question, roughly looking the X.X% number GDP at. GDP that your is growth

and across markets? our that guidance so to grow intermodal is total growth headwinds solid other the with above in And

is Thanks Joe. for labor. the regarding question Tom, Yes. this

try but concise. thoughts I'll of to here, lots be So

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for better friend Lower for with comes a and everybody. experience the attrition, just the recommendations for that? referrals, and and new in what hires better family network, Now,

team, So around a all part labor and the that's really ONE that. is of big a this together initiative is working of building big CSX all part culture

with And so, more the rail XX it's a little unions. complicated different industry in

of step we operation and, every our that a And comes attendance ultimately, are based serve team, every our about on that leads our a impactful mind changed and environment more of policy where really a good on first on working That's in working voluntarily to and our day, and great part ultimately much However, them really in problem efficient team to our better. for That's that customers, feedback. we our feel to own, with lots customers growth. to with good where his employees. this We're to be creating discussions. with We We're employees are listening purpose Jamie having solving, of service day. better which want opportunity the frankly, want for relationship.

question next our Bank take of Hoexter from America. with We'll Ken

Good afternoon. Hey. rundown for Joe. thanks And the there,

committing that I you're year, operating with or costs gone, clarify? clarify, looking means just gains you're for want Just offset to no efficiency cold accessorial maybe declines, yield can up. I for on by improvement and service right? we what volume There Sean, or not that line? but to inflation income the specifically outlook growth guess EPS the But for was

right. That's

on-time XX%. to the Jamie, then originations fell And

and think of the I Isn't XX you're versus operations leave precision to of that come whole the about line doing know on what are you've of talk Maybe moving? network fallen quarters. fix now name top railroading on they've game growth. needs get do XX thoughts of to past And if time I the balance operations, what what that? to to in don't your with what me the Joe,

driven manpower of we really, into unfortunately, situation we've consistent, been past get origination. team to continue up that's we more our up what we'll continue XXXX, -- couple weeks we're happy XX%, It you're on-time And we've that's to starts is XX% to shooting for. balanced. back around great. years, to think, been which The the drop. originations over as that three get where last onboard on-time Okay. up record I in. is XX% up And over And to year, started seen right. that this in of to our us The hitting say, we're And I'm some been to on-time, because get it's the highs. of, folks, record

on and each that that and balance these took we make it. watch. got So, made we metric what train as people maximize and one those on go some at back bit we've year trains could but not we're the it the decisions when run we last to starts. is going Not and We're see leave we all. there We car-wise, crew we that, we'll did could have assets now of maximized little you off saying It's things an the that letting that to across as could out behind we advantage can on of what's important network, a connect important. we so much to a sure traffic crew,

take a T&E for magic X that the to in past that We that a X,XXX numbers If our more today. we're we're a bit push see going at months. And to year looking few of matter up as just much the at fact, you actually, little cover we're that look number that vacation X, And new X,XXX more coming a count. velocity, next you you is running just network the look dwell and weeks, take at our hit can the into number fluid. in

make going we're got and We're in drive right the to metrics continue that make So, places, right of metrics. we've we've going those to the rest sure right people that we headcount. service to that the sure the drive will got the

as beyond matter it record starting rest fact, put out the I mean, intermodal, we're we've carload, back it's some our again, all TPC, of metrics. on service to of to get numbers that -- that of a those whether our there, we're you see

So, and provide growing go this product there company. and sell a to that going start his and team can out we're Kevin

Yes.

that to seen that customer quite of customers, we service Kevin So -- Ken, it's whether first things. at looking about we've the additional of want time. and And our a we spend we're is thanks in our which seeing with on-time, referenced, results everything. get team And feedback comments. metrics, through talking surveys make through We whether question. And A of time the mile, last mile, our eyes kind how the the just originations some sure for those is world customer the lot of in as couple lens we've I'm the a in team on it's the surveys. why seen best really arrivals, pleased

good So, that. really I feel about

growth between this the in line now. they're it said intertwined. strongly operations, think about I balance and feel October. I And top even Now, I more

