Eastern Railroad Discussion > NS Meets Earnings expectations

Norfolk Southern Meets Expectations
By THE ASSOCIATED PRESS


Filed at 2:48 p.m. ET


NORFOLK, Va. (AP) -- Norfolk Southern Corp.'s second quarter earnings rose 11 percent, matching Wall Street forecasts even as coal shipments fell in the face of weakened demand by utilities.

The railroad company said Wednesday it earned $119 million, or 31 cents per share in the quarter, as its intermodal and general merchandise business grew. That was in line with the Thomson First Call analyst consensus estimate.

The company had earnings of $107 million, or 28 cents per share, in the same quarter a year ago.

Revenue for the quarter ended June 30 totaled $1.59 billion, unchanged from the same period last year.

Coal revenues declined 11 percent to $350 million from $395 million in the second quarter as utilities took longer to use up stockpiles because mild weather meant less need for electricity production.

But second quarter general merchandise revenues of $948 million were the highest of any quarter in Norfolk Southern's history, improving 3 percent over the second quarter of 2001.

``Second quarter results demonstrate our commitment to continued improvement in net income, operating expenses and operating ratio,'' said David R. Goode, chairman, president and chief executive officer. ``We expect to continue to build on that progress.''

Intermodal revenues climbed 7 percent in the second quarter to $295 million, reflecting increased demand for consumer products and traffic growth from the introduction of new services, the company said.

Railway operating expenses were $1.27 billion for the quarter, down 3 percent as fuel costs and freight car rental charges decreased.

For the first half of the year, net income was $205 million, or 53 cents per share, up from $181 million, or 47 cents a share. Earnings for the first half of last year included an after-tax gain of $13 million, or 3 cents per share, related to the 1998 sale of Norfolk Southern's former trucking subsidiary.

Revenue for the half was $3.1 billion, down slightly from the first half of 2001.

Railway operating expenses were $2.53 billion in the half, down 4 percent.

Norfolk Southern shares were up 15 cents to $18.20 each in afternoon trading on the New York Stock Exchange.