Summary
Norfolk Southern Corporation (NSC) has filed an 8-K report to disclose preliminary third-quarter 2020 financial results and a significant non-cash impairment charge. The company anticipates a non-cash impairment charge of approximately $99 million related to an equity method investment, which will affect its reported GAAP results. Investors are advised that NSC will present both GAAP and non-GAAP financial results, with the latter excluding this impairment charge to provide a clearer view of ongoing operational performance. Preliminary estimates for the third quarter of 2020 indicate railway operating revenues of around $2.5 billion. The reported operating ratio under GAAP is expected to be 66.5%. However, when excluding the impairment charge, the adjusted railway operating expenses are projected at approximately $1.567 billion, leading to a more favorable adjusted operating ratio of 62.5%. The company will provide its full third-quarter financial details and further analysis during its earnings conference call on October 28, 2020.
Key Highlights
- 1Anticipates a non-cash impairment charge of approximately $99 million in Q3 2020 related to an equity method investment.
- 2Will report financial results on both a GAAP and a non-GAAP basis, excluding the impairment charge.
- 3Preliminary Q3 2020 railway operating revenues are estimated at approximately $2.5 billion.
- 4Expected GAAP operating ratio for Q3 2020 is 66.5%.
- 5Excluding the impairment, the adjusted operating ratio for Q3 2020 is expected to be 62.5%.
- 6Full Q3 2020 financial results and conference call scheduled for October 28, 2020.