Norfolk Southern Corp.'s first-quarter profit fell 18 percent as severe winter weather slowed shipments and the railroad delivered 1 percent less freight overall.
The Norfolk, Virginia, based railroad said Wednesday it earned $368 million, or $1.17 per share, during the January-March period. That's down from $450 million, or $1.41 per share, a year ago.
“Following the extreme winter weather across the U.S. rail network which impacted first-quarter results, we are seeing a rebound in shipments across all of our business,” Norfolk Southern CEO Wick Moorman wrote in a statement. “Our people responded admirably to meet the challenges of the harsh conditions, and we remain focused on delivering superior service to our customers.”
Last year's results were helped by a one-time $60 million real estate gain that boosted profits by 19 cents per share.
Analysts surveyed by FactSet expected earnings per share of $1.15 for the latest quarter.
Norfolk Southern says revenue declined 2 percent to $2.69 billion. Analysts expected $2.739 billion.
Declines in automotive, construction and forest product shipments offset increases in crude oil and liquefied petroleum gas shipments.
Norfolk Southern shares fell 92 cents to $96 in premarket trading.
Here is the news release from Norfolk Southern:
Norfolk Southern reported first-quarter net income of $368 million, or $1.17 per diluted share, compared with $450 million, or $1.41 per diluted share, earned in the same period of 2013. First-quarter 2013 net income included a $60 million, or $0.19 per diluted share, gain from a land sale.
First-Quarter 2014 Results
- Railway operating revenues totaled $2.7 billion.
- Income from railway operations was $667 million.
- Net income totaled $368 million.
- Diluted earnings per share of $1.17.
- The railway operating ratio was 75.2 percent.
“Following the extreme winter weather across the U.S. rail network which impacted first-quarter results, we are seeing a rebound in shipments across all of our business,” said Norfolk Southern CEO Wick Moorman. “Our people responded admirably to meet the challenges of the harsh conditions, and we remain focused on delivering superior service to our customers.”
Railway operating revenues were $2.7 billion, 2 percent lower compared with first-quarter 2013, and shipment volumes decreased 1 percent.
First-Quarter Revenue by Commodity
- Chemicals, up 12 percent.
- Intermodal, up 4 percent.
- Agriculture, even.
- Metals/Construction, down 1 percent.
- Paper/Forest, down 3 percent.
- Automotive, down 7 percent
- Coal, down 15 percent.
For the first quarter, general merchandise revenues were $1.6 billion, 1 percent higher than the same period last year, despite overall volume declining 1 percent. Increased crude and liquefied petroleum gas shipments were offset by declines in automotive, metals/construction, and paper/forest shipments.
Intermodal revenues improved 4 percent, to $596 million, compared with first-quarter 2013. Growth primarily in domestic business pushed traffic volume up 3 percent in the quarter compared with the same period of 2013.
First-quarter coal revenues were $541 million, 15 percent lower compared with the same quarter of 2013, the result of a 13 percent volume decrease due primarily to lower utility and export shipments.
Railway operating expenses for the first quarter were $2 billion, 1 percent lower than in the same period of 2013.
Income from railway operations was $667 million, 3 percent lower compared with first-quarter 2013.
The quarterly railway operating ratio, or operating expenses as a percentage of revenue, was 75.2 percent versus 74.8 percent in the same period of 2013.