0001552781-24-000408.txt : 20240725 0001552781-24-000408.hdr.sgml : 20240725 20240725160509 ACCESSION NUMBER: 0001552781-24-000408 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 17 CONFORMED PERIOD OF REPORT: 20240725 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20240725 DATE AS OF CHANGE: 20240725 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORFOLK SOUTHERN CORP CENTRAL INDEX KEY: 0000702165 STANDARD INDUSTRIAL CLASSIFICATION: RAILROADS, LINE-HAUL OPERATING [4011] ORGANIZATION NAME: 01 Energy & Transportation IRS NUMBER: 521188014 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08339 FILM NUMBER: 241142033 BUSINESS ADDRESS: STREET 1: 650 W PEACHTREE STREET NW CITY: ATLANTA STATE: GA ZIP: 30308 BUSINESS PHONE: 470-463-6807 MAIL ADDRESS: STREET 1: 650 W PEACHTREE STREET NW CITY: ATLANTA STATE: GA ZIP: 30308 8-K 1 e24315_nsc-8k.htm NSC 8-K
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

________________________________

 

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):

July 25, 2024 (July 25, 2024)

________________________________

soaring nameunderblacklg

NORFOLK SOUTHERN CORPORATION

(Exact name of registrant as specified in its charter)

______________________________________

 

Virginia 1-8339 52-1188014
(State or other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification Number)

 

650 West Peachtree Street NW

Atlanta, Georgia

30308-1925

(855) 667-3655
(Address of principal executive offices, including zip code) (Registrant’s telephone number, including area code)

 

No Change
(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

 

Trading Symbol

 

Name of each exchange

on which registered

Norfolk Southern Corporation
Common Stock (Par Value $1.00)
  NSC   New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

   

 

Item 2.02. Results of Operations and Financial Condition

Item 7.01. Regulation FD Disclosure

 

On July 25, 2024, Norfolk Southern Corporation (the “Company”) issued a press release, attached hereto as Exhibit 99.1, reporting second-quarter results for 2024. Attached hereto, as Exhibit 99.2, is the Quarterly Financial Data for the second quarter of 2024. This information is available on the Company’s website, www.norfolksouthern.com, on the “Investors” page under “Financial Reports.” This unaudited financial information and summary of certain notes to the consolidated financial statements should be read in conjunction with: (a) the consolidated financial statements and notes included in the Company's latest Annual Report on Form 10-K and in subsequent Quarterly Reports on Form 10-Q; and (b) any Current Reports on Form 8-K.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits

  

Exhibit Number   Description
     
99.1   Press Release dated July 25, 2024
99.2   2024 Q2 Financial Data
104   Cover Page Interactive Data File (embedded within the Inline XBRL document).

  

  

   

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

  SIGNATURES
  NORFOLK SOUTHERN CORPORATION
  (Registrant)
     
     
  /s/ Nabanita C. Nag
  Name: Nabanita C. Nag
  Title: EVP Corporate Affairs, CLO & Corporate Secretary

 

Date:  July 25, 2024

 

   

EX-99.1 2 e24315_ex99-1.htm

 

Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

 

Norfolk Southern reports second quarter 2024 results;
reaffirms full year adjusted operating ratio guidance

 

ATLANTA, July 25, 2024 – Norfolk Southern Corporation (NYSE: NSC) announced Thursday its second quarter 2024 financial results. For the quarter, income from railway operations was $1.1 billion, the operating ratio was 62.8%, and diluted earnings per share were $3.25.

 

After adjusting the results to exclude the impact of the Eastern Ohio incident, restructuring and other charges, and shareholder advisory costs from the proxy contest, railway operating income was $1.1 billion, the operating ratio was 65.1%, and diluted earnings per share were $3.06. Notably, in the second quarter, the impact of the Eastern Ohio incident included insurance recoveries which were greater than the costs incurred in the quarter.

 

“The Norfolk Southern team delivered strong results, including on operating ratio and expenses, that are directly in-line with the targets we committed to our shareholders,” said Norfolk Southern President and CEO Alan H. Shaw. “During the quarter, we demonstrated that we are leveraging our service product to secure volume growth, enhancing our safety culture, and accelerating operational improvements, while eliminating service recovery costs. These results show that our strategy is working and that our momentum is building. We are committed to accomplishing even more in the second half of 2024, and we reaffirm our guidance of a full year adjusted operating ratio of approximately 66%.”

 

Second Quarter Summary 

 

·Railway operating revenues of $3.0 billion, up $64 million, or 2%, compared to the second quarter of 2023. 

 

·Income from railway operations was $1.1 billion, an increase of $555 million, or 96%, compared to second quarter of 2023. 

 

oAdjusting for the Eastern Ohio incident and restructuring and other costs, income from railway operations was $1.1 billion, up $71 million, or 7%, compared to second quarter 2023.

 

·Operating ratio in the quarter was 62.8% compared to 80.7% in second quarter 2023.

 

oOn an adjusted basis, the operating ratio for second quarter 2024 was 65.1%. This represents 160 basis points of improvement from second quarter 2023 which was 66.7%.

 

·Diluted earnings per share were $3.25, an increase of 108% compared to second quarter 2023.

