Document And Entity Information
Document And Entity Information - Jun. 30, 2015 - shares | Total |
Document And Entity Information [Abstract] | |
Entity Registrant Name | NORFOLK SOUTHERN CORP |
Entity Central Index Key | 702,165 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2015 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus (Q1,Q2,Q3,FY) | Q2 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 301,386,849 |
Consolidated Statements Of Inco
Consolidated Statements Of Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Statement [Abstract] | ||||
Railway operating revenues | $ 2,713 | $ 3,042 | $ 5,280 | $ 5,731 |
Railway operating expenses: | ||||
Compensation and benefits | 724 | 715 | 1,507 | 1,455 |
Purchased services and rents | 438 | 414 | 861 | 806 |
Fuel | 255 | 408 | 519 | 840 |
Depreciation | 247 | 238 | 492 | 475 |
Materials and other | 235 | 248 | 481 | 469 |
Total railway operating expenses | 1,899 | 2,023 | 3,860 | 4,045 |
Income from railway operations | 814 | 1,019 | 1,420 | 1,686 |
Other income – net | 19 | 18 | 40 | 44 |
Interest expense on debt | 134 | 139 | 266 | 278 |
Income before income taxes | 699 | 898 | 1,194 | 1,452 |
Provision for income taxes | 266 | 336 | 451 | 522 |
Net income | $ 433 | $ 562 | $ 743 | $ 930 |
Per share amounts: | ||||
Basic (in dollars per share) | $ 1.43 | $ 1.81 | $ 2.43 | $ 2.99 |
Diluted (in dollars per share) | 1.41 | 1.79 | 2.41 | 2.97 |
Dividends (in dollars per share) | $ 0.59 | $ 0.54 | $ 1.18 | $ 1.08 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 433 | $ 562 | $ 743 | $ 930 |
Other comprehensive income, before tax: | ||||
Pension and other postretirement benefits | 11 | 7 | 21 | 306 |
Other comprehensive income of equity investees | 0 | 7 | (4) | 10 |
Other comprehensive income, before tax | 11 | 14 | 17 | 316 |
Income tax expense related to items of other comprehensive income | (5) | (4) | (8) | (118) |
Other comprehensive income, net of tax | 6 | 10 | 9 | 198 |
Total comprehensive income | $ 439 | $ 572 | $ 752 | $ 1,128 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Assets | ||
Cash and cash equivalents | $ 889 | $ 973 |
Accounts receivable – net | 1,055 | 1,055 |
Materials and supplies | 277 | 236 |
Deferred income taxes | 125 | 167 |
Other current assets | 67 | 347 |
Total current assets | 2,413 | 2,778 |
Investments | 2,724 | 2,679 |
Properties less accumulated depreciation of $11,188 and $10,814, respectively | 28,075 | 27,694 |
Other assets | 98 | 49 |
Total assets | 33,310 | 33,200 |
Liabilities and stockholders’ equity | ||
Accounts payable | 1,144 | 1,233 |
Short-term debt | 0 | 100 |
Income and other taxes | 295 | 217 |
Other current liabilities | 264 | 228 |
Current maturities of long-term debt | 500 | 2 |
Total current liabilities | 2,203 | 1,780 |
Long-term debt | 8,890 | 8,883 |
Other liabilities | 1,322 | 1,312 |
Deferred income taxes | 8,818 | 8,817 |
Total liabilities | 21,233 | 20,792 |
Stockholders’ equity: | ||
Common stock $1.00 per share par value, 1,350,000,000 shares authorized; outstanding 301,386,849 and 308,240,130 shares, respectively, net of treasury shares | 303 | 310 |
Additional paid-in capital | 2,146 | 2,148 |
Accumulated other comprehensive loss | (389) | (398) |
Retained income | 10,017 | 10,348 |
Total stockholders’ equity | 12,077 | 12,408 |
Total liabilities and stockholders’ equity | $ 33,310 | $ 33,200 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Properties, accumulated depreciation | $ 11,188 | $ 10,814 |
Common stock, par or stated value per share | $ 1 | $ 1 |
Common stock, shares authorized | 1,350,000,000 | 1,350,000,000 |
Common stock, shares outstanding, net of treasury shares | 301,386,849 | 308,240,130 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 743 | $ 930 |
Reconciliation of net income to net cash provided by operating activities: | ||
Depreciation | 494 | 478 |
Deferred income taxes | 35 | 17 |
Gains and losses on properties and investments | (18) | (3) |
Changes in assets and liabilities affecting operations: | ||
Accounts receivable | 0 | (98) |
Materials and supplies | (41) | (28) |
Other current assets | 282 | 30 |
Current liabilities other than debt | (1) | 144 |
Other – net | (21) | (33) |
Net cash provided by operating activities | 1,473 | 1,437 |
Cash flows from investing activities: | ||
Property additions | (886) | (809) |
Property sales and other transactions | 32 | 44 |
Investments, including short-term | (3) | (3) |
Investment sales and other transactions | 5 | 121 |
Net cash used in investing activities | (852) | (647) |
Cash flows from financing activities: | ||
Dividends | (360) | (335) |
Common stock issued | 28 | 82 |
Purchase and retirement of common stock | (765) | (100) |
Proceeds from debt, net of issuance costs | 494 | 0 |
Debt repayments | (102) | (213) |
Net cash used in financing activities | (705) | (566) |
Net increase (decrease) in cash and cash equivalents | (84) | 224 |
Cash and cash equivalents: | ||
At beginning of year | 973 | 1,443 |
At end of period | 889 | 1,667 |
Supplemental disclosures of cash flow information: | ||
Interest (net of amounts capitalized) | 249 | 255 |
Income taxes (net of refunds) | $ 55 | $ 313 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation During the first and second quarters of 2015 , a committee of non-employee members of our Board of Directors granted stock options, restricted stock units (RSUs) and performance share units (PSUs) pursuant to the Long-Term Incentive Plan (LTIP) and granted stock options pursuant to the Thoroughbred Stock Option Plan (TSOP) as discussed below. Stock-based compensation expense was $4 million and $10 million during the second quarters of 2015 and 2014 , respectively. For the first six months of 2015 and 2014 , stock-based compensation was $35 million and $42 million , respectively. The total tax effects recognized in income in relation to stock-based compensation were net benefits of $1 million and $4 million for the second quarters of 2015 and 2014 , respectively, and net benefits of $11 million and $14 million for the first six months of 2015 and 2014 , respectively. Stock Options In the first quarter of 2015 , 511,010 options were granted under LTIP and 181,320 options were granted under TSOP. In the second quarter of 2015, 132,880 options were granted under LTIP. The grant prices were $104.23 and $92.76 for the options granted in the first and second quarters of 2015, respectively, which was the greater of the average fair market value of Norfolk Southern common stock (Common Stock) or the closing price of Common Stock on the effective date of the grant, and the options have a term of ten years. The options granted under LTIP and TSOP may not be exercised prior to the four th and third anniversaries of the date of grant, respectively, or if the optionee retires or dies before that anniversary date, may not be exercised