NS’s second-quarter operating ratio is a 140 basis point improvement compared with the 70% operating ratio it achieved in the second quarter of 2015. The operating ratio was 69.4% for the first six months of 2016, a first-half record.

Net quarterly income was down 6.5% at $US 405m, compared with $US 433m during the second quarter of 2015. Second-quarter operating revenue fell by 10% to $US 2.5bn, due to reduced volume and lower fuel surcharge revenue. However, NS managed to cut operating costs by 11% to $US 1.7bn, so that operating income was only 5% lower at $US 770m compared with the second quarter of 2015.

NS suffered particularly severe revenue reductions in certain types of freight traffic compared with the second quarter of 2015. Chemical traffic saw a 6% reduction at $US 426m, paper and forest products fell by 5% to $US 186m, intermodal revenue fell by 15% to $US 538m, while coal revenue plunged by 25% to $US 339m. Coal traffic fell by 24% due to high stockpiles, limited coal consumption due to mild winter weather, and sustained low natural gas prices.

“Our second-quarter results reflect our unwavering focus on cost-control, steadfast commitment to customer service and significant improvements in network performance,” says NS chairman, president and CEO Mr Jim Squires. “We are on track to achieve productivity savings of at least $US 200m for 2016, and our record first-half operating ratio of 69.4% gives us confidence we’ll achieve a full-year operating ratio below 70%.”