BB&T Annual Transportation ConferenceFebruary 16, 2011
Deborah H. ButlerExecutive Vice Presidentand Chief Information Officer
Overview
• Safety• Service Performance• Moving Forward in 2011
Overview
• Safety• Service Performance• Moving Forward in 2011
Quarterly Safety Performance2010 Preliminary (Injury Ratio per 200,000 Employee-Hours)
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
1.10
0.89 0.85
0.68
Overview
• Safety• Service Performance• Moving Forward in 2011
T&E Employment CountNet of Furloughs, Trainees, and Projected Attrition
10,500
10,750
11,000
11,250
11,500
Jan-
10
Feb-
10
Mar
-10
Apr
-10
May
-10
Jun-
10
Jul-1
0
Aug
-10
Sep-
10
Oct
-10
Nov
-10
Dec
-10
Jan-
11
Feb-
11
Mar
-11
Apr
-11
May
-11
Jun-
11
Productivity Scorecard2010 vs. 2009
GTMs per Gallon
GTMs per Employee
Total Employees
Crew Starts
Carload Volume
1%
14%
(1%)
5%
14%
Propelling the Franchise
Propelling the Franchise
0.8
0.9
1
1.1
1.2
1.3
1.4
64
69
74
79
84
89
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Operating Ratio Injury Ratio per 200,000 Employee Hours
Operating Ratio Injury Ratio
Improved Safety Process Improvements Lower Operating Ratio
Six Sigma
LEAN
LEADER
UTCS
TYES OPD
RailEdge
ECPTOR
Overview
• Safety• Service Performance• Moving Forward in 2011
Outlook – Business Portfolio
• Manufacturing recoveryChemicals
• Build out of ethanol network and export grain growthAgriculture
• Highway conversionsDomestic Intermodal
• Improving imports/exportsInternational Intermodal & Export Coal
• Recovery in global steel productionDomestic Met Coal & Steel
• Falling stockpiles and increased electricity generationUtility Coal
• New business, improved auto production and salesAutomotive
• Uncertainty in housing, but improving paper marketsForest Products
Chicago
Cincinnati
Columbus
Pritchard Roanoke
Norfolk
Detroit
Harrisburg Philadelphia
NY/NJ
Titusville
Jacksonville
Atlanta
Charlotte
Lynchburg
ShreveportMeridian
Birmingham
New Orleans
Memphis
Bethlehem
MechanicvilleAyer
Corridor Volume Increases
2010 vs. 2009
Premier Route 18%
PanAm Southern 32%
Crescent Corridor 31%
Meridian Speedway 36%
Titusville 146%
NSCorridor Strategy
Long-Term Business Focus & Strategy
Long Term Revenue &
Volume Growth
New Business
Development
Corridor Strategy
Yield Management
Profitability Improvement
Improve Customer
Satisfaction
Lamberts Point Coal Docks - 2/12/11Cape Henry, Chesapeake Bay – 2/12/11
21
Railway VolumeFirst Quarter through Week 6 2011 vs. 2010
1QTD 2011 vs. 2010
Units Abs. % Chg.
Agriculture 72,187 (1,571) (2%)
Chemicals 44,029 (997) (2%)
MetCon 62,598 4,109 7%
Paper 37,504 1,122 3%
Automotive 32,464 2,650 9%
Merchandise 248,782 5,223 2%
Intermodal 338,427 29,228 9%
Coal 187,622 26,531 16%
Total 774,831 60,982 9%
Source: AAR carloadings, which are reported weekly and may not equal NS' reported volumes.
Total Capital Program($ Millions)
2007 2008 2009 2010 2011 budget
$1,341 $1,558
$1,299 $1,470
$1,743
$334$146
Baseline Lease Replacements PTC
$2,223
23
$763
$244
$212
$155
$96
$79
$194
RoadwayFacilities & TerminalsLocomotivesFreight CarsTechnologyInfrastructureOther Projects
* Please see reconciliation to GAAP posted on our website
2011 Baseline Capital Program*($ Millions)
Total Spending = $1.7 billion
24
$763
$244
$212
$155
$96
$79
$194
RoadwayFacilities & TerminalsLocomotivesFreight CarsTechnologyInfrastructureOther Projects
2011 Baseline Capital Program($ Millions)
Total Spending = $1.7 billion
25
$763
$244
$212
$155
$96
$79
$194
RoadwayFacilities & TerminalsLocomotivesFreight CarsTechnologyInfrastructureOther Projects
2011 Baseline Capital Program($ Millions)
Total Spending = $1.7 billion
26
$763
$244
$212
$155
$96 $79
$194
RoadwayFacilities & TerminalsLocomotivesFreight CarsTechnologyInfrastructureOther Projects
2011 Baseline Capital Program($ Millions)
Total Spending = $1.7 billion
27
Freight Cars - Purchase vs. Lease
28
• Financing decision produces a positive PV
• 2011 bonus depreciation
• Accretive to earnings
2011 Capital Program Objectives
• Maintain the franchise
• Strengthen the coal fleet
• Invest in business growth
• Optimize capital efficiency (purchase versus lease)
29
• Will get picture from Frank Brown
Thank You