before the later of one year after the grant date or the date of the optionee's retirement or death. Holders of the 2015 options granted under LTIP who remain actively employed receive cash dividend equivalent payments during the four year vesting period in an amount equal to the regular quarterly dividends paid on Common Stock. Dividend equivalent payments are not made on TSOP options. The fair value of each option award was measured on the date of grant using a lattice-based option valuation model. Expected volatilities are based on implied volatilities from traded options on, and historical volatility of, Common Stock. Historical data is used to estimate option exercises and employee terminations within the valuation model. The average expected option life is derived from the output of the valuation model and represents the period of time that all options granted are expected to be outstanding, including the branches of the model that result in options expiring unexercised. The average risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. A dividend yield of zero was used for LTIP options during the vesting period. A dividend yield of 2.27% was used for all vested LTIP options and all TSOP options. The assumptions for the 2015 LTIP and TSOP grants are shown in the following table: Expected volatility range 19% - 27% Average expected volatility 25% Average risk-free interest rate 1.83% Average expected option term LTIP 9.3 years Per-share grant-date fair value LTIP $30.35 Average expected option term TSOP 9.1 years Per-share grant-date fair value TSOP $24.71 For the second quarter of 2015 , options relating to 90,269 shares were exercised, yielding $5 million of cash proceeds and $1 million of tax benefit recognized as additional paid-in capital. For the second quarter of 2014 , options relating to 353,327 shares were exercised, yielding $16 million of cash proceeds and $4 million of tax benefit recognized as additional paid-in capital. For the first six months of 2015 , options relating to 331,673 shares were exercised, yielding $17 million of cash proceeds and $4 million of tax benefit recognized as additional paid-in capital. For the first six months of 2014 , options relating to 1,234,071 shares were exercised, yielding $56 million of cash proceeds and $15 million of tax benefit recognized as additional paid-in capital. Restricted Stock Units During the first quarter of 2015 , there were 101,470 RSUs granted with a grant-date fair value of $104.23 and a five -year restriction period that will be settled through the issuance of shares of Common Stock. The RSU grants include cash dividend equivalent payments during the restriction period commensurate with regular quarterly dividends paid on Common Stock. No RSUs were earned or paid out during the second quarter s of 2015 or 2014 . During the first six months of 2015 , 166,750 of the RSUs granted in 2010 vested, with 99,337 shares of Common Stock issued net of withholding taxes. For the first six months of 2014 , 318,150 of the RSUs granted in 2009 vested, with 187,449 shares of Common Stock issued net of withholding taxes. The total related tax benefits recognized as additional paid-in capital were less than $1 million for the second quarters of both 2015 and 2014 , and $4 million and $6 million for the first six months of 2015 and 2014 , respectively. Performance Share Units PSUs provide for awards based on achievement of certain predetermined corporate performance goals at the end of a three -year cycle and are settled through the issuance of shares of Common Stock. During the first quarter of 2015 , there were 413,770 PSUs granted. PSUs will earn out based on the achievement of a return on average invested capital target (a performance condition) and a total shareholder return target (a market condition). The grant-date fair values of the PSUs associated with the performance and market conditions were $97.24 and $46.08 , respectively, with the market condition fair value measured on the date of grant using a Monte Carlo simulation model. No PSUs were earned or paid out in the second quarter s of 2015 and 2014 . During the first six months of 2015 , 236,601 of the PSUs granted in 2012 were earned, with 141,386 shares of Common Stock issued net of withholding taxes. For the first six months of 2014 , 374,099 of the PSUs granted in 2011 were earned, with 223,253 shares of Common Stock issued net of withholding taxes. The total related tax benefits recognized as additional paid-in capital were $3 million and $5 million for the first six months of 2015 and 2014 , respectively. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes There have been no material changes to the balance of unrecognized tax benefits reported at December 31, 2014 . IRS examinations have been completed for all years prior to 2011. Our consolidated federal income tax returns for 2011 and 2012 are currently being audited by the IRS. We anticipate that the IRS will complete its examination in 2015. We do not expect that the resolution of the examination will have a material effect on our financial position, results of operations, or liquidity. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the calculation of basic and diluted earnings per share: Basic Diluted Second Quarter 2015 2014 2015 2014 ($ in millions, except per share amounts, shares in millions) Net income $ 433 $ 562 $ 433 $ 562 Dividend equivalent payments (1 ) (2 ) (1 ) (1 ) Income available to common stockholders $ 432 $ 560 $ 432 $ 561 Weighted-average shares outstanding 302.9 309.5 302.9 309.5 Dilutive effect of outstanding options and share-settled awards 2.6 3.3 Adjusted weighted-average shares outstanding 305.5 312.8 Earnings per share $ 1.43 $ 1.81 $ 1.41 $ 1.79 Basic Diluted First Six Months 2015 2014 2015 2014 ($ in millions, except per share amounts, shares in millions) Net income $ 743 $ 930 $ 743 $ 930 Dividend equivalent payments (3 ) (4 ) (2 ) (2 ) Income available to common stockholders $ 740 $ 926 $ 741 $ 928 Weighted-average shares outstanding 304.8 309.5 304.8 309.5 Dilutive effect of outstanding options and share-settled awards 2.7 3.2 Adjusted weighted-average shares outstanding 307.5 312.7 Earnings per share $ 2.43 $ 2.99 $ 2.41 $ 2.97 During the second quarter s and first six months of 2015 and 2014 , dividend equivalent payments were made to holders of stock options and RSUs. For purposes of computing basic earnings per share, dividend equivalent payments made to holders of stock options and RSUs were deducted from net income to determine income available to common stockholders. For purposes of computing diluted earnings per share, we evaluate on a grant-by-grant basis those stock options and RSUs receiving dividend equivalent payments under the two-class and treasury stock methods to determine which method is the more dilutive for each grant. For those grants for which