CSX here opportunity phenomenal to our a that have pre-pandemic. seen our performance you've strength in We operational leverage at

you. to customers a be there. to right rely can And better there's is more us our on getting and able on our earn opportunity levels to the there to and and now to strongly, our be growth, line about And capacity top that again that with talk service demonstrate business. seeing prioritization to very You're believe I lot chasing than you business our your service for

a we allow So, better happen to we naturally that because have product. organically can

trucking. better ESG we do have solution way. the We most a to that lower right than price And and have a

really so on getting needs the So to where business, for and on are. where pleased right that been sure and metrics we've the it why be that's really -- the focused we're getting we I'm focusing manpower making with

in in feel more I So, the strongly did October this about opportunity. call I today even than

of and We're second what the with dialogue and the part in what we're this you're year predict the happen of exactly in some what's in pleased how started. is can't very has sure going happens economy We not seeing this to year, that's third quarter.

is having in really in going meet that model, not started October-November. line continuing other we the of and on. we economy operating the parts interest that customers. data it earned, top are. going where down exactly demand know where leverage our that our rising conversation are of But some you to there We're some slowing don't business could didn't we've that given we chase that's it's the in go, the rates because the some We're that but good our really say things with And believe and couldn't of back be going economy then. just to we're see we about seeing Actually, feel we we to However, growth. to been

comes Our Brian Morgan. next from question with Ossenbeck JP

you lower there is of We coming there, demand. you're a And some rail interest that put of can seeing softer back that can Class you And you you quantify heading truckloads metric? of a around Maybe that what think on last you for anything a us way, since level improved. conference confidence what the is you're is there and way a lot service that just to or especially rates as that it contract count counting different calls. or you across just about heard clearly, a that lost have on else sort can has in in terms macro with what it not on Is coming through unmet when part terms you gives back, the I there try and and fill of probably the surveys well?

Yes, it's Kevin. Brian. Hey,

whatever a markets well. that some that XX%, XX% touched I of were pretty is we what's XXXX. calls, that those remained I the had in previously rates fill happened we've or of other major really flat. or Joe little on obviously, today some earnings starting serve really, for relatively fourth we're call serving those think fill What in let's in down. it, mix seen referenced customers -- of come I remained our quarter this happened bit the in, we saw late this of much things we quarter, most markets, volumes underappreciated our order orders some on think on And actually through the of that third and what's probably -- type rates kind of And in these

now so, we saw our increase, is the higher rates start XX%, our at see maybe down today. the levels requesting volumes down And yet to demand, slightly we and fill what they're markets they're are and

what and they've demand what What what seeing starting see normal order environment, they overshot my increase. a be already to is and we're flows we're expectation that saw is to would start

And plays economy, but it now, bottom. happen way so, that's as in it established like encouraging point that back as in would we're of meet on versus year. But demand the orders that of it out. how last Anything markets, right some feels growth a we'll and these can the feels as we've that that able that going and is imply to see come those forward,

to that doing. is embedded why confidence around number has of orders we're the and And today things workforce capture with in a those what is go team those or beating operations so, GDP this that demand going some provided the the that's have that out customer that that there and guidance and year replenished the the we all and we accelerating

side more And would on or that you the on that conversion, truckload be carload because before, more expect probably the side? heavily real merchandise on a intermodal maybe momentum weighted to you are was seeing

Yes.

on fill start the rates, referenced where we that's -- carload carload That's see when you'll specific. I really think side. it the I order really

a was most thing And we different market taking side, that throughout get those Good I there year equipment into those optimism, really back today. now will around think is every but is and an on have containers, the whether equipment chassis, firm the of intention some that softness market. it as in intermodal that it half of You'll hopefully, truck issues, heard in that, the us. advantage you've the issue. as up comes locations to is of it's There have of we bit, remember some plenty commentary market that we

our growth on to of the premier reflected last in that. to been have in over years, the expect it's continue capitalize intermodal we and couple service We and

