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Rail News: Norfolk Southern Railway
NS: New records for Q4 operating income, full-year operating ratio
Norfolk Southern Corp. yesterday reported record fourth-quarter income from operations of $1.1 billion, up 27 percent compared with fourth-quarter 2017 and up 9 percent on an adjusted basis.
Net income shot up 44 percent to $702 million, earnings per share jumped 52 percent to $2.57, revenue rose 9 percent to $2.9 billion, volume increased 3 percent to 1.98 million units, railway operating expenses climbed 9 percent to $1.8 billion and the operating ratio improved 5.5 points to 62.8.
Adjusted Q4 results reflect the remeasurement effects of net deferred tax liabilities resulting from the Tax Cuts and Jobs Act of 2017, which impacted net income and diluted earnings per share in a year-over-year comparison, NS officials said in a press release.
Intermodal revenue climbed 13 percent to a record $755 million and volume rose 5 percent to a record 1.1 million units; merchandise revenue grew 7 percent to nearly $1.7 billion and volume was flat at 611,700 units; and coal revenue increased 7 percent to $457 million and volume inched up 1 percent to 255,000 units.
The financial results "clearly demonstrate improved financial performance and our commitment to delivering shareholder value," said NS Chairman, President and Chief Executive Officer James Squires.
For the full year, NS reported railway operating revenue of $11.5 billion, up 9 percent compared with 2017's mark. Intermodal and merchandise revenue set new annual records at $2.9 billion (up 18 percent) and $6.7 billion (up 6 percent), respectively.
In addition, 2018 income from railway operations jumped 17 percent to a record $3.9 billion, net income leaped 39 percent to $2.7 billion, railway operating expenses rose 4 percent to $7.5 billion, volume increased 4 percent to 7.9 million units and the operating ratio improved 2.7 points to an annual record 65.4.
"Our confidence to deliver improved value to our shareholders … is heightened by [our] momentum heading into 2019, and by an array of initiatives to serve customers better and operate more efficiently," said Squires.
NS officials did not release information on the company's 2019 capital spending budget. They expect to address capital expenditures at the Class I's investor day event to be held Feb. 11 in Atlanta.
Contact Progressive Railroading editorial staff.