NS increases profit, cuts operating ratio

Norfolk Southern Corp. Tuesday reported second-quarter 2010 net income of $392 million, up 59% from the $247 million posted for second-quarter 2009. The railroad’s operating ratio fell five percentage points to 69.8%, a second-quarter record, from 74.8% during second-quarter 2009.

Diluted earnings per share were $1.04., beating the Wall Street estimate of 99 cents.

“This is our fourth straight quarter of volume growth, and we are optimistic about continued year-over-year increases in rail traffic,” said CEO Wick Moorman (pictured at left).

Second-quarter railway operating revenue increased 31% to $2.4 billion from the second quarter of 2009, primarily as the result of a 22% increase in traffic volume.

General merchandise revenue was $1.3 billion, up 31%. Coal revenue increased 36% to $696 million, and intermodal revenue reached $451 million, 23% higher compared with the second quarter of 2009.

Railway operating expenses were $1.7 billion, up 22%, mainly due to higher compensation and benefits, and fuel expenses. Income from railway operations improved 57% to $733 million.