Norfolk Southern Profit Beats Forecast

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Jan. 23 (Bloomberg) -- Norfolk Southern Corp. CEO Wick Moorman discusses the company's growth and earnings on Bloomberg Television's "Bloomberg Surveillance." (Source: Bloomberg)


A lot of railroads suffering because coal is dropping off as a shipment, but you managed to increase your general merchandise shipment.

I am wondering if that is because the economy is picking up or you targeted those particular items to replace coal?

Thanks for having me this morning.

I think some of both.

But i would focus right now on the economy.

The railroads are running very well and our service is good, but we are starting to see i think the economy pick up a little more.

We are optimistic that 2013 -- 2014 will be a stronger year for the u.s. economy and that obviously benefits a lot of folks, including norfolk southern.

One of the things in the general merchandise category you move more of his automobiles.

Some concern about autos having peaked for the year.

A you concerned about that?

Right now we see the automobile business as obviously back from the lows where it was.

And we still think there is room to run.

You look at the forecast for vehicles to be produced in the country, and they are up a little more this year.

Our business was up because not only of the general production but because some of the models of the plants we serve are up.

We have been very competitive in terms of getting some good service to those companies." x, -- how much of your bottom-line result is the result of oil prices going down?

They have stabilize in the outlook is for lower prices going forward.

As you know, we, like all transportation companies, have a fuel surcharge.

The fuel surcharge has a lag.

This quarter, there was a positive effect of the lag but over the year that effectively washes out.

We think that whether fuel prices go up or down, it does not have much of an effect on results.

Although obviously if fuel prices start to go up a lot, we become more and more competitive because of our fuel efficiency.

Wick, i want to broaden this out.

Warren buffett's investment in burlington northern i give-and-go made railroads -- five years ago made railroads and attractive sector.

I am wondering if there are misrepresentations or misperceptions about investing in rail?

What do people most get wrong?

I guess people think the railroad industry is an old line, stable business.

Actually we are very technologically adept.

We are very focused on service and a lot of shippers are not quite as familiar with the great service story of the railroad industry these days.

And a lot of people just don't realize how much of the nation's economy we move.

We are an absolutely integral part of everything that happens in this country.

So, we are much broader, much more sophisticated than i think a lot of people understand.

And as the economy grows, as fuel prices go up, as the highways become more and more congested, we are going to play more and more of a part of this nation's transportation infrastructure.

How do you deal about the concerns over shipping of oil and chemicals after the disasters in 2013? there are three things we are working on in particular with crude oil -- although, as you know, there are other hazardous materials we handle.

First, the rails have a great safety story in terms of reduction of accidents, in terms of investments, and our record in safety is extraordinarily good.

But we are still working on getting better.

That is number one.

We've got to understand exactly what this crude oil is.

There are questions about how it is composed.

And we have to make sure as a broad industry we are shipping it in the right kind of car.

And there is a lot of conversation with the regulators and industry about that as well.

Wick moorman, thank you very much, from norfolk southern.

Optimism about the economy going forward.

In terms of economic data coming up this morning, jobless

This text has been automatically generated. It may not be 100% accurate.


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