Third Quarter

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Railway Operating Revenues ( Millions)
Third Quarter
Nine Months
6,270
2,155
5,363
1,857
2004 2005 2004
2005

Change vs. Prior Period 16
17
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Railway Operating RevenueVariance Analysis2005
vs. 2004
Third Quarter
Nine Months
20.0
20.0
17
16
12
11
5
5
0.0
0.0
Units Revenue per Revenues Units Revenue
per Revenues Unit / Mix Unit / Mix
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Railway Operating Expenses ( Millions)
Third Quarter
Nine Months
4,747
4,123
1,627
1,388
2004 2005 2004 2005
Change vs. Prior Period 17 15
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Railway Operating Expense Analysis Third Quarter
2005 vs. 2004 ( Millions)
91
59
51
45
Conrail Rents and Services
28
13
Materials, Services and Rents
Depreciation
Other
Diesel Fuel
Compensation and Benefits
Casualties and Other Claims
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Net Increase 239 Million / 17
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Diesel Fuel Cost AnalysisAverage Price Per
Gallon( Dollars)
2004
2005
1.52
1.28
1.07
1.12
0.88
0.86
0.83
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd
Qtr 3rd Qtr
Change vs. Prior Period
73
7
Diesel Fuel Gallons Hedged, Hedge Benefit,
Avg. Price Per Gallon
80
84
84
79
81
82
90
87
82
89
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Railway Operating Expense Analysis Third Quarter
2005 vs. 2004 ( Millions)
91
59
51
45
Conrail Rents and Services
28
13
Materials, Services and Rents
Depreciation
Other
Diesel Fuel
Compensation and Benefits
Casualties and Other Claims
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Net Increase 239 Million / 17
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Compensation Benefits Analysis Third Quarter
2005 vs. 2004 ( Millions)
T E and Mechanical Hours 17
Net Increase 59 Million 10
Stock-Based Compensation 17
Wage Rates 12
HW Benefits and Pension 11
Other Items 2
10
Railway Operating Expense Analysis Third Quarter
2005 vs. 2004 ( Millions)
91
59
51
45
Conrail Rents and Services
28
13
Materials, Services and Rents
Depreciation
Other
Diesel Fuel
Compensation and Benefits
Casualties and Other Claims
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Net Increase 239 Million / 17
11
Materials, Services Rents Third Quarter 2005
vs. 2004 ( Millions)
Maintenance Activities 26
Net Increase 51 Million 12
Volume-Related Purchased Services 14
Other 8
Equipment Rents 3
12
Selective Expenses ComparisonYear-Over-Year
Increase ( Millions)
Locomotive and Freight Car Repair
TE Trainees
13
Railway Operating Expense Analysis Third Quarter
2005 vs. 2004 ( Millions)
91
59
51
45
Conrail Rents and Services
28
13
Materials, Services and Rents
Depreciation
Other
Diesel Fuel
Compensation and Benefits
Casualties and Other Claims
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Net Increase 239 Million / 17
14
Railway Operating Expense Analysis Third Quarter
2005 vs. 2004 ( Millions)
91
59
51
45
Conrail Rents and Services
28
13
Materials, Services and Rents
Depreciation
Other
Diesel Fuel
Compensation and Benefits
Casualties and Other Claims
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Net Increase 239 Million / 17
15
Casualties and Other Claims Third Quarter 2005
vs. 2004 ( Millions)
Unfavorable Jury Verdict 16
Net Increase 28 Million 90
Hurricane Katrina 4
Insurance Costs 4
Loss and Damage 4
16
Hurricane Katrina

• 40 - 45 million estimated total costs
• Major costs are
• Engineering roadway replacement
• Replacement of signals
• Yard buildings and structures
• Other
• 12.5 million self insurance retention

