CSX Corporation (CSX) 2017 Q1 法說會逐字稿

Good morning, ladies and gentlemen. Welcome to the CSX Corporation First Quarter 2017 Earnings Call. (Operator Instructions)

各位女士、先生，早安。歡迎參加 CSX Corporation 2017 年第一季財報電話會議。(接線員指示)

For opening remarks and introduction, I'd like to turn the call over to Mr. David Baggs, Vice President, Treasurer and Investor Relations Officer for CSX Corporation.

接下來進行開場致詞與介紹，我想把電話交給 CSX Corporation 副總裁、財務主管暨投資人關係主管 David Baggs 先生。

Thank you, Shirley, and good morning, everyone. On behalf of the management team, I'd like you -- like to welcome you to our first quarter earnings call and also thank you for your interest in CSX Corporation. This morning, we are being represented by our Chief Executive Officer, Hunter Harrison; our Chief Marketing Officer, Fredrik Eliasson; our Chief Financial Officer, Frank Lonegro; and our Chief Operating Officer, Cindy Sanborn.

謝謝你，Shirley，各位早安。我謹代表管理團隊，歡迎各位參加我們第一季財報電話會議，也感謝各位對 CSX Corporation 的關注。今天上午出席的有：我們的執行長 Hunter Harrison；行銷長 Fredrik Eliasson；財務長 Frank Lonegro；以及營運長 Cindy Sanborn。

Now before we begin the formal part of our presentation this morning, let me remind everyone that the presentation materials, our safety and service measures, our quarterly financial report and our press release announcing our new guidance and dividend and share repurchase are all found on our website at csx.com under the Investors section. In addition, following this presentation, later today, our webcast replay and a 10-Q will be filed.

在我們開始今天上午簡報的正式內容之前，先提醒各位：簡報資料、我們的安全與服務衡量指標、季度財務報告，以及宣布最新財測指引、股利與庫藏股回購的新聞稿，皆可在 csx.com 網站「投資人」專區找到。此外，在本次簡報結束後，今天稍晚我們也會提供網路直播重播，並提交 10-Q。

And so now let me turn your attention to Slide 2 of our presentation. Here, our forward-looking disclosure statement outlines the risks and uncertainties of forward-looking statements. There will be a number of them this morning during our presentation. I imagine quite a few during our question-and-answer session. So I would encourage you to take those forward-looking statements in the full context of this disclosure statement.

現在請各位看簡報第 2 頁。此處的前瞻性揭露聲明說明了前瞻性陳述所涉及的風險與不確定性。今天上午在我們的簡報中會有不少此類陳述。我想在問答環節也會有相當多。因此，我鼓勵各位在完整的揭露聲明脈絡下理解這些前瞻性陳述。

On Slide 3 is our non-GAAP disclosure statement. While CSX does file all of its financials in accordance with U.S. GAAP, we are providing some non-GAAP financial measures in addition to the GAAP financial measures to help you better understand the business, but these measures are not a substitute for GAAP.

第 3 頁是我們的非 GAAP 揭露聲明。雖然 CSX 的所有財務資料皆依照美國 GAAP 編製與申報，但我們除 GAAP 財務衡量指標外，也提供部分非 GAAP 財務衡量指標，以協助各位更好理解業務；不過，這些指標不能取代 GAAP。

Finally, I would say that we have close to 30 analysts this morning so I would encourage everyone to play nicely in the sandbox, so to speak. (Operator Instructions) And before I turn the presentation over to the team, let me also remind you that the earnings call today is limited to discussions of the earnings and the business of CSX only, and we will not touch upon matters that are currently the subject of the company's annual meeting.

最後，我要說今天上午大約有近 30 位分析師參與，因此我鼓勵大家在「沙坑」裡好好相處，換句話說。(接線員指示) 在我把簡報交給團隊之前，也提醒各位：今天的財報電話會議僅限討論 CSX 的財報與業務，我們不會觸及目前屬於公司年度股東會議題的事項。

And with that, it is my great pleasure and privilege to introduce our President and Chief Executive Officer, Hunter Harrison.

接下來，我非常榮幸介紹我們的總裁暨執行長 Hunter Harrison。

Thank you, David, and thanks to all of you for joining us this morning. I guess my first comment would be, I'm back. I didn't think that -- I didn't think this was going to happen, but it's come together hopefully -- well, not hopefully. I think it's factually my last leg on this journey that I've taken down this railroad career for now, a little in excess of 50 years, did I ever think that I would finish in Jacksonville with a group of railroaders with the talent that they possess and the franchise that's before us. And I'm very, very excited about the opportunities.

