2001 Business Outlook

Rail – The Railroad anticipates that revenue will continue to grow in 2001 despite signals of a weakening economy that were evident at the close of 2000. The Railroad's diverse commodity base helps insulate overall financial performance from weakness in individual commodity groups due to economic or other factors. Fuel prices are expected to remain above historical levels during 2001, but should fall below the record levels of 2000. To help reduce the effect of volatile fuel prices on earnings, the Railroad will continue to look for opportunities to use hedge contracts. Emphasis will continue to be placed on cost control. In addition, by developing innovative new rail services and improving service performance and reliability, the Railroad expects to continue to grow market share and raise overall customer satisfaction.

Trucking – Overnite expects to continue to improve financial performance by focusing on customer service and by expanding new service offerings that have been introduced in recent years. While fuel prices are expected to remain high in 2001, reliable on-time performance and quality service should enable Overnite to maintain profitable margins.

2001 Capital Investments – The Corporation's 2001 capital expenditures and debt service requirements are expected to be funded through cash generated from operations, additional debt financings and the sale or lease of various operating and non-operating properties. The Corporation expects that these sources will continue to provide sufficient funds to meet cash requirements in the foreseeable future. Railroad-related capital expenditures will be used to maintain track and structures, continue capacity expansions on its main lines, upgrade and augment equipment to better meet customer needs, build infrastructure and develop and implement new technologies. Overnite will continue to maintain its truck fleet, expand service centers and enhance technology. Fenix expects to invest capital to upgrade and develop technologies which should generate increased business from third party sales.