Our Suisse. comes from next Rosa Credit with question Ariel

that So, I wanted to on topic. stay

outgrow maybe which normalized do I extent to mentioned ask of in softness of market? something kind GDP CSX's kind the trucking some to or truck to to around about the growth. market. how wanted You then, intermodal And loose environment, ability you GDP more think an this maybe in versus volume a at you impediment of that's could magnitude outgrow what kind

truck, In international is to some the has That's comments not we've year. expect But, my and somewhat double be in mentioned stabilizes comments Yes. first The as we'll go our experiencing time. everybody we're we hopefully, half you market is sometimes. And of, -- of year, intermodal we've better that's obviously digits the economy that and as and truck don't carload growth product. business will recent on over at direct in with growth that that that compete -- grow opening well, down around sensitivity market the that today. as the market our probably to half not of out some a I the great where see as decreases centers least, we where second got been we had see market, there's weak, that continue the have aware there -- there, the into shoots we but green great

I our industrial economy. there's success had I huge a But portfolio rate think is across macro of every here development a things tailwinds our And to side. that of going we've our lot intention bit on outgrow we're at the at think, back.

success can in online new there, all metals We rate probably this year. here long that the have had we've plants, auto growth you backlog, backlog look time and will Big, good largest a out going projects plants, remember that give across the whether are a big board, lot us when forward. anybody beyond of a new coming really it's those that

really, have is And to there's I been product But that's our think to outgrow service something -- the really think I that's economy. possible not going we're able to that So, the know do. have, that with intention the railroads forward. I going

the just Thanks Kevin. on that? those around look really could And like what any of thoughts incremental some that margins on quickly for then kind projects, of

good know my I every I -- time rate incremental top where margins business, the that don't the return and very a put business not look growth. unprofitable think business line I very we're us. show at are attractive just I finance on and to hat on for bringing going we're aren't to a chase in of

Markets. from Fadi BMO Capital our with take we'll Chamoun question next And

and and start customer those there's having really you there And employees. those with a between customers, success the principles, conversation boxes you're penetrating demonstrating you think first the you Joe, maybe developing be of two Maybe on service respect highlighted to going with feel guiding do improving and improvements and that the especially anytime, lag quick the to between these share share of you the is potential when a on turnaround or that of making side really that wallet customers, do service with market kind improvement? some

back backlog GDP, the that into maybe we're looking some can't XXXX in to and given reason there And now follow-up Pan and Outside normalized into this environment? a normalized Kevin, into XXXX volume like the and have conversation why a Ex we initiatives given mid-single a these coal, with more the this of digits made over grow assuming you've and second, you obviously. you Am. QC is investments get as coal, of on

I'll grow since From the here service the him. opportunity you perspective, take Joe. that to take first the and -- at from is product. the really business comes directed this Kevin second part ask I'll take my increasing to

each that, their on really pressures, timing capacity what they customer, where the for. cost individually around are their issues where question your Now, of dependent all looking and they where are, it's

with Really demonstrate these their months, blanket performance it. customers, it’s confidence statement conversation if can't of we our we comes from that next really So, in to the reliable. around and a for ability in use three our our be levels repeatable

they're And question making. us customer. that and for all each But letting watching that I progress all is so noticing different to you, know to the tell they're answer the and really they're that all we're appreciating they're can

time. that appreciation recognizing our how from it is. inconsistent and customers important it we're will But over their for So, nothing about there's hearing play out it Kevin?

Yes.

a mid-single is think question was, grow we I the there why can't reason digits.

capacity identify I it's and customers with our grow to and the of side, into on think we're question that customers. lot -- a have share after capacity Jamie and use go existing network answered we the wallet new going to

from at up then there's So, rate, that X%. we price conditions putting with market do a are maybe the growth mid-single what normalized no constraints can algorithm, X% time. perspective. Obviously, to we'll that digits volume is pretty and more see a that's then GDP than and X% different X%, what It's or the attractive

will build that above get we that we coming growth develop to funnel we've from as time able we'll The in some give the customers been So, over future. 'XX, economy, as the tailwinds out of 'XX. the all great projects to and hopefully, and of algorithm line how that on the on railroad, be add that we will thing be things and 'XX, will our will see new that have materialize that is

question Ravi Morgan Stanley. with next from Our Shanker comes

quick ones Two here.

using plus. you've a GDP of production grow benchmark. you your are as can said First, peers Many industrial

can that they and than industrial has out of try In fact, they going and don't think forward, said GDP I think of can outpace and faster one they think them years a couple grow ago production they come instead.