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Railway Operating Expense Analysis Third Quarter
2005 vs. 2004 ( Millions)
91
59
51
45
Conrail Rents and Services
28
13
Materials, Services and Rents
Depreciation
Other
Diesel Fuel
Compensation and Benefits
Casualties and Other Claims
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Net Increase 239 Million / 17
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Railway Operating Expense Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
190
179
177
173
Conrail Rents and Services
68
22
Diesel Fuel
Depreciation
Other
Materials, Services and Rents
Compensation and Benefits
Casualties and Other Claims
- 185
Net Increase 624 Million / 15
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Railway Operating Expense Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
190
179
177
173
Conrail Rents and Services
68
22
Diesel Fuel
Depreciation
Other
Materials, Services and Rents
Compensation and Benefits
Casualties and Other Claims
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Net Increase 624 Million / 15
20
Materials, Services Rents Nine Months Ended
September 30, 2005 vs. 2004 ( Millions)
Volume-Related Purchased Services 60
Net Increase 179 Million 15
Maintenance Activities 59
Other 32
Equipment Rents 28
21
Railway Operating Expense Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
190
179
177
173
Conrail Rents and Services
68
22
Diesel Fuel
Depreciation
Other
Materials, Services and Rents
Compensation and Benefits
Casualties and Other Claims
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Net Increase 624 Million / 15
22
Compensation Benefits Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
T E and Mechanical Hours 63
Net Increase 177 Million 11
Wage Rates 35
HW Benefits and Pension 29
Other Items 20
Stock-Based Compensation 18
Payroll Taxes 12
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Railway Operating Expense Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
190
179
177
173
Conrail Rents and Services
68
22
Diesel Fuel
Depreciation
Other
Materials, Services and Rents
Compensation and Benefits
Casualties and Other Claims
- 185
Net Increase 624 Million / 15
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Railway Operating Expense Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
190
179
177
173
Conrail Rents and Services
68
22
Diesel Fuel
Depreciation
Other
Materials, Services and Rents
Compensation and Benefits
Casualties and Other Claims
- 185
Net Increase 624 Million / 15
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Railway Operating Expense Analysis Nine Months
Ended September 30, 2005 vs. 2004 ( Millions)
190
179
177
173
Conrail Rents and Services
68
22
Diesel Fuel
Depreciation
Other
Materials, Services and Rents
Compensation and Benefits
Casualties and Other Claims
- 185
Net Increase 624 Million / 15
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Railway Operating Ratio (Percent)
Third Quarter
Nine Months
76.9
75.5
75.7
74.7
2004 2005 2004 2005
Change vs. Prior Period 1 - 2
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Income From Railway Operations ( Millions)
Third Quarter
Nine Months
1,523
528
1,240
469
2004 2005 2004 2005
Change vs. Prior Period 13 23
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Total Other Income (Expense)Third Quarter 2005
vs. 2004( Millions)
Change 2005 vs. 2004 Favorable (Unfavorable)
Third Qtr 2005
Third Qtr 2004
Other Income - Net Conrail Corporate
Reorganization -- 53 (53) Equity in
Conrail Earnings 14 2 12 Interest
Income 10 3 7 Coal Royalties 14 11 3
All Other (6) (29) 23 Other
Income - Net 32 40 (8) Interest Expense
on Debt (119) (121) 2 Total
(87) (81) (6)
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Total Other Income (Expense)Nine Months Ended
September 30, 2005 vs. 2004( Millions)
Change 2005 vs. 2004 Favorable (Unfavorable)
Nine Months 2005
Nine Months 2004
Other Income - Net Conrail Corporate
Reorganization -- 53 (53) Expenses
Related to Tax Credit Investments (78) (37)
(41) Equity in Conrail Earnings 28 2 26
Interest Income 26 8 18 Gain on Sale of
Property and Investments 27 15 12
Coal Royalties 41 31 10 All
Other (1) (22) 21 Other Income - Net
43 50 (7) Interest Expense on
Debt (373) (363) (10) Total
(330) (313) (17)
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Income Before Income Taxes ( Millions)
Third Quarter
Nine Months
1,193
441
874
335
2004 2005 2004 2005
Change vs. Prior Period 32 36
Excluding gain from Conrail corporate
reorganization.
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Provision For Income Taxes ( Millions)
Third Quarter
Nine Months
370
140
268
100
2004 2005 2004 2005
Change vs. Prior Period 40 38
Excluding effects of change in Ohio tax
legislation.
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Net Income ( Millions)
Third Quarter
Nine Months
823
301
606
235
2004 2005 2004 2005
Change vs. Prior Period 28 36
Excluding gain from Conrail corporate
reorganization. Excluding effects of change
in Ohio tax legislation.
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Diluted Earnings Per Share ( Dollars)
Third Quarter
Nine Months
2.01
0.73
1.53
0.59
2004 2005 2004 2005
Change vs. Prior Period 24 31
Excluding gain from Conrail corporate
reorganization. Excluding effects of change
in Ohio tax legislation.
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Reconciliation of Net Income( Millions Except
Per Share)

2004 2004 2005
Third Quarter
Nine Months Nine Months
Net Income Excluding Significant Items
235 0.59 606 1.53 823
2.01 Conrail Corporate Reorganization
53 .13 53
0.13 -- -- Change in Ohio Tax Legislation
--
-- -- -- 96 0.23 Net Income GAAP
288 0.72 659 1.66 919 2.24
The reconciliation is posted on our web site,
www.nscorp.com
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Reported Earnings ( Millions)
Third Quarter
Nine Months
919
301
659
288
(Per Share)
Nine Months
Third Quarter
2.24
0.73
0.72
1.66
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