NS' Q3 profit plummets after derailment charge

Norfolk Southern Railway today reported third-quarter 2023 income from rail operations of $756 million and diluted earnings per share of $2.10. The results include a $163 million charge associated with the Feb. 3 train derailment in East Palestine, Ohio, which includes an initial insurance recovery of $25 million.

Adjusting for the effects of the incident charge, Q3 results included income from railway operations of $919 million and diluted earnings per share of $2.65 — declines of 28% and 35%, respectively, compared to Q3 2022 results, NS officials said in a press release.

Revenue from rail operations was $3 billion, an 11% decrease. Net income for the quarter totaled $478 million, down 50% from the year-ago period. NS posted an operating ratio of 74.6% for the quarter, up from 62% in Q3 2022.

"In the third quarter, we continued to invest in our people and our assets to lay the foundation for our innovative strategy," said NS President and CEO Alan Shaw. "Part of charting a better way forward for Norfolk Southern is building solid operational disciplines that move us toward consistency, all to enable productivity enhancements and growth in the quarters ahead."

During the first nine months of 2023, NS recognized $966 million of expense for costs primarily associated with environmental matters and legal proceedings resulting from the derailment in East Palestine.