Slide 1: Forward-Looking Statements
Forward-Looking Statements This information and other statements by the company may 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, margins, volumes, rates, cost
Slide 2: Executive Summary
Executive Summary Michael Ward Chairman, President and Chief Executive Officer First quarter performance . . . Volume 1,620K Revenue $3,012M Operating Income $739M Operating Ratio 75.5% EPS $0.40 Earnings Per Share Revenue increases 2% — Merchandise and Intermodal growth offsets coal decline $0.45
Slide 3: Sales and Marketing Review
Sales and Marketing Review Clarence Gooden Executive Vice President Chief Sales and Marketing Officer Sales and Marketing summary . . . Volume (000) Revenue (millions) Revenue per Unit All-in Core Pricing 1,620 $3,012 $1,878 $1,859 0.5% 1,578 $2,963 0.3% Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 20
Slide 4: Merchandise revenue increases 4%; Intermodal revenue increases 4%
Merchandise revenue increases 4% Revenue $1,787M Volume 680K RPU $2,628 First Quarter First Quarter Summary Year-Over-Year Change Strong 2013 harvest continues to Revenue 4% drive Agricultural Sector growth Volume 2% — Broad strength in feed grain and ethanol shipments RPU 2% Construction Sector
Slide 5: Coal revenue decreases 9%; Underlying macro-economy constructive for growth
Coal revenue decreases 9% Revenue $662M Volume 293K RPU $2,259 First Quarter First Quarter Summary Year-Over-Year Change Export volume declines 15% Revenue (9%) — Reflects soft global market conditions Volume (1%) RPU (8%) Domestic volume increases 8% — Reflects gains in northern utility volumes
Slide 6: Overall outlook for second quarter is favorable
Overall outlook for second quarter is favorable Outlook Markets Drivers Agricultural Products Strong 2013 harvest shipments to continue Food & Consumer Increase in food and beverage shipments Chemicals Strength in energy-related markets continues Metals Steel production expected to i
Slide 7: CSX a leader in one of the nation's safest industries
CSX a leader in one of the nation’s safest industries FRA Personal Injury Rate FRA Train Accident Rate 0.96 2.64 0.81 2.35 0.80 2.24 0.76 1.81 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2011 Q1 2012 Q1 2013 Q1 2014 13 Network performance impacted by weather On-time Originations Train Velocity (mph) 89% 91%
Slide 8: Winter's impact widespread across CSX's network
Winter’s impact widespread across CSX’s network On-Time Originations Heating Degree Days In CSX Territory North South 8,820 7,511 2,036 1,789 5,722 6,784 Q1 2013 Q1 2014 Greater than 85% 70% – 85% Total Snowfall in Inches Less than 70% City 2014 vs. 2013 Chicago, IL 85 216% Northwest Ohio 82 252% Q1
Slide 9: Service recovering; costs will linger in second quarter
Service recovering; costs will linger in second quarter CSX Performance Higher resource investments Trailing 4-week Average will ensure recoverability Indexed: Week 10 = 100 — Service recovery is necessary to Volume On-time Originations Dwell handle projected volume growth 115 110 Chicago remain
Slide 10: Financial Review: First quarter earnings summary
Financial Review Fredrik Eliasson Executive Vice President Chief Financial Officer First quarter earnings summary . . . First Quarter Results Dollars in millions, except EPS 2014 2013 Variance Revenue $ 3,012 $ 2,963 2% Expense 2,273 2,083 (9%) Operating Income $ 739 $ 880 (16%) Interest Expense (14
Slide 11: Fuel lag headwind is $4 million year-over-year; Total expense increases 9%
Fuel lag headwind is $4 million year-over-year Fuel Surcharge Lag Impact Weekly Highway Diesel Monthly Highway Diesel (two-month lag) Negative Impact Positive Impact ($4) million year-over-year negative lag impact ($5) Million $13 Million ($6) Million $7 Million ($9) Million Q1 2013 Q2 2013 Q3 2013
Slide 12: First quarter expense analysis; Increasing dividend 7%
First quarter expense analysis . . . Labor Analysis in Millions MS&O Analysis in Millions Fuel Analysis in Millions 2013 Labor Expense $ 767 2013 MS&O Expense $ 507 2013 Fuel Expense $ 444 Real estate gains (49) Weather disruptions (35) Weather disruptions (35) Train accidents (12) Weather disruptio
Slide 13: Financial wrap-up
Financial wrap-up . . . Core earning power remains strong — Broad-based strength across markets will drive long-term growth Near-term focus on restoring service — Productivity gains will be balanced against restoring superior service levels Expect modest earnings growth for full year 2014 — Ov
Slide 14: Relentless pursuit of excellence
Relentless pursuit of excellence . . . 27