NS net income falls 16% in Q1

The railway reported net income of $310 million on total operating revenues of $2.6 billion in first quarter 2015.    Norfolk Southern Corporation reported a 16 percent drop in net income to $310 million in the first quarter of 2015 compared with the first quarter of 2014. Railway operating revenues were down 5 percent to $2.6 billion for the quarter, according to the company’s latest financial statements.
   Diluted earnings per share at NS fell from $1.17 per diluted share in Q1 2014 to $1.00 per diluted share in Q1 2015. The company attributed the decline in profits primarily to lower fuel surcharge revenue, lower coal volumes and lower average revenue per unit.
   Norfolk Southern increased its total volumes 2 percent for the quarter, with growth in intermodal and merchandise traffic.
   General merchandise volumes were up 3 percent, led by increases in chemicals and automotive shipments. Overall revenues for the segment, however, were down 2 percent year-over-year to $1.5 billion in the first quarter. Revenues from chemicals cargo fell 2 percent to $432 million; agriculture revenues were up 4 percent to $374 million; revenues from shipments of metals and construction materials were down 6 percent to $310 million; automotive revenues fell 4 percent to $219 million; and revenues from the company’s paper and forest segment decreased 3 percent to $185 million.
   Revenues from the company’s intermodal unit fell 1 percent to $592 million despite a 5 percent increase in volumes from the first quarter the previous year.
  Coal volumes decreased 7 percent at NS, causing a 16 percent year-over-year dip in revenues to $455 million in the first quarter of 2015.
   “Our first quarter results reflected continued weakness in our coal markets along with a slowdown in network velocity in part caused by severe winter weather which impacted both our expenses and our volumes,” NS CEO Wick Moorman said of the results. “Looking ahead, while the market uncertainties remain, the resources that we are deploying are driving improved network performance, and we expect our service levels will be significantly higher in the second half.”