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Published: 2021-04-28 00:00:00 ET
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EX-99.2 3 e21271_ex99-2.htm

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)

 

   First Quarter 
   2021   2020 
   (in millions, except per share amounts) 
         
Railway operating revenues          
Merchandise  $1,608   $1,672 
Intermodal   719    655 
Coal   312    298 
Total railway operating revenues   2,639    2,625 
           
Railway operating expenses          
Compensation and benefits   611    622 
Purchased services and rents   393    403 
Fuel   177    189 
Depreciation   292    292 
Materials and other   151    166 
Loss on asset disposal   —    385 
Total railway operating expenses   1,624    2,057 
           
Income from railway operations   1,015    568 
           
Other income – net   7    22 
Interest expense on debt   156    154 
           
Income before income taxes   866    436 
           
Income taxes          
Current   141    44 
Deferred   52    11 
Total income taxes   193    55 
           
Net income  $673   $381 
           
Earnings per share – diluted  $2.66   $1.47 
           
Weighted average shares outstanding – diluted   252.6    258.7 

 

See accompanying notes to consolidated financial statements 

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

 

   March 31,   December 31, 
   2021   2020 
   ($ in millions) 
Assets          
Current assets:          
Cash and cash equivalents  $998   $1,115 
Accounts receivable – net   944    848 
Materials and supplies   241    221 
Other current assets   120    134 
Total current assets   2,303    2,318 
           
Investments   3,604    3,590 
Properties less accumulated depreciation of $11,672 and $11,985, respectively   31,312    31,345 
Other assets   718    709 
           
Total assets  $37,937   $37,962 
           
Liabilities and stockholders’ equity          
Current liabilities:          
Accounts payable  $1,043   $1,016 
Income and other taxes   361    263 
Other current liabilities   344    302 
Current maturities of long-term debt   501    579 
Total current liabilities   2,249    2,160 
           
Long-term debt   12,116    12,102 
Other liabilities   1,952    1,987 
Deferred income taxes   6,977    6,922 
           
Total liabilities   23,294    23,171 
           
Stockholders’ equity:          
Common stock $1.00 per share par value, 1,350,000,000 shares authorized; outstanding 250,241,009 and 252,095,082 shares, respectively, net of treasury shares   251    254 
Additional paid-in capital   2,241    2,248 
Accumulated other comprehensive loss   (586)   (594)
Retained income   12,737    12,883 
           
Total stockholders’ equity   14,643    14,791 
           
Total liabilities and stockholders’ equity  $37,937   $37,962 

 

See accompanying notes to consolidated financial statements 

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

 

   First Three Months 
   2021   2020 
   ($ in millions) 
Cash flows from operating activities          
Net income  $673   $381 
Reconciliation of net income to net cash provided by operating activities:          
Depreciation   292    292 
Deferred income taxes   52    11 
Gains and losses on properties   (8)   (8)
Loss on asset disposal   —    385 
Changes in assets and liabilities affecting operations:          
Accounts receivable   (95)   32 
Materials and supplies   (20)   (21)
Other current assets   9    (33)
Current liabilities other than debt   158    (40)
Other – net   (46)   (44)
           
Net cash provided by operating activities   1,015    955 
           
Cash flows from investing activities          
Property additions   (265)   (366)
Property sales and other transactions   37    158 
Investment sales and other transactions   26    (25)
           
Net cash used in investing activities   (202)   (233)
           
Cash flows from financing activities          
Dividends   (249)   (242)
Common stock transactions   (6)   14 
Purchase and retirement of common stock   (591)   (466)
Debt repayments   (84)   — 
           
Net cash used in financing activities   (930)   (694)
           
Net increase (decrease) in cash and cash equivalents   (117)   28 
           
Cash and cash equivalents          
At beginning of year   1,115    580 
           
At end of period  $998   $608 
           
Supplemental disclosures of cash flow information          
Cash paid during the period for:          
Interest (net of amounts capitalized)  $110   $121 
Income taxes (net of refunds)   27    16 

 

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 2.3 million and 2.6 million shares of common stock under our stock repurchase program during the first three months of 2021 and 2020, respectively, at a cost of $591 million and $466 million, respectively.