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Published: 2021-07-28 08:06:49 ET
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EX-99.2 3 e21490_ex99-2.htm

Exhibit 99.2

 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)

 

   Second Quarter   First Six Months 
   2021   2020   2021   2020 
   (in millions, except per share amounts) 
                 
Railway operating revenues                    
Merchandise  $1,680   $1,307   $3,288   $2,979 
Intermodal   801    569    1,520    1,224 
Coal   318    209    630    507 
Total railway operating revenues   2,799    2,085    5,438    4,710 
                     
Railway operating expenses                    
Compensation and benefits   624    586    1,235    1,208 
Purchased services and rents   429    372    822    775 
Fuel   188    84    365    273 
Depreciation   294    282    586    574 
Materials and other   97    151    248    317 
Loss on asset disposal   —    —    —    385 
Total railway operating expenses   1,632    1,475    3,256    3,532 
                     
Income from railway operations   1,167    610    2,182    1,178 
                     
Other income – net   35    49    42    71 
Interest expense on debt   161    156    317    310 
                     
Income before income taxes   1,041    503    1,907    939 
                     
Income taxes                    
Current   167    66    308    110 
Deferred   55    45    107    56 
Total income taxes   222    111    415    166 
                     
Net income  $819   $392   $1,492   $773 
                     
Earnings per share – diluted  $3.28   $1.53   $5.94   $3.00 
                     
Weighted average shares outstanding – diluted   250.0    256.7    251.3    257.7 

 

See accompanying notes to consolidated financial statements.

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

 

   June 30,   December 31, 
   2021   2020 
   ($ in millions) 
Assets          
Current assets:          
Cash and cash equivalents  $1,670   $1,115 
Accounts receivable – net   941    848 
Materials and supplies   246    221 
Other current assets   155    134 
Total current assets   3,012    2,318 
           
Investments   3,658    3,590 
Properties less accumulated depreciation of $11,777 and $11,985, respectively   31,355    31,345 
Other assets   729    709 
           
Total assets  $38,754   $37,962 
           
Liabilities and stockholders’ equity          
Current liabilities:          
Accounts payable  $1,116   $1,016 
Income and other taxes   302    263 
Other current liabilities   330    302 
Current maturities of long-term debt   1,048    579 
Total current liabilities   2,796    2,160 
           
Long-term debt   12,669    12,102 
Other liabilities   1,937    1,987 
Deferred income taxes   7,035    6,922 
           
Total liabilities   24,437    23,171 
           
Stockholders’ equity:          
Common stock $1.00 per share par value, 1,350,000,000 shares authorized; outstanding 246,972,217 and 252,095,082 shares, respectively, net of treasury shares   248    254 
Additional paid-in capital   2,240    2,248 
Accumulated other comprehensive loss   (578)   (594)
Retained income   12,407    12,883 
           
Total stockholders’ equity   14,317    14,791 
           
Total liabilities and stockholders’ equity  $38,754   $37,962 

 

See accompanying notes to consolidated financial statements.

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

 

   First Six Months 
   2021   2020 
   ($ in millions) 
Cash flows from operating activities          
Net income  $1,492   $773 
Reconciliation of net income to net cash provided by operating activities:          
Depreciation   586    574 
Deferred income taxes   107    56 
Gains and losses on properties   (75)   (11)
Loss on asset disposal   —    385 
Changes in assets and liabilities affecting operations:          
Accounts receivable   (96)   98 
Materials and supplies   (25)   (13)
Other current assets   30    30 
Current liabilities other than debt   170    — 
Other – net   (92)   (134)
           
Net cash provided by operating activities   2,097    1,758 
           
Cash flows from investing activities          
Property additions   (627)   (735)
Property sales and other transactions   66    258 
Investment purchases   (5)   (5)
Investment sales and other transactions   37    (58)
           
Net cash used in investing activities   (529)   (540)
           
Cash flows from financing activities          
Dividends   (496)   (482)
Common stock transactions   6    26 
Purchase and retirement of common stock   (1,525)   (669)
Proceeds from borrowings   1,087    784 
Debt repayments   (85)   (314)
           
Net cash used in financing activities   (1,013)   (655)
           
Net increase in cash and cash equivalents   555    563 
           
Cash and cash equivalents          
At beginning of year   1,115    580 
           
At end of period  $1,670   $1,143 
           
Supplemental disclosures of cash flow information          
Cash paid during the period for:          
Interest (net of amounts capitalized)  $281   $287 
Income taxes (net of refunds)   249    1 

 

See accompanying notes to consolidated financial statements.

 
 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

1. Loss on Asset Disposal

 

In 2020, we sold 703 locomotives deemed excess and no longer needed for railroad operations. We evaluated these locomotive retirements and concluded they were abnormal. Accordingly, we recorded a $385 million loss to adjust their carrying amount to their estimated fair value, which resulted in a $97 million tax benefit.

 

2. Stock Repurchase Program

 

We repurchased and retired 5.7 million and 3.9 million shares of common stock under our stock repurchase program during the first six months of 2021 and 2020, respectively, at a cost of $1.5 billion and $669 million, respectively.