Norfolk Southern reported slightly lower first-quarter earnings after harsh winter weather affected volumes across much of its network in February.
Adjusted operating income declined 2% to $939 million, while revenue remained flat at $2.99 billion. Earnings per share fell 1% to $2.65.
The railroad’s adjusted operating ratio reached 68.7%, up 0.8 points from a year earlier.
Chief executive Mark George said the company successfully navigated a difficult winter, with weather events placing pressure on the network and volumes. He added that conditions improved in March, allowing Norfolk Southern to regain momentum.
Total adjusted expenses rose just 1% year on year despite inflation, storm-related costs and sharply higher fuel prices.
Overall volume declined 1% during the quarter, mainly due to a 4% drop in intermodal traffic. Coal traffic increased 9%, while merchandise volumes rose 1%.
The intermodal decline was driven largely by a 9% fall in international traffic compared with last year’s tariff-related volume spike. Merger-related domestic intermodal business losses also contributed, with some traffic shifting to CSX through its alliance with BNSF Railway.
Coal volumes benefited from a 27% increase in domestic utility shipments as higher natural gas prices encouraged utilities to rebuild coal stockpiles.
Merchandise growth was supported by share gains in chemicals and automotive markets.
Norfolk Southern and Union Pacific plan to submit a revised merger application to federal regulators on April 30, after their original filing was rejected as incomplete in January.
Operationally, car miles per day increased 2.5%, terminal dwell improved 3%, and customer service metrics for intermodal and merchandise shipments remained stable. The train accident rate improved 40%, while the main line accident rate improved 51%. The personal injury rate rose 10%.
