CSX 1Q earnings up 46%

CSX Corp. reported record earnings for the first quarter: $351 million compared with $240 million for the first quarter 2007.

CSX (NYSE: CSX) posted increases in revenue in six of its 10 markets, despite decreases in volume among most of them. Its total revenue of $2.7 billion compared with $2.4 billion in the first quarter 2007.

The company said it overcame softness in some sectors through yield management and fuel recovery, as well as growth in ethanol and grain shipments and increased demand for exported coal.

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CSX's earnings report came as The Children's Investment Fund Management LLP, a hedge fund that has been critical of the railroad's board and management, and fellow hedge fund company 3G Capital Partners Ltd., issued a proxy statement to shareholders seeking support for its proposed slate of directors and bylaws amendments.

Among the amendments proposed by TCI and 3G, which collectively own 8.7 percent of CSX's common stock, is a change to allow one or more shareholders holding 15 percent or more of stock to call a special shareholder meeting. The hedge funds are calling for a resolution to repeal any changes to CSX's bylaws made by its board since Jan. 1.

They're also asking shareholders to abstain from voting on a shareholder proposal regarding proxy statement disclosure of certain security information and to abstain from voting on the selection of Ernst & Young LLP as the independent accounting firm.