 

oAdjusting for the Eastern Ohio incident, restructuring and other costs, diluted earnings per share were $3.06, up $0.11, or 4%, compared to second quarter 2023.

 

###

 

Norfolk Southern Corporation | 1

 

 

About Norfolk Southern

 

Since 1827, Norfolk Southern Corporation (NYSE: NSC) and its predecessor companies have safely moved the goods and materials that drive the U.S. economy. Today, it operates a customer-centric and operations-driven freight transportation network. Committed to furthering sustainability, Norfolk Southern helps its customers avoid approximately 15 million tons of yearly carbon emissions by shipping via rail. Its dedicated team members deliver more than 7 million carloads annually, from agriculture to consumer goods, and Norfolk Southern originates more automotive traffic than any other Class I Railroad. Norfolk Southern also has the most extensive intermodal network in the eastern U.S. It serves a majority of the country’s population and manufacturing base, with connections to every major container port on the Atlantic coast as well as major ports in the Gulf of Mexico and Great Lakes. Learn more by visiting www.NorfolkSouthern.com.

 

Media Inquiries:  

Media Relations

 

Investor Inquiries:

Investor Relations

 

Non-GAAP Financial Measures

 

Information included within this press release contains non-GAAP financial measures, including adjusted income from railway operations, adjusted operating ratio, and adjusted diluted earnings per share. Non-GAAP financial measures should be considered in addition to, not as a substitute for, the financial measures reported in accordance with U.S. generally accepted accounting principles (GAAP).

 

Our second quarter 2024 non-GAAP financial results exclude the effects of certain expenses related to the Eastern Ohio incident, restructuring and other charges, and shareholder advisory costs. The following table adjusts our second quarter 2024 GAAP financial results to exclude the effects of those items. The income tax effects of the non-GAAP adjustments were calculated based on the applicable tax rates to which the non-GAAP adjustments related. We use these non-GAAP financial measures internally and believe this information provides useful supplemental information to investors to facilitate making period-to-period comparisons by excluding these costs. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant to be considered in isolation from, or as a substitute for, the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similar measures presented by other companies. With respect to our full-year 2024 adjusted operating ratio guidance, we are unable to predict or estimate with reasonable certainty the ultimate outcome of certain items required for the GAAP measure without unreasonable effort. Information about the adjustments that are not currently available to us could have a potentially unpredictable and significant impact on future GAAP results.

 

($ in millions, except per share amounts)  Second
Quarter 2024
 
     
Income from railway operations  $1,131 
Effect of the Incident and restructuring and other charges   (68)
Adjusted income from railway operations  $1,063 
      
Operating ratio   62.8%
Effect of the Incident and restructuring and other charges   2.3%
Adjusted operating ratio   65.1%
      
Diluted earnings per share  $3.25 
Effect of the Incident, restructuring and other charges, and shareholder advisory costs   (0.19)
Adjusted diluted earnings per share  $3.06 

 

Norfolk Southern Corporation | 2

 
EX-99.2 3 e24315_ex99-2.htm

 

Exhibit 99.2

 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)

 

   Second Quarter   First Six Months 
   2024   2023   2024   2023 
   (in millions, except per share amounts) 
                 
Railway operating revenues                    
Merchandise  $1,904   $1,826   $3,767   $3,704 
Intermodal   742    745    1,487    1,559 
Coal   398    409    794    849 
Total railway operating revenues   3,044    2,980    6,048    6,112 
                     
Railway operating expenses                    
Compensation and benefits   700    693    1,436    1,383 
Purchased services and rents   516    506    1,044    1,002 
Fuel   257    263    541    578 
Depreciation   335    321    672    642 
Materials and other   173    205    388    417 
Restructuring and other charges   (3)       96     
Eastern Ohio incident   (65)   416    527    803 
Total railway operating expenses   1,913    2,404    4,704    4,825 
                     
Income from railway operations   1,131    576    1,344    1,287 
                     
Other income – net   17    57    35    113 
Interest expense on debt   204    170    405    345 
                     
Income before income taxes   944    463    974    1,055 
                     
Income taxes   207    107    184    233 
                     
Net income  $737   $356   $790   $822 
                     
Earnings per share – diluted  $3.25   $1.56   $3.48   $3.60 
                     
Weighted average shares outstanding – diluted   226.4    228.0    226.3    228.1 

 

See accompanying notes to consolidated financial statements.