the two-class method was more dilutive, net income was reduced by dividend equivalent payments to determine income available to common stockholders. The dilution calculations exclude options having exercise prices exceeding the average market price of Common Stock as follows: none in the first quarter of 2015 , 0.7 million in the first quarter of 2014 , 0.7 million in the second quarter of 2015 , and none in the second quarter of 2014 . |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock Common Stock is reported net of shares held by our consolidated subsidiaries (Treasury Shares). Treasury Shares at June 30, 2015 , and December 31, 2014 , amounted to 20,320,777 shares, with a cost of $19 million at both dates. Accumulated Other Comprehensive Loss The components of “Other comprehensive income” reported in the Consolidated Statements of Comprehensive Income and changes in the cumulative balances of “Accumulated other comprehensive loss” reported in the Consolidated Balance Sheets consisted of the following: Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) Second Quarter March 31, 2015 $ (313 ) $ (82 ) $ (395 ) Other comprehensive income: Amounts reclassified into net income 11 (1) — 11 Tax expense (5 ) — (5 ) Other comprehensive income 6 — 6 June 30, 2015 $ (307 ) $ (82 ) $ (389 ) Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) Second Quarter March 31, 2014 $ (125 ) $ (68 ) $ (193 ) Other comprehensive income: Amounts reclassified into net income 7 (1) — 7 Net gain — 7 7 Tax expense (3 ) (1 ) (4 ) Other comprehensive income 4 6 10 June 30, 2014 $ (121 ) $ (62 ) $ (183 ) Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) First Six Months December 31, 2014 $ (320 ) $ (78 ) $ (398 ) Other comprehensive income (loss): Amounts reclassified into net income 21 (1) — 21 Net loss — (4 ) (4 ) Tax expense (8 ) — (8 ) Other comprehensive income (loss) 13 (4 ) 9 June 30, 2015 $ (307 ) $ (82 ) $ (389 ) Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) First Six Months December 31, 2013 $ (310 ) $ (71 ) $ (381 ) Other comprehensive income: Prior service benefit 367 — 367 Amounts reclassified into net income 19 (1) — 19 Net gain (loss) (80 ) 10 (70 ) Tax expense (117 ) (1 ) (118 ) Other comprehensive income 189 9 198 June 30, 2014 $ (121 ) $ (62 ) $ (183 ) (1) These items are included in the computation of net periodic pension and postretirement benefit costs. See Note 8, “Pensions and Other Postretirement Benefits” for additional information. |
Stock Repurchase Program
Stock Repurchase Program | 6 Months Ended |
Jun. 30, 2015 | |
Stock Repurchase Program [Abstract] | |
Stock Repurchase Program | Stock Repurchase Program We repurchased and retired 7.4 million and 1.0 million shares of Common Stock under our stock repurchase program in each of the first six months of 2015 and 2014 , respectively, at a cost of $765 million and $100 million , respectively. The timing and volume of purchases is guided by our assessment of market conditions and other pertinent factors. Any near-term share repurchases are expected to be made with internally generated cash, cash on hand, or proceeds from borrowings. Since the beginning of 2006, we have repurchased and retired 147.2 million shares at a total cost of $9.2 billion . |
Investment In Conrail
Investment In Conrail | 6 Months Ended |
Jun. 30, 2015 | |
Investments [Abstract] | |
Investment In Conrail | Investment in Conrail Through a limited liability company, we and CSX Corporation (CSX) jointly own Conrail Inc. (Conrail), whose primary subsidiary is Consolidated Rail Corporation (CRC). We have a 58% economic and 50% voting interest in the jointly owned entity, and CSX has the remainder of the economic and voting interests. Our investment in Conrail was $1.1 billion at both June 30, 2015 and December 31, 2014 . CRC owns and operates certain properties (the Shared Assets Areas) for the joint and exclusive benefit of Norfolk Southern Railway Company (NSR) and CSX Transportation, Inc. (CSXT). The costs of operating the Shared Assets Areas are borne by NSR and CSXT based on usage. In addition, NSR and CSXT pay CRC a fee for access to the Shared Assets Areas. “Purchased services and rents” and “Fuel” include expenses for amounts due to CRC for the operation of the Shared Assets Areas totaling $40 million and $34 million for the second quarter s of 2015 and 2014 , respectively, and $77 million and $68 million for the first six months of 2015 and 2014 , respectively. Our equity in the earnings of Conrail, net of amortization, included in “Purchased services and rents” was $13 million and $10 million for the second quarter s of 2015 and 2014 , respectively, and $23 million and $16 million for the first six months of 2015 and 2014 , respectively. “Accounts payable” includes $72 million at June 30, 2015 , and $56 million at December 31, 2014 , due to Conrail for the operation of the Shared Assets Areas. In addition, “Other liabilities” includes $280 million at both June 30, 2015 and December 31, 2014 , for long-term advances from Conrail, maturing 2044 , that bear interest at an average rate of 2.9% . |
Debt Debt Disclosure (Notes)
Debt Debt Disclosure (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | Debt In the first six months of 2015, NS repaid $100 million under its accounts receivable securitization facility. At June 30, 2015 and December 31, 2014, the amounts outstanding under the facility were $100 million (at an average variable interest rate of 1.29% ) and $200 million (at an average variable interest rate of 1.28% ), respectively. The facility has a two year term which was renewed and amended in October 2014 to run until October 2016. During the second quarter of 2015, NS issued $500 million of 4.45% senior notes due 2045 . NS has authority from its Board of Directors to issue an additional $1.2 billion of debt or equity securities through public or private sale. |
Pensions And Other Postretireme
Pensions And Other Postretirement Benefits | 6 Months Ended |
Jun. 30, 2015 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
