AP
Norfolk Southern Reports Higher Profit
Tuesday January 22, 6:11 pm ET
By Tim Huber, AP Business Writer
Norfolk Southern 4th-Quarter Profit Rises 3.6 Percent


Norfolk Southern Corp. said Tuesday its fourth-quarter profit rose 3.6 percent despite higher fuel costs and flat revenue from key businesses.

The Norfolk, Va.-based railroad credited higher revenue from hauling general merchandise for the increase.

Norfolk Southern said it earned $399 million, or $1.02 per share, in the three months that ended Dec. 31. The company earned $385 million, or 95 cents per share, during the same period of 2006.

Analysts had predicted Norfolk Southern would earn 90 cents per share.

Revenue increased to $2.45 billion in the quarter, compared with $2.32 billion a year earlier. Analysts predicted revenue of $2.33 billion.

"I am pleased to report that Norfolk Southern delivered a strong financial performance in the fourth quarter in the face of economic headwinds and higher fuel costs," Chief Executive Wick Moorman said in a statement.

While general merchandise revenue increased 10 percent to $1.4 billion in the quarter, other key areas posted more modest gains. Coal shipments increased 2 percent to $601 million in the quarter, though traffic volume decreased 5 percent in the quarter, Norfolk Southern said. Intermodal -- which involves moving freight from one transportation method to another -- increased 1 percent to $496 million in the quarter. Again, traffic volume was down in the quarter.

For the full year, Norfolk Southern reported net income fell to $1.46 billion, or $3.68 per share, from $1.48 billion, or $3.57 per share. Revenue rose to $9.43 billion from $9.41 billion.

Shares of Norfolk Southern rose 92 cents, or 2.1 percent, to close at $45.07. In aftermarket activity, they added another $1.02 to $46.09.

AP Business Writer Adam Schreck in New York contributed to this report.