SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 8, 1997
CSX CORPORATION
(Exact name of registrant as specified in its charter)
Virginia
(State or other jurisdiction of
incorporation or organization)
2-63273 62-1051971
(Commission (I.R.S. Employer
File No.) Identification No.)
One James Center, 901 East Cary Street, Richmond, VA 23219
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(804) 782-1400
- 1 -
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
The following exhibits are filed as a part of this report.
99.1 Selected historical financial data for Conrail Inc.
99.2 Pro forma condensed consolidated financial statements
of CSX Corporation as of and for the six months ended
June 27, 1997 and the fiscal year ended December 27,
1996, adjusted to reflect its acquisition of a 42%
economic interest in Conrail Inc. as if such interest
had been acquired at the beginning of each respective
period.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
CSX CORPORATION
By: /s/ MARK G. ARON
Mark G. Aron
Executive Vice President - Law and
Public Affairs
Date: August 8, 1997
- 2 -
<PAGE>
EXHIBIT LIST
Exhibit Description
99.1 Selected historical financial data for Conrail Inc.
99.2 Pro forma condensed consolidated financial statements of CSX
Corporation as of and for the six months ended June 27, 1997 and
the fiscal year ended December 27, 1996, adjusted to reflect its
acquisition of a 42% economic interest in Conrail Inc. as if such
interest had been acquired at the beginning of each respective
period.
- 3 -
<PAGE>
Exhibit 99.1
SELECTED HISTORICAL FINANCIAL DATA FOR CONRAIL
The selected financial data presented below for the six months ended June
30, 1997 were derived from information provided to CSX Corporation (the
"Company") by management of Conrail Inc. ("Conrail"). The selected financial
data presented below for the six months ended June 30, 1996 and the years ended
December 31, 1996, 1995, 1994, and 1993 were derived from the consolidated
financial statements of Conrail and its subsidiaries and should be read in
conjunction with the information and consolidated statements and related notes
and Management's Discussion and Analysis of Results of Operations and Financial
Condition contained in Conrail's Annual Report on Form 10-K for the year ended
December 31, 1996 and its Quarterly Report on Form 10-Q for the quarter and six
months ended June 30, 1996. Reports on Form 10-K for years prior to 1993 were
filed by Consolidated Rail Corporation, Conrail's only significant subsidiary
and primary asset for those time periods, and 1992 historical data presented
herein are with respect to such corporation.
<TABLE>
<CAPTION>
As of or for
the Six Months
Ended June 30, As of or for the Years Ended December 31,
-------------- ----------------------------------------
1997 1996 1996 1995 1994 1993 1992
(Dollars in millions, except per share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Income Statement Data
Revenues $1,843 $1,838 $3,714 $3,686 $3,733 $3,453 $3,345
Operating income (loss) (115) 123 601 456 606 591 534
Income (loss) before cumulative
effect of changes in
accounting principles (213) 57 342 264 324 234 282
Net income (loss) (213) 57 342 264 324 160 282
Per Share Data
Income per common share before
the cumulative effect of
changes in accounting
principles:
Primary (a) $ 0.66 $4.25 $3.19 $3.90 $2.74 $3.28
Fully diluted (a) 0.64 3.89 2.94 3.56 2.51 2.99
Net income
Primary (a) $ 0.66 $4.25 $3.19 $3.90 $1.82 $3.28
Fully diluted (a) 0.64 3.89 2.94 3.56 1.70 2.99
Book Value $34.17 35.06 37.91 35.66 36.69 34.57 34.16
Cash dividends per common share 0.475(b) 0.85 1.80 1.60 1.40 1.20 1.00
Balance Sheet Data
Total assets $8,538 $8,341 $8,402 $8,424 $8,322 $7,948 $7,315
Total debt, including current
maturities 2,045 2,078 2,105 2,181 2,182 2,184 1,911
Shareholders' equity 2,944 2,899 3,107 2,977 2,925 2,784 2,748
Ratio of Earnings to Fixed Charges (c) 1.7x 3.2x 2.5x 3.2x 3.0x 3.3x
</TABLE>
(a) Subsequent to the acquisition of its remaining outstanding shares by the
Company and Norfolk Southern Corporation ("NSC") during the quarter
ended June 30, 1997, Conrail is not required to report earnings per
share ("EPS") data.