謝謝你，David，也感謝各位今天上午加入我們。我想我的第一個評論是：我回來了。我原本不認為——我原本不認為這會發生，但它終於成形了，希望——嗯，不是希望。我認為事實上，這是我這段鐵路職涯旅程的最後一段路；到目前為止已經超過 50 年。我是否曾想過，我會在傑克遜維爾，與一群具備如此才華的鐵路人，以及我們眼前這樣的特許經營版圖，一起畫下句點。我對這些機會感到非常、非常興奮。

I met yesterday at the first board meeting formally with our board. I think it's safe to say that all of us were pretty excited about the opportunities going forward. As I found here, like I found before and I thought, here's a group of great railroaders. There might be a little shift in direction, but this company is going to achieve things that some of you don't think could be achieved. I'm not going to spend a lot of your time and mine on this -- on the first quarter, because I wasn't here. I was only here for 30 days. And the 3 leaders here that, with their teams, produced those results are going to spend some time going through there with you. I certainly think it was a pretty outstanding quarter as an outsider certainly looking in, and it builds a foundation for us to go forward on with our plans for the future.

我昨天在第一次正式的董事會會議上與董事會見面。我想可以很肯定地說，我們所有人都對未來的機會感到相當振奮。我在這裡看到的，就像我以前看到、也曾想過的那樣：這是一群很棒的鐵路人。方向可能會有些微調整，但這家公司將達成一些你們之中有些人認為不可能達成的事。我不會在這裡花太多你我的時間談——談第一季，因為我當時不在。我只在這裡 30 天。而在座的 3 位領導者與他們的團隊創造了那些成果，他們會花些時間帶各位一起回顧。以一個外部人士的角度來看，我確實認為這是一個相當出色的季度，也為我們依循未來計畫向前推進奠定了基礎。

I would say this. As I was reflecting this morning on what I might say here today, and I know if you look at the various constituencies that we deal with, certainly the -- our investors are represented, certainly our employees are represented. The one group that's so important to us that's not represented directly that I'm going to become an advocate for is our customers, and I'm extremely excited.

我想說的是。今天早上我在思考我可能要在此說些什麼；我知道如果你看我們所面對的各個利害關係人，當然——我們的投資人有代表在場，當然我們的員工也有代表在場。但有一個對我們極其重要、卻沒有直接在場的群體，我將成為他們的倡議者，那就是我們的客戶，而我感到非常振奮。

If you look at our service offering as it is today, we do a, I think, there's a lot I've got to learn, but pretty good job in our bulk movements and cycles, do a good job in the intermodal area. I think all of us would say that in our "merchandise category", we can make some significant improvements. Cindy and her team have already started it, down that road. And I think you'll see some -- what I would characterize as some pretty dramatic changes in our cycles. And I think you'll see things, like from Chicago to Florida markets, that we'll take 2 and 3 days out of that as a result of some of the strategies you're going to hear about today. So I think that's pretty exciting for the customer base.

如果你看我們目前的服務提供，我認為——我還有很多要學，但我們在散裝運輸與循環方面做得相當不錯，在聯運領域也做得很好。我想我們都會說，在我們的「一般貨運（merchandise）類別」方面，我們可以做出一些顯著改善。Cindy 和她的團隊已經開始朝那條路推進。我想你們會看到一些——我會形容為相當劇烈的循環改善。我也認為你們會看到一些成果，例如從芝加哥到佛羅里達市場的運輸，我們將因為今天你們會聽到的一些策略而縮短 2 到 3 天。所以我認為這對客戶群而言相當令人振奮。

So without me taking up a lot of additional time, let me turn it over to the team here and let Frank give us some observations on the results in the quarter.

因此我不再占用更多時間，接下來把時間交給團隊，請 Frank 針對本季結果提供一些觀察。

Thanks, Hunter, and good morning, everyone. Consistent with the transformation that we are undertaking to Precision Scheduled Railroading under Hunter's leadership, and knowing that you're eager to ask questions this morning, we're going to be very efficient in the way that we discuss the numbers. So with that as a backdrop, let's turn to Slide 7.

謝謝你，Hunter，各位早安。配合我們在 Hunter 領導下推動的「精準排程鐵路營運（Precision Scheduled Railroading）」轉型，也知道各位今天上午迫不及待想提問，我們將以非常有效率的方式來討論數字。在此背景下，請翻到第 7 頁。

The safety of our employees and the communities that we serve will continue to be a top priority for CSX and for this leadership team. While the personal injury frequency index was 9% higher year-over-year, the absolute number of injuries was down slightly. And that's part of our continuing drive toward the ultimate goal of 0 injuries. Our train accident frequency index was 25% improved on substantially fewer reportable incidents. In terms of efficiency, we are continuing to drive both train length improvements and fuel efficiency gains, while our service levels remain stable on a year-over-year basis.

