NSC - Norfolk Southern presentation: We are creating a safer more profitable railroad with long-term upside for shareholders | Benzinga

Outlines clear path to close the margin gap with peers by achieving a sub-60% operating ratio in 3-4 years

Urges shareholders to vote "FOR" ONLY Norfolk Southern's 13 highly qualified nominees on the WHITE proxy card today

Identifies safety, service and financial risk of Ancora's "tear it down to the studs"¹ strategy

ATLANTA, April 18, 2024  /PRNewswire/ -- Norfolk Southern Corporation (NYSE:NSC) filed an investor presentation Thursday with the U.S. Securities and Exchange Commission and sent an accompanying letter to shareholders in connection with its Annual Meeting of Shareholders on May 9, 2024. The presentation and letter are available at www.VoteNorfolkSouthern.com and on the company's investor relations page.

Highlights of the presentation include:

• Norfolk Southern is on a clear and achievable path to close the margin gap with peers by achieving a sub-60% operating ratio (OR) in three to four years²
  
  • This includes a detailed, ground-up plan to capture 400 basis points of productivity savings and upcycle improvement
  • In 2024, the plan targets to deliver 100-150 basis points of OR improvement year-over-year, with line of sight to 400-450 basis points of improvement in the second half of 2024, compared to the prior year period

• Norfolk Southern is actively delivering on a better strategy with greater long-term upside for shareholders 
  
  • The board appointed Alan Shaw CEO in 2022 because the depth and breadth of his experience best positions us to leverage Precision Scheduled Railroading (PSR) to deliver top-tier revenue and earnings growth with industry-competitive margins
  • Shaw has developed a balanced strategy focused on service, productivity, and growth, with safety at its core
  • The strategy was working prior to the East Palestine (EP) incident in February 2023 – in 2022, the company delivered record revenues, closed the margin gap to Class I peers with an OR in the low 60%'s, and achieved the second highest five-year total shareholder returns among Class I peers
  • Shaw and the board addressed the challenges following the EP incident head on and acted decisively to overhaul safety standards to protect the franchise. Following EP-related network disruptions and necessary investments in service and safety in 2023, the strategy is back on track and driving meaningful improvements

• Norfolk Southern has accelerated the execution of its strategy, making a series of organizational changes, including the appointment of seasoned PSR expert, John Orr, as chief operating officer
  
  • Orr is a 40-year industry veteran with a successful track record of implementing scheduled railroading strategies to drive sustainable, long-term value creation
  • Since Orr joined the company four weeks ago, he has instilled more diligent plan adherence and began efforts to streamline operations. Already, these initiatives have improved Merchandise velocity by 8% and terminal dwell by 8%
  • The company expects to deliver further sequential OR improvement as operational changes scale throughout the network
  • In the next 60 to 90 days, under Orr's leadership, the company expects to:
    
    • Reduce terminal dwell in two major yards by 30%
    • Reduce overtime by 20%
    • Reduce recrew rate by 20%
    • Increase on-time connections system wide by 10%

• Strong execution from Norfolk Southern's crisis-tested leadership is delivering a safer, more profitable railroad
  
  • Following the EP incident, the company acted decisively to overhaul safety standards to protect the franchise and long-term shareholder value
    
    • The company reduced its mainline accident rate by 38% year-over-year in 2023, achieving the lowest rate since 1999 and positioning itself among the best of the North American Class I railroads
  • Norfolk Southern has improved service levels despite EP's adverse impact – increasing train speed by 22% and decreasing terminal dwell by 11% since Shaw became CEO

• Norfolk Southern's engaged, highly qualified board is committed to transformation and ...

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