NORFOLK SOUTHERN CORPORATION 
NORFOLK, Va., Jan. 22, 2013 /PRNewswire/ --
For fourth-quarter 2012:
-- Railway operating revenues were $2.7 billion.
-- Income from railway operations was $714 million.
-- Net income totaled $413 million.
-- Diluted earnings per share were $1.30.
-- The railway operating ratio was 73.4 percent.
For 2012:
-- Railway operating revenues were $11 billion.
-- Income from railway operations was $3.1 billion.
-- Net income was $1.7 billion.
-- Diluted earnings per share were $5.37.
-- The railway operating ratio was 71.7 percent.
Norfolk Southern Corporation (NYSE: NSC) today reported fourth-quarter 2012 net income of $413 million, or $1.30 per diluted share, compared with $480 million, or $1.42 per diluted share, earned in the fourth quarter of 2011. Net income for 2012 was $1.7 billion, or $5.37 per diluted share, compared with $1.9 billion, or $5.45 per diluted share, earned in 2011.
"While the fourth quarter reflected declines in coal shipments, we also saw steady intermodal volume gains coupled with improved volumes in our chemicals, auto, and housing sectors," said Norfolk Southern CEO Wick Moorman. "We remain focused on controlling costs and improving productivity while continuing to provide high service levels for our customers. In 2013, we plan to invest $2 billion in capital improvements to further our strong safety performance, improve operational efficiency and service, and support future growth."
Fourth-quarter railway operating revenues were $2.7 billion, down 4 percent compared with the same period of 2011. For 2012, railway operating revenues were $11 billion, 1 percent lower than 2011.
General merchandise revenues were $1.4 billion, 4 percent higher compared with fourth-quarter 2011 results. For 2012, general merchandise revenues increased to $5.9 billion, 6 percent higher compared with 2011. Traffic volume increased 1 percent in the quarter and 2 percent for the year compared with the same periods of 2011.
Coal revenues were $657 million, 23 percent lower compared with fourth-quarter 2011, and $2.9 billion for 2012, 17 percent lower than 2011. Coal traffic volume declined 13 percent both in the quarter and for 2012 compared with the same periods of 2011.
Intermodal revenues increased to $584 million, 5 percent higher compared with fourth-quarter 2011. For the full year, intermodal revenues reached $2.2 billion, up 5 percent compared with 2011. Traffic volume increased 4 percent in the quarter and 5 percent for 2012 compared with the same periods of 2011.
Fourth-quarter railway operating expenses were $2 billion, 1 percent lower compared with the same period a year earlier. For 2012, railway operating expenses were $7.9 billion, also down 1 percent compared with 2011.
Income from railway operations was $714 million, 11 percent lower compared with fourth-quarter 2011, and $3.1 billion for 2012, 3 percent lower compared with 2011.
The railway operating ratio increased 3 percent to 73.4 percent during the fourth quarter and rose 1 percent to 71.7 percent for 2012 compared with the same periods of 2011.
Norfolk Southern Corporation is one of the nation's premier transportation companies. Its Norfolk Southern Railway subsidiary operates approximately 20,000 route miles in 22 states and the District of Columbia, serves every major container port in the eastern United States, and provides efficient connections to other rail carriers. Norfolk Southern operates the most extensive intermodal network in the East and is a major transporter of coal, automotive, and industrial products.
Connect with NS
http://www.nscorp.com
http://www.facebook.com/NorfolkSouthern
http://www.flickr.com/photos/norfolksouthern
http://www.twitter.com/nscorp
http://www.youtube.com/user/norfolksoutherncorp
Norfolk Southern Corporation and Subsidiaries
Consolidated Statements of Income
(Unaudited)
Three Months Ended Years Ended
December 31, December 31,
2012 2011 2012 2011
---- ---- ---- ----
(in millions, except per share amounts)
Railway operating revenues:
Coal $657 $850 $2,879 $3,458
General merchandise 1,443 1,393 5,920 5,584
Intermodal 584 554 2,241 2,130
--- --- ----- -----
Total railway operating revenues 2,684 2,797 11,040 11,172
----- ----- ------ ------
Railway operating expenses:
Compensation and benefits 726 734 2,960 2,974
Purchased services and rents 418 419 1,604 1,610
Fuel 395 403 1,577 1,589
Depreciation 233 221 916 862
Materials and other (note 1) 198 220 859 924
--- --- --- ---
Total railway operating expenses 1,970 1,997 7,916 7,959
----- ----- ----- -----
Income from railway operations 714 800 3,124 3,213
Other income - net 36 39 129 160
Interest expense on debt 129 116 495 455
--- --- --- ---
Income before income taxes 621 723 2,758 2,918
Provision for income taxes:
Current 121 130 643 475
Deferred 87 113 366 527
Total income taxes (note 2) 208 243 1,009 1,002
Net income $413 $480 $1,749 $1,916
==== ==== ====== ======
Earnings per share (note 3):
Basic $1.31 $1.44 $5.42 $5.52
Diluted 1.30 1.42 5.37 5.45
Weighted average shares outstanding (note 4):
Basic 314.8 332.8 320.9 345.5
Diluted 318.6 338.6 325.2 351.3
Norfolk Southern Corporation and Subsidiaries
Consolidated Statements of Comprehensive Income
(Unaudited)
Three Months Ended Years Ended
December 31, December 31,
2012 2011 2012 2011
---- ---- ---- ----
($ in millions)
Net income $413 $480 $1,749 $1,916
Other comprehensive loss, before tax:
Pension and other postretirement benefits (211) (410) (114) (325)
Other comprehensive loss of equity investees (9) (21) (13) (21)
--- --- --- ---
Other comprehensive loss, before tax (220) (431) (127) (346)
