Updates article with information from Norfolk Southern
Norfolk Southern (NYSE: NSC) has shed approximately 300 locomotives and intends to put up another 400 for sale, the Eastern U.S. railroad said in a Thursday filing to the Securities and Exchange Commission (SEC).
The company attributes its decision to the introduction of precision scheduled railroading [PSR] in 2019, which “continues to provide significant benefits to the network operations and has resulted in excess capacity,” which in turn sidelined these locomotives. PSR is an operating model that seeks to streamline operations.
Norfolk Southern (NS) told FreightWaves that the 300 locomotives were sold.
Because of these actions, NS will incur a noncash charge of $385 million for the first quarter of 2020. This charge will reduce first-quarter diluted earnings per share by $1.11, NS said.
The company will provide more details on this transaction, as well as an update on how the coronavirus pandemic has affected operations and its first-quarter results, according to the filing.
NS told the SEC earlier this month that it hadn’t taken into account the impact of the COVID-19 pandemic when it issued its earnings guidance for 2020.
NS will announce its first-quarter 2020 results on April 29.