(b) Cash dividends per common share in 1997 include only a first quarter
dividend. Dividend payments were suspended upon the acquisition of all
Conrail shares by the Company and NSC during the quarter ended June 30,
1997.
(c) Earnings available for fixed charges were insufficient by $167 million
for the six months ended June 30, 1997.
Six Months Ended June 30,
1997 Operating income includes charges totaling $394 million to reflect
obligations for separation-related compensation to certain Conrail
executives, including vesting of benefits under certain stock compensation
plans, and the termination of Conrail's Employee Stock Ownership Plan.
Operating income also includes other merger-related costs of $68 million.
These items, totaling $462 million on a pre-tax basis, reduced net income
by $405 million.
1996 Operating income includes a charge of $135 million for voluntary separation
programs, which reduced net income by $83 million and EPS $1.06 on a
primary basis and 95 cents on a fully diluted basis.
Years Ended December 31,
1996 Operating income includes a charge of $135 million for voluntary separation
programs, which reduced net income by $83 million and EPS $1.06 on a
primary basis and 95 cents on a fully diluted basis. Operating income also
includes merger-related costs of $16 million, which reduced net income by
$10 million and EPS by 13 cents on a primary basis and 11 cents on a fully
diluted basis.
1995 Operating income includes an asset disposition charge of $285 million for
rail lines and other assets written down to estimated net realizable value,
which reduced net income by $176 million and EPS by $2.24 on a primary
basis and $1.98 on a fully diluted basis. Net income also includes a
one-time $21 million benefit related to a decrease in a state income tax
rate which increased EPS 27 cents on a primary basis and 23 cents on a
fully diluted basis.
1994 Included in operating income is a charge of $84 million ($51 million after
tax benefits) for a voluntary early retirement program and related costs.
This reduced EPS 64 cents on a primary basis and 57 cents on a fully
diluted basis.
1993 Net income includes charges of $74 million as a result of the adoption of
required changes in accounting for income taxes and postretirement benefits
other than pensions which reduced EPS 92 cents on a primary basis and 81
cents on a fully diluted basis; $50 million ($80 million before tax benefit
of $30 million) for the disposition of a subsidiary which decreased EPS 62
cents on a primary basis and 55 cents on a fully diluted basis; and $34
million for the increase in the federal corporate income tax rate which
decreased EPS 42 cents on a primary basis and 37 cents on a fully diluted
basis.
<PAGE>
Exhibit 99.2
UNAUDITED PRO FORMA FINANCIAL STATEMENTS
On May 23, 1997, the joint tender offer (the "Joint Tender Offer") of
CSX Corporation (the "Company") and Norfolk Southern Corporation ("NSC") for the
outstanding shares of Conrail Inc. ("Conrail") not already owned by them (the
"Shares") expired. As a result of the contribution by the Company and NSC of
Conrail shares owned by them before the Joint Tender Offer, as well as the
contribution of funds to complete the Joint Tender Offer and the subsequent
merger of Conrail with a subsidiary of an acquisition entity jointly owned by
the Company and NSC (the "Acquisition Entity"), they have, respectively, a 42
percent and a 58 percent economic interest in the Acquisition Entity which now
owns all of the Conrail shares. Such shares are being held in a voting trust
pending approval by the Surface Transportation Board (the "STB"). The Company
and NSC also each may exercise a 50 percent voting interest in the Acquisition
Entity and each has the right to appoint half of that entity's directors and a
full-time Co-Chief Executive Officer. Under the agreement, dated as of April 8,
1997, between the Company and NSC providing for their joint acquisition of
Conrail (the "CSX/NSC Agreement"), subject to STB approval, the Company will
operate routes and assets (or rights thereto) that generated approximately 42
percent of Conrail's 1995 revenues.
The Unaudited Pro Forma Financial Statements included herein present a
Condensed Consolidated Statement of Financial Position for the Company as of
June 27, 1997, and Condensed Consolidated Statements of Earnings for the six
months ended June 27, 1997, and the fiscal year ended December 27, 1996. The pro
forma financial statements reflect (i) the completion by the Company and NSC of
their Joint Tender Offer for the Conrail Shares and the subsequent merger at
$115 per share through the Acquisition Entity; and (ii) the related borrowings
by the Company.
