1. Third Quarter 2007
Earnings Conference Call
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Forward-Looking Disclosure
This presentation and other statements by the company contain forward-looking statements within the 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 management’s plans, strategies and
objectives for future operation, and management’s expectations as to 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 “believe,” “expect,” “anticipate,” “project,” “estimate,” and similar expressions.
Forward-looking statements speak only as of the date they are made, and the company undertakes no obligation to
update or revise any forward-looking statement. If the company does update any forward-looking statement, no
inference should be drawn that the company will make additional updates with respect to that statement or any other
forward-looking statements.
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 cause actual results to
differ materially from those contemplated by these forward-looking statements include, among others: (i) the company’s
success in implementing its financial and operational initiatives, (ii) changes 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 company’s SEC reports, accessible on the SEC’s website at www.sec.gov and the company’s
website at www.csx.com.
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2. Executive Summary
Michael Ward
Chairman, President and
Chief Executive Officer
Third quarter overview . . .
Core earning power is strong
Third Quarter EPS
and continues to improve
From Continuing Operations
$0.71 Safety and customer service
$0.67 $0.67
at high levels and improving
$0.54
Pricing gains supported by
24%
strong service levels
Increase
Price/productivity continue to
drive operating ratio lower
Reported Comparable
2006 2007
Note: Comparable EPS from continuing operations exclude insurance gains and income tax benefits
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3. Operations Review
Tony Ingram
Executive Vice President
Chief Operating Officer
Leadership, discipline and execution
Safety at historical best; driving
to industry leading levels
Productivity helping drive
Performance
operating ratio to mid-low 70’s Excellence
Service Execution
Service Execution
Network performance and
service at all-time highs Productivity Discipline
Productivity Discipline
Safety Leadership
Safety Leadership
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4. Helping lead one of the nation’s safest industries
FRA Personal Injury FRA Train Accidents
13 Week 13 Week
Average Average
1.24 2.79
1.46
1.43 3.67
1.39 3.50
3.29
1.30 3.09
1.24 2.98
Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3
2006 2006 2007 2007 2007 2006 2006 2007 2007 2007
Rolling 12-month Averages
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On-time performance at all-time highs
On-Time Originations On-Time Arrivals
13 Week 13 Week
Average Average
83% 76%
69%
78%
77% 66%
76% 76% 63%
63%
57%
71%
Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3
2006 2006 2007 2007 2007 2006 2006 2007 2007 2007
Rolling 12-month Averages
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6. Productivity focus helping to drive operating ratio
Adjusting resources to the
Comparable
market environment
Operating Ratio
87.1%
Delivering a pipeline of
productivity initiatives
83.0%
80.4%
78.0% Leveraging technology to
drive productivity
Driving the Total Service
Integration (TSI) initiative
Q3 2004 Q3 2005 Q3 2006 Q3 2007
Note: 2004 excludes restructuring charges, and 2006 and 2007 exclude insurance gains
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Operations wrap-up . . .
Achieving new highs in safety performance
Delivering service reliability for our customers
Driving productivity with process improvement,
technology and Total Service Integration
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7. Sales and Marketing Review
Clarence Gooden
Executive Vice President
Sales and Marketing
Revenues increased 3% to $2.5 billion
Pricing gains supported by
Third Quarter
strong service levels
Revenue in Millions
Yield strength continues to
$83 $2,501
offset softer volumes
$2,418
Uninterrupted revenue growth
for more than five years
2006 Growth 2007
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8. Price continues to drive RPU growth
Year-Over-Year Change
12.6%
11.8%
11.7%
11.0%
9.0% 8.4% 8.1% 8.0%
6.9%
7.1% 6.5%
6.8% 6.7% 6.6% 6.5%
6.3% 6.2%
5.6%
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2005 2005 2006 2006 2006 2006 2007 2007 2007
Price Increase on 'Same Store Sales' Total Revenue per Unit
Note: ‘Same Store Sales’ price increases exclude impacts from fuel and mix
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Merchandise revenue increased 3%
Third Quarter Yields continue to offset the
2007 versus 2006 impact of weaker volumes
Continued softness in
RPU 9%
housing related markets
Volume (5%)
Revenue 3%
Phosphates, agriculture and
chemicals led revenue gains
2006 Change 2007
RPU $ 1,711 $ 150 $ 1,861
Volume 713 (37) 676
(thousands)
Revenue $ 1,220 $ 38 $ 1,258
(millions)
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9. Coal revenue increased 8%
Third Quarter Export market remains strong
2007 versus 2006
Utility inventory levels remain
