2. Forward-
Forward-looking Disclosure Statement
This presentation and other statements by the Company contain forward-looking statements within the
forward-
meaning of the Private Securities Litigation Reform Act with respect to, among other items: projections and
estimates of earnings, revenues, cost-savings, expenses, or other financial items; statements of
cost-
management’s plans, strategies and objectives for future operation and management’s expectations as to
management s plans operation, management s
future performance and operations and the time by which objectives will be achieved; statements concerning
proposed new products and services; and statements regarding future economic, industry or market
conditions or performance. Forward-looking statements are typically identified by words or phrases such as
Forward-
“believe,” “expect,” “anticipate,” “project,” and similar expressions. Forward-looking statements speak only
, p, p ,pj , p Forward- g p y
as of the date they are made, and the Company undertakes no obligation to update or revise any forward-
forward-
looking statement. If the Company does update any forward-looking statement, no inference should be drawn
forward-
that the Company will make additional updates with respect to that statement or any other forward-looking
forward-
statements.
Forward-
Forward-looking statements are subject to a number of risks and uncertainties, and actual performance or
results could differ materially from that anticipated by these forward-looking statements. Factors that may
forward-
cause actual results to differ materially from those contemplated by these forward-looking statements include,
forward-
among others: (i) the Company’s success in implementing its financial and operational initiatives (ii) changes
(i initiatives,
in domestic or international economic or business conditions, including those affecting the rail industry (such
as the impact of industry competition, conditions, performance and consolidation); (iii) legislative or
regulatory changes; (iv) the inherent business risks associated with safety and security; and (v) the outcome
of claims and litigation involving or affecting the Company. Other important assumptions and factors that
could cause actual results to differ materially from those in the forward-looking statements are specified in the
forward-
Company’s SEC reports, accessible on the SEC’s website at www.sec.gov and the Company’s website at
www.csx.com.
www.csx.com.
5. Surface Transportation revenues
of $2 1 billi increased by $188 million
f $2.1 billion i db illi
First Quarter
Year-Over-Year Change
(Dollars in millions)
$2,108
$1,920
First Quarter 2004 First Quarter 2005
6. Overall revenue-per-car i
O ll improved by 8.6%
d b 8 6%
First Quarter
Year-Over-Year Change
• Price momentum continues
9.8%
• Fuel surcharge continues to
8.6%
partially offset rising oil prices
• Volume was slightly favorable
driven primarily by coal
1.1%
Revenue Volume RPC
7. Coal revenues of $506 million increased
$84 million on strong yield and volume
illi t i ld d l
First Quarter
• Yield improvement continues in all Year-Over-Year Change
lines of business
19.9%
• Volume strength in many markets
including export, northern utilities,
industrial and coke
10.0%
9.0%
9 0%
• Utility stockpiles remain below
normal
Revenue Volume RPC
8. Automotive revenues of $208 million
increased $6 million on yield improvements
i d illi i ld i t
First Quarter
• Yield improvement Year-Over-Year Change
• Production decline
• Sales favorable; inventories
down, yet still at high levels
3.0%
3 0% 3.0%
3 0%
0.0%
Revenue Volume RPC
9. Intermodal revenues of $329 million
increased by $14 million
i db illi
First Quarter
• Domestic volume weakness; Year-Over-Year Change
Network Simplification impact
8.6%
• Domestic yield strength
4.4%
• International volume strength
(3.8%)
Revenue Volume RPC
10. Intermodal operating income improved $33
million year-over-year
illi
First Quarter
2005 2004 Variance
Dollars in millions
Linehaul Revenue $ 291 $ 309 $ ( 18)
Other Revenue 38 6 32
Operating Revenue 329 315 14
Operating Expenses 277 296 19
$ 52 $ 19 $ 33
Operating Income
Operating Ratio 84.2% 94.0% 9.8 pts
11. Merchandise revenues of $1.0 billion
increased $80 million on stronger yield
i d illi t i ld
First Quarter
• Strong yield across markets Year-Over-Year Change
• Food and Consumer volume
8.4%
strength 7.9%
