Railroad transporter Norfolk Southern Corp. (NSC), said Tuesday its first-quarter earnings jumped 26 percent from last year on growth at its General Merchandise and Intermodal segments and the absence of one-time charges recorded last year.
Earnings for the quarter were in line with Street estimates, while revenue topped expectations. Norfolk Southern shares gained 2.85 percent in after-hours trade on the New York Stock Exchange.
Norfolk Southern said its railway operating revenue for the quarter grew 6 percent from last year, marked by a 5 percent rise in revenue per unit.
General merchandise segment revenue rose 13 percent from last year, while Intermodal revenue rose 9 percent. Intermodal segment involves the transportation of freight in an intermodal container or vehicle, using multiple modes of transportation.
Coal segment revenue for the quarter was down 6 percent compared to last year.
Commenting on the results, CEO Wick Moorman said, "The benefits of our steady focus on service and operating efficiency are reflected in our results, and we continue to position our franchise for sustained growth through strategic investments in infrastructure."
Norfolk Southern said its railway operating ratio, which measures the percentage of revenue that is consumed by expenses, improved 5 percent to 73.3 percent from a year ago.
Norfolk, Virginia-based Norfolk Southern reported first-quarter net income of $410 million or $1.23 per share, compared to $325 million or $0.90 per share last year.
On average, 24 analysts polled by Thomson Reuters expected the company to earn $1.12 per share for the quarter. Analysts' estimate typically exclude special items.
Railway operating revenue for the quarter was $2.8 billion, compared to $2.62 billion in the prior year. Seventeen analysts expected revenue of $2.75 billion.
The company repurchased and retired 5.7 million shares of common stock at a cost of $400 million during the quarter.
Among others in the industry, Norfolk Southern's bigger rival Canadian National Railway Co. (CNI,CNR.TO) yesterday reported a rise in first-quarter earnings on a 13 percent growth in revenue.
The company's peer CSX Corp. (CSX) last week had reported a 23 percent rise in quarterly earnings on strong shipment growth in Merchandise and Intermodal freight segments and higher price realizations.
The positive results by major transport companies come amid a slight turnaround in economic conditions as demand for raw materials and goods gain momentum.
NSC closed Tuesday at $70.22, up $0.82 or 1.18%, on a volume of 2.9 million shares. In after hours, the stock slid $0.11 or 0.16%.
by RTT Staff Writer
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