Pensions And Other Postretirement Benefits | Pensions and Other Postretirement Benefits We have both funded and unfunded defined benefit pension plans covering principally salaried employees. We also provide specified health care and life insurance benefits to eligible retired employees; these plans can be amended or terminated at our option. Under our self-insured retiree health care plan, for those participants who are not Medicare-eligible, a defined percentage of health care expenses is covered for retired employees and their dependents, reduced by any deductibles, coinsurance, and, in some cases, coverage provided under other group insurance policies. Those participants who are Medicare-eligible are not covered under the self-insured retiree health care plan, but instead are provided with an employer-funded health reimbursement account which can be used for reimbursement of health insurance premiums or eligible out-of-pocket medical expenses. Other Postretirement Pension Benefits Benefits Second Quarter 2015 2014 2015 2014 ($ in millions) Service cost $ 10 $ 8 $ 2 $ 2 Interest cost 23 24 5 5 Expected return on plan assets (42 ) (38 ) (5 ) (5 ) Amortization of net losses 17 13 — — Amortization of prior service benefit — — (6 ) (6 ) Net cost (benefit) $ 8 $ 7 $ (4 ) $ (4 ) Other Postretirement Pension Benefits Benefits First Six Months 2015 2014 2015 2014 ($ in millions) Service cost $ 20 $ 17 $ 4 $ 4 Interest cost 47 47 10 13 Expected return on plan assets (83 ) (76 ) (10 ) (9 ) Amortization of net losses 33 27 — — Amortization of prior service benefit — — (12 ) (8 ) Net cost (benefit) $ 17 $ 15 $ (8 ) $ — |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Fair Value Measurements The Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820-10, “Fair Value Measurements,” established a framework for measuring fair value and a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows: Level 1 Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that we have the ability to access. Level 2 Inputs to the valuation methodology include: • quoted prices for similar assets or liabilities in active markets; • quoted prices for identical or similar assets or liabilities in inactive markets; • inputs other than quoted prices that are observable for the asset or liability; • inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability. Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The asset’s or liability’s fair value measurement level within the hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Other than those assets and liabilities described below that approximate fair value, there were no assets or liabilities measured at fair value on a recurring basis at June 30, 2015 or December 31, 2014 . Fair Values of Financial Instruments We have evaluated the fair values of financial instruments and methods used to determine those fair values. The fair values of “Cash and cash equivalents,” “Accounts receivable,” “Accounts payable,” and “Short-term debt” approximate carrying values because of the short maturity of these financial instruments. The carrying value of corporate-owned life insurance is recorded at cash surrender value and, accordingly, approximates fair value. The carrying amounts and estimated fair values for the remaining financial instruments, excluding investments accounted for under the equity method, consisted of the following: June 30, 2015 December 31, 2014 Carrying Amount Fair Value Carrying Amount Fair Value ($ in millions) Long-term investments $ 165 $ 195 $ 162 $ 193 Long-term debt, including current maturities (9,390 ) (10,867 ) (8,885 ) (10,962 ) Underlying net assets were used to estimate the fair value of investments with the exception of notes receivable, which are based on future discounted cash flows. The fair values of long-term debt were estimated based on quoted market prices or discounted cash flows using current interest rates for debt with similar terms, company rating, and remaining maturity. The following table sets forth the fair value of long-term investment and long-term debt balances disclosed above by valuation technique level, within the fair value hierarchy (there were no level 3 valued assets or liabilities). Level 1 Level 2 Total ($ in millions) June 30, 2015 Long-term investments $ 51 $ 144 $ 195 Long-term debt, including current maturities (10,661 ) (206 ) (10,867 ) December 31, 2014 Long-term investments $ 50 $ 143 $ 193 Long-term debt, including current maturities (10,754 ) (208 ) (10,962 ) |
Commitments And Contingencies
Commitments And Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments And Contingencies | Commitments and Contingencies Lawsuits We and/or certain subsidiaries are defendants in numerous lawsuits and other claims relating principally to railroad operations. When we conclude that it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, it is accrued through a charge to earnings. While the ultimate amount of liability incurred in any of these lawsuits and claims is dependent on future developments, in our opinion, the recorded liability is adequate to cover the future payment of such liability and claims. However, the final outcome of any of these lawsuits and claims cannot be predicted with certainty, and unfavorable or unexpected outcomes could result in additional accruals that could be significant to results of operations in a particular year or quarter. Any adjustments to the recorded liability will be reflected in earnings in the periods in which such adjustments become known. Two of our customers, DuPont and Sunbelt Chlor Alkali Partnership (Sunbelt), filed rate reasonableness complaints before the Surface Transportation Board (STB) alleging that our tariff rates for transportation of regulated movements are unreasonable. Since June 1, 2009, in the case of DuPont, and April 1, 2011, in the case of Sunbelt, we have been billing and collecting amounts based on the challenged tariff rates. In 2014, the STB resolved both rate reasonableness complaints in our favor. The STB’s findings in both cases remain subject to technical corrections, requests for reconsideration, and appeal. We believe the estimate of any reasonably possible loss will not have a material effect on our financial position, results of operations, or liquidity. With regard to rate cases, we record adjustments to revenues in the periods if and when such adjustments are probable and estimable. On November 6, 2007, various antitrust class actions filed against us and other Class I railroads in various Federal district courts regarding fuel surcharges were consolidated in the District of Columbia by the Judicial Panel on Multidistrict Litigation. On June 21, 2012, the court certified the case as a class action. The defendant railroads appealed this certification, and the Court of Appeals for the District of Columbia vacated the District Court’s decision and remanded the case for further consideration. We believe the allegations in the complaints are without merit and intend to vigorously defend the cases. We do not believe the outcome of these proceedings will have a material effect on our financial position, results of operations, or liquidity. A lawsuit containing similar allegations against us and four other major railroads that was filed on March 25, 2008, in the U.S. District Court for the District of Minnesota, was voluntarily dismissed by the plaintiff subject to a tolling agreement entered into in August 2008, and most recently extended in August 2013. Casualty Claims Casualty claims include employee personal injury and occupational claims as well as third-party claims, all exclusive of legal costs. To aid in valuing our personal injury liability and