(Norfolk Southern issued the following news release on October 29.)
NEW YORK, N.Y. — Norfolk Southern Corporation (NYSE: NSC) today reported third-quarter net income of $137 million, or $0.35 per diluted share, compared with net income of $126 million, or $0.32 per diluted share, in the third quarter of 2002.
“Despite a challenging environment, we managed to improve our net income and earnings per share and at the same time post the best operating performance metrics in our history, positioning ourselves for the future by improving service consistency, asset utilization and efficiency,” said David R. Goode, chairman, president and chief executive officer.
For the first nine months, income from continuing operations, before required accounting changes, was $359 million, or $0.92 per diluted share, compared with net income of $331 million, or $0.85 per diluted share, for the same period in the prior year.
Net income during the first nine months was $483 million, or $1.24 per diluted share, and included a $114 million, or $0.29 per diluted share, gain largely due to a required change in accounting for the cost of removing railroad crossties, and a $10 million, or $0.03 per diluted share, gain from discontinued operations resulting from the 1998 sale of a former motor carrier subsidiary.
Third-quarter railway operating revenues of $1.60 billion were even with third quarter 2002. Year-to-date railway operating revenues of $4.79 billion were up $103 million, or two percent, compared to the same period a year earlier and established a new nine-month record.
Intermodal revenues in 2003 set a third-quarter record at $315 million and also a record for the first nine months, increasing three percent to $904 million compared to the same period a year earlier. The revenue growth reflects increases in converting traffic from the highway to the railroad.
Coal revenues improved slightly to $372 million in the quarter and increased three percent to $1.12 billion for the first nine months compared to the same period a year earlier, primarily due to increases in utility and export coal shipments.
Third-quarter general merchandise revenues declined one percent to $911 million compared to the same period of 2002. Automotive revenues decreased 11 percent, primarily due to slowed manufacturing and model changeovers, while agricultural, paper and forest products and chemicals reported increased revenues. For the first nine months, general merchandise revenues rose one percent to $2.77 billion compared with the year-earlier nine-month period.
Railway operating expenses for the quarter remained unchanged at $1.29 billion compared to third quarter 2002 but were up three percent to $3.95 billion for the first nine months compared to the same period last year largely due to lower pension income and increases in employee wages and medical benefits, as well as higher diesel fuel prices.
For the quarter, the railway operating ratio remained unchanged at 80.5 percent compared with the same period of 2002. For the first nine months, the operating ratio rose from 81.4 percent to 82.5 percent.
Norfolk Southern Corporation is one of the nation’s premier transportation companies. Its Norfolk Southern Railway subsidiary operates 21,500 route miles in 22 states, the District of Columbia and Ontario, serving every major container port in the eastern United States and providing superior connections to western rail carriers. NS operates the most extensive intermodal network in the East and is the nation’s largest rail carrier of automotive parts and finished vehicles.