員工與我們所服務社區的安全，將持續是 CSX 以及本領導團隊的首要優先事項。雖然人身傷害頻率指數較去年同期高出 9%，但受傷的絕對件數略有下降。這也是我們持續朝最終目標「零傷害」努力的一部分。在可通報事件大幅減少的情況下，我們的列車事故頻率指數改善了 25%。就效率而言，我們持續推動列車編組長度提升與燃油效率改善，同時我們的服務水準在年對年基礎上仍保持穩定。

Thanks, Frank. Let me just add a little bit. First of all, very excited to be working with Hunter here, and as the operating leader, spend a lot of time with him. And so I'll talk a little bit about the quarter, but I will talk about, going forward, how we're working on some of the items that Hunter has briefly alluded to this morning.

謝謝你，Frank。我再補充一點。首先，我非常興奮能在這裡與 Hunter 共事；作為營運負責人，我花很多時間與他一起工作。因此我會稍微談一下本季，但也會談談未來我們如何推動 Hunter 今天上午簡要提到的一些事項。

First of all, as you would expect and has always been the case at CSX, safety is our highest priority. And we will continue to focus on that, not only employee performance -- employee injury performance, but train accidents in order to improve or make sure that the communities that we operate through, we operate through safely.

首先，正如各位所預期、也一直是 CSX 的一貫作法，安全是我們的最高優先事項。我們將持續聚焦於此，不僅是員工表現——員工受傷表現，也包括列車事故，以改善並確保我們所行經營運的社區能夠安全地運作。

Turning to productivity. In the first quarter, we delivered $123 million worth of savings. Significant resource productivity drove this, continued train length opportunities and reduction in crew starts. And also, we saw some other support costs, particularly in engineering, and mechanical labor costs also affecting us positively in the quarter. But I think what we really want to hit on here is how we think about our business going forward to drive both productivity and service, as Hunter's alluded to. And in the past 6 weeks, we've done a couple of key things I'll just highlight this morning.

接著談生產力。第一季我們實現了1.23億美元的節省。這主要由顯著的資源生產力所帶動，包括持續的列車加長機會以及減少開班（crew starts）。此外，我們也看到一些其他支援成本，特別是工程，以及機務勞務成本，在本季也對我們產生正面影響。但我認為我們真正想強調的是，正如Hunter提到的，我們如何看待未來的業務以同時推動生產力與服務。在過去6週，我們做了幾項關鍵事項，今天早上我先重點說明其中幾點。

One, we've adopted -- adapted our operating plans to incorporate some of our unit train business into a merchandise -- into merchandise service. And this allows us to do a couple things. As you think about our 28-hour train dispatch, or variable train dispatch, we did that in order to improve our train length. And we've done that, been very successful with it. But I think what's helping us continue to move forward with train length and cycle time improvement is adding the batch network into the merchandise service. So now we can have a more balanced network with a more highly likely probability of "7 day a week" service and still keeping the length of the trains where it's productive. This also serves our customers well as we're able to improve dwell time in our terminals as a result of these changes.

第一，我們已採用——調整我們的營運計畫，把部分單元列車（unit train）業務納入貨運——納入一般貨運（merchandise）服務。這讓我們能做到幾件事。當你想到我們的28小時列車派遣，或可變列車派遣，我們這麼做是為了改善列車長度。而我們已經做到，且非常成功。但我認為能幫助我們在列車長度與週轉時間改善上持續前進的，是把批次網路（batch network）加入一般貨運服務。因此現在我們可以擁有更平衡的網路，更有可能提供「每週7天」服務，同時仍維持具生產力的列車長度。這些改變也能更好地服務客戶，因為我們因此得以改善終端場站的停留時間（dwell time）。

The second item that we've been working on is reduce -- or changing or converting our switching operations in some of our traditional hump yards into a flat yard model. We have 12 hump yards across the system. To date, we have converted 4 of those over into flat switching operations. This has allowed us to reduce support resource efficiencies, particularly in managing the infrastructure that's necessary to support in hump yards in the humping process, reduce that as well as, again, our plan has been focusing on improving the cycle time through those terminals. So we've been able to do both of those things.

第二項我們正在推動的是，降低——或改變、把我們部分傳統驼峰編組場（hump yards）的調車作業轉換為平面場（flat yard）模式。我們全系統共有12座驼峰場。截至目前，我們已將其中4座轉為平面調車作業。這使我們得以降低支援資源的效率損耗，特別是在管理驼峰場驼峰作業所需的基礎設施方面；同時也降低相關需求；而且再次強調，我們的計畫一直聚焦於改善這些終端的週轉時間。因此我們已能同時做到這兩點。

As we look forward, we expect to continue to reduce several hump yards. We don't have a hard and fast specific number. We'll look at each one individually. We will make sure we're making the right decisions to improve both productivity and service.