• Metals yield improvements
• Military volume weakness
0.4%
0 4%
Revenue Volume RPC
12. CSX’s outlook continues to be favorable
across most markets
t kt
Unfavorable Flat Favorable
Automotive Emerging Markets Agricultural Products
Intermodal Chemicals
Phosphate & Fertilizer Coal
Food & Consumer
Forest Products
Metals
14. Consistent focus on key drivers in 2005
C i t tf k di i
Safety Service Productivity
• Process enhancements • Resources • Plan execution
• Employee training • Terminal focus • Asset utilization
• Labor partnerships • Plan execution • Process improvement
15. Safety processes produced positive results
in th fi t
i the first quarter
t
FRA Personal Injury FRA Train Accident Rate
Frequency Index
F Id
2.25 2.24
2.18
4.97
4 97
2.04
2 04
4.64 4.61 4.41
1.67 4.03
Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1
2004 2004 2004 2004 2005 2004 2004 2004 2004 2005
16. Train velocity declined in first quarter after
increasing in consecutive quarters
i ii ti t
Average Overall Train Velocity
(miles per hour)
20.9
20 9
20.5
20.1
19.5 19.5
Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005
17. Efforts to improve network performance and
service consistency are ongoing
i it i
• ONE Plan
– Plan adjustment
– Resource planning
– Phase II implementation
• Terminal Focus
– System terminals
– Process approach
• Plan Execution
– Increasing discipline
19. CSX earnings from continuing operations
increased $0.55 per share for the quarter
i d $0 55 h f th t
First Quarter
Dollars i illi
D ll in millions, except Earnings P Sh
tE i Per Share 2005
200 2004 Variance
Vi
Surface Transportation Operating Income $ 351 $ 151 $ 200
Other Operating Income
p g 3 1 2
Consolidated Operating Income $ 354 $ 152 $ 202
Other Income ( 2) ( 4) 2
Interest Expense 114 108 ( 6)
Income Taxes 84 13 ( 71)
Earnings from Continuing Operations $ 154 $ 27 $ 127
EPS from Continuing Operations $ 0.68 $ 0.13 $ 0.55
Net Earnings $ 579 $ 30 $ 549
EPS $ 2.56 $ 0.14 $ 2.42
20. CSX World Terminals Sale
W ld T i l Sl
• Gross proceeds $1.14 billion
$1 14
• Net earnings from discontinued operations $425 million
• Earnings per share from discontinued operations of $1.88
21. Surface Transportation operating income
generated strong EPS growth in the quarter
td t th i th t
First Quarter
2005 2004 Variance
Dollars in millions
Surface Transportation Operating Income $ 351 $ 151 $ 200
Restructuring Charge - 53 ( 53)
Surface Transportation Operating Income
before Restructuring Charge $ 351 $ 204 $ 147
First Quarter
2005 2004 Variance
Dollars in millions
EPS from Continuing Operations $ 0.68 $ 0.13 $ 0.55
Restructuring Charge - 0.14 ( 0.14)
EPS from Continuing Operations
before Restructuring Charge $ 0.68 $ 0.27 $ 0.41
22. Surface transportation operating income
improved significantly
i d i ifi tl
First-
First-Quarter Variance versus 2004*
Dollars in millions 2005 Variance Percent
Revenue $ 2,108 $ 188 10%
Operating Expense
Labor and Fringe 702 ( 17) ( 2%)
Materials, Supplies and Other 462 ( 46) ( 11%)
Depreciation 203 ( 43) ( 27%)
Fuel 179 ( 25) ( 16%)
Building and Equipment Rent 135 5 4%
Inland Transportation 56 18 24%
Conrail R t Fees and Services
C il Rents, F dS i 20 67 77%
Operating Expense 1,757 ( 41) ( 2%)
Operating Income 351 147 72%
Operating Ratio 83.3% 6.1 pts
* 2004 excludes $53 million in restructuring charges
23. Expense increase limited to 2% through
operations and management productivity
ti d t d ti it
Surface Transportation Operating Expenses
First Quarter Year-Over-Year Variance*
(Dollars in millions)
$19
$10
($11)
($14)
($19)
($26)
Fuel Price Volume and Train Operations Management Other
Inflation Operations Productivity Reductions
* 2004 excludes $53 million in restructuring charges
24. Surface transportation operating income
drove a 152% i
d increase i EPS
in
First-
First-Quarter Variance versus 2004*
Dollars in millions 2005 Variance Percent
Revenue $ 2,108
2 108 $ 188 10%
Operating Expense 1,757 ( 41) ( 2%)
Operating Income 351 147 72%
Operating R ti
O ti Ratio 83.3%
83 3% 6.1 t
6 1 pts
EPS from Continuing Operations $ 0.68 $ 0.41 152%
* 2004 excludes restructuring charges of $53 million pre-tax, $0.14 per share
pre-
25. Looking forward
L ki f d
• Tougher comparables ahead
– Cycling progressively stronger 2004 results
• Strong foundation is in place
– Core strategies are taking hold
– Financial results are improving
• Focused on consistent, continuous improvement
