NS Operating Net Income Up 14% in 3rd Quarter

Norfolk Southern posted a 14 percent increase in operating net income during the third quarter, earning $1 billion when compared with the same period in 2017.

Net income during the quarter jumped 39 percent to $702 million as result of the railway operations income increase and a lower tax rate.

Diluted earnings per share were $2.52, up 44 percent year over year and a third-quarter record, NS said in news release.

NS posted railway operating revenue of $2.9 billion, a 10 percent year-over-year increase due to higher volumes and revenue per unit, including more fuel surcharge revenue and increased rates.

Overall, volumes rose 5 percent, which reflected growth in intermodal and merchandise traffic. The growth in those major categories helped offset a decline in coal volume.

Railway operating expenses increased 9 percent to $1.9 billion in the quarter compared with a year ago, driven by higher fuel prices, additional volume-related expenses and increased costs associated with overall lower network velocity.

The operating ratio for the quarter was 65.4 percent, a third-quarter record. The OR in the third quarter of 2017 had been 66.5 percent.

“Norfolk Southern continues to deliver record financial results that reflect our careful and determined pursuit of a balanced and flexible strategy,” said CEO James Squires in a statement. “Our demonstrated progress toward the goals of our strategic plan is significant, and our ongoing pursuit of new initiatives to benefit customers and shareholders will further strengthen our organization.”

Squires also confirmed that NS is considering moving its corporate headquarters from Norfolk, Virginia, to Atlanta.

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