at target levels
RPU 10%
Volume (2%)
Contract repricing to current
Revenue 8%
market levels continues
2006 Change 2007
RPU $ 1,267 $ 129 $ 1,396
Volume 475 (10) 465
(thousands)
Revenue $ 602 $ 47 $ 649
(millions)
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Automotive revenue increased 8%
Third Quarter Light vehicle production more
2007 versus 2006 than offset SUV declines
Yields remain strong and are
RPU 6%
expected to continue
Volume 2%
Revenue 8%
Well positioned in changing
automotive landscape
2006 Change 2007
RPU $ 1,830 $ 111 $ 1,941
Volume 100 2 102
(thousands)
Revenue $ 183 $ 15 $ 198
(millions)
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10. Intermodal revenue declined 7%
Third Quarter Yields on same store sales
2007 versus 2006 increased over 3%; offset by
impact of short haul traffic
RPU (1%)
International traffic declined
Volume (6%)
17% on customer losses and
Revenue (7%)
slowing Asian import growth
2006 Change 2007 Domestic traffic improved
11% on new services
RPU $ 645 ($ 9) $ 636
Volume 564 (34) 530
(thousands)
Revenue $ 364 ($ 27) $ 337
(millions)
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Fourth quarter revenue outlook is positive
Favorable Neutral Unfavorable
Agricultural Products Automotive Food & Consumer
Chemicals Forest Products
Coal, Coke & Iron Ore Intermodal
Emerging Markets
Metals
Phosphate & Fertilizer
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11. Financial Results
Oscar Munoz
Executive Vice President
Chief Financial Officer
Strong third quarter results
Third Quarter Results
Dollars in millions, except EPS 2007 2006 Variance
Surface Transportation Operating Income $ 552 $ 489 $ 63
Other Operating Income 3 - 3
Consolidated Operating Income $ 555 $ 489 $ 66
Other Income (net) 17 25 (8)
Interest Expense (102) (97) (5)
Income Taxes (173) (89) (84)
Net Earnings from Continuing Operations $ 297 $ 328 $ (31)
EPS from Continuing Operations $ 0.67 $ 0.71 $ (0.04)
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12. Comparable EPS increased 24%
Third Quarter Results
Dollars in millions, except EPS 2007 2006 Variance
EPS from Continuing Operations $ 0.67 $ 0.71 $ (0.04)
Less Gain on Insurance Recoveries - (0.02) 0.02
Less Income Tax Benefits - (0.15) 0.15
Comparable EPS from Continuing Operations $ 0.67 $ 0.54 $ 0.13
Surface Transportation Operating Income $ 552 $ 489 $ 63
Less Gain on Insurance Recoveries (1) (15) 14
Comparable Operating Income $ 551 $ 474 $ 77
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Surface Transportation operating income up 16%
Third Quarter Results
Dollars in millions 2007 2006 Variance
Revenue $ 2,501 $ 2,418 $ 83
Expenses
Labor and Fringe 746 736 (10)
Materials, Supplies and Other 503 497 (6)
Fuel 305 300 (5)
Depreciation 220 213 (7)
Equipment and Other Rents 116 135 19
Inland Transportation 60 63 3
Operating Expenses 1,950 1,944 (6)
Operating Income $ 551 $ 474 $ 77
Operating Ratio 78.0% 80.4% 2.4 pts
Note: Results exclude insurance gains
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13. Labor and fringe increased 1%
Primarily due to wage and
Third Quarter
benefit inflation
Dollars in Millions
Partially offset by lower
$10 $746
$736
volumes and improved
productivity
Surface Transportation
headcount declined over 500
2006 Variance 2007
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MS&O increased 1%
Increase primarily driven
Third Quarter
by inflation
Dollars in Millions
Mostly offset by reduced train
$503
$6
$497
accidents and related costs
2006 Variance 2007
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14. Fuel increased by 2%
Driven by a $0.16 increase in
Third Quarter
fuel price per gallon
Dollars in Millions
Fuel efficiency reduced
$5 $305
$300
consumption by nearly five
million gallons
Lower volumes also resulted
in lower consumption
2006 Variance 2007
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Rents decreased 14%
Lower Merchandise and
Third Quarter
Intermodal volumes
Dollars in Millions
Operations driving better
$135 $19
asset utilization
$116
2006 Variance 2007
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15. All other expenses increased 1%
Higher capital base increased
Third Quarter
depreciation expense
Dollars in Millions
Lower intermodal volumes
$280
$4
$276
reduced inland transportation
$60
$63
$220
$213
2006 Variance 2007
Depreciation Inland Transport
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Share repurchase update . . .
Cumulative Shares Repurchased
Dollars in Millions
$2,074
$882
$1,192
$644
$465 $1,192
$422
$149
Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007
Note: Approximately $1.6 billion of the $2.1 billion has been repurchased under the current $3.0 billion program
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16. Double-digit growth targeted on higher 2007 base
2007-2010 Capital
2007-2010
Guidance Spending in Billions
Operating Income* 10% – 12%
$1.7 $1.7
$1.6 $1.6
Earnings Per Share* 15% – 17%
Free Cash Flow $800M – $1B
Before Dividends in 2010
Operating Ratio Mid-low 70’s
2007 2008 2009 2010
Note: Operating income and earnings per share reflect four-year CAGR’s
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Concluding Remarks
Michael Ward
Chairman, President and
Chief Executive Officer