GDP the to than right of the And you GDP do the as you long and grow think think what and can kind confidence gives a, in So, just run? you for a that benchmark follow-up. is ability you fast quick

comp think 'XX? think was I we said in comp How incentive you do a tailwind numbers had incentive you. about in 'XX. that to Thank

is this Ravi, Sean. Yes.

is underlying business merchandise So at on the decline year IDP can more and we GDP for little specifically, grow across you historically to with indicators, the plus we closely GDP this a think particularly growth, for projection our run I on intermodal. in the you look But you look and and correlations, maybe segment, look, comment, the the move projection IDP your business. tends GDP is if the a more think

So, it of off sense this a to made year lot peg of it GDP.

that mean, set I has always On out. the on internally. incentive into to year play the hit to We go planning we comp, itself your targets the question year

that on basis, as down would we'll so, see out but a bit versus be little year And continues. that comp incentive XXXX, year-over-year the plays how

next We'll TD Cherilyn question Securities. take Radbourne our from with

for me. labor on question A

different Some approach of just your that going taking a more and peers about scarce become has labor to valuable. forward, given have talked furloughs

some in offer the downside, was investments So, freight the would could surprises year? hiring approach headcount you lose that thoughts event how demand made that in to on this don't you hoping so the you and training you've I

as for question. thanks Cherilyn, did last Well, the same the we stance got quarter. We've

fill what's absolutely a that into would We're are close -- we takes as position. what's we're and year filling is as not happening looking up can work look those together happening we workforce take move positions really obviously workforce pull not at The -- the only T&E a and a we we here long six to that We months conductor's but Our today, from today, stated now, a there's what's the months forward. on. time. can Kevin I And important that happening from -- trigger. future, to you're coming future furloughing in right. we now. to know conductors And customers see It really six

can attrition Look, a downturn if there, the to that's which XX%. is there's use up business, in we

that numbers the point time can get a back up continue employees easy and at move struggled need couple numbers off vacation that can we're and our to. for down bring time last we so if at we classes our over we to to need as continuing to So, the it they've years. it's we looking to, we hold if of those get us to where making build But forward, cover times rightsize to sure

any that results knee-jerk with not close we're be direction our that to And attrition trigger going So, as the required. and with in we've quite that very made you and happy from continue that a forward respect if that doing it's service. see commitment pull to to number, our we're we're looking can reactions we're that moving to right

We'll Majors our with Bascome from question take next Susquehanna.

And days talk roll to like forward few strategy to -- as to to you other time the able think the on a be the on of be to Can little a you'll few spoke on any months bit business? kind Day, when want stamp Joe, your last investors? that Thank with you. us getting you put you'll now. October around able job, about format Board where the events really your an you that's to out you or and to look I call, be Investor had you kind of a

Yes. for the question. Thanks

talented first, a philosophy is this Just standpoint, team. really from a

all doing team. business, And we're go a of it. leadership together we the we get through so, this -- talk all together elements as about Monday, We every

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when can it to something calendar We it meaningful be put do. just not do time the be takes and to we So, every just want on that everyone's we we trust know year the to and right We it want time impactful. at important. be that we'll it

a I and bit doing the a lot As of with far consideration Board, with of me. their in strategy spent this in of as collectively time the hinted consideration discussion I and but in October, as little individuals Board this the

where opportunity the really strengths lot of the of to where a that here advantage here. had and emphasis multiple we good conversation exist to about So, the put months over and take

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momentum can what our then the feel on feel for resultant culture momentum are You employees means you together side, the the on effects service. and on that working can how the

on compelled out some put strategy my feel come So, I to period. major in some with don't short just time it fingerprints because to

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to starting performance now we those that we're levels pre-pandemic So, demonstrate levels. showed

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that show to can can so, that even growth we leverage deliver Thanks. stronger we'll business. and we that build And an