展望未來，我們預期會持續縮減若干驼峰場。我們沒有一個硬性、明確的特定數字。我們會逐一評估每一座。我們會確保做出正確決策，以同時提升生產力與服務。

And I would also say that as we look at our quarter 1 measurements, and our network performance measurements, we are seeing, as we've implemented some of these changes I'm talking about, improved dwell time, improved velocity across the network. And we think that will compound the effect of some of the changes that we're making to lead us to feel very comfortable moving forward that we'll actually have record productivity in 2017 following our previous record productivity in 2016.

我也想說，從第一季的衡量指標與網路績效指標來看，隨著我們落實我剛提到的一些改變，我們看到停留時間改善、網路整體速度提升。我們認為這將強化我們所做改變的效果，讓我們非常有信心地往前走，並且在2016年創下前次生產力新高之後，2017年將再創生產力紀錄。

So overall, I think the team is doing very well coming together with some significant changes as we adjusted to the reductions in management headcount as part of our first quarter initiative. We saw a lot of change there, and we're continuing to see change. And we're driving that effectively, I believe, and we'll continue to do so, incorporating that into our business model going forward.

總體而言，我認為團隊在第一季倡議中，隨著我們因管理人力編制縮減而進行調整，正非常順利地整合並推動一些重大變革。我們看到很多改變，而且仍持續看到改變。我相信我們正有效地推動這些改變，並將持續如此，把它們納入未來的業務模式之中。

Thanks, Cindy. Those are great insights for the analysts and for the investors. Going forward, as we implement Precision Scheduled Railroading, you'll see what we believe is a powerful combination of improved safety, improved service and improved efficiency that exemplifies a great railroad. We believe that that powerful combination will benefit employees, customers and shareholders alike.

謝謝你，Cindy。這些對分析師與投資人而言都是很棒的洞見。展望未來，隨著我們導入精準排程鐵路（Precision Scheduled Railroading），你們將看到我們所相信的強大組合：更高的安全性、更好的服務與更高的效率，這正體現了一家卓越鐵路公司應有的樣貌。我們相信這個強大組合將同時讓員工、客戶與股東受益。

Turning to Slide 8. The GAAP view of our income statement highlights the 10% year-over-year top line improvement, which has been achieved through a combination of volume growth, higher fuel surcharge recoveries, favorable mix and value pricing. Volume's up 3%, with pricing on a same-store sales basis increasing 3.9% all in and 2.5% excluding coal, driving revenue per unit up 7%.

接著看第8頁。以GAAP口徑呈現的損益表顯示，營收年增10%，這是透過運量成長、更高的燃油附加費回收、有利的產品組合以及價值定價等多重因素共同達成。運量成長3%；以同店銷售基礎計算，整體定價上升3.9%，若排除煤炭則上升2.5%，帶動單位收入上升7%。

Looking at the expenses at a high level. Total costs were up $243 million with the $173 million restructuring charge accounting for most of that year-over-year increase. Absent the charge, the combined impact of increased fuel prices, inflation and volume were nearly offset by the $123 million of efficiency savings that you heard Cindy reference. The focus on cost control in a rising volume environment produced incremental margins of over 70% excluding the charge. Bottom line, ex charge, CSX delivered a record first quarter operating ratio of 69.2%, operating income of $885 million and a record first quarter EPS of $0.51.

從較高層次來看費用。總成本增加2.43億美元，其中1.73億美元的重組費用占了年增的大部分。若不計該費用，燃油價格上升、通膨與運量增加的綜合影響，幾乎被你們聽到Cindy提到的1.23億美元效率節省所抵銷。在運量上升的環境下，對成本控制的聚焦使得（不含該費用）增量利潤率超過70%。總結來說，若不計該費用，CSX第一季營業比率（operating ratio）創下69.2%的紀錄，營業利益為8.85億美元，第一季每股盈餘（EPS）也創下0.51美元的紀錄。

Turning to Slide 9. These financial results drove over $1 billion in operating cash flow, a nearly $300 million year-over-year improvement. This improvement carried through to free cash flow before dividends of $630 million. Earlier this morning, we announced a free cash flow target of around $1.5 billion for the year, which takes into consideration the combined impact of our earnings trajectory and a CapEx reduction of over $100 million.

接著看第9頁。這些財務結果帶動營運現金流超過10億美元，較去年同期改善近3億美元。這項改善也反映在股利發放前的自由現金流，達到6.30億美元。今天稍早，我們宣布全年自由現金流目標約為15億美元，這已考量我們獲利走勢與資本支出（CapEx）減少逾1億美元的綜合影響。

We continue to remain focused on returning capital to shareholders through a balanced deployment strategy. In the quarter, we distributed $166 million to shareholders in the form of dividends while repurchasing $258 million of CSX shares. Having now completed the 2-year $2 billion program we commenced in April of 2015, we were pleased to announce a new 1-year $1 billion buyback program earlier this morning.

