Eastern Railroad Discussion > Norfolk Southern (NSC) - Q2 Earnings July 26, 2017

http://money.cnn.com/news/newsfeeds/articles/prnewswire/PH50561.htm

Pretty good result achieved with an incremental approach vs EHH's methodology.



Edited 1 time(s). Last edit at 07/26/17 09:34 by NYSWSD70M.

And it bolsters my contention that CSX probably would have posted similar numbers with or WITHOUT hiring EHH.



Edited 1 time(s). Last edit at 07/27/17 04:22 by junctiontower.

And speaking of CSX, NS Execs were pretty low key on the Q2 earnings con call when asked whether CSX current tribulations was enhancing NS' revenues. Here's a relevant excerpt from the analyst Q&A:

"Jason Seidl - Cowen and Company, LLC

All right. I guess, my follow-up is going to be more on the top line side. We did, as you know, our big Railroad Shipper survey,. And your eastern competitor probably got the worst ratings and service. And we just held dinner last night with some railroad people, and clearly, they're having some service challenges over there. Have you seen freight come over from the other eastern railroads due to poorer-than-expected service, where it can come over? And if it's come over, has it come over at regular pricing, or have you been able to actually increase the pricing on that?

James A. Squires - Norfolk Southern Corp.

Look, Jason, again, let me just set the stage here, and I'm going to let Alan comment specifically on what's going on with the top line in that regard. But first off, our focus is very much on enhancing value at NSC and driving our plan to continue to drive productivity and growth. And growth is an important part of that plan. We'll take the market share, whether it's from truck or competitors, as long as it complements our network and obviously falls to the bottom line. Those are the keys.

So, Alan, what are you seeing in terms of the landscape?

Alan H. Shaw - Norfolk Southern Corp.

Jason, we are always talking to our customers. As Jim noted, our primary form of competition is truck. But we're talking to our customers about service products that offer a sustainable view of their markets and allow them to grow. And we have seen some business move over to us. It's a small amount, I'll tell you that, but it's early. We've got a really good service product. The customers value the continuity of our market approach, of our operating philosophy, and our focus on allowing them to grow with their customers.

...

Alan H. Shaw - Norfolk Southern Corp.

So, we're going to capitalize on opportunities that fit our network. And if customers see that we provide a predictable, efficient service product that meets their needs, whether that's in competition with truck or another rail carrier, then we're going to go after that business, Jim, as long as it fits our network and we can drive value to our shareholders.

Thomas Wadewitz - UBS Securities LLC

Okay. But when you said, it's early, does that imply that there might be some building in the opportunity, or am I over-reading that comment?

Alan H. Shaw - Norfolk Southern Corp.

I'll tell you that the average duration of our contract is three years, and so, it takes time for some things to play out."

JPB Wrote:
-------------------------------------------------------
> And speaking of CSX, NS Execs were pretty low key
> on the Q2 earnings con call when asked whether CSX
> current tribulations was enhancing NS' revenues.
> Here's a relevant excerpt from the analyst Q&A:
>
> "Jason Seidl - Cowen and Company, LLC
>
> All right. I guess, my follow-up is going to be
> more on the top line side. We did, as you know,
> our big Railroad Shipper survey,. And your eastern
> competitor probably got the worst ratings and
> service. And we just held dinner last night with
> some railroad people, and clearly, they're having
> some service challenges over there. Have you seen
> freight come over from the other eastern railroads
> due to poorer-than-expected service, where it can
> come over? And if it's come over, has it come over
> at regular pricing, or have you been able to
> actually increase the pricing on that?
>
> James A. Squires - Norfolk Southern Corp.
>
> Look, Jason, again, let me just set the stage
> here, and I'm going to let Alan comment
> specifically on what's going on with the top line
> in that regard. But first off, our focus is very
> much on enhancing value at NSC and driving our
> plan to continue to drive productivity and growth.
> And growth is an important part of that plan.
> We'll take the market share, whether it's from
> truck or competitors, as long as it complements
> our network and obviously falls to the bottom
> line. Those are the keys.
>
> So, Alan, what are you seeing in terms of the
> landscape?
>
> Alan H. Shaw - Norfolk Southern Corp.
>
> Jason, we are always talking to our customers. As
> Jim noted, our primary form of competition is
> truck. But we're talking to our customers about
> service products that offer a sustainable view of
> their markets and allow them to grow. And we have
> seen some business move over to us. It's a small
> amount, I'll tell you that, but it's early. We've
> got a really good service product. The customers
> value the continuity of our market approach, of
> our operating philosophy, and our focus on
> allowing them to grow with their customers.
>
> ...
>
> Alan H. Shaw - Norfolk Southern Corp.
>
> So, we're going to capitalize on opportunities
> that fit our network. And if customers see that we
> provide a predictable, efficient service product
> that meets their needs, whether that's in
> competition with truck or another rail carrier,
> then we're going to go after that business, Jim,
> as long as it fits our network and we can drive
> value to our shareholders.
>
> Thomas Wadewitz - UBS Securities LLC
>
> Okay. But when you said, it's early, does that
> imply that there might be some building in the
> opportunity, or am I over-reading that comment?
>
> Alan H. Shaw - Norfolk Southern Corp.
>
> I'll tell you that the average duration of our
> contract is three years, and so, it takes time for
> some things to play out."

Thanks for providing this.  With a service melt down, the CSX customer base has grounds to cancel and move - if they are able.  Customers are so captive these days, the number may be quite limited outside of bulk via transload and intermodal. 

It may be a great time to be in the trucking business.

NSC is down almost 10% in the last week,an $11 drop. Buy the rumor,sell the fact? Or something more??

Tom