Norfolk Southern to aim for 60 operating ratio by 2021

Norfolk Southern Corp. officials today will provide details of the Class I’s latest strategic plan, which includes targeting an operating ratio (OR) of 60 percent by 2021.

The details — which will be revealed at the railroad’s Investor and Financial Analyst Conference being held today in Atlanta — will cover ways to increase productivity, efficiency and growth.

"As we implement precision scheduled railroading, our initiatives are focused on five key principles: serving our customers, managing our assets, controlling our costs, working safely and developing our people," NS Chairman, President and Chief Executive Officer James Squires said in a press release.

Highlights of the Class I's financial targets include:
• a full-year OR improvement in 2019 of at least 100 basis points from the 2018 OR of 65.4 percent;
• a full-year OR of 60 by 2021;
• capital expenditures totaling between 16 percent and 18 percent of annual revenue through 2021 to promote safety, efficiency and growth; and
• a dividend payout ratio of 33 percent and continuance of share repurchases using free cash flow and borrowing capacity.