nsc-20210930

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended SEPTEMBER 30, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to___________

Commission File Number: 1-8339

NORFOLK SOUTHERN CORPORATION

(Exact name of registrant as specified in its charter)


Virginia						52-1188014
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


650 West Peachtree Street NW		30308-1925
Atlanta,	Georgia
(Address of principal executive offices)		(Zip Code)
(855)		667-3655
(Registrant’s telephone number, including area code)


Three Commercial Place,	Norfolk,	Virginia	23510-2191
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Norfolk Southern Corporation Common Stock (Par Value $1.00)	NSC	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class	Outstanding at September 30, 2021
Common Stock ($1.00 par value per share)	243,344,509	(excluding 20,320,777 shares held by the registrant’s
	consolidated subsidiaries)

TABLE OF CONTENTS

NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES


		Page
Part I.	Financial Information:
	Item 1.	Financial Statements:
		Consolidated Statements of Income Third Quarter and First Nine Months of 2021 and 2020	3
		Consolidated Statements of Comprehensive Income Third Quarter and First Nine Months of 2021 and 2020	4
		Consolidated Balance Sheets At September 30, 2021 and December 31, 2020	5
		Consolidated Statements of Cash Flows First Nine Months of 2021 and 2020	6
		Consolidated Statements of Changes in Stockholders’ Equity Third Quarter and First Nine Months of 2021 and 2020	7
		Notes to Consolidated Financial Statements	9
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
	Item 4.	Controls and Procedures	29

Part II.	Other Information:
	Item 1.	Legal Proceedings	30
	Item 1A.	Risk Factors	30
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
	Item 6.	Exhibits	31

		Signatures	32

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)


	Third Quarter				First Nine Months
	2021		2020		2021		2020
	($ in millions, except per share amounts)

Railway operating revenues	$	2,852	$	2,506	$	8,290	$	7,216

Railway operating expenses
Compensation and benefits	609		578		1,844		1,786
Purchased services and rents	432		486		1,254		1,261
Fuel	208		126		573		399
Depreciation	297		293		883		867
Materials and other	170		183		418		500
Loss on asset disposal	—		—		—		385

Total railway operating expenses	1,716		1,666		4,972		5,198

Income from railway operations	1,136		840		3,318		2,018

Other income – net	14		39		56		110
Interest expense on debt	164		155		481		465

Income before income taxes	986		724		2,893		1,663

Income taxes	233		155		648		321

Net income	$	753	$	569	$	2,245	$	1,342

Earnings per share
Basic	$	3.07	$	2.23	$	9.03	$	5.24
Diluted	3.06		2.22		8.99		5.21

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(Unaudited)


	Third Quarter				First Nine Months
	2021		2020		2021		2020
	($ in millions)

Net income	$	753	$	569	$	2,245	$	1,342
Other comprehensive income, before tax:
Pension and other postretirement benefits	10		7		31		20
Other comprehensive income of equity investees	—		—		—		6

Other comprehensive income, before tax	10		7		31		26
Income tax expense related to items of other
comprehensive income	(3)		(3)		(8)		(6)

Other comprehensive income, net of tax	7		4		23		20

Total comprehensive income	$	760	$	573	$	2,268	$	1,362

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)


	September 30, 2021		December 31, 2020
	($ in millions)
Assets
Current assets:
Cash and cash equivalents	$	1,465	$	1,115

Accounts receivable – net	945		848
Materials and supplies	235		221
Other current assets	77		134
Total current assets	2,722		2,318

Investments	3,684		3,590
Properties less accumulated depreciation of $11,867
and $11,985, respectively	31,429		31,345
Other assets	769		709

Total assets