(Source: Norfolk Southern press release, January 26, 2022)
ATLANTA — Norfolk Southern Corporation today reported fourth-quarter and full-year 2021 financial results which included fourth-quarter and full-year records for income from railway operations and operating ratio.
Fourth-quarter net income was $760 million, diluted earnings per share were $3.12, and the operating ratio improved to 60.4%. Full-year net income was $3.0 billion, diluted earnings per share were $12.11 and the operating ratio improved to 60.1%.
“The fourth quarter marks the successful completion of the ambitious three-year strategic plan we launched in 2019,” said James A. Squires, Norfolk Southern chairman and CEO. “We achieved significant additional improvement in productivity while overcoming the headwinds associated with the pandemic and global supply chain disruptions. Our team continues to deliver long-term value to our shareholders and customers, and we are in an excellent position to build on these results moving forward.”
Fourth-quarter summary
- Railway operating revenues of $2.85 billion increased 11%, or $279 million, compared with fourth-quarter 2020, driven by a 15% increase in revenue per unit.
- Railway operating expenses were $1.7 billion, an increase of 8%, or $134 million, compared with the same period last year due to higher fuel and purchased services expenses.
- Income from railway operations was a fourth-quarter record of $1.1 billion, an increase of 15%, or $145 million, year-over-year.
- The railway operating ratio was 60.4%, a fourth-quarter record.
2021 summary
- Railway operating revenues of $11.1 billion improved 14%, or $1.35 billion, reflecting an 8% increase in revenue per unit and 5% higher volume versus a year ago. Volume increased in all major commodity groups.
- Railway operating expenses were $6.7 billion, a decrease of 1%, or $92 million, compared with last year.
- Last year’s results included a $385 million non-cash locomotive rationalization charge and a $99 million non-cash impairment charge related to an equity-method investment. Excluding those charges, operating expenses were up 6%, or $392 million, compared with adjusted operating expenses in 2020, driven by higher fuel, purchased services and compensation and benefit expenses.
• Income from railway operations was a record $4.45 billion, up 48% or $1.45 billion. - Excluding the effects of the locomotive rationalization and impairment charges in 2020, income from railway operations was up 28%, or $961 million, on a year-over-year adjusted basis.
• Railway operating ratio was 60.1%, an all-time record and an improvement of 920 basis points over 2020. - Excluding the effects of the locomotive rationalization and impairment charges in 2020, the operating ratio improved 430 basis points over the adjusted results for 2020.