Norfolk Southern's profit halves on new $416M derailment charge
(Reuters) – Norfolk Southern Corp.’s second-quarter profit tumbled 55% after the U.S. railroad operator recorded a fresh $416 million charge associated with the Eastern Ohio freight train derailment.
The derailment of one of its freight trains carrying hazardous materials in February led to a lawsuit by the U.S. Justice Department seeking to ensure that the company paid the full cost of the cleanup and any future long-term impact.
The company took a $387 million charge in the first quarter related to the derailment.
Meanwhile, Norfolk is also struggling with an industry-wide decline in freight volumes as consumer spending preferences shift to services from goods.
Union Pacific Corp. said on Wednesday volumes fell 2% in the second quarter.
