10/23/2012 04:53 EDT | Updated 12/23/2012 05:12 EST

Norfolk Southern reports 27 per cent drop in 3Q profit as railroad's coal revenue declines

NORFOLK, Va. - Norfolk Southern Corp. says the weak economy contributed to a 27 per cent drop in profits as the company hauled less coal and other merchandise.

The railroad said Tuesday that it earned $402 million, or $1.24 per share, in the third quarter.

That's down from $554 million, or $1.59 per share, Norfolk Southern reported last year but in line with the revised forecast officials offered last month.

The company, based in Norfolk, Va., said revenue fell nearly 7 per cent to $2.7 billion.

Analysts expected earnings of $1.25 per share and $2.73 billion in revenue, according to FactSet.

Many analysts lowered their forecasts after the railroad said Sept. 19 that it expected earnings of between $1.18 and $1.25 per share for the quarter because of the revenue drop.