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1
Baird 2016 Global Industrial Conference
November 9, 2016
Marta R. Stewart
Executive Vice President Finance
and Chief Financial Officer
Forward-Looking Statements
Certain statements in this presentation are forward-looking statements within the meaning of the safe harbor provision of
the Private Securities Litigation Reform Act of 1995, as amended. In some cases, forward-looking statements may be
identified by the use of words like “believe,” “expect,” “anticipate,” “estimate,” “plan,” “consider,” “project,” and similar
references to the future. Forward-looking statements are made as of the date they were first issued and reflect the
good-faith evaluation of Norfolk Southern Corporation’s (NYSE: NSC) (“Norfolk Southern” or the “Company”)
management of information currently available. These forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond the Company’s control. These and other important factors, including those
discussed under “Risk Factors” in the Company’s Form 10-K for the year ended December 31, 2015, as well as the
Company’s other public filings with the SEC, may cause our actual results, performance or achievement to differ
materially from those expressed or implied by these forward-looking statements. Forward-looking statements are not,
and should not be relied upon as, a guarantee of future performance or results, nor will they necessarily prove to be
accurate indications of the times at or by which any such performance or results will be achieved. As a result, actual
outcomes and results may differ materially from those expressed in forward-looking statements. We undertake no
obligation to update or revise forward-looking statements, whether as a result of new information, the occurrence of
certain events or otherwise, unless otherwise required by applicable securities law.
2
Business Update
2016 Overview
2016 Outlook
Strategic Plan to Reduce Costs and Accelerate Growth
Capital Allocation Priorities
3
Financial ResultsNine Months 2016 vs. 2015 ($ millions, except EPS)
4
Strong cost controls resulted in a record 68.7% operating ratio
2016 2015 * $ %
Railway operating revenues $ 7,398 $ 7,993 $ (595) (7%)
Railway operating expenses $ 5,085 $ 5,751 $ 666 12%
Income from railway operations $ 2,313 $ 2,242 $ 71 3%
Railway operating ratio (%) 68.7 72.0 3.3 5%
Net income $ 1,252 $ 1,195 $ 57 5%
Earnings per share $ 4.21 $ 3.90 $ 0.31 8%
(Unfavorable)
Favorable
* 2015 included restructuring costs of $44 million, which increased the railway operating ratio by 60 basis points.
Railway Operating RevenuesNine Months 2016 vs. 2015
1. Please see reconciliation to GAAP posted on our website.
Revenue RPU RPU Less Fuel (1) Volume
$7.4 Billion $1,365 $1,334 5.4 Million units
down (7%) down (3%) flat down (5%)
Revenue $ in million & Y-o-Y Percent Change
Merchandise
$4,678
(2%)
Coal
$1,085
(22%)
Intermodal
$1,635
(11%)
$7,993
$7,398
($269)
($229)
($169)
($1)$73
YTD 2015 Coal ex.Fuel
Fuel TCS ex.Fuel
Merch ex.Fuel
IMex.TCSex. Fuel
YTD 2016
Revenue Change $ in millions (1)
Low commodity prices pressured revenue line
5
Railway Operating Expenses Nine Months 2016 vs. 2015 ($ millions)
Streamlining operations to strengthen NS and drive productivity
$5,751
$236
$163
$139
$128
$5,085
Depreciation
$ ---
Materials &
Other
Compensation
& Benefits2015 Purchased
Svcs & Rents
2016
6
Fuel