Income tax benefit related to items of other
comprehensive loss 82 158 44 125
--- --- --- ---
Other comprehensive loss, net of tax (138) (273) (83) (221)
---- ---- --- ----
Total comprehensive income $275 $207 $1,666 $1,695
==== ==== ====== ======
Norfolk Southern Corporation and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
December 31, December 31,
2012 2011
---- ----
($ in millions)
Assets
Current assets:
Cash and cash equivalents $653 $276
Short-term investments 15 25
Accounts receivable - net 1,109 1,022
Materials and supplies 216 209
Deferred income taxes 167 143
Other current assets 82 76
--- ---
Total current assets 2,242 1,751
Investments 2,300 2,234
Properties less accumulated
depreciation of $9,922 and
$9,464, respectively 25,736 24,469
Other assets 64 84
--- ---
Total assets $30,342 $28,538
======= =======
Liabilities and stockholders'
equity
Current liabilities:
Accounts payable $1,362 $1,092
Short-term debt 200 100
Income and other taxes 206 207
Other current liabilities 263 252
Current maturities of long-term
debt 50 50
--- ---
Total current liabilities 2,081 1,701
Long-term debt 8,432 7,390
Other liabilities 2,237 2,050
Deferred income taxes 7,832 7,486
----- -----
Total liabilities 20,582 18,627
------ ------
Stockholders' equity:
Common Stock $1.00 per share par
value, 1,350,000,000 shares
authorized; outstanding 314,034,174
and 330,386,089 shares,
respectively, net of treasury
shares 315 332
Additional paid-in capital 1,911 1,912
Accumulated other comprehensive
loss (1,109) (1,026)
Retained income 8,643 8,693
----- -----
Total stockholders' equity 9,760 9,911
----- -----
Total liabilities and stockholders'
equity $30,342 $28,538
======= =======
Norfolk Southern Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
Years Ended
December 31,
2012 2011
---- ----
($ in millions)
Cash flows from
operating
activities:
Net income $1,749 $1,916
Reconciliation
of net income
to net cash
provided by
operating
activities:
Depreciation 922 869
Deferred income
taxes 366 527
Gains and losses
on properties
and investments (6) (32)
Changes in
assets and
liabilities
affecting
operations:
Accounts
receivable (64) (215)
Materials and
supplies (7) (40)
Other current
assets (6) 14
Current
liabilities
other than debt 82 68
Other - net 29 120
--- ---
Net cash
provided by
operating
activities 3,065 3,227
Cash flows from
investing
activities:
Property
additions (2,241) (2,160)
Property sales
and other
transactions 192 84
Investments,
including
short-term (23) (135)
Investment sales
and other
transactions 78 439
--- ---
Net cash used in
investing
activities (1,994) (1,772)
Cash flows from
financing
activities:
Dividends (624) (576)
Common Stock
issued - net 89 120
Purchase and
retirement of
Common Stock
(note 4) (1,288) (2,051)
Proceeds from
borrowings -
net 1,491 1,101
Debt repayments (362) (600)
---- ----
Net cash used in
financing
activities (694) (2,006)
---- ------
Net increase
(decrease) in
cash and cash
equivalents 377 (551)
Cash and cash
equivalents:
At beginning of
year 276 827
--- ---
At end of year $653 $276
==== ====
Supplemental
disclosures of
cash flow
information:
Cash paid during
the year for:
Interest (net of
amounts
capitalized) $473 $435
Income taxes
(net of
refunds) 618 289
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS:
1. MATERIALS AND OTHER During the first quarter of 2011, we received
an unfavorable ruling for an arbitration claim with an insurance carrier,
and were denied recovery of the contested portion of the claim. As a
result, we recorded a $43 million charge for the receivables associated
with the contested portion of the claim and a $15 million charge for
other receivables affected by the ruling for which recovery was no longer
probable.
2. INCOME TAXES During the second quarter of 2011, the Internal Revenue
Service (IRS) completed its examination of our 2008 tax return and review
of certain claims for refund for prior years that resulted in a decrease
in income tax expense of $40 million. During the second and fourth
quarters of 2011, enacted state tax law changes resulted in a decrease to
deferred income tax expense of $19 million and $11 million, respectively.
3. EARNINGS PER SHARE For basic earnings per share, income available to
common stockholders reflects reductions for the effect of dividend
equivalent payments made to holders of stock options and restricted stock
units as follows: for the fourth quarter, $2 million in 2012 and $3
million in 2011; and for the year, $9 million in both 2012 and 2011.
For diluted earnings per share, income available to common stockholders
reflects reductions for the effect of dividend equivalent payments made
to holders of stock options and restricted stock units as follows: for
the fourth quarter, $1 million in 2012 and less than $1 million in 2011;
and for the year, $4 million in 2012 and $2 million in 2011.
4. STOCK REPURCHASE PROGRAM We repurchased and retired 18.8 million
shares of Common Stock in 2012, at a cost of $1.3 billion, and 30.2
million shares at a cost of $2.1 billion for the same period of 2011. On
August 1, 2012, our Board of Directors authorized the repurchase of up to
an additional 50 million shares of Common Stock through December 31,
2017. The timing and volume of purchases is guided by our assessment of
market conditions and other pertinent factors. Any near-term share
repurchases are expected to be made with internally generated cash, cash
on hand, or proceeds from borrowings. Since the beginning of 2006, we
have repurchased and retired 128.4 million shares at a total cost of $7.5
billion.
SOURCE Norfolk Southern Corporation
