Ratings on Norfolk Southern Corp. reflect its strong competitive position as one of the two large eastern freight railroads and the strong industry risk characteristics of the U.S. freight railroad industry, offset by a somewhat leveraged (albeit improving) financial profile. Norfolk Southern is currently benefiting from strong demand. This, and a continuing focus on improving service and operating efficiency, has enabled the company to generate significantly better results in recent quarters. Norfolk Southern's operating metrics have been among the best in the industry over the past year. Its rail operating ratio (operating expenses, including depreciation, as a percentage of revenues), was 75.7% during the first nine months of 2005, much healthier than its 87.0% level in 2000, the year after