我們仍持續專注於透過均衡的資金運用策略，將資本回饋給股東。本季我們以股利形式向股東發放1.66億美元，同時回購2.58億美元的CSX股票。在完成我們於2015年4月啟動的為期兩年、總額20億美元的計畫後，我們很高興在今天稍早宣布新的為期一年、總額10億美元的庫藏股回購計畫。

While ROIC was stable on a year-over-year basis, we fully expect that it will inflect more positively going forward as we continue to increase efficiency and reduce the asset intensity of our railroad. Debt-to-EBITDA was also relatively stable as we continue to appropriately utilize our balance sheet and remain committed to a BBB+, Baa1 credit rating.

雖然投入資本報酬率（ROIC）年對年持平，但我們完全預期，隨著我們持續提升效率並降低鐵路資產密集度，ROIC未來將更明顯地向上轉折。負債對EBITDA比率也相對穩定，因為我們持續適度運用資產負債表，並承諾維持BBB+、Baa1的信用評等。

Turning to Slide 10. The volume outlook for the second quarter is largely positive, with nearly 70% of our markets in the favorable category and over 20% of our markets in the neutral category. Only domestic coal is expected to be unfavorable in the second quarter.

接著看第10頁。第二季的運量展望大致正向，近70%的市場屬於有利類別，超過20%的市場屬於中性類別。預期第二季只有國內煤炭會是不利項目。

Yes. So to just to add a little color to that. If you look at the macro environment, there are several indicators that seem to support continued growth. Obviously, the economy continues to grow at a modest pace, IDP, GDP, in the 2, 2.5 range for the full year and probably similar pace in the second quarter itself. The consumer sentiment continues to be at a high level, which helps many of our markets, especially perhaps our intermodal market.

是的。我再補充一些背景說明。如果你看總體環境，有幾個指標似乎支持成長可望延續。顯然，經濟仍以溫和步伐成長，IDP、GDP全年大約在2到2.5的區間，第二季本身可能也是類似的步調。消費者信心仍維持在高檔，這有助於我們許多市場，尤其可能是我們的多式聯運（intermodal）市場。

Now at the same time though, the truck market right now is -- continues to see excess capacity. But as we move through the year, we do expect that to gradually improve in the second half and into '18. And then of course, on the favorable side, export coal, that was very strong here in the first quarter, 8.7 million tons that we moved in the first quarter. We do expect that to taper off as we move through the year, but we still think that an upper 20 million range in terms of tons for the full year on the export side is a good estimate at this point.

不過同時，卡車市場目前——仍然存在過剩運能。但隨著今年推進，我們預期下半年以及進入2018年將逐步改善。另外在有利面，出口煤炭在第一季非常強勁，我們第一季運送了870萬噸。我們確實預期隨著年度推進會逐步降溫，但就目前而言，我們仍認為全年出口量以噸計落在2,000多萬噸的高端區間，是一個合理的估計。

As we think about some of the headwinds, we think that auto production is clearly flattening out. And we think for the rest of the year relatively flat is probably a good place to think about the auto business. And then while the core chemical market continues to grow at a nice pace, we expect crude-by-rail to continue to decline, both year-over-year and sequentially as we move through the rest of 2017.

當我們思考一些逆風時，我們認為汽車產量顯然正在趨於持平。而我們認為在今年剩餘時間，汽車業務以相對持平來看待，可能是個不錯的基準。另外，雖然核心化學品市場仍以不錯的速度成長，我們預期鐵路運輸原油（crude-by-rail）將持續下滑，無論是年對年或是隨著2017年剩餘時間推進的季對季都會下降。

And then of course, on the unfavorable side, we see our domestic coal business. We talked about it in the fourth quarter. We lost some short-haul business. And -- but despite that, we did about 15 million tons here in the first quarter on the domestic side, and we expect a similar pace in the second quarter. But as you saw in the first quarter, the quality of the revenue and the impact to the bottom line is still very strong, and we expect it to continue as we move through the year. It's obviously reflected in our RPU.

然後當然，在不利的一面，我們看到我們的國內煤炭業務。我們在第四季談過這件事。我們流失了一些短程運輸業務。而且——但儘管如此，我們在第一季國內端仍完成了約1,500萬噸，並且我們預期第二季會維持類似的節奏。但如你在第一季所見，營收品質以及對最終獲利的影響仍然非常強勁，我們預期在今年接下來的時間也會持續如此。這也明顯反映在我們的RPU上。

So I would say overall, we feel good about the top line. We continue to expect our merchandise and intermodal business to grow at or above the economy as a whole. And it's nice to see coal revenue to be growing a little bit here this year as well. And lastly, and echoing Cindy's comments earlier, we are very excited about what this operating model can do for CSX, not just in terms of the bottom line, but really what it can do for our customers. We're already seeing that and -- from a service perspective, both in terms of transit time, reliability and recoverability. So we feel very good about this change.