determining the amount to accrue with respect to such claims during the year, we utilize studies prepared by an independent consulting actuarial firm. Job-related accidental injury and occupational claims are subject to the Federal Employers’ Liability Act (FELA), which is applicable only to railroads. FELA’s fault-based system produces results that are unpredictable and inconsistent as compared with a no-fault workers’ compensation system. The variability inherent in this system could result in actual costs being different from the liability recorded. While the ultimate amount of claims incurred is dependent on future developments, in our opinion, the recorded liability is adequate to cover the future payments of claims and is supported by the most recent actuarial study. In all cases, we record a liability when the expected loss for the claim is both probable and estimable. Employee personal injury claims – The largest component of casualties and other claims expense is employee personal injury costs. The independent actuarial firm engaged by us provides quarterly studies to aid in valuing our employee personal injury liability and estimating personal injury expense. The actuarial firm studies our historical patterns of reserving for claims and subsequent settlements, taking into account relevant outside influences. The actuarial firm uses the results of these analyses to estimate the ultimate amount of liability, which includes amounts for incurred but unasserted claims. We adjust the liability quarterly based upon our assessment and the results of the study. Our estimate of loss liabilities is subject to inherent limitation given the difficulty of predicting future events such as jury decisions, court interpretations, or legislative changes and as such the actual loss may vary from the estimated liability recorded. Occupational claims – Occupational claims (including asbestosis and other respiratory diseases, as well as conditions allegedly related to repetitive motion) are often not caused by a specific accident or event but rather allegedly result from a claimed exposure over time. Many such claims are being asserted by former or retired employees, some of whom have not been employed in the rail industry for decades. The independent actuarial firm provides an estimate of the occupational claims liability based upon our history of claim filings, severity, payments, and other pertinent facts. The liability is dependent upon judgments we make as to the specific case reserves as well as judgments of the actuarial firm in the quarterly studies. The actuarial firm’s estimate of ultimate loss includes a provision for those claims that have been incurred but not reported. This provision is derived by analyzing industry data and projecting our experience into the future as far as can be reasonably determined. We adjust the liability quarterly based upon our assessment and the results of the study. However, it is possible that the recorded liability may not be adequate to cover the future payment of claims. Adjustments to the recorded liability are reflected in operating expenses in the periods in which such adjustments become known. Third-party claims – We record a liability for third-party claims including those for highway crossing accidents, trespasser and other injuries, automobile liability, property damage, and lading damage. The actuarial firm assists us with the calculation of potential liability for third-party claims, except lading damage, based upon our experience including the number and timing of incidents, amount of payments, settlement rates, number of open claims, and legal defenses. The actuarial estimate includes a provision for claims that have been incurred but not reported. We adjust the liability quarterly based upon our assessment and the results of the study. Given the inherent uncertainty in regard to the ultimate outcome of third-party claims, it is possible that the actual loss may differ from the estimated liability recorded. Environmental Matters We are subject to various jurisdictions’ environmental laws and regulations. We record a liability where such liability or loss is probable and its amount can be estimated reasonably. Claims, if any, against third parties, for recovery of cleanup costs we have incurred are reflected as receivables (when collection is probable) in the Consolidated Balance Sheets and are not netted against the associated liability. Environmental engineers regularly participate in ongoing evaluations of all known sites and in determining any necessary adjustments to liability estimates. We have an Environmental Policy Council, composed of senior managers, to oversee and interpret our environmental policy. Our Consolidated Balance Sheets include liabilities for environmental exposures of $70 million at June 30, 2015 , and $66 million at December 31, 2014 (of which $15 million is classified as a current liability at both June 30, 2015 and December 31, 2014 ). At June 30, 2015 , the liability represents our estimates of the probable cleanup, investigation, and remediation costs based on available information at 144 known locations and projects compared with 146 locations and projects at December 31, 2014 . At June 30, 2015 , 16 sites accounted for $43 million of the liability, and no individual site was considered to be material. We anticipate that much of this liability will be paid out over five years; however, some costs will be paid out over a longer period. At 11 locations, one or more of our subsidiaries in conjunction with a number of other parties have been identified as potentially responsible parties under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or comparable state statutes that impose joint and several liability for cleanup costs. We calculate our estimated liability for these sites based on facts and legal defenses applicable to each site and not solely on the basis of the potential for joint liability. With respect to known environmental sites (whether identified by us or by the Environmental Protection Agency (EPA) or comparable state authorities), estimates of our ultimate potential financial exposure for a given site or in the aggregate for all such sites can change over time because of the widely varying costs of currently available cleanup techniques, unpredictable contaminant recovery and reduction rates associated with available cleanup technologies, the likely development of new cleanup technologies, the difficulty of determining in advance the nature and full extent of contamination and each potential participant’s share of any estimated loss (and that participant’s ability to bear it), and evolving statutory and regulatory standards governing liability. The risk of incurring environmental liability – for acts and omissions, past, present, and future – is inherent in the railroad business. Some of the commodities