DOW JONES NEWSWIRES
Norfolk Southern Corp. (NSC) posted a 13% increase in
fourth-quarter net income as growth in coal-shipping revenue offset
smaller losses in the intermodal and general merchandise
segments.
The largely East Coast rail company reported net income of $452
million, or $1.21 a share, up from $399 million, or $1.02 a share,
a year ago.
Revenue rose 2% to $2.5 billion.
Analysts polled by Thomson Reuters projected per-share earnings
of $1.18 on revenue of $2.6 billion.
Chief Executive Wick Moorman said the company planned to invest
$1.4 billion in capital improvements in 2009, to help improve its
operational efficiency and service, and support business
growth.
Revenue from coal shipping rose 33% as volumes climbed 5%. For
general merchandise, revenue dropped 10% as volumes fell 19%.
Intermodal revenue, or sales from the movement of freight by two or
more modes of transportation, decreased 3.2% as volumes dropped
5%.
Earlier Tuesday, the company increased its dividend to 34 cents
from 32 cents. Norfolk said it has increased its dividend 17% over
the past 12 months.
Last week, rivals Union Pacific Corp. (UNP) and Burlington
Northern Santa Fe Corp. (BNI) reported fourth-quarter net income
improved by double-digit figures as fuel costs dropped, but volumes
also fell.
The company last month said it plans to reduce costs by cutting
capacity and laying off workers, as weakness in the auto,
construction and intermodal sectors hurt shippers' profits.
Last month, BMO Capital Markets cut its investment rating on
Norfolk to market perform from outperform, saying the company's
risk profile had increased amid falling oil prices, intense
competition in the trucking industry and uncertainty about
metallurgical coal demand in 2009.
Shares of Norfolk, which have lost half of their value from a
52-week high in July, were up 0.2% to $37.72 in after-hours
trading. The shares closed up 6.7% in the regular session.
-By John Kell, Dow Jones Newswires; 201-938-5285;
john.kell@dowjones.com
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