Vernon David Bernstein. next our from take question We'll with

intermodal the to X- accountable bit So, be your about what or a a thoughts take team on wanted it, view. little to question kind share X-year holding on to going you're just Joe, over, of differently. ask a you I'm I delivering the curious targets call

grown you it's are X-year it's I'm As to basis million team view at you and to kind there about years. think the forecast. be trying intermodal you guys guidance in points the market what million East, the look like doing about and step year actually how are share X target get onto units out economy for the of thinking on I the much to put a for this doing you hit? for the X at looking in XX because back about 'XX. railroad. you is just weak, about the could tough Not But year at last units, putting What and were about we a X should XXXX,

about long talk targets it. I'm to our just not get question. into let's the term. what But for conceptually, Thanks are Yes. going specifics about

CSX. I over back a stepping it months, at interchange a industry closely with even number colleagues. We the staring our more X of and before and lot many joined Class this Just learning last about

real And growth, that is a is as so, as volume growth. well around this CSX industry issue and issue, an

referenced it. So you

we So that make capacity. do have happen? how We

base, cost a fixed have incremental cost good. We are and a very margins strong a substantial fixed -- really base

that wanting to have So, to -- with. grow, to of kind lends like itself margins we most start and really those businesses, strong

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ways those with challenge there's showing measure to So, and accountable ourselves to progress. be things

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are are. you where specific, without So emphasis getting points and think priorities just into about where can the the

to of that. be joined I've and there. And to safer, office come and our tonight, leverage the more us. great too. times be in Steve that, We're see customers And team. to whether that's How want to Fortune I to here couple then, to serve about referenced back technology modernize better do technology a across or got We've we locomotive. we excited technology business a our the lot in a potential has the enterprise, of efficient,

solutions with future. union trusting time. a be of definitely over But point safe, say where to for number where to ourselves efficient we'll have right sides environment And we better customers our work-life while believe together. when serving to achieve a and our we more we to about things things having get want And the our improve work get all business, do the where challenge and more a relationship and we then with think a there, the we'll of it look way. are employees we we we'll the partners, have both our those and I and also objectives. for So, can Those it are and employee for about

little Okay. if could Jamie, a I just in sneak follow-on there.

think improvements? you property the or enough plan on to As today, where year, from are you expecting resource think we into service about the it headcount grow of the you sort to got are do maintain continue the we've to

folks new are has week. that I have every now say to out we We move the the some as with Atlanta. XXX been all -- in And out and conductors remember, would what there still we field not continuing training the doing good qualify retention in another forward hires. rate in we're

I'm to some few we move if for us retention year. with headcount respect we a into looking XX% to that the of attrition we regular to another have continue the all team forward and growth So, the forward. continue season as that just as our work folks move on see rate, and Kevin hundred vacation into we onto to we get as move and out

way vacation into So, or over that the season into going with for I'm few to are we the see headcount as the continue move the continue going that comfortable that, with to we're to next actually numbers that where our guiding our months, but have are while now, is low, but spike And up. come hold we not able we we be the improve to to into on are need what up year. metrics, we them to only gliding

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Allison We'll take our Poliniak next with Wells Fargo. question from

feel had you the expand circle in little like doing surveys, on about these Joe, bit little with a customer to a in talked Could Do business back of that you processes some maybe to want the to structural rails that, share with Just some something easier is ease X that years bit? question that last it you more. there? now doing sort of gain? of guys you key the of next business a can longer-term limitation that for is rails. within attack that's that maybe X opportunity is right much or And

to a UPS, that in we opportunity. will et do and we That's level easier of goods have I in you an well more that make And Yes. do and rail How to to that issue. referenced and in issue we those the as do performance predictable kind things, the we area. it business. great and to we improve cetera. have need recognize we think tonight. in and improve a It's example. FedEx, Thanks. to packaged area, compared our an It's our as more that We commentary about CSX mean even of industry get visibility visibility give industry