we transport, particularly those classified as hazardous materials, pose special risks that we work diligently to reduce. In addition, several of our subsidiaries own, or have owned, land used as operating property, or which is leased and operated by others, or held for sale. Because environmental problems that are latent or undisclosed may exist on these properties, there can be no assurance that we will not incur environmental liabilities or costs with respect to one or more of them, the amount and materiality of which cannot be estimated reliably at this time. Moreover, lawsuits and claims involving these and potentially other unidentified environmental sites and matters are likely to arise from time to time. The resulting liabilities could have a significant effect on our financial position, results of operations, or liquidity in a particular year or quarter. Based on our assessment of the facts and circumstances now known, we believe we have recorded the probable and reasonably estimable costs for dealing with those environmental matters of which we are aware. Further, we believe that it is unlikely that any known matters, either individually or in the aggregate, will have a material adverse effect on our financial position, results of operations, or liquidity. Insurance We obtain on behalf of ourself and our subsidiaries insurance for potential losses for third-party liability and first-party property damages. We are currently self-insured up to $50 million and above $1.2 billion per occurrence and/or policy year for bodily injury and property damage to third parties and up to $25 million and above $200 million per occurrence and/or policy year for property owned by us or in our care, custody, or control. Purchase Commitments At June 30, 2015 , we had outstanding purchase commitments totaling approximately $1.0 billion for locomotives, freight cars and containers, track material, and track and yard expansion projects in connection with our capital programs as well as long-term service contracts through 2018. |
New Accounting Pronouncement (N
New Accounting Pronouncement (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncement, Early Adoption [Table Text Block] | New Accounting Pronouncement In April 2015, the FASB issued Accounting Standards Update (ASU) No. 2015-03, “Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” This update requires that debt issuance costs be presented in the balance sheet as a reduction from the related debt liability rather than as an asset, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this update. We early adopted the provisions of this ASU during the second quarter of 2015 and applied it retrospectively. The adoption of ASU 2015-03 resulted in the presentation of $43 million of debt issuance costs as a reduction of “Long-term debt” at June 30, 2015. We retrospectively adjusted the December 31, 2014 consolidated balance sheet and related disclosures to reflect the reclassification of $41 million of debt issuance costs from “Other assets” to “Long-term debt.” There was no other impact on our consolidated financial statements from the adoption of ASU 2015-03. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule Of Assumptions Used For LTIP And TSOP Grants | The assumptions for the 2015 LTIP and TSOP grants are shown in the following table: Expected volatility range 19% - 27% Average expected volatility 25% Average risk-free interest rate 1.83% Average expected option term LTIP 9.3 years Per-share grant-date fair value LTIP $30.35 Average expected option term TSOP 9.1 years Per-share grant-date fair value TSOP $24.71 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Schedule Of Earnings Per Share Calculation | The following table sets forth the calculation of basic and diluted earnings per share: Basic Diluted Second Quarter 2015 2014 2015 2014 ($ in millions, except per share amounts, shares in millions) Net income $ 433 $ 562 $ 433 $ 562 Dividend equivalent payments (1 ) (2 ) (1 ) (1 ) Income available to common stockholders $ 432 $ 560 $ 432 $ 561 Weighted-average shares outstanding 302.9 309.5 302.9 309.5 Dilutive effect of outstanding options and share-settled awards 2.6 3.3 Adjusted weighted-average shares outstanding 305.5 312.8 Earnings per share $ 1.43 $ 1.81 $ 1.41 $ 1.79 Basic Diluted First Six Months 2015 2014 2015 2014 ($ in millions, except per share amounts, shares in millions) Net income $ 743 $ 930 $ 743 $ 930 Dividend equivalent payments (3 ) (4 ) (2 ) (2 ) Income available to common stockholders $ 740 $ 926 $ 741 $ 928 Weighted-average shares outstanding 304.8 309.5 304.8 309.5 Dilutive effect of outstanding options and share-settled awards 2.7 3.2 Adjusted weighted-average shares outstanding 307.5 312.7 Earnings per share $ 2.43 $ 2.99 $ 2.41 $ 2.97 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | The components of “Other comprehensive income” reported in the Consolidated Statements of Comprehensive Income and changes in the cumulative balances of “Accumulated other comprehensive loss” reported in the Consolidated Balance Sheets consisted of the following: Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) Second Quarter March 31, 2015 $ (313 ) $ (82 ) $ (395 ) Other comprehensive income: Amounts reclassified into net income 11 (1) — 11 Tax expense (5 ) — (5 ) Other comprehensive income 6 — 6 June 30, 2015 $ (307 ) $ (82 ) $ (389 ) Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) Second Quarter March 31, 2014 $ (125 ) $ (68 ) $ (193 ) Other comprehensive income: Amounts reclassified into net income 7 (1) — 7 Net gain — 7 7 Tax expense (3 ) (1 ) (4 ) Other comprehensive income 4 6 10 June 30, 2014 $ (121 ) $ (62 ) $ (183 ) Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) First Six Months December 31, 2014 $ (320 ) $ (78 ) $ (398 ) Other comprehensive income (loss): Amounts reclassified into net income 21 (1) — 21 Net loss — (4 ) (4 ) Tax expense (8 ) — (8 ) Other comprehensive income (loss) 13 (4 ) 9 June 30, 2015 $ (307 ) $ (82 ) $ (389 ) Pensions and Other Postretirement Benefits Other Comprehensive Loss of Equity Investees Accumulated Other Comprehensive Loss ($ in millions) First Six Months December 31, 2013 $ (310 ) $ (71 ) $ (381 ) Other comprehensive income: Prior service benefit 367 — 367 Amounts reclassified into net income 19 (1) — 19 Net gain (loss) (80 ) 10 (70 ) Tax expense (117 ) (1 ) (118 ) Other comprehensive income 189 9 198 June 30, 2014 $ (121 ) $ (62 ) $ (183 ) (1) These items are included in the computation of net periodic pension and postretirement benefit costs. See Note 8, “Pensions and Other Postretirement Benefits” for additional information. |
Pensions And Other Postretire21
Pensions And Other Postretirement Benefits (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
