NORFOLK, Va. - Norfolk Southern Corp. chugged its way to a record profit of $1.60 per share even while pulling in less overall income in the second quarter, the railroad said Tuesday.
Earnings per share were up 3 percent compared with $1.56 per diluted share in the same period last year.
Second-quarter 2011 net income included favorable, nonrecurring income tax-related benefits totaling $63 million or 18 cents per diluted share.
"In the second quarter, Norfolk Southern continued to deliver outstanding results. Our income from operations, diluted earnings per share and improved operating ratio all set records, despite the slow economic recovery and softness in our coal franchise," CEO Wick Moorman said.
"Our railroad continues to operate extremely well, and that enables us to control costs and operate efficiently while providing high levels of service for our customers."
Railway operating revenues of $2.9 billion were essentially flat in the second quarter compared to 2011. General merchandise revenues improved 9 percent to $1.6 billion. Coal revenues declined 15 percent to $755 million. Intermodal revenues improved 4 percent to $563 million.
Railway operating expenses for the second quarter fell 3 percent to $1.9 billion, compared with 2011.
Income from railway operations for the second quarter was $934 million, up 7 percent compared with the same period last year.
The second-quarter railway operating ratio improved 2 percentage points to an all-time record 67.5 percent, compared with 2011.
Anthony B. Hatch, an independent senior transportation analyst on Wall Street for more than 20 years, said the company had a "great quarter."
Earnings rose 16 to 17 percent from the previous year, and "a third over Wall Street's too-conservative expectations," Hatch said. "They faced a 12 percent drop in coal, famously and historically their base business. How? Excellent operations and growth in other markets that they had prepared through big [capital expenditures]."
Norfolk Southern Corp. is one of the nation's premier transportation companies. Its Norfolk Southern Railway subsidiary operates about 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 and industrial products.