Norfolk Southern reports first-quarter 2013 results

             Norfolk Southern reports first-quarter 2013 results

PR Newswire

NORFOLK, Va., April 23, 2013

NORFOLK, Va., April 23, 2013 /PRNewswire/ --

For 2013 vs. 2012:

  oRailway operating revenues were $2.7 billion.
  oIncome from railway operations was $691 million.
  oNet income was $450 million, or $1.41 per diluted share.
  oNet income included $60 million, or $0.19 per diluted share from a
    property sale.
  oThe first-quarter railway operating ratio was 74.8 percent.

For the first quarter of 2013, Norfolk Southern Corporation (NYSE: NSC)
reported net income of $450 million, or $1.41 per diluted share, 10 percent
higher than $410 million, or $1.23 per diluted share, for the first quarter of
2012.

First-quarter results included a gain from the sale of land to the Michigan
Department of Transportation, which increased net income by $60 million, or
$0.19 per diluted share.

"We're pleased with Norfolk Southern's first-quarter results, which illustrate
our diverse customer base, superior operating performance, productivity
initiatives, and expense controls," said CEO Wick Moorman. "We are working to
ensure that our rail franchise continues to thrive regardless of how our
business mix changes."

Railway operating revenues were $2.7 billion, 2 percent lower compared with
first-quarter 2012, but shipment volumes increased 3 percent.

General merchandise revenues were $1.5 billion, 2 percent higher compared with
first-quarter 2012, driven by increased shipments of chemicals and
automobiles.

First-quarter coal revenues were $635 million, down 17 percent compared with
the same quarter last year, due to lower average revenue per unit and a 4
percent decline in volume, the result of mild winter weather and low natural
gas prices.

Intermodal revenues climbed 9 percent to $573 million as volumes increased by
9 percent compared with first-quarter 2012.

Railway operating expenses for the quarter were $2.0 billion, about even
compared with first-quarter 2012.

Income from railway operations for the first quarter was $691 million, 7
percent lower compared with the same period of 2012.

The railway operating ratio was 74.8 percent compared with 73.3 percent for
first-quarter 2012.

Norfolk Southern Corporation (NYSE: NSC) is one of the nation's premier
transportation companies. Its Norfolk Southern Railway Company 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.

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Norfolk Southern Corporation and Subsidiaries
Consolidated Statements of Income
(Unaudited)
                                     First Quarter
                                     2013                    2012
                                     ($ in millions, except per share amounts)
Railway operating revenues
Coal                                 $      635              $      766
General merchandise                         1,530                   1,496
Intermodal                                  573                     527
Total railway operating revenues            2,738                   2,789
Railway operating expenses
Compensation and benefits                   780                     786
Purchased services and rents                393                     391
Fuel                                        429                     413
Depreciation                                227                     224
Materials and other                         218                     230
Total railway operating expenses            2,047                   2,044
Income from railway operations              691                     745
Other income – net (note 1)                 135                     29
Interest expense on debt                    129                     120
Income before income taxes                  697                     654
Provision for income taxes
Current                                     173                     156
Deferred                                    74                      88
Total income taxes                         247                     244
Net income                           $      450              $      410
Earnings per share (notes 1 & 2)
Basic                                $      1.43             $      1.24
Diluted                                     1.41                    1.23
Weighted average shares outstanding
(note 3)
Basic                                       314.5                   328.3
Diluted                                     318.1                   332.9
See accompanying notes to consolidated financial statements.



Norfolk Southern Corporation and Subsidiaries
Consolidated Statements of Comprehensive Income
(Unaudited)
                                                      First Quarter
                                                      2013     2012
                                                      ($ in millions)
Net income                                            $  450   $ 410
Other comprehensive income, before tax:
Pension and other postretirement benefits                36      32
Other comprehensive income (loss) of equity investees    1       (4)
Other comprehensive income, before tax                   37      28
Income tax expense related to items of other
comprehensive income                                     (14)    (12)
Other comprehensive income, net of tax                   23      16
Total comprehensive income                            $  473   $ 426
See accompanying notes to consolidated financial statements.