3Q15 Consolidation of regional headquarters
3Q15 Acquisition of Delaware & Hudson South line
4Q15 Restructuring of Triple Crown operations
1Q15,
1Q-2Q16Reductions in capital spending
1Q16 Consolidation of operating divisions and regions
2Q16 Idling of Ashtabula Coal Terminal
2Q16 Idling of Knoxville, TN Yard operations
2Q16 Shortline of West VA Secondary
2Q16 Restructuring Pocahontas Land coal subsidiary
1Q-3Q16 Line rationalizations - concentrating flows & speed reductions
Efficiency Initiatives
7
20
22
24
26
28
Service Metrics – Nine MonthsVelocity Remains Near Record Levels
15
17
19
21
23
25 Speed (mph) Dwell (Hours)
Better ( ) Better ( )
8
50%
60%
70%
80%
90%Composite
Better ( ) 2015 2016
• Service Composite 14%
• Train Speed 11%
• Dwell 9%
Source: Wells Fargo; IHS Markit; WardsAuto Forecast; EIA; EVA; Census Bureau; NYMEX
IndicatorDec 2015
2016 (F)1Q 2Q
3Q (Prelim)
4Q (F)Current
2016 (F)
GDP +2.7% +0.8% +1.4% +2.9% +1.5% +1.5%
Housing Starts (millions, annual rate) 1.23 1.15 1.16 1.18 1.15 1.16
N.A. Vehicle Production (millions, units) 18.2 4.5 4.7 4.5 4.5 18.2
Industrial Production +1.0% (1.6%) (1.0%) (0.8%) (0.4%) (1.0%)
Real Consumer Spending (annual rate) +3.1% +2.4% +2.7% +2.8% +2.8% +2.7%
Henry Hub Nat Gas Price ($/mmBtu) $2.88 $2.00 $2.14 $2.88 $2.83 $2.46
USD Exchange Rate With Major
Trading Partners+4.7% +4.3% (0.4%) (1.7%) (2.5%) (0.1%)
IndicatorDec 2015 Mar 2016 Jun 2016 Sep 2016 Oct 2016
Utility Coal Stockpiles (days, in NS
Territory, data from 1 month prior)92.9 95.1 104.2 86.8 84.8
Inventories/Sales Ratio (total business,
adjusted, data from 2 months prior)1.39 1.41 1.40 1.39 1.39
Economic Backdrop
9
120,000
125,000
130,000
135,000
140,000
145,000
150,000
155,000
160,000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44
We
ek
ly V
olu
me
Week
2015
2016
Q2 Q3 Q4
10
2016 Weekly Volume
Volumes are ~ flat with last year in 4QTD
Q1
Coal Drivers
Source: EIA; Platts; SNL; NYMEX; EVA
$40
$60
$80
$100
$120
$140
$160
$180
$200
$220
1Q2014
2Q2014
3Q2014
4Q2014
1Q2015
2Q2015
3Q2015
4Q2015
1Q2016
2Q2016
3Q2016
4Q2016*
Export Prices
Queensland Coking Coal API 2* API 2 for 4Q projected from forward curve
Utility:
‒ Weather
‒ Natural gas prices
‒ Stockpiles
Export:
‒ Market prices
‒ Production availability
0
20
40
60
80
100
Days o
f B
urn
Utility - Total Stockpiles
11
$0
$1
$2
$3
$4
$5
$6
$7
Do
llars
per
MM
Btu
Natural Gas Prices - Henry Hub
Merchandise Drivers
Source: EIA; WardsAuto; Federal Reserve
Industrial production muted
Crude oil limited by low prices and
narrow WTI/Brent spread
Automotive tied to North American
vehicle production
$20
$40
$60
$80
$100
$120
$140
Jan
-13
Ma
r-13
Ma
y-1
3
Ju
l-1
3
Se
p-1
3
No
v-1
3
Jan
-14
Ma
r-14
Ma
y-1
4
Ju
l-1
4
Se
p-1
4
No
v-1
4
Jan
-15
Ma
r-15
Ma
y-1
5
Ju
l-1
5
Se
p-1
5
No
v-1
5
Jan
-16
Ma
r-16
Ma
y-1
6
Ju
l-1
6
Se
p-1
6
Do
llars
per
Barr
el
Brent and WTI Oil Prices
Brent WTI
15,801 16,501 17,423 17,955 18,207
2012 2013 2014 2015 2016
North American Vehicle Production
+5.6%+3.1% +1.4%
+4.4%
98
100
102
104
106
Jan
-13
Ma
r-13
Ma
y-1
3
Ju
l-1
3
Se
p-1
3
No
v-1
3
Jan
-14
Ma
r-14
Ma
y-1
4
Ju
l-1
4
Se
p-1
4
No
v-1
4
Jan
-15
Ma
r-15
Ma
y-1
5
Ju
l-1
5
Se
p-1
5
No
v-1
5
Jan
-16
Ma
r-16
Ma
y-1
6
Ju
l-1
6
Se
p-1
6
Industrial Production(Index 2012 = 100)
Manufacturing
12
Intermodal Drivers
Source: Census Bureau; BEA; Truckstop.com
Truck competition
Consumer demand
Retail inventory levels 1.20
1.25
1.30
1.35
