Moody's: CSX outlook negative

Moody's Investors Service said it confirmed the Baa2 senior unsecured and Prime-2 debt ratings of CSX Corp. but changed the outlook to negative from stable.

Moody's said the change in outlook reflects weak operating performance of the railroad, the high level of adjusted debt compared to free cash flow, and the continuation of financial underperformance compared to expectations.

The ratings could be downgraded if CSX does not demonstrate measurable improvement in rail operations, including service metrics of on-time departures above 60% and average train re-crew rates to below 45/day; the company is not making progress toward reporting retained cash flow to adjusted debt at least in the 18 to 20% level; or, there is evidence of yield/price deterioration because of slipping service.

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