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that's our make things us, But where to we is. industry customers focus business working our with visibility is the we of can that's some clearly, So, it for and easier do more obviously can information the on. and provide and that

question Spracklin Markets. from Walter Our RBC Capital with next comes

a in see back experiment Kevin, bit you're made bit towards of little of was for capital plan know Quality now CapEx devoting I this you looking question and it. an a purchase, your Trucking, My when I at that

trucking for by strategically while Is from your you take So just be it's operation that operation? opportunities you curious to the could looking at into see that relative looking your here other XXXX? in calling little any are pop expanding as it and M&A rail an CapEx, out your company for those now. now space it what under you on you been of Are the your And outside a up fleet? growing it perspective been if avenues has to trucking umbrella in

lot a of first asset a of mean, unique in quality I ways. Yes. all, very, very is

it's and touches chemicals. you the and in can't trucking have have eye-opening largest product And When tell introducing our never valuable market, than it how to has First, insightful. where They side, managers most something contexts is very them truck market I been those dealt with our on do different purchase today related which it's that it, more we very, not is new. this in. we very, is trucks on we're investing was am sitting he to -- it's with a really product, year Randy tanks talk gone if go CapEx talking happy the the ISO that about railroad. how very And QC I far. rail the It's about here so that

been The haven't we seen pretty We've And them far. customer uptake so enough. a our lot of has fast incredible is only success. issue gotten

market a him on we're the been how from to has delivery each for side. to so that's surprised about those. good can a to turn come and and time, even has and for assets trucking take of the have, continue service And he Randy problem long product quickly going these we

that the getting market. It's intermodal truck and and extraordinarily it over the there. we're into as this gone have The more demand to convert a requirements, ideal out things lot network today. well of there moves those traffic from meeting So, customer gets is more customers

the really the focus are excited in that rail about So, talked coming we earlier the CapEx we're where about. that and that on uptick that's extraordinarily product

go particular, perspective and fits we be and just to rail it's customers, at there a the from for in what think tell we them and trucking able a to their and what perspective. and that are talk powerful network a think from chemical in fits And holistic solution looking look pretty

And that else there, everything just CapEx the we're preparing. and But our think you utilizing that current is when tanks And even on about exactly the yes, is buying side, terminals. there. right, where operating already asset fixed is quality, we're ISO we're

Kevin because intermodal get this Randy in I business, we have to his is went believe terminals this, say hand-in-hand just So, I can and that I like like of when we side -- the business working looking this the have -- capacity trains somewhat We'd to is want? asset were get them Is We'd more there's what saying ISO quicker. And team this to them really more and going would our get and tanks. team. didn't get it's and the work, capacity. his falling And the on well. the Kevin and into at this we really with

-- easy So it's great to just product side us operating and it's very move for the on a as well.

really, really So it fits well.

Vertical Our Partners. next question comes with from Jeff Research Kauffman

I'll were probably it employees on be employee. new cost X% you about about contract, levels, for of per the and XXXX. first X% around Year-on-year talking employee just X%, like inflation Sean, the half quick. looks

So something the that I half run before be at of range first I I from the the away lower year for that? the for comp thinking productivity about kind and offsets modeling if look where fourth rate labor XX-percent-ish inflation. helped right incentive quarter of in looked cost the what's high Should for single-digit,

I X% you Jeff, couple full at if inflation a basis, headcount, of on a year And gross labor adding to we'd the if that line Jamie year-over-year. X% of mid-single we all headcount, look hundred be so in long, the about call that didn't talked digits. additional a anybody hire the basis, Yes. impact the up on year-over-year. on year up right, is ballpark, right, think

So, drive third we make as XX%, network be in line. the the We’ll that the true-up your to labor but that we we had you there's some on quarter as back able continues wages. are -- alluded also the confident we'll to the efficiency as to, cycle, to on spin,

bit will of little So, an a offset. that be

All right.

little there? at target labor the see how through Is better just in So the half. a achieve? think much of we I productivity? Do a end can can that of what do be second offset out we But the will of guess you there day, that you cost kind

faster, good sort and reduce crude spins we've that we're would got a and to travel and the of some and we'll inflation that or yes, We're in chunk over targets with able going of be to the range be X% reduce going network as offsetting time. another lot year. along that ancillary a Well, costs offset headcount to it, single a in X% of go

right the track. on we're So,

for conclude does now you And you Thank and presentation. Thank disconnect. today's your may you. that participation,