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

 

   June 30,   December 31, 
   2024   2023 
   ($ in millions) 
Assets          
Current assets:          
Cash and cash equivalents  $659   $1,568 
Accounts receivable – net   1,189    1,147 
Materials and supplies   308    264 
Other current assets   148    292 
Total current assets   2,304    3,271 
           
Investments   3,812    3,839 
Properties less accumulated depreciation of $13,630 and $13,265, respectively   35,280    33,326 
Other assets   1,162    1,216 
           
Total assets  $42,558   $41,652 
           
Liabilities and stockholders’ equity          
Current liabilities:          
Accounts payable  $1,535   $1,638 
Short-term debt   400     
Income and other taxes   208    262 
Other current liabilities   1,269    728 
Current maturities of long-term debt   255    4 
Total current liabilities   3,667    2,632 
           
Long-term debt   16,937    17,175 
Other liabilities   1,747    1,839 
Deferred income taxes   7,228    7,225 
           
Total liabilities   29,579    28,871 
           
Stockholders’ equity:          
Common stock $1.00 per share par value, 1,350,000,000 shares authorized; outstanding 226,096,433 and 225,681,254 shares, respectively, net of treasury shares   227    227 
Additional paid-in capital   2,208    2,179 
Accumulated other comprehensive loss   (330)   (320)
Retained income   10,874    10,695 
           
Total stockholders’ equity   12,979    12,781 
           
Total liabilities and stockholders’ equity  $42,558   $41,652 

 

See accompanying notes to consolidated financial statements.

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

 

   First Six Months 
   2024   2023 
   ($ in millions) 
Cash flows from operating activities          
Net income  $790   $822 
Reconciliation of net income to net cash provided by operating activities:          
Depreciation   672    642 
Deferred income taxes   5    (35)
Gains and losses on properties   (25)   (25)
Changes in assets and liabilities affecting operations:          
Accounts receivable   (43)   57 
Materials and supplies   (44)   (19)
Other current assets   57    36 
Current liabilities other than debt   596    460 
Other – net   (133)   (92)
           
Net cash provided by operating activities   1,875    1,846 
           
Cash flows from investing activities          
Property additions   (1,125)   (948)
Acquisition of assets of CSR   (1,643)    
Property sales and other transactions   70    61 
Investment purchases   (206)   (6)
Investment sales and other transactions   337    152 
           
Net cash used in investing activities   (2,567)   (741)
           
Cash flows from financing activities          
Dividends   (610)   (615)
Common stock transactions   (5)   (9)
Purchase and retirement of common stock       (303)
Proceeds from borrowings   600    724 
Debt repayments   (202)   (802)
           
Net cash used in financing activities   (217)   (1,005)
           
Net increase (decrease) in cash and cash equivalents   (909)   100 
           
Cash and cash equivalents          
At beginning of year   1,568    456 
At end of period  $659   $556 
           
Supplemental disclosures of cash flow information          
Cash paid during the period for:          
Interest (net of amounts capitalized)  $373   $318 
Income taxes (net of refunds)   107    315 

 

See accompanying notes to consolidated financial statements.

 
 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

1. Eastern Ohio Incident

 

On February 3, 2023, a train operated by us derailed in East Palestine, Ohio (the Incident). We recognized expenses of $527 million and $803 million during the first six months of 2024 and 2023, respectively, for costs related to the Incident. Insurance recoveries exceeded expenses by $65 million in the second quarter of 2024 compared to expenses of $416 million in the second quarter of 2023. The total expense recognized in the first six months of 2024 includes the impact of $264 million in insurance recoveries, of which $156 million was recognized in the second quarter 2024. No insurance recoveries were recorded during the first six months of 2023. Any additional amounts recoverable under our insurance policies or from third parties will be reflected in future periods in which recovery is considered probable. No amounts have been recorded related to potential third-party recoveries, which may reduce amounts payable by our insurers under applicable insurance coverage.

 

2. Restructuring and Other Charges

 

During the first six months of 2024, the Company executed a voluntary and an involuntary separation program that resulted in a reduction of approximately 350 management employees. In the first six months of 2024, “Restructuring and other charges” includes $61 million of costs related to these programs which primarily consists of separation payments to the impacted management employees. The Company also incurred $35 million of costs associated with the March 2024 appointment of our chief operating officer. Additionally, “Other income – net” includes a $20 million curtailment gain on our other postretirement benefit plan resulting from the restructuring, recorded in the second quarter of 2024.

 

3. Shareholder Advisory Costs

 

“Other income – net” includes costs associated with shareholder advisory matters, which amounted to $29 million and $50 million during the second quarter and first six months of 2024, respectively.

 

4. Deferred Income Taxes

 

During the first six months of 2024, we recorded a $27 million reduction to deferred income taxes, the result of a subsidiary restructuring that reduced our estimated deferred state income tax rate.

 

5. Stock Repurchase Program

 

We did not repurchase shares of common stock under our stock repurchase program in the first six months of 2024, while we repurchased and retired 1.3 million shares of common stock at a cost of $305 million in the first six months of 2023, inclusive of excise taxes.

 

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Cover
Jul. 25, 2024
Cover [Abstract]  
Document Type 8-K
Amendment Flag false
Document Period End Date Jul. 25, 2024
Entity File Number 1-8339
Entity Registrant Name NORFOLK SOUTHERN CORPORATION
Entity Central Index Key 0000702165
Entity Tax Identification Number 52-1188014
Entity Incorporation, State or Country Code VA
Entity Address, Address Line One 650 West Peachtree Street NW
Entity Address, City or Town Atlanta
Entity Address, State or Province GA
Entity Address, Postal Zip Code 30308-1925
City Area Code 855
Local Phone Number 667-3655
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Norfolk Southern Corporation
Trading Symbol NSC
Security Exchange Name NYSE
Entity Emerging Growth Company false

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