1.40
1.45
1.50
1.55
Jan
-12
Ap
r-12
Ju
l-1
2
Oc
t-1
2
Jan
-13
Ap
r-13
Ju
l-1
3
Oc
t-1
3
Jan
-14
Ap
r-14
Ju
l-1
4
Oc
t-1
4
Jan
-15
Ap
r-15
Ju
l-1
5
Oc
t-1
5
Jan
-16
Ap
r-16
Ju
l-1
6
Inventory/Sales Ratio
Retail Total Business
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
1Q2014
2Q2014
3Q2014
4Q2014
1Q2015
2Q2015
3Q2015
4Q2015
1Q2016
2Q2016
3Q2016
Consumer Spending (% Change vs. Preceding Period, Seasonally Adj)
0
5
10
15
20
25
30
35
Truckstop.com Market Demand Index
2012 2013 2014 2015 2016
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
13
Current Railway VolumeFourth Quarter through Week 44 (ended November 5, 2016)
14
Total Units (000’s)0.2% Increase in Units 4QTD 2016 vs. 2015
12,795; 3%
3,010; 5%
1,676; 3%
589;1%
(2,414);(9%)
(6,467); (13%)
(7,776);(8%)
Paper
Chemicals
Coal
Intermodal
MetCon
Agriculture
Automotive
730.2 731.6
2015 2016
Lapping Triple Crown restructuring and inventory builds
4Q16 Revenue Outlook
Volume Pricing
Fourth quarter year-over-year, flat to
moderate growth expected, despite
continued challenges
− Excess capacity in the trucking market
− Stockpiles and weather impact coal
volumes
− Crude oil and Automotive declines
− Stronger intermodal as we clear Triple
Crown comparison
− Metals market laps fourth quarter 2015
declines
Fourth quarter volumes stabilize, solid pricing leveraging value of service, mix headwinds continue
Focus on Pricing
− 2016 pricing remains strong
− Domestic truck rates lower
− Leveraging value of service product
Long-term view of markets and pricing
Volume and Resource Alignment
Flexibility to adapt to changing market
conditions and volume expectations
15
$163
$119 $113
$82
$49 $50
$67
$0
$50
$100
$150
$200
1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
Revenue ($M)
Fuel Surcharge Revenue
4Q16 fuel surcharge decline to moderate relative to lower prior year comp
16
4Q16 Expense Outlook
17
3Q16 Actualvs. 3Q15
4Q16 Outlookvs. 4Q15
Compensation and benefits:
Headcount ~ 2,400 ~ 2,200
Wage and H&W rates $26M ~ $26M
Incentive compensation $39M ~ $39M
Triple Crown – purchased services $37M ~ $20M
Fuel $40M Price and consumption driven
Depreciation $17M ~ $25M
Materials $15M ~ $15M
Improving efficiencies and reducing costs to drive shareholder value
Strategic Plan Enhancing Shareholder Value
18
NS well positioned to achieve 2016 financial and operational targets
− Operating ratio below 70%
− Productivity savings of ~ $250 million
− Capital spending of ~ $1.9 billion
− On track for $800M in share repurchases
Dedicated team focus on delivering long-term shareholder value
− $650M of annual productivity savings by 2020
− Top line growth
− Operating ratio below 65% by 2020
− EPS double digit compound annual growth rate by 2020
− Returning capital to shareholders
Agile NS team reliably delivers shareholder value in the near- and long- term
Thank you
19
NS well positioned to achieve 2016 financial and operational targets
− Operating ratio below 70%
− Productivity savings of about $250 million
− Capital spending of $1.9 billion
− On track for $800M in share repurchases
Dedicated team focus on delivering long-term shareholder value
− $650M of annual productivity savings by 2020
− Top line growth
− Operating ratio below 65% by 2020
− EPS double digit compound annual growth rate by 2020
− Returning capital to shareholders
Agile NS team reliably delivers shareholder value in near- and long- term