(The Associated Press distributed the following article on January 28.)
NORFOLK, Va. — Norfolk Southern Corp.’s fourth-quarter net income fell 60 percent as the railroad company took after-tax charges related to voluntary staff reductions and a decline in the value of some telecommunications assets.
Norfolk Southern earned $52 million, or 13 cents per share, in the quarter ended Dec. 31, compared with net income of $129 million, or 33 cents per share, in the final quarter of 2002, the company reported Wednesday.
Without the charges, fourth-quarter profits would have been $171 million, or 43 cents per share. Analysts surveyed by Thomson First Call had estimated earnings of 37 cents per share.
Shares of Norfolk Southern fell 64 cents to close at $22.61 on the New York Stock Exchange.
“What you’re seeing in the fourth quarter is the result of what a well-positioned transportation company, like Norfolk Southern is, can do as the economy recovers and builds momentum,” David R. Goode, chairman, president and chief executive officer, said in an interview.
Fourth-quarter revenues were $1.68 billion, up 6 percent compared with the same period one year earlier.
Railway operating expenses in the quarter increased 12 percent to $1.5 billion, primarily because of a voluntary workforce reduction program involving 553 salaried employees.
An after-tax charge for that program reduced income by $66 million, or 17 cents per share. An after-tax charge to recognize the decline in value of certain telecommunications assets reduced income by $53 million, or 13 cents per share.
Norfolk Southern owns Thoroughbred Technology and Telecommunications, or T-Cubed, which has a fiber-optic network along company tracks. An appraisal in the fourth quarter indicated a deterioration in the value of those assets, Goode said.
For the year, net income was $535 million, compared with $460 million in 2002. Revenues in 2003 rose 3 percent to $6.5 billion, up from $6.3 billion.