所以我會說整體而言，我們對營收表現感到樂觀。我們仍預期我們的商品與聯運業務將以等同或高於整體經濟的速度成長。而且也很高興看到今年煤炭營收也有些許成長。最後，也呼應Cindy先前的評論，我們對這個營運模式能為CSX帶來的成果感到非常振奮，不僅是在最終獲利方面，更重要的是它能為我們的客戶帶來什麼。我們已經看到——從服務角度來看，無論是運輸時間、可靠性與復原能力。因此我們對這項改變感到非常有信心。

Thanks, Fredrik. A very helpful, again, commentary for the investors and for the analysts. Let's finish up on Slide 11. With our first quarter results, we're off to a very good start in 2017 and expect to accelerate the transformation to Precision Scheduled Railroading in the coming quarters.

謝謝你，Fredrik。再次提供了對投資人與分析師非常有幫助的評論。我們在第11頁投影片做個收尾。以我們第一季的結果來看，2017年我們有一個非常好的開局，並預期在接下來幾季加速推動精準排程鐵路（Precision Scheduled Railroading）的轉型。

Earlier this morning, you saw that we issued full year guidance, excluding the restructuring charges. To that end, in 2017, CSX expects to achieve a mid-60s operating ratio, record efficiency gains that you heard Cindy mention, EPS growth of around 25% off of 2016's reported EPS of $1.81, and free cash flow before dividends of around $1.5 billion. In issuing these expectations, we assume, of course, that the coal markets and the overall economy will remain stable.

今天稍早，你們看到我們發布了全年指引，並排除重組費用。就此而言，2017年CSX預期可達到約中60%區間的營運比率（operating ratio）、你們聽Cindy提到的創紀錄效率提升、以2016年公告EPS 1.81美元為基礎約25%的EPS成長，以及股利發放前約15億美元的自由現金流。在提出這些預期時，我們當然假設煤炭市場與整體經濟將維持穩定。

This morning, we were also pleased to announce an 11% or $0.02 increase in the quarterly dividend along with a new 1-year $1 billion share buyback program. And finally, we look forward to sharing our longer-term plans with you in the second half of the year.

今天早上，我們也很高興宣布季度股利提高11%（或0.02美元），並同時推出新的為期1年、規模10億美元的庫藏股回購計畫。最後，我們期待在今年下半年與各位分享我們較長期的規劃。

With that, we'd be delighted to take your questions this morning.

接下來，我們很樂意在今天早上回答各位的問題。

(Operator Instructions) Our first question comes from Brian Ossenbeck with JPMorgan.

（接線員指示）我們的第一個問題來自摩根大通（JPMorgan）的Brian Ossenbeck。

Hunter, I guess the first one for you. I know we'll have a scheduled day later in the year perhaps to hear more about the longer-term plan. But the initial impressions that were laid out in the slides, if you could just give us some context in terms of what you think the significant opportunities are to further streamline the network. You've talked about monetizing real estate, which I know was a target at Canadian Pacific when you were there. And just in general, if you think there's just too much track with too few carloads going over there. Is there just an ability to improve the network density and the design as you move forward over the next couple of years?

Hunter，我想先問你第一個問題。我知道我們可能會在今年稍晚有一個既定的日程，聽你們更詳細說明長期計畫。但就投影片中提出的初步印象而言，能否請你提供一些背景脈絡，談談你認為進一步精簡網路的重大機會在哪裡？你提到資產變現不動產，我知道你在加拿大太平洋（Canadian Pacific）時這也是一個目標。而且更一般地說，你是否認為軌道太多、但通過的車皮量太少？在未來幾年推進的過程中，是否有能力提升網路密度與設計？

