Norfolk Southern posts revenue, income declines in Q4

Norfolk Southern Railway reported fourth-quarter 2023 railway operating revenue of $3.1 billion, down 5%, and railway operating income of $808 million, down 32%, compared to Q4 2022 results.

The railway operations figure includes a $150 million charge associated with the Feb. 3, 2023, derailment in East Palestine, Ohio. Adjusting for that charge, income from railway operations in the quarter declined 19% to $958 million.

The Class I posted diluted earnings per share of $2.32, down 32% compared to Q4 2022. Adjusting for East Palestine, diluted earnings per share were $2.83, down $0.59, or 17%.

"The fourth quarter marked the end of a challenging, yet transformational year for Norfolk Southern. I'm proud that the team responded with unwavering dedication while continuing to advance our strategy that strikes the necessary balance between service, productivity and growth,” said President and CEO Alan Shaw. “We invested in our people, enhanced our service performance and made a safe railroad even safer."

For full-year 2023, NS posted railway operating revenue of $12.2 billion, a 5% decrease, and railway operating income of $2.9 billion (inclusive of the $1.1 billion charge associated with the Eastern Ohio incident), a 41% decrease compared to 2022. Adjusting for the derailment, income from railway operations was $4 billion, down 18%.

"Norfolk Southern enters 2024 with positive momentum and a focus on driving further productivity gains and operational discipline through aggressive cost management," Shaw said. "We see growth on the horizon, and we are confident in our ability to deliver industry-competitive margins over time."

Meanwhile, in a staff memo yesterday, NS announced it is laying off 7% of its nonunion workforce amid a difficult freight cycle, according to MarketWatch.com. 

Workers affected include management and administrative staff. The company will offer a voluntary separation program.