Higher intermodal, coal and general merchandise volumes helped Norfolk Southern increase net profit 19 percent to $480 million in the fourth on $2.8 billion in sales.
The $2.8 billion in revenue was a 17 percent increase from the year ago fourth quarter for the Eastern rail operator, which is expanding its intermodal network. Norfolk Southern Railway plans to open intermodal terminals in Alabama, Pennsylvania and Tennessee this year, said CEO Charles “Wick” Moorman.
“Facilities such as these relieve congested freight lines and highways and are proven centers for creating jobs and economic development,” Moorman said in a statement.
Norfolk Southern is the latest Class I railroad to report robust revenue and profit gains for last year on moderate increases in volume, a sign of strong pricing. Union Pacific, CSX Transportation and Kansas City Southern all used pricing power to drive down their operating ratios and expand profits in 2011.
For the full year, Norfolk Southern net profit jumped 28 percent to $1.9 billion, an earnings record, the rail operator said. Revenue rose 17 percent to $11.2 billion.
Freight volumes rose 6 percent for the quarter and 5 percent for the year, while revenue per unit or yield rose 11 percent and 12 percent, respectively.