(Bloomberg) -- The new leader of Norfolk Southern Corp. said he’s focused on reviving the tarnished railroad’s operations in the months after a workplace scandal led to the ouster of his predecessor.
Chief Executive Officer Mark George plans to emphasize productivity and efficiency gains after the freight hauler “fell out of balance” on those aspects of the business.
“We’ve put more focus on getting back in balance,” George said in an interview. He’s paying particular attention to profit margins. “We are doing just that this quarter.”
George last month succeeded former CEO Alan Shaw, who was fired for having a consensual relationship with the railroad’s chief legal officer. The shakeup capped a tumultuous stretch in which Norfolk Southern was put under a microscope by a high-profile 2023 derailment in Ohio and a campaign by activist Ancora Holdings Group to oust Shaw and other members of the company’s board.
Ancora had criticized Shaw for being too deferential to rail workers and reluctant to implement changes to compete in the cutthroat freight rail industry.
“We’re closing that margin gap we had with our peers,” George said. “My philosophy now is to just continue to accelerate execution.”
Norfolk Southern on Tuesday reported a third-quarter adjusted profit of $3.25 a share, topping the $3.11 average of analyst estimates compiled by Bloomberg. Adjusted operating ratio, a measure of efficiency in which a lower number is better, was 63.4% in the period, compared with 64.8% expected by Wall Street.
Norfolk Southern shares rose 3% before the start of normal trading in New York on Tuesday.
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