Fourth Quarter 2012 Results Donald W. Seale Executive Vice President and Chief Marketing Officer 1
Railway Operating Revenue Fourth Quarter 2012 vs. 2011 Components of Revenue Change $ in Millions $2,797 $105 $2,684 Revenue $15 $23 $2.7 Billion, down (4%) RPU 4Q 2011 Price/Mix Volume Fuel 4Q 2012 $1,498, down (3%) 4Q 2012 Revenue $ in Millions & y-o-y Percent Change Coal $657 Volume (23%) Merchandise $1,443 1,792,100 units, down (1%) +4% Intermodal $584 +5% 2
Railway Volume Fourth Quarter 2012 vs. 2011 4Q 2012 Volume (000’s) Total volume down (1%) & y-o-y Percent Change Coal down (13%) 1,806.7 (16%) decline in Utility 1,792.1 2,000 (17%) decline in Domestic Met 0.5% rise in Export (13%) Coal 1,500 Intermodal up 4% 9% gain in Domestic more than offset (1%) decline in Intermodal +4% 1,000 International Merchandise up 1% 500 Strength in Chemicals and Merchandise +1% Automotive more than offset decline in MetCon 0 4Q 2011 4Q 2012 3
Coal Market Fourth Quarter 2012 vs. 2011 Percent of Total 4Q Volume Revenue: $657 Million, down (23%) Dom Ind RPU: $1,867, down (11%) Met 5% Export 13% 18% Utility Units 64% Drivers (000’s) Utility 250 224.6 Competition from natural gas, and Weak demand across most year-over-year stockpile reduction 200 markets resulted in overall Export volume decline of (13%) 150 Increase in steam coal from IL Basin Baltimore up 8% 100 Lamberts Point down (10%) 63.0 47.3 50 Domestic Met 17.2 Weak raw steel production and 0 closure of RG Steel Utility Export Dom Met Ind (16%) +0.5% (17%) (12%) 4
Intermodal Market Fourth Quarter 2012 vs. 2011 Percent of Total 4Q Volume Revenue: $584 Million, up 5% TCS Prem RPU: $674, up 2% 8% 9% Int’l Domestic 32% 51% Units Drivers (000’s) Domestic 500 Continued strong highway conversions 440.7 Robust Domestic growth 400 International leads to 4% overall Negative comp partially offset by other volume gain 278.9 300 gains across customer base 200 Premium Use of larger equipment in key lanes 73.7 72.5 100 offsets increases within LTL segment 0 Triple Crown Domestic Int'l Premium Triple Equipment conversion impact Crown 9% (1%) (1%) (3%) 5
Merchandise Market Fourth Quarter 2012 vs. 2011 Percent of Total 4Q Volume Revenue: $1.4 Billion, up 4% Paper MetCon RPU: $2,513 up 2% 13% Auto 28% 16% Ag Chem 26% 17% Units Drivers (000’s) MetCon Lower iron & steel shipments driven by RG 200 steel closure and fewer natural gas drilling Strong gains in materials 158.4 150.9 Chemicals and 150 Agriculture Automotive Higher shipments of soybeans and feed offset decline in corn and ethanol 95.3 94.1 100 Chemicals 75.5 Continued growth in crude oil Automotive 50 Increased light vehicle production Paper 0 Improvement in housing related goods offset MetCon Ag Chem Auto Paper decline in waste (4%) 0.3% 9% 6% 1% 6
Business Outlook Continued opportunities Project growth in crude Utility coal impacted by • • • for highway conversion oil, increased plastics due reduced demand for to low-cost feedstock electricity, competition from natural gas and New Intermodal service • Gains in steel, but weaker • higher stockpiles lanes ahead as new aggregate market corridor terminals open Continued automotive Softer domestic • • growth despite tougher metallurgical market to Growth with international • comps support steel production shipping partners Reduced U.S. corn and • Weak demand in Expansion in premium • • soybean crop European market for both market segment Improved housing & met and steam coal, • related construction marginal improvement in materials market Asia Coal Intermodal Merchandise 7
Thank You 8
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