NS, WITH HELP FROM RAILROAD, BOOSTS EARNINGS 10 PERCENT

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, January 28, 1993                   TAG: 9301280138
SECTION: BUSINESS                    PAGE: B-5   EDITION: METRO 
SOURCE: DANIEL HOWES STAFF WRITER
DATELINE:                                 LENGTH: Medium
NS, WITH HELP FROM RAILROAD, BOOSTS EARNINGS 10 PERCENT
Norfolk Southern Corp., buoyed by a strong performance from its railroad operations, Wednesday reported a 10 percent gain in earnings per common share.
Net income for the year ended Dec. 31 jumped 6 percent over 1991's results to $558 million, excluding a special charge the Norfolk-based transportation company took in late 1991 to offset the cost of labor buyouts and other reductions.
The performance, announced in New York to Wall Street securities analysts, dovetailed with analysts' expectations. Norfolk Southern shares closed Wednesday's trading at $60.75 per share, down 25 cents.
"There really weren't any major surprises," said Graeme Anne Lidgerwood, a transportation analyst with First Boston Corp.
North American Van Lines Inc., Norfolk Southern's trucking subsidiary, "continues to be a drag on their overall earnings," Lidgerwood said.
NS acquired the Indiana-based trucking concern in 1985 for $369 million. "We think it's time for them to do or die" with North American, to cut costs and increase revenue, said a New York analyst who asked not to be identified.
Still, analysts and NS officials seemed pleased by the results. "We think the railroad had a remarkable performance, [given] today's environment," said Luella White Price, NS officials expect merchandise traffic to improve this year along with the economy, but the prospects for its coal hauling - the company's bread-and-butter - don't seem as bright. a transportation analyst with Donaldson Lufkin & Jenrette.
Norfolk Southern officials expect merchandise traffic to improve this year along with the economy, but the prospects for its coal hauling - the company's bread-and-butter - don't seem as bright.
A struggling European economy for much of the coming year promises to dampen Norfolk Southern's coal export business, officials say. And talk in Washington of energy taxes - specifically, a carbon tax - makes folks who mine and haul coal nervous.
"The entire industry is concerned about it - I think with good reason," Lidgerwood said. "If [President] Clinton is worried about jobs, a carbon tax is not the way to go."
Norfolk Southern Chairman David Goode this month urged Roanoke leaders to make sure their federal lawmakers understand the economic costs of carbon taxes, especially to a region so dependent on coal and rail business.

by Bhavesh Jinadra by CNB