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Published: 2024-01-26 08:04:38 ET
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EX-99.2 3 e24025_ex99-2.htm

Exhibit 99.2

 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)

 

   Fourth Quarter   Years Ended
December 31,		 
   2023   2022   2023   2022 
   (in millions, except per share amounts) 
                 
Railway operating revenues                    
Merchandise  $1,849   $1,876   $7,353   $7,331 
Intermodal   794    913    3,090    3,681 
Coal   430    448    1,713    1,733 
Total railway operating revenues   3,073    3,237    12,156    12,745 
                     
Railway operating expenses                    
Compensation and benefits   721    653    2,819    2,621 
Purchased services and rents   551    520    2,070    1,922 
Fuel   303    367    1,170    1,459 
Depreciation   330    309    1,298    1,221 
Materials and other   210    207    832    713 
Eastern Ohio incident   150    —    1,116    — 
Total railway operating expenses   2,265    2,056    9,305    7,936 
                     
Income from railway operations   808    1,181    2,851    4,809 
                     
Other income – net   38    34    191    13 
Interest expense on debt   195    177    722    692 
                     
Income before income taxes   651    1,038    2,320    4,130 
                     
Income tax expense (benefit)                    
Current   120    188    542    777 
Deferred   4    60    (49)   83 
Total income taxes   124    248    493    860 
                     
Net income  $527   $790   $1,827   $3,270 
                     
Earnings per share – diluted  $2.32   $3.42   $8.02   $13.88 
                     
Weighted average shares outstanding – diluted   226.3    230.7    227.4    235.6 

 

See accompanying notes to consolidated financial statements.

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

 

   At December 31, 
   2023   2022 
   ($ in millions) 
Assets          
Current assets:          
Cash and cash equivalents  $1,568   $456 
Accounts receivable – net   1,147    1,148 
Materials and supplies   264    253 
Other current assets   292    150 
Total current assets   3,271    2,007 
           
Investments   3,839    3,694 
Properties less accumulated depreciation of $13,265 and $12,592, respectively   33,326    32,156 
Other assets   1,216    1,028 
           
Total assets  $41,652   $38,885 
           
Liabilities and stockholders’ equity          
Current liabilities:          
Accounts payable  $1,638   $1,293 
Short-term debt   —    100 
Income and other taxes   262    312 
Other current liabilities   728    341 
Current maturities of long-term debt   4    603 
Total current liabilities   2,632    2,649 
           
Long-term debt   17,175    14,479 
Other liabilities   1,839    1,759 
Deferred income taxes   7,225    7,265 
           
Total liabilities   28,871    26,152 
           
Stockholders’ equity:          
Common stock $1.00 per share par value, 1,350,000,000 shares authorized; outstanding 225,681,254 and 228,076,415 shares, respectively, net of treasury shares   227    230 
Additional paid-in capital   2,179    2,157 
Accumulated other comprehensive loss   (320)   (351)
Retained income   10,695    10,697 
           
Total stockholders’ equity   12,781    12,733 
           
Total liabilities and stockholders’ equity  $41,652   $38,885 

 

See accompanying notes to consolidated financial statements.

 
 

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

 

   Years Ended December 31, 
   2023   2022 
   ($ in millions) 
Cash flows from operating activities          
Net income  $1,827   $3,270 
Reconciliation of net income to net cash provided by operating activities:          
Depreciation   1,298    1,221 
Deferred income taxes   (49)   83 
Gains and losses on properties   (49)   (82)
Changes in assets and liabilities affecting operations:          
Accounts receivable   (2)   (171)
Materials and supplies   (11)   (35)
Other current assets   (54)   (18)
Current liabilities other than debt   435    23 
Other – net   (216)   (69)
           
Net cash provided by operating activities   3,179    4,222 
           
Cash flows from investing activities          
Property additions   (2,349)   (1,948)
Property sales and other transactions   86    263 
Investment purchases   (124)   (12)
Investment sales and other transactions   205    94 
           
Net cash used in investing activities   (2,182)   (1,603)
           
Cash flows from financing activities          
Dividends   (1,225)   (1,167)
Common stock transactions   3    (4)
Purchase and retirement of common stock   (622)   (3,110)
Proceeds from borrowings   3,293    1,832 
Debt repayments   (1,334)   (553)
           
Net cash provided by (used in) financing activities   115    (3,002)
           
Net increase (decrease) in cash and cash equivalents   1,112    (383)
           
Cash and cash equivalents          
At beginning of year   456    839 
           
At end of year  $1,568   $456 
           
Supplemental disclosures of cash flow information          
Cash paid during the year for:          
Interest (net of amounts capitalized)  $653   $619 
Income taxes (net of refunds)   681    750 

 

See accompanying notes to consolidated financial statements.

 
 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS:

 

1. Eastern Ohio Incident

 

On February 3, 2023, a train operated by Norfolk Southern derailed in East Palestine, Ohio. During 2023, we recognized $1.1 billion of expense for costs primarily associated with environmental matters and legal proceedings resulting from the incident ($150 million of which was recognized in the fourth quarter). The total expense recorded in 2023 is net of $101 million in insurance recoveries recorded during year ($76 million of which was recognized in the fourth quarter). Any additional amounts recoverable under our insurance policies or from third parties will be reflected in future periods in which recovery is considered probable. No amounts have been recorded related to potential third-party recoveries, which may reduce amounts payable by our insurers under applicable insurance coverage.

 

2. Stock Repurchase Program

 

We repurchased and retired 2.8 million and 12.6 million shares of common stock under our stock repurchase programs in 2023 and 2022, respectively, at a cost of $627 million and $3.1 billion, respectively, inclusive of excise taxes in 2023.