Norfolk Southern Corporation and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
                                                      March 31,   December 31,
                                                      2013        2012
                                                      ($ in millions)
Assets
Current assets:
Cash and cash equivalents                             $  672      $    653
Short-term investments                                   15            15
Accounts receivable – net                                1,158         1,109
Materials and supplies                                   246           216
Deferred income taxes                                    167           167
Other current assets                                     65            82
Total current assets                                     2,323         2,242
Investments                                              2,341         2,300
Properties less accumulated depreciation of $10,042
and $9,922,
respectively                                             25,870        25,736
Other assets                                             65            64
Total assets                                          $  30,599   $    30,342
Liabilities and stockholders' equity
Current liabilities:
Accounts payable                                      $  1,188    $    1,362
Short-term debt                                          -             200
Income and other taxes                                   319           206
Other current liabilities                                350           263
Current maturities of long-term debt                     47            50
Total current liabilities                                1,904         2,081
Long-term debt                                           8,438         8,432
Other liabilities                                        2,226         2,237
Deferred income taxes                                    7,921         7,832
 Total liabilities                              20,489        20,582
Stockholders' equity:
Common stock $1.00 per share par value, 1,350,000,000
shares
authorized; outstanding 315,088,379 and 314,034,174
shares,
respectively, net of treasury shares                     316           315
Additional paid-in capital                               1,976         1,911
Accumulated other comprehensive loss                     (1,086)       (1,109)
Retained income                                          8,904         8,643
Total stockholders' equity                               10,110        9,760
Total liabilities and stockholders' equity            $  30,599   $    30,342
See accompanying notes to consolidated financial statements.



Norfolk Southern Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
                                                              First Quarter
                                                              2013     2012
                                                              ($ in millions)
Cash flows from operating activities
Net income                                                    $ 450    $ 410
Reconciliation of net income to net cash provided by
operating activities:
Depreciation                                                    228      226
Deferred income taxes                                           74       88
Gains and losses on properties and investments (note 1)         (99)     (1)
Changes in assets and liabilities affecting operations:
Accounts receivable                                             (49)     (34)
Materials and supplies                                          (30)     (19)
Other current assets                                            17       5
Current liabilities other than debt                             96       316
Other – net                                                     36       44
Net cash provided by operating activities                       723      1,035
Cash flows from investing activities
Property additions                                              (379)    (461)
Property sales and other transactions                           19       2
Investments, including short-term                               (5)      (4)
Investment sales and other transactions                         (1)      27
Net cash used in investing activities                           (366)    (436)
Cash flows from financing activities
Dividends                                                       (157)    (155)
Common stock issued – net                                       55       31
Purchase and retirement of common stock (note 3)                (33)     (400)
Proceeds from borrowings – net                                  -        696
Debt repayments                                                 (203)    (218)
Net cash used in financing activities                           (338)    (46)
Net increase in cash and cash equivalents                       19       553
Cash and cash equivalents
At beginning of period                                          653      276
At end of period                                              $ 672    $ 829
Supplemental disclosures of cash flow information
Cash paid during the period for:
Interest (net of amounts capitalized)                         $ 62     $ 60
Income taxes (net of refunds)                                   23       2
See accompanying notes to consolidated financial statements.



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS:

1.OTHER INCOME – NET
    First quarter 2013 results include a $97 million land sale gain, which
    increased net income by $60 million or $0.19 per share.
2.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
    first quarter, $2 million in 2013 and $3 million in 2012.
    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
    first quarter, $1 million in 2013 and $2 million in 2012.
3.STOCK REPURCHASE PROGRAM
    We repurchased and retired 0.5 million shares of common stock in the first
    quarter of 2013, at a cost of $33 million, and 5.7 million shares at a
    cost of $400 million for the same period of 2012. 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
    128.9 million shares at a total cost of $7.5 billion.



SOURCE Norfolk Southern Corporation

Website: http://www.nscorp.com
Contact: (Media) Frank Brown, 757-629-2710 (fsbrown@nscorp.com), (Investors)
Michael Hostutler, 757-629-2861 (michael.hostutler@nscorp.com)
 
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