How long do you have, Brian, to listen to this response? Let me -- I don't think that this franchise is significantly different than others that we've overlaid this model with. Cindy touched on a lot of these things. And as we've talked internally, we don't have some ironclad numbers on what's the number, what's the headcount number got to be. What's the hump closures got to be. It's going to be what's smart to do. I do think that -- I've spent a great deal of time with Cindy and her team. We are -- I think step one was we're cutting through a lot of bureaucracy. We're shedding through where we had, I think, 9 divisions, and so we'll be going down to maybe a couple. Lines in organizational charts just cost money, and I think we're trying to streamline that. We're trying to get the right leadership in the right spots. We've got 9 dispatching offices. I don't think any railroad has 9 dispatching offices, and we're going to take -- make some efforts there. There's efforts going on now with the locomotive productivity. I would expect that before the summer's out, we'll have 550 or so locomotives stored, we'll probably have 25,000 freight cars put up, and all the associated costs that go with them: labor, material, and locomotives, fuel productivity, velocity and a lot of things. Dwell time in terminals, I would say, will come down dramatically. Are some of our facilities, historically, have they been overbuilt? Yes, like a lot of railroads. But this railroad has had a special challenge. If you look back at the mergers, there was more companies involved with the mergers of what is now the CSX than any other major road. So if you go to a place like Atlanta, and we have 4 or 5 yards, well, it's because everybody had a yard there, or if you go to some of these common points. So we're doing some things, for example, Atlanta's a good example where I think we have 4 yards there. Cindy's helping me here. And I think we'll be down to -- maybe there's one super operation there. But I know we have a tract of land there that's an operating [proxy] that doesn't need to be this [for us]. It's a good deal of money. So there's going to be some monetization of assets. So this is going to be more of the same at maybe a more rapid pace with taking advantage of larger opportunities.

Brian，你有多少時間可以聽完這個回答？我先說——我不認為這個特許經營（franchise）與我們在其他公司導入這套模式時有顯著不同。Cindy已經提到很多這些事情。而且如同我們內部討論的，我們並沒有一些鐵板釘釘的數字，例如最終要到什麼規模、員額要是多少。駝峰調車場（hump）要關閉多少。這將取決於什麼做法最明智。我確實認為——我花了很多時間和Cindy及她的團隊一起工作。我們——我想第一步是我們正在砍掉大量官僚層級。我們正在精簡原本我認為有9個事業部的架構，因此我們可能會降到只有幾個。組織圖上的層級線條只會增加成本，我認為我們正試圖把它精簡。我們正努力把合適的領導放在合適的位置。我們有9個行車調度辦公室。我不認為有任何鐵路公司會有9個調度辦公室，我們會在這方面採取一些行動。目前也正在推動機車生產力的提升。我預期在夏天結束前，我們大約會有550台機車封存，可能會有25,000輛貨車停放，並且連同其相關的所有成本：人力、材料，以及機車、燃油效率、速度與許多其他項目。我會說，終端場站的停留時間（dwell time）將大幅下降。我們的一些設施，從歷史來看，是否建得過度？是的，和很多鐵路公司一樣。但這家鐵路公司有一個特殊挑戰。如果你回頭看併購歷史，形成如今CSX的併購涉及的公司數量，比任何其他主要鐵路都多。所以如果你到像亞特蘭大這樣的地方，我們有4到5個編組場，那是因為每家公司當時都在那裡有一個編組場，或是你到一些共同樞紐點也是如此。因此我們正在做一些事情，例如亞特蘭大就是個好例子，我想我們那裡有4個編組場。Cindy在這裡幫我補充。我想我們會降到——也許那裡只需要一個超級作業中心。但我知道我們在那裡有一塊土地，是一個營運[proxy]，對我們而言不需要做到這種程度。那是一筆相當可觀的金額。所以會有一些資產變現。因此，這會是類似的作法，但可能以更快的速度，並把握更大的機會。

Okay, great. So just one quick follow-up just on the coal side. Frank or Fredrik, if you could give us a sense as the export market price in met really spiked in -- pretty much after the quarter ended. So I just wanted to see if you thought that the mix, the favorable benefit that you saw in the first quarter is something that you would also be able to capture in the second and third quarter.

好的，很棒。那我再快速追問一個關於煤炭的問題。Frank或Fredrik，能否請你們談談，因為冶金煤（met）的出口市場價格在——幾乎是在季度結束後大幅飆升。所以我想了解你們是否認為，第一季看到的組合改善所帶來的有利效益，第二季與第三季也能同樣掌握到？

Well, thank you. Obviously, we don't forecast price, but we have said overall, all the time, that we do have indexes on our contracts on the export side that when things go well, we share in some of the economics. And when things aren't as well, we take some of that pain. Clearly, this quarter, it wasn't just export pricing that helped. We also see -- saw some pretty favorable mix, and a lot of that mix we do expect to continue. But it, of course, depends on where we see the utility business, for example, go in terms of refill, replenishment of inventories through the year. So I think there's a favorable mix story and favorable sort of going forward. But I think it's unclear at this point how favorable it's going to be as we move through the year.

好的，謝謝你。顯然，我們不會預測價格，但我們一直以來都說過，整體而言，我們在出口端的合約中確實設有指數機制，當情況順利時，我們會分享部分經濟利益。而當情況不那麼好時，我們也會承擔部分壓力。很明顯，本季帶來助益的不只是出口定價。我們也看到——也確實看到相當有利的產品組合，而其中很大一部分組合我們預期會持續。但當然，這取決於例如公用事業業務在今年內補充、回補庫存的走向。所以我認為這是一個有利的組合故事，而且往前看也偏正面。但我認為目前還不清楚，隨著我們走過今年，這種有利程度會有多大。

Our next question comes from Chris Wetherbee with Citigroup.

