NORFOLK SOUTHERN CORP - 10-Q Quarterly Report

TABLE OF CONTENTS

			Page

Part I.	Financial information:

	Item 1.	Financial statements:

		Consolidated Statements of Income	3
		Three Months Ended March 31, 2004 and 2003

		Consolidated Balance Sheets	4
		March 31, 2004 and Dec. 31, 2003

		Consolidated Statements of Cash Flows	5
		Three Months Ended March 31, 2004 and 2003

		Notes to Consolidated Financial Statements	6

		Independent Accountants' Review Report	15

	Item 2.	Management's Discussion and Analysis of	16
		Financial Condition and Results of Operations

	Item 3.	Quantitative and Qualitative Disclosures	22
		About Market Risks

	Item 4.	Controls and Procedures	22

Part II.	Other Information:

	Item 6.	Exhibits and Reports on Form 8-K	22

Signatures			23

Exhibit Index			23

2
PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES

Consolidated Statements of Income

( Unaudited )

	Three Months Ended
	March 31,
	2004		2003
	($ in millions except per share)

*Railway operating revenues*
Coal	$	398	$	354
General merchandise		967		918
Intermodal		328		289
Total railway operating revenues		1,693		1,561

*Railway operating expenses*
Compensation and benefits		545		526
Materials, services and rents		365		360
Conrail rents and services (Note 2)		102		107
Depreciation		129		127
Diesel fuel		107		104
Casualties and other claims		40		51
Other		59		55
Total railway operating expenses		1,347		1,330

Income from railway operations		346		231

Other income - net		10		21
Interest expense on debt		(121)		(127)

Income from continuing operations before
income taxes and accounting changes		235		125

Provision for income taxes		77		40

Income from continuing operations before accounting changes		158		85

Discontinued operations - taxes on sale of
motor carrier (Note 6)		- --		10
Cumulative effect of changes in accounting
principles, net of taxes (Note 7)		- --		114
Net income	$	158	$	209

*Per share amounts, basic and diluted (Note 8)*
Income from continuing operations before
accounting changes	$	0.40	$	0.22
Discontinued operations		- --		0.03
Cumulative effect of changes in accounting principles		- --		0.29
Net income	$	0.40	$	0.54
Dividends	$	0.08	$	0.07

See accompanying notes to consolidated financial statements.

NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

( Unaudited )

	March 31,		Dec. 31,
	2004		2003
	($ in millions)
*Assets*
Current assets:
Cash and cash equivalents	$	107	$	284
Accounts receivable, net (Note 3)		765		695
Materials and supplies		97		92
Deferred income taxes		197		189
Other current assets		156		165
Total current assets		1,322		1,425

Investment in Conrail (Note 2)		6,275		6,259
Properties less accumulated depreciation		11,819		11,779
Other assets		1,176		1,133
Total assets	$	20,592	$	20,596

*Liabilities and Stockholders' Equity*
Current liabilities:
Accounts payable	$	884	$	948
Income and other taxes		233		199
Due to Conrail (Note 2)		89		81
Other current liabilities		270		213
Current maturities of long-term debt		210

FORM 10-Q

(X)	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
	EXCHANGE ACT OF 1934
	For the quarterly period ended MARCH 31, 2004

( )	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
	EXCHANGE ACT OF 1934
	For the transition period from __________ to __________
	Commission file number 1-8339

Virginia	52-1188014
(State or other jurisdiction of	(IRS Employer Identification No.)
incorporation or organization)


Three Commercial Place
Norfolk , Virginia	23510-2191
(Address of principal executive offices)	Zip Code

Registrant's telephone number, including area code	(757) 629-2680

No Change
(Former name, former address and former fiscal year,
if changed since last report.)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13
or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.	(X) Yes	( ) No

Indicate by check mark whether registrant is an accelerated filer (as defined in Rule 12b-2 of The Exchange Act).
	(X) Yes	( ) No

The number of shares outstanding of each of the registrant's classes of Common Stock, as of the last
practicable date:

Class			Outstanding as of March 31, 2004
Common Stock (par value $1.00)			392,068,916 (excluding 21,016,125 shares
			held by registrant's consolidated subsidiaries)