These events occurred prior to June 27, 1997 and, with the exception of
certain transaction fees expected to be incurred after that date, the Historical
Condensed Consolidated Statement of Financial Position includes the Company's
full 42% investment in Conrail. The Pro Forma Condensed Consolidated Statement
of Financial Position reflects all transaction fees as if they had been incurred
on or before June 27, 1997. The Pro Forma Condensed Consolidated Statements of
Earnings reflect the events as if they had occurred at the beginning of the
period presented. The financial information for Conrail was based upon its
historical financial statements for the six months ended June 30, 1997, provided
to the Company by Conrail's management, and such financial statements for the
year ended December 31, 1996, as reported in its Form 10-K. Conrail's results
for the six months ended June 30, 1997 included one-time charges of $394 million
(pre-tax) to reflect obligations for separation-related compensation to certain
Conrail executives and the termination of its Employee Stock Ownership Plan, as
well as $68 million (pre-tax) in other acquisition-related costs. Conrail's 1996
results included a special charge of $135 million (pre-tax) for voluntary
separation programs, as well as $16 million (pre-tax) in acquisition-related
costs.
The Company is using the equity method of accounting for its interest in
Conrail following consummation of the Joint Tender Offer and the merger and
continuing as long as the Conrail shares are held in the voting trust - a period
that will extend at least until the effective date of the STB's decision
approving the transactions contemplated by the agreements concerning the joint
control and division of Conrail between CSX and NSC (if such approval is
obtained). In accordance with Accounting Principles Board ("APB") Opinion No.
18, "The Equity Method of Accounting for Investments in Common Stock," the
excess of the Company's purchase price over the underlying net assets acquired
("Excess") is being amortized. Based on a preliminary analysis of the fair value
of the underlying net assets of Conrail, the Company believes a significant
portion of the Excess will be allocated to long-lived assets other than
goodwill. Further information as to the values of assets and liabilities, as
well as additional analysis of such information and specific allocations to the
Company or NSC, may affect these preliminary estimates.
The method of accounting for the investment in Conrail subsequent to
dissolution of the voting trust will depend on the final terms of the ownership
arrangement between the Company and NSC approved by the STB. Additionally, the
ultimate terms of leases, operating partnerships and other arrangements will
affect the accounting. It is also expected that some of the assets and
operations of Conrail will remain subject to joint control by the Company and
NSC and, thus, may continue to be accounted for using the equity method of
accounting even after STB approval.
The unaudited pro forma financial statements do not reflect synergies
and, accordingly, do not account for any potential increases in operating
income, any estimated cost savings, any adjustments to conform accounting
practices or any capital expenditures to be realized or made by either the
Company or Conrail to achieve such improvements. The unaudited pro forma
financial statements are prepared for illustrative purposes only and are not
necessarily indicative of the financial position or results of operations that
might have occurred had the applicable transactions actually taken place on the
date indicated, or of future results of operations or financial position of the
standalone or combined entities.
The unaudited pro forma financial statements are based on the historical
consolidated financial statements of the Company and Conrail and should be read
in conjunction with such historical financial statements and the notes thereto,
except with respect to the historical consolidated financial statements of
Conrail for the six months ended June 30, 1997. Such financial statements have
been provided to the Company by Conrail's management and, subsequent to the
joint acquisition, are not required to be reported on Form 10-Q.
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As of June 27, 1997
Unaudited
(Dollars in Millions)
Pro Forma
CSX with
CSX Pro Forma Conrail
Historical Adjustments Investment
---------- ----------- ----------
Assets
Current assets $ 2,153 $ (20) (1) $ 2,133
Properties - net 11,998 11,998
Investment in Conrail 4,188 20 (1) 4,208
Other long-term assets 1,130 1,130
------- ------ -------
Total assets $19,469 $ -- $19,469
======= ====== =======
Liabilities
Current liabilities $ 2,430 $ 2,430
Long-term debt 6,753 6,753
Deferred income taxes 2,779 2,779
Other long-term liabilities 2,197 2,197
------- ------ -------
Total liabilities 14,159 -- 14,159
------- ------ -------
Shareholders' Equity
Common stock 218 218
Other capital 1,482 1,482
Retained earnings 3,717 3,717
Minimum pension liability (107) (107)
------- ------ -------
Total shareholders' equity 5,310 -- 5,310
------- ------ -------
Total liabilities and shareholders'
equity $19,469 $ -- $19,469
======= ====== =======
See accompanying Notes to Unaudited Pro Forma Financial Statements.
