Norfolk Southern Corp. on April 20, 2016 announced that it will downsize its Knoxville, Tenn., classification yard, effective May 1. “The action is in response to lower traffic volumes and is consistent with the company’s ongoing implementation of its strategic plan to enhance operating efficiencies, reduce costs, drive profitability and support long-term growth,” NS said.
Despite a 4% drop in revenues, Canadian Pacific Railway Ltd. posted its lowest-ever first-quarter operating ratio of 58.9% and reported diluted earnings per share of $3.51, or $2.50 on an adjusted diluted earnings per share basis, for first-quarter 2016.
Kansas City Southern (KCS) on April 19, 2016 reported a first quarter 2016 operating ratio of 66.6%, a 2.3-point improvement from 70.5% in first-quarter 2015. KCS also reported first-quarter 2016 revenues of $563 million, a decrease of 7% from first-quarter 2015.
The Association of American Railroads on April 12, 2016 presented Michael Hoey, a CSX Transportation civil engineer from Philadelphia, Pa., the 2016 John H. Chafee Environmental Excellence Award. U.S. Senator Cory Gardner (R-Colo.) was the 2016 John H. Chafee Congressional Environmental Award.
Impacted by lower volume, CSX posted first-quarter 2016 net earnings of $356 million, or $0.37 per share, down from $442 million, or $0.45 per share, in the same period of last year. “Service improvements, significant efficiency and resource alignment savings combined to help offset the impact of lower volume,” the company said.
Rail price increases will come at a slowing rate over the next 6-12 months, says Cowen and Company Managing Director and Railway Age Wall Street Contributing Editor Jason Seidl. This marks the fifth consecutive quarter of moderation as shippers are expecting rates to rise just 2.9%, according to Cowen’s 1Q2016 Rail Shipper Survey.
Well, it’s all over but the ruminating and regurgitating: Hedge fund king Bill Ackman had his blinders ripped off, read the handwriting on the wall, and wisely deep-sixed his attempt to bolster his sagging pockets by going after Norfolk Southern, a damn good railroad that doesn’t need a radical makeover.
On Monday, April 11, 2016, Canadian Pacific Railway Ltd. terminated its efforts to merge with Norfolk Southern Corp.. This includes “withdrawal of a resolution asking NS shareholders to vote in favor of good-faith negotiations between the two companies,” CP sais. “No further financial offers or overtures to meet with the NS board of directors are planned at this time.”
The Surface Transportation Board, in seeking comments addressing Canadian Pacific’s petition for an expedited declaratory order, has received letters from the U.S. Department of Justice and the Department of Defense-United States Army, Military Surface Deployment and Distribution Command Transportation Engineering Agency, Railroads for National Defense Program opposing CP’s proposed acquisition of Norfolk Southern, and/or CP CEO Hunter Harrison becoming a senior executive at NS.
CSX Corp. on April 6, 2016 announced the recipients of its 22nd annual Chemical Safety Excellence Award, recognizing 78 customers for their commitment to the safe transportation of hazardous materials by rail.