A 34% increase in operating revenue, including gains for coal and intermodal, boosted Norfolk Southern’s net profit for the second quarter of 2021.
NS (NYSE: NSC) reported record second-quarter 2021 net income of $819 million, or $3.28 per diluted share, compared with $392 million, or $1.53 per diluted share, in the second quarter of 2020.
Operating revenues totaled nearly $2.8 billion amid a 41% revenue increase for intermodal and a 52% revenue increase for coal. Second-quarter volumes rose 25% year-over-year while revenue per unit grew 7%.
In contrast, operating revenue in the second quarter of 2020 was nearly $2.1 billion.
Operating expenses also rose year-over-year. Second-quarter expenses were $1.6 billion, an 11% increase from nearly $1.5 billion a year ago amid a 124% increase in fuel costs.
Income from railway operations grew by 91% and reached an all-time quarterly record of $1.2 billion in the second quarter.
NS achieved a record quarterly operating ratio of 58.3% for the second quarter, compared with 70.7% a year ago. Investors sometimes use OR to gauge the financial health of a company, with a lower OR implying improved financial health. Results in the second quarter of 2020 may also have been impacted by the volume trough that occurred as a result of the onset of the COVID-19 pandemic in North America.
“Our team met the challenge for the second quarter head-on, delivering another solid performance of sequential operating ratio improvement, driving meaningful productivity into our business as revenue and volume rebounded from last year, up 34% and 25%, respectively,” NS President and CEO Jim Squires said in a release. “Leveraging the strong and diverse book of business we have developed, we will build upon our success in the creation of long-term, sustainable value for our customers and shareholders.”
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