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
Six Months Ended June 27, 1997
Unaudited
(Dollars in Millions, Except Per Share Data)
Pro Forma
CSX with
CSX Pro Forma Conrail
Historical Adjustments Investment
---------- ----------- ----------
Operating revenue $ 5,245 $ 5,245
Operating expense 4,488 4,488
------- -------
Operating income 757 757
Other income (expense) 11 $ (3) (3) 8
Interest expense 195 61 (2) 256
------- ------ -------
Earnings before income taxes 573 (64) 509
Income tax expense 195 (23) (4) 172
------- ------ -------
Net earnings $ 378 $ (41) $ 337
======= ====== =======
Earnings per share $ 1.74 $(0.19) $ 1.55
Average common shares outstanding
(thousands) 217,456 217,456
See accompanying Notes to Unaudited Pro Forma Financial Statements.
<PAGE>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
Fiscal Year Ended December 27, 1996
Unaudited
(Dollars in Millions, Except Per Share Data)
Pro Forma
CSX with
CSX Pro Forma Conrail
Historical Adjustments Investment
---------- ----------- ----------
Operating revenue $10,536 $10,536
Operating expense 9,014 9,014
------- -------
Operating income 1,522 1,522
Other income 43 $ 73 (3) 116
Interest expense 249 284 (2) 533
------- ------ -------
Earnings before income taxes 1,316 (211) 1,105
Income tax expense 461 (96) (4) 365
------- ------ -------
Net earnings $ 855 $ (115) $ 740
======= ====== =======
Earnings per share $ 4.00 $ (0.54) $ 3.46
Average common shares outstanding
(thousands) 213,633 213,633
See accompanying Notes to Unaudited Pro Forma Financial Statements.
<PAGE>
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
(Dollars in Millions, Except Per Share Data)
Note 1. Preliminary Calculation of Purchase Price
Pursuant to the CSX/NSC Agreement, CSX has invested approximately $4.124
billion (including $1.955 billion expended in November 1996, and excluding
transaction fees) to acquire, through its ownership interest in Conrail, various
Conrail routes and assets or rights thereto. The acquisition was financed with a
combination of debentures and commercial paper. The purchase price has been
preliminarily calculated as follows:
<TABLE>
<S> <C>
Estimated Conrail shares outstanding at May 23, 1997 (000's) 86,150
Less: Shares acquired pursuant to CSX's first tender offer (a) (17,775)
Shares acquired pursuant to NSC's first tender offer (8,200)
Shares acquired pursuant to Joint Tender Offer and merger 60,175
Joint Tender Offer and merger price per share $ 115
-------
Cost of shares acquired pursuant to Joint Tender Offer and merger $ 6,920
Add: Cost of shares acquired pursuant to CSX's first tender offer (a) 1,955
Cost of shares acquired pursuant to NSC's first tender offer 943
-------
Joint purchase price 9,818
CSX's allocation 42%
Joint purchase price payable by CSX 4,124
Estimated transaction fees payable by CSX 50
-------
Purchase price payable by CSX, including transaction fees 4,174
Less: Portion of transaction fees estimated to be incurred after June 27,1997 (20)
Add: CSX's equity in Conrail's earnings, less amortization of the
purchase price in excess of 42% of Conrail's net assets, through
June 27, 1997 34
-------
Investment in Conrail at June 27, 1997 4,188
Pro forma adjustment to investment in Conrail for transaction fees estimated to
be incurred after June 27, 1997 20
-------
Pro forma investment in Conrail $ 4,208
=======
</TABLE>
(a) Exclusive of 85,000 shares previously sold by CSX at an average price of
$98.983 per share.
<PAGE>
Note 2. Debt
As a consequence of the Company's first tender offer and its share of
the subsequent Joint Tender Offer and merger, short-term and long-term debt of
$4.204 billion was outstanding at June 27, 1997, as outlined below. This debt is
inclusive of the proceeds of $2.5 billion of debentures, reduced by net
repayments of commercial paper previously outstanding.
