Norfolk Southern Posts Record Results for Q4, Full Year
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Norfolk Southern Corp. reported record fourth-quarter and full-year net income from railway operations and operating ratio when the Class I railroad released its results Jan. 26.
The Atlanta-based company said it delivered an overall 13% increase in profit in the final three months of the year, even as the amount of freight it transported declined. Earnings climbed to $760 million, or $3.12 a share, compared with $671 million, $2.64, in 2020. The gain is attributed, in part, to higher rates and more efficient operations.
For the year, income surged 27% to $3 billion, or $12.11 a share compared with an adjusted $2.37 billion, adjusted $9.25. The railroad said the 2020 adjusted numbers reflected the sale of 703 locomotives it deemed as excess and were no longer needed for its ongoing operations.
Norfolk Southern-4q2021 Earnings Release by Transport Topics on Scribd
Q4 revenue rose 11% to $2.85 billion compared with $2.57 billion in the same period a year ago.
For the full year, Norfolk Southern said revenue climbed 14% to $11.1 billion from $9.78 billion in 2020.
The revenue and income results beat Wall Street’s expectations. A survey of four analysts by Zacks Investment Research forecast quarterly revenue at $2.79 billion, which it exceeded by $600 million. The average income forecast of seven analysts was for earnings of $3.04 per share.
Norfolk Southern’s fourth-quarter operating ratio fell to 60.4 from 61.8 in the same period a year ago. For the full year, it was 60.1 compared with 69.3 in 2020.
Squires
“The fourth quarter marks the successful completion of the ambitious three-year strategic plan we launched in 2019,” CEO James Squires said in a statement. “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.”
Revenue increased across all seven business lines:
• Agriculture, forest and consumer products saw a 4% increase to $570 million from $546 million.
• Chemicals gained 13% to $494 million from $438 million.
• Metals and construction showed a 9% improvement to $366 million from $336 million.
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• Automotive rose 3% year-over-year to $241 million from $233 million despite headwinds that included a shortage of computer chips and other supply chain issues.
• Merchandise was up 8% to $1.67 billion from $1.55 billion.
• Intermodal increased 14% to $831 million from $730 million.
• Coal shipment posted the biggest increase, 21% to $350 million from $290 million.
Norfolk Southern said it accomplished the increase in revenue even as it moved 4% fewer shipments of freight along the East Coast. The railroad forecasts revenue will grow by high single digits in 2022.
In the fourth quarter, average revenue per train carload increased by 13.5%.
Norfolk Southern operates about 19,500 miles of track in 22 states and the District of Columbia.