Pension And Other Postretirement Benefit Cost Components | Other Postretirement Pension Benefits Benefits Second Quarter 2015 2014 2015 2014 ($ in millions) Service cost $ 10 $ 8 $ 2 $ 2 Interest cost 23 24 5 5 Expected return on plan assets (42 ) (38 ) (5 ) (5 ) Amortization of net losses 17 13 — — Amortization of prior service benefit — — (6 ) (6 ) Net cost (benefit) $ 8 $ 7 $ (4 ) $ (4 ) Other Postretirement Pension Benefits Benefits First Six Months 2015 2014 2015 2014 ($ in millions) Service cost $ 20 $ 17 $ 4 $ 4 Interest cost 47 47 10 13 Expected return on plan assets (83 ) (76 ) (10 ) (9 ) Amortization of net losses 33 27 — — Amortization of prior service benefit — — (12 ) (8 ) Net cost (benefit) $ 17 $ 15 $ (8 ) $ — |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block] | The Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820-10, “Fair Value Measurements,” established a framework for measuring fair value and a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows: Level 1 Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that we have the ability to access. Level 2 Inputs to the valuation methodology include: • quoted prices for similar assets or liabilities in active markets; • quoted prices for identical or similar assets or liabilities in inactive markets; • inputs other than quoted prices that are observable for the asset or liability; • inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability. Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement. |
Schedule Of Carrying Amounts And Estimated Fair Values | The carrying amounts and estimated fair values for the remaining financial instruments, excluding investments accounted for under the equity method, consisted of the following: June 30, 2015 December 31, 2014 Carrying Amount Fair Value Carrying Amount Fair Value ($ in millions) Long-term investments $ 165 $ 195 $ 162 $ 193 Long-term debt, including current maturities (9,390 ) (10,867 ) (8,885 ) (10,962 ) |
Schedule Of Fair Value Of Long-term Assets And Liabilities | The following table sets forth the fair value of long-term investment and long-term debt balances disclosed above by valuation technique level, within the fair value hierarchy (there were no level 3 valued assets or liabilities). Level 1 Level 2 Total ($ in millions) June 30, 2015 Long-term investments $ 51 $ 144 $ 195 Long-term debt, including current maturities (10,661 ) (206 ) (10,867 ) December 31, 2014 Long-term investments $ 50 $ 143 $ 193 Long-term debt, including current maturities (10,754 ) (208 ) (10,962 ) |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 4 | $ 10 | $ 35 | $ 42 | |
Tax benefits associated with stock-based compensation costs | $ 1 | $ 4 | $ 11 | $ 14 | |
Stock options exercised | 90,269 | 353,327 | 331,673 | 1,234,071 | |
Proceeds from stock options exercised | $ 5 | $ 16 | $ 17 | $ 56 | |
Excess tax benefits recognized for share-based awards | $ 1 | 4 | $ 4 | 15 | |
LTIP | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock options granted | 132,880 | 511,010 | |||
Vesting period, in years | 4 years | ||||
LTIP dividend equivalent payment, in years | 4 years | ||||
Dividend yield for period dividend equivalents paid | 0.00% | ||||
Grant price of options granted | $ 92.76 | ||||
TSOP | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock options granted | 181,320 | ||||
Vesting period, in years | 3 years | ||||
Ltip And Tsop [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option term, in years | 10 years | ||||
Dividend yield for period dividend equivalents paid | 2.27% | ||||
Grant price of options granted | $ 104.23 | ||||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Tax benefits associated with stock-based compensation costs | $ 1 | $ 1 | $ 4 | $ 6 | |
Restriction period, in years | 5 years | ||||
Performance share units earned | 166,750 | 318,150 | |||
Shares issued net of withholding taxes | 99,337 | 187,449 | |||
Grants other than stock options | 101,470 | ||||
Grant price of options granted | $ 104.23 | ||||
PSU | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Tax benefits associated with stock-based compensation costs | $ 3 | $ 5 | |||
Performance share units earned | 236,601 | 374,099 | |||
Shares issued net of withholding taxes | 141,386 | 223,253 | |||
Performance share units cycle, in years | 3 years | 3 years | |||
Grants other than stock options | 413,770 | ||||
PSU | Performance Condition | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Grant-date fair value of units granted | $ 97.24 | ||||
PSU | Market Condition | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Grant-date fair value of units granted | $ 46.08 |
Stock-Based Compensation (Sched
Stock-Based Compensation (Schedule Of Assumptions Used For LTIP And TSOP Grants) (Details) - 3 months ended Mar. 31, 2015 - $ / shares | Total |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility rate, minimum | 19.00% |
Expected volatility rate, maximum | 27.00% |
Average expected volatility rate | 25.00% |
Average risk-free interest rate | 1.83% |
LTIP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Average expected option term, in years | 9 years 3 months 18 days |
Grant price for options granted | $ 30.35 |
TSOP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Average expected option term, in years | 9 years 1 month 6 days |
Grant price for options granted | $ 24.71 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Net income | $ 433 | $ 562 | $ 743 | $ 930 | ||
Earnings Per Share, Basic | $ 1.43 | $ 1.81 | $ 2.43 | $ 2.99 | ||
Earnings Per Share, Diluted | $ 1.41 | $ 1.79 | $ 2.41 | $ 2.97 | ||
Options having exercise prices exceeding average market price | 0.7 | 0 | 0 | 0.7 | ||
Earnings Per Share Basic | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Net income | $ 433 | $ 562 | $ 743 | $ 930 | ||
Dividend equivalent payments | (1) | (2) | (3) | (4) | ||
Income available to common stockholders, basic | $ 432 | $ 560 | $ 740 | $ 926 | ||
Weighted-average shares outstanding | 302.9 | 309.5 | 304.8 | 309.5 | ||
Earnings Per Share, Basic | $ 1.43 | $ 1.81 | $ 2.43 | $ 2.99 | ||
Earnings Per Share Diluted | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Net income | $ 433 | $ 562 | $ 743 | $ 930 | ||
Dividend equivalent payments | (1) | (1) | (2) | (2) | ||
Income available to common stockholders, diluted | $ 432 | $ 561 | $ 741 | $ 928 | ||
Weighted-average shares outstanding | 302.9 | 309.5 | 304.8 | 309.5 | ||
Dilutive effect of outstanding options and share-settled awards | 2.6 | 3.3 | 2.7 | 3.2 | ||
Adjusted weighted-average shares outstanding | 305.5 | 312.8 | 307.5 | 312.7 | ||
Earnings Per Share, Diluted | $ 1.41 | $ 1.79 | $ 2.41 | $ 2.97 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Shares held by consolidated subsidiaries | 20,320,777 | 20,320,777 | 20,320,777 | |||
Value of shares held by consolidated subsidiaries | $ 19 | $ 19 | $ 19 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Accumulated other comprehensive loss - beginning balance | (395) | $ (193) | (398) | $ (381) | ||