Weighted-Average
Principal Interest Rate for
Amount Pro Forma Adjustment
--------- --------------------
Debentures $2,500 7.55% (fixed)
Commercial paper 1,704 5.85% (variable)
-------
Total debt incurred by CSX $4,204 6.86%
======
As of June 27, 1997, the Company had financed with debt the following
costs related to the joint acquisition of Conrail:
Joint purchase price payable by CSX $4,124
Debt issuance-related financing fees 50
Transaction fees paid through June 27, 1997 30
--------
Total costs financed with debt $4,204
======
Pro forma interest expense has been increased as a result of the
additional debt incurred, as noted below. Debt placement fees, debt discount and
related costs are being amortized on the interest method and, together with
annual commitment fees, approximate $7 million in the first year after
consummation of the Joint Tender Offer. Inclusive of these costs, the effective
interest rate is approximately 7.02%. If interest rates assumed were to change
by one-eighth of one percent, the pro forma interest expense on variable rate
debt associated with the transaction would vary by $2 million annually.
Six Months Fiscal Year
Ended Ended
June 27, 1997 Dec. 27, 1996
------------- -------------
Effective interest on $4.204 billion of debt $148 $295
Less: interest already recognized in
historical financial statements (a) (87) (11)
----- -----
Pro forma adjustment $ 61 $284
===== ====
(a) Resulting from long-term debt incurred to finance the first tender offer in
1996 and, additionally, the Joint Tender Offer and subsequent merger in the
second quarter of 1997.
<PAGE>
Note 3. Other Income
The equity method of accounting will be applied to the Company's
investment in Conrail throughout the period the investment is held in the voting
trust. In accordance with APB Opinion No. 18, "The Equity Method of Accounting
for Investments in Common Stock," other income includes 42% of Conrail's
historical net income, adjusted for amortization, net of tax, of the difference
between the Company's investment in Conrail and 42% of Conrail's underlying
equity in net assets. The difference is primarily attributable to the estimated
fair value of property and equipment, net of the related deferred taxes, and
includes approximately $654 million in goodwill. This allocation is based on
preliminary estimates of fair values of all Conrail assets and liabilities and
is likely to change after regulatory approvals are obtained. To the extent that
specific assets and liabilities are allocated to Conrail entities over which the
Company will have a controlling financial interest, the allocation will be
redesignated to follow the method in which the investment is accounted for
subsequent to approval by the STB. The preliminary estimates are also likely to
change as additional information concerning fair values and remaining useful
lives becomes available. An appraisal of the assets is currently underway. The
Company intends to amortize any goodwill resulting from the purchase over a
period of 40 years. Adjustments to property and equipment are depreciated over
their estimated remaining useful lives, which range from 2 to 102 years.
Preliminary Allocation of Purchase Price
----------------------------------------
Approximate net assets of Conrail at May 23, 1997 $3,203
CSX's economic interest x 42%
------
CSX share of Conrail net assets 1,345
Estimated fair value adjustments, principally property
and equipment 3,480
Deferred taxes on estimated fair value adjustments and
transaction fees (1,305)
Estimated goodwill 654
------
Purchase price payable by CSX (including transaction fees) $4,174
======
<TABLE>
<CAPTION>
Detail of Pro Forma Adjustment
- ------------------------------
Six Months Fiscal Year
Ended Ended
June 27, 1997 Dec. 27, 1996
------------- -------------
<S> <C> <C>
Conrail net income (a) $ 150 $ 342
CSX's economic interest x 42% x 42%
----- -----
Equity earnings from investment in Conrail 63 144
Depreciation (39) (77)
Amortization of goodwill (40-year life) (8) (16)
Tax benefit on depreciation 15 30
----- -----
Net impact on other income 31 81
Less: amounts recognized in historical financial
statements (cost method for fiscal year ended
Dec. 27, 1996; equity method for the six
months ended June 27, 1997) (34) (8)
----- -----
Pro Forma adjustment to Other Income (Expense) $ (3) $ 73
===== =====
</TABLE>
(a) For the Company's six months ended June 27, 1997, Conrail net income has
been adjusted to exclude certain separation-related charges (see Notes 5 and
6).
