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csx  2004_Bear_Stearns_Presentation-REF21834
CSX Corporation

          Bear Sterns
Global Transportation Conference


          Clarence Gooden
       Executive Vice President
       Chief Commercial Officer
CSX operates the largest rail network in
the eastern United States
• Covers 23,400 route miles in 23                                                                    Montreal
  states, the District of Columbia,
  and two Canadian Provinces
                                                                                                         Selkirk Boston
                                                                                             Syracuse
                                                                                 Buffalo
• Serves all major eastern                                           Detroit               Newark New York City
                                                 Chicago
                                                                   Toledo
  markets and more ports than                                             Willard Harrisburg Philadelphia
                                                                             Pittsburgh
  any other railroad                                                                       Baltimore
                                                                  Columbus
                                                                               Cumberland
                                                                                          Washington D.C.
                                                     Indianapolis Cincinnati
                                                                               Charleston
                                                                       Huntington
                                      East St. Louis                                           Norfolk
                                                          Louisville
• Operates 144 terminals                                                                      Rocky Mount
                                                                    Knoxville
                                                        Nashville               Charlotte
                                                                                            Hamlet
                                            Memphis
• Operates over 100,000 freight                                Atlanta
                                                                                            Charleston
  cars and over 4,000 locomotives                      Birmingham
                                                                                    Savannah
                                                      Montgomery
                                                                       Waycross
                                                                                    Jacksonville
                                                        Pensacola
• Employs 34,000 dedicated                      New Orleans
  individuals                                                                        Orlando
                                                                           Tampa           West Palm Beach

                                                                                               Miami
Earnings improvement stalled in 2003, as
the operating ratio reached 88%
  Rail Operating Income                    Rail Operating Ratio
        Dollars in millions
        Dollars in millions

                                        90%
                                        90%
                   $995
                   $995
                                                                  88%
                                                                  88%
                                                87%
                                                87%
          $907                $902
          $907                $902
                                                         86%
                                                         86%

 $713
 $713




 2000     2001     2002       2003      2000    2001     2002    2003
 2000     2001     2002       2003      2000    2001     2002    2003

  Note: Operating income and operating ratio exclude one-time charges
Restoring the company’s earnings power
is being driven in three key areas

    Revenue             Operating           Organizational
    Impacts           Improvements          Effectiveness


••Price Leadership
  Price Leadership    ••Safety
                        Safety              ••Organizational
                                              Organizational
                                              Effectiveness
                                               Effectiveness
••Profitable Growth
  Profitable Growth   ••Zero-based Plan
                        Zero-based Plan
                                              Initiative
                                               Initiative
••Offset Inflation
  Offset Inflation    ••Asset Utilization
                        Asset Utilization
                                            ••Process
                                              Process
                      ••Productivity
                        Productivity          Improvement
                                               Improvement
                                              Teams
                                               Teams
The Surface Transportation management
reorganization is now complete
• Management reductions total approximately 900

• Annual savings estimated at $90 million

• Increased accountability across the organization

• Enhanced communication and speed of decision making
The CSX One Plan is being developed
to drive productivity
• Why a new operating plan

• What is involved

• The power of ONE



Process improvement will leverage best
practices with greater accountability
CSX will improve yield by leveraging our
network and an improving economy
                Year-over-year Change in Revenue
                              Dollars in millions
                              Dollars in millions

$90
$90
                                                    $85
                                                    $85                     $82
                                                                      $81   $82
                                                                      $81
$60
$60
                                                          $53
                                                          $53
$30
$30                                                             $37
                                                                $37
                             $7
                             $7    $5    $31
                                   $5    $31
 $0
 $0
        ($7) ($29)
        ($7) ($29)
($30)
($30)
                     ($54)
                     ($54)
($60)
($60)
         Q3    Q4     Q1     Q2    Q3     Q4        Q1    Q2    Q3    Q4     Q1
         Q3    Q4     Q1     Q2    Q3     Q4        Q1    Q2    Q3    Q4     Q1
        2001          2002                      2003                        2004
CSX’s intermodal network provides
coast to coast service


     Vancouver
        Seattle
     Tacoma
                                                                                          Montreal
   Portland
                                                                         Toronto
                                                                                          Syracuse
                                                            Chicago       Detroit               Massachusetts
                                                                                   Buffalo
                                                                               Cleveland
                                                        Indianapolis                        New York
                                                                           Columbus
                                       Kansas City
                                                                                           Philadelphia
                                                                        Cincinnati
 Oakland                                       E. St. Louis       Evansville              Baltimore
               Lathrop
                                                                                        Portsmouth
                                                                Nashville
                                                    Memphis                        Greensboro
                                                                    Charlotte
 Los Angeles
                                                                                Greenville
                                                                        Atlanta Charleston
                                       Dallas                     Mobile
                                                                                Savannah
                                                 Houston
                                                                              Jacksonville
                                                            New Orleans        Orlando
                                                                     Tampa
                                            Laredo
                                                                                Miami
                                        Monterrey