Prior service benefit | 367 | |||||
Amounts reclassified into net income | 11 | 7 | 21 | 19 | ||
Net gain (loss) | 7 | (4) | (70) | |||
Tax expense | (5) | (4) | (8) | (118) | ||
Other comprehensive income, net of tax | 6 | 10 | 9 | 198 | ||
Accumulated other comprehensive loss - ending balance | (389) | (183) | (389) | (183) | ||
Pensions And Other Postretirement Liabilities | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Accumulated other comprehensive loss - beginning balance | (313) | (125) | (320) | (310) | ||
Prior service benefit | 367 | |||||
Amounts reclassified into net income | [1] | 11 | 7 | 21 | 19 | |
Net gain (loss) | 0 | 0 | (80) | |||
Tax expense | (5) | (3) | (8) | (117) | ||
Other comprehensive income, net of tax | 6 | 4 | 13 | 189 | ||
Accumulated other comprehensive loss - ending balance | (307) | (121) | (307) | (121) | ||
Accumulated Other Comprehensive Loss Equity Investees | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Accumulated other comprehensive loss - beginning balance | (82) | (68) | (78) | (71) | ||
Prior service benefit | 0 | |||||
Amounts reclassified into net income | 0 | 0 | 0 | 0 | ||
Net gain (loss) | 7 | (4) | 10 | |||
Tax expense | 0 | (1) | 0 | (1) | ||
Other comprehensive income, net of tax | 0 | 6 | (4) | 9 | ||
Accumulated other comprehensive loss - ending balance | $ (82) | $ (62) | $ (82) | $ (62) | ||
[1] | These items are included in the computation of net periodic pension and postretirement benefit costs. See Note 8, “Pensions and Other Postretirement Benefits” for additional information. |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) shares in Millions, $ in Millions | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Stock Repurchase Program [Abstract] | ||
Stock repurchased and retired during period, shares | 7.4 | 1 |
Stock repurchased and retired during period, cost | $ 765 | $ 100 |
Stock repurchased and retired since beginning of stock repurchase program in 2006, shares | 147.2 | |
Stock repurchased and retired since beginning of stock repurchase program in 2006, cost | $ 9,200 |
Investment In Conrail (Details)
Investment In Conrail (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Equity Method Investee [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity method investment, ownership percentage | 58.00% | 58.00% | 58.00% | ||
Conrail Voting | |||||
Schedule of Investments [Line Items] | |||||
Equity method investment, ownership percentage | 50.00% | 50.00% | 50.00% | ||
Conrail Inc [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity method investments | $ 1,100 | $ 1,100 | $ 1,100 | ||
Expenses for the use of the Shared Assets Area | 40 | $ 34 | 77 | $ 68 | |
Equity in the earnings of Conrail | 13 | $ 10 | 23 | $ 16 | |
Due to affiliate, current | 72 | 72 | 56 | ||
Due to affiliate, noncurrent | $ 280 | $ 280 | $ 280 | ||
Due to affiliate, noncurrent, maturity date | 2,044 | 2,044 | |||
Due to affiliate, average interest rate | 2.90% | 2.90% |
Debt Debt Instrument Line Items
Debt Debt Instrument Line Items (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | |||
Repayments of Short-term Debt | $ 100 | ||
Accounts Receivable Securitization Balance | $ 100 | $ 100 | $ 200 |
Short-term Debt, Weighted Average Interest Rate | 1.29% | 1.29% | 1.28% |
Authority To Issue Debt Equity Securities | $ 1,200 | ||
Proceeds from Issuance of Long-term Debt | $ 500 | ||
June 2015 Senior Note 4.45% Due 2045 [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.45% | 4.45% | |
Debt Instrument, Maturity Date, Description | 2,045 |
Pensions And Other Postretire30
Pensions And Other Postretirement Benefits (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Pension Plans, Defined Benefit | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 10 | $ 8 | $ 20 | $ 17 |
Interest cost | 23 | 24 | 47 | 47 |
Expected return on plan assets | (42) | (38) | (83) | (76) |
Amortization of net losses | 17 | 13 | 33 | 27 |
Amortization of prior service benefit | 0 | 0 | 0 | 0 |
Net cost (benefit) | 8 | 7 | 17 | 15 |
Other Postretirement Benefit Plans, Defined Benefit | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 2 | 2 | 4 | 4 |
Interest cost | 5 | 5 | 10 | 13 |
Expected return on plan assets | (5) | (5) | (10) | (9) |
Amortization of net losses | 0 | 0 | 0 | 0 |
Amortization of prior service benefit | (6) | (6) | (12) | (8) |
Net cost (benefit) | $ (4) | $ (4) | $ (8) | $ 0 |
Fair Value (Narrative) (Details
Fair Value (Narrative) (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Fair Value Disclosures [Abstract] | ||
Assets or liabilities measured at fair value | $ 0 | $ 0 |
Fair Value (Schedule Of Carryin
Fair Value (Schedule Of Carrying Amounts And Estimated Fair Values) (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Fair Value Disclosures [Abstract] | ||
Long-term investments, carrying amount | $ 165 | $ 162 |
Long-term investments, fair value | 195 | 193 |
Long-term debt, including current maturities, carrying value | (9,390) | (8,885) |
Long-term debt, including current maturities, fair value | $ (10,867) | $ (10,962) |
Fair Value (Schedule Of Fair Va
Fair Value (Schedule Of Fair Value Of Long-term Assets And Liabilities) (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments | $ 195 | $ 193 |
Long-term debt, including current maturities | (10,867) | (10,962) |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments | 51 | 50 |
Long-term debt, including current maturities | (10,661) | (10,754) |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments | 144 | 143 |
Long-term debt, including current maturities | $ (206) | $ (208) |
Commitments And Contingencies (
Commitments And Contingencies (Details) | 6 Months Ended | |
Jun. 30, 2015USD ($)location | Dec. 31, 2014USD ($)location | |
Commitments and Contingencies Disclosure [Abstract] | ||
Environmental liability | $ 70,000,000 | $ 66,000,000 |
Current environmental liability | $ 15,000,000 | $ 15,000,000 |
Known cleanup and remediation locations and projects | location | 144 | 146 |
Number of sites - representative sample | location | 16 | |
Liability associated with those sites | $ 43,000,000 | |
Environmental locations representative sample liability payout period, in years | 5 years | |
Responsible locations with another party | location | 11 | |
Self-insured injury/damage to third party - up to | $ 50,000,000 | |
Self-insured injury/damage to third parties - and above, per occurrence | 1,200,000,000 | |
Self-insured NS owned property - up to | 25,000,000 | |
Self-insured NS owned property - and above, per occurrence | 200,000,000 | |
Purchase commitments, long-term service contracts | $ 1,000,000,000 |
New Accounting Pronouncement (D
New Accounting Pronouncement (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ||
Unamortized Debt Issuance Expense | $ 43 | $ 41 |