<PAGE>
Note 4. Income Tax Expense
Income tax expense includes the tax benefit on the additional interest
expense (see Note 2) as well as the tax effect on equity income:
Six Months Fiscal Year
Ended Ended
June 27, 1997 Dec. 27, 1996
------------- -------------
Tax benefit on acquisition debt interest expense $ (52) $(104)
Tax expense on dividends received 1 5
------ -----
Net tax benefit (51) (99)
Less tax benefit previously recognized (28) (3)
----- -----
Pro forma adjustment to income tax expense $ (23) $ (96)
===== =====
Note 5. Unusual Events
As described in Note 3, pro forma amounts reflected in the Pro Forma
Condensed Consolidated Statements of Earnings were calculated and presented in
accordance with the equity method of accounting. Conrail's operating results for
the six months ended June 30, 1997 included certain acquisition-related charges
that the acquiring companies are required to account for as liabilities
established in connection with a purchase business combination under generally
accepted accounting principles. These charges reflect obligations for
separation-related compensation to certain Conrail executives, including vesting
of benefits under certain stock compensation plans, and the termination of
Conrail's Employee Stock Ownership Plan. The charges, which totaled $394 million
on a pre-tax basis and $363 million on an after-tax basis, were excluded from
the net earnings of Conrail in determining the proportionate share of such
earnings recorded by the Company.
Conrail incurred other one-time costs during its six months ended June
30, 1997 and fiscal year ended December 31, 1996 which were included in its net
earnings in determining the proportionate share of such earnings recognized by
the Company for purposes of the Pro Forma Condensed Consolidated Statements of
Earnings. If the effects of 42% of Conrail's after-tax acquisition-related costs
of $42 million had been excluded for the six months ended June 27, 1997, the
Company's pro forma net earnings and pro forma earnings per share would have
been $354 million and $1.63, respectively. If the effects of 42% of Conrail's
one-time after-tax charge of $83 million related to voluntary separation
programs and after-tax acquisition-related costs of $10 million had been
excluded for the fiscal year ended December 27, 1996, the Company's pro forma
net earnings and pro forma earnings per share would have been $779 million and
$3.65, respectively.
<PAGE>
Note 6. Summarized Consolidated Conrail Financial Data
Because of the numerous agreements that must be negotiated and completed,
and because STB approval must be obtained, it is not possible to present some or
most of the Company's investment in Conrail based on separate assets,
liabilities and operations. However, the Company has a 42% economic interest in
the entity formed to acquire Conrail shares. It is expected that in some form
the Company will have a primary operating interest in certain routes and
facilities of Conrail. The following historical Conrail financial data, as of
and for the six months ended June 30, 1997 and the year ended December 31, 1996,
respectively, are presented to facilitate an understanding of the Company's
ultimate economic interest in Conrail:
Conrail Inc.
Summarized Consolidated Statement of Income
(Dollars in millions)
Six Months Ended
June 30, 1997
-------------------------
Excluding
Separation-
Related Year Ended
Actual Charges Dec. 31, 1996
------ ----------- -------------
Revenues $ 1,843 $1,843 $3,714
Operating expenses 1,958(a) 1,564(a)(c) 3,113(b)
------- ------ ------
Income from operations (115) 279 601
Interest expense (90) (90) (182)
Other income - net 51 51 112
------- ------ ------
Income (loss) before income taxes (154) 240 531
Income taxes 59 90 189
------- ------ ------
Net income (loss) $ (213) $ 150 $ 342
======= ====== ======
(a) Operating expenses include $68 million in acquisition-related costs, $42
million after-tax.
(b) Operating expenses include a $135 million charge for voluntary separation
programs, $83 million after-tax, and $16 million in acquisition-related
costs, $10 million after-tax.
(c) Operating expenses exclude $394 million in separation-related charges, $363
million after-tax, resulting from the joint CSX/NSC acquisition.
Conrail Inc.
Summarized Consolidated Balance Sheet
(Dollars in millions)
As of As of
June 30, 1997 December 31, 1996
------------- -----------------
Assets
Current assets $1,137 $1,117
Property and equipment 6,668 6,590
Other assets 733 695
-------- --------
Total assets $8,538 $8,402
====== ======
Liabilities and Stockholders' Equity
Current liabilities (a) $1,211 $1,092
Long-term debt 1,879 1,876
Other long-term liabilities (a) 2,504 2,327
------ ------
Total liabilities 5,594 5,295
Stockholders' equity 2,944 3,107
------ ------
Total liabilities and
stockholders' equity $8,538 $8,402
====== ======
(a) Of the $394 million expensed for separation-related charges, $265 million
remained payable as of June 30, 1997. Current liabilities and other long
term liabilities include separation-related payables of $110 million and
$155 million, respectively.