                         Guadalajara
                                          Queretaro                                           CSXI Rail Service Locations

                                                                                              CSXI Trucking Service
                                             Mexico City
We continue to expand our market
reach with TRANSFLO
We are developing new markets and
converting traffic from other modes
CSX’s focus on increasing price has
never been stronger

• Service improvement is underway

• Rail-truck economics have never been better
  Rail-truck

• The economy is rebounding

• Favorable STB rulings enhance pricing opportunities

• Revenue growth will offset inflation
csx  2004_Bear_Stearns_Presentation-REF21834

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csx 2004_Bear_Stearns_Presentation-REF21834

  • 2. CSX Corporation Bear Sterns Global Transportation Conference Clarence Gooden Executive Vice President Chief Commercial Officer
  • 3. CSX operates the largest rail network in the eastern United States • Covers 23,400 route miles in 23 Montreal states, the District of Columbia, and two Canadian Provinces Selkirk Boston Syracuse Buffalo • Serves all major eastern Detroit Newark New York City Chicago Toledo markets and more ports than Willard Harrisburg Philadelphia Pittsburgh any other railroad Baltimore Columbus Cumberland Washington D.C. Indianapolis Cincinnati Charleston Huntington East St. Louis Norfolk Louisville • Operates 144 terminals Rocky Mount Knoxville Nashville Charlotte Hamlet Memphis • Operates over 100,000 freight Atlanta Charleston cars and over 4,000 locomotives Birmingham Savannah Montgomery Waycross Jacksonville Pensacola • Employs 34,000 dedicated New Orleans individuals Orlando Tampa West Palm Beach Miami
  • 4. Earnings improvement stalled in 2003, as the operating ratio reached 88% Rail Operating Income Rail Operating Ratio Dollars in millions Dollars in millions 90% 90% $995 $995 88% 88% 87% 87% $907 $902 $907 $902 86% 86% $713 $713 2000 2001 2002 2003 2000 2001 2002 2003 2000 2001 2002 2003 2000 2001 2002 2003 Note: Operating income and operating ratio exclude one-time charges
  • 5. Restoring the company’s earnings power is being driven in three key areas Revenue Operating Organizational Impacts Improvements Effectiveness ••Price Leadership Price Leadership ••Safety Safety ••Organizational Organizational Effectiveness Effectiveness ••Profitable Growth Profitable Growth ••Zero-based Plan Zero-based Plan Initiative Initiative ••Offset Inflation Offset Inflation ••Asset Utilization Asset Utilization ••Process Process ••Productivity Productivity Improvement Improvement Teams Teams
  • 6. The Surface Transportation management reorganization is now complete • Management reductions total approximately 900 • Annual savings estimated at $90 million • Increased accountability across the organization • Enhanced communication and speed of decision making
  • 7. The CSX One Plan is being developed to drive productivity • Why a new operating plan • What is involved • The power of ONE Process improvement will leverage best practices with greater accountability
  • 8. CSX will improve yield by leveraging our network and an improving economy Year-over-year Change in Revenue Dollars in millions Dollars in millions $90 $90 $85 $85 $82 $81 $82 $81 $60 $60 $53 $53 $30 $30 $37 $37 $7 $7 $5 $31 $5 $31 $0 $0 ($7) ($29) ($7) ($29) ($30) ($30) ($54) ($54) ($60) ($60) Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2001 2002 2003 2004
  • 9. CSX’s intermodal network provides coast to coast service Vancouver Seattle Tacoma Montreal Portland Toronto Syracuse Chicago Detroit Massachusetts Buffalo Cleveland Indianapolis New York Columbus Kansas City Philadelphia Cincinnati Oakland E. St. Louis Evansville Baltimore Lathrop Portsmouth Nashville Memphis Greensboro Charlotte Los Angeles Greenville Atlanta Charleston Dallas Mobile Savannah Houston Jacksonville New Orleans Orlando Tampa Laredo Miami Monterrey Guadalajara Queretaro CSXI Rail Service Locations CSXI Trucking Service Mexico City
  • 10. We continue to expand our market reach with TRANSFLO
  • 11. We are developing new markets and converting traffic from other modes
  • 12. CSX’s focus on increasing price has never been stronger • Service improvement is underway • Rail-truck economics have never been better Rail-truck • The economy is rebounding • Favorable STB rulings enhance pricing opportunities • Revenue growth will offset inflation