Oct. 15--Michael Ward says there is "nothing dramatic" happening, but the chairman and CEO of Jacksonville-based CSX Corp. saw enough in the third quarter to think the economy is slowly beginning to recover.

The volume of freight carried on CSX's railroad was lower than it was in the third quarter of 2008, but it did improve since the second quarter this year.

"Virtually every major market we're in had more carloads over the second quarter," Ward said in a telephone interview today.

CSX on Tuesday reported third-quarter earnings fell 23 percent to $293 million, or 74 cents a share, with revenue also dropping 23 percent to $2.3 billion.

Another Jacksonville-based transportation company, Landstar System Inc., reported lower earnings today as the economy continued to impact the trucking company. Landstar's net income fell 39 percent to $20.1 million, or 39 cents a share. Revenue fell 32 percent to $500.7 million.

But Landstar CEO Henry Gerkens echoed Ward's sentiment that the economy seems to be improving.

"I see a gradually improving freight environment, and I believe that the worst is over. I am cautiously optimistic as we close out 2009," Gerkens said in a news release.

Ward said CSX has done a good job of controlling costs, with operating expenses falling 24 percent in the quarter. "That's hard to do in a fixed cost business," he said.

The expense control includes idling some trains because of the reduction in demand for freight service over the past year. CSX still has about 1,600 trainmen and engineers and 500 other workers on furlough until the economy improves.

Some workers did return in the summer months to fill in for workers on vacation and to replace retirees. The company also needed to increase staff because of the federal Rail Safety Act, which reduced the number of hours train personnel can work.

Ward said it's difficult to predict when CSX will be able to bring back all the furloughed workers.

"A lot of it depends on the pace of the economy," he said.

Although CSX's results were lower than the third quarter last year, its earnings per share of 74 cents was three cents higher than the average forecast of analysts surveyed by Thomson Financial. CSX's stock rose $2.78 to $47.06 today. The earnings were released after the market closed Tuesday.

Landstar's earnings were announced after the market closed today. The earnings were in line with Landstar's previous forecast of 35 cents to 40 cents a share.

-----

To see more of The Florida Times-Union or to subscribe to the newspaper, go to http://www.jacksonville.com.

Copyright (c) 2009, The Florida Times-Union, Jacksonville

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

NYSE:CSX, NASDAQ-NMS:LSTR, OTC-PINK:LDSR, NYSE:TRI,

A service of YellowBrix, Inc.