我們的下一個問題來自花旗集團（Citigroup）的 Chris Wetherbee。

Wanted to touch on the volume side, Hunter. If you could just sort of give your initial impressions on what you'd give as sort of volume opportunities that are out there for CSX. Obviously, playing in the East, we automatically kind of think of the intermodal markets, and efficiency obviously plays big into being able to gain share, either both from trucks as well as your rail competitors. Can you give us a sense of sort of what your initial impressions are about sort of the franchise there? And how you think about that going forward?

想談一下運量面，Hunter。如果可以的話，請你大致分享一下你對 CSX 在外部有哪些運量機會的初步印象。顯然，身處東部市場，我們自然會想到聯運市場，而效率在能否取得市占上扮演很重要的角色，不論是從卡車那邊，或是從你的鐵路同業競爭者那邊。你能否讓我們了解一下你對那個特許經營版圖（franchise）的初步印象？以及你對未來的看法？

Well, I'm obviously, in 30 days, I'm limited to my knowledge. I will say this. I think one of the exciting things going forward with this organization as well as rail overall is the opportunity that's before us to get business off the highway. And I think that we're set up in almost a perfect storm here to take advantage of that. If you look at -- we have -- we start with a strong base to begin with, with great markets that we serve up and down the East Coast and Chicago and Florida and some really -- some growth areas. Where there's congestion, the highway system's not going to be able to accommodate everything if you look at the advantages of rail with -- from an environmental standpoint, from an energy standpoint. And if you look at an organization that is going to be able to take a combination of, say, dwell times in terminals by eliminating terminals, which lowers cost, but at the same time then takes the dwell times down from an average of effectively a day or 25 or 26 hours of dwell down to 18 or so. And you say, we're going to skip some terminals and you start to look at really -- what we used to talk about was truck competitive. Hell, it's not truck competitive, it's better than truck. Now the issue is the change and the [strategy] to take that to the marketplace and to sell it and convert it and change it. But that's where -- look, the individual markets, I mean, this company has some -- we've got some worthy competitors out there. We'll scratch and bite and win the business there. The real opportunity I see is on the -- is in the highway.

嗯，顯然我才 30 天，所掌握的資訊有限。我會這麼說。我認為，無論對這個組織或整體鐵路業而言，未來最令人振奮的一點，就是我們面前有機會把貨從公路上移轉過來。而我認為我們幾乎處在一個完美風暴的情境中，可以好好把握這個機會。如果你看——我們有——我們一開始就有很強的基礎，因為我們服務的市場很棒，從東岸一路到芝加哥、佛羅里達，以及一些真正——一些成長區域。在有壅塞的地方，如果你看看鐵路在環境面、能源面的優勢，公路系統將無法容納所有需求。而如果你看一個組織能夠把例如場站的停留時間（dwell time）透過取消場站來降低——這會降低成本——同時把停留時間從平均實質上一天、也就是 25 或 26 小時，降到大約 18 小時。你再說，我們要跳過一些場站，然後你開始真正——我們過去常說的是「能跟卡車競爭」。見鬼，這不只是能跟卡車競爭，而是比卡車更好。現在的問題在於變革，以及把這個[策略]帶到市場上去、去銷售、去轉換並推動改變。但這就是——你看，個別市場方面，我是說，這家公司有一些——外面也有一些很值得尊敬的競爭對手。我們會拼到底、咬緊牙關，把那裡的生意贏下來。我看到的真正機會是在——是在公路上。

Okay, okay. That's very helpful. Appreciate that. And then just to follow up, thinking about some of the guidance and maybe how to think about it a little bit beyond 2017. So mid-60s for this year, which I think pulls forward some of the benefits. But clearly, some of the things that you're going to be doing are going to be gaining traction as the year progresses. So presumably, you'll be entering 2018 at a better run rate. So obviously, I'm trying to jump the gun here a little bit and get some of a forward look before you might be ready to give it. But when you think about 2018, am I thinking about it wrong in the respect that it is sort of natural that some of the benefits you're accruing in 2017 will be playing out in 2018? Maybe we're thinking something like the low 60s or [slow] OR in 2018.

好，好。這非常有幫助。謝謝。接著追問一下，關於一些指引，以及也許如何把它延伸到 2017 年之後來思考。今年是中段 60%（mid-60s），我認為這等於把部分效益提前反映。但很明顯，你們要做的一些事情會在一年當中逐步發酵。所以推測你們進入 2018 年時，會處在更好的運行水準（run rate）。所以顯然，我有點想先偷跑，在你可能準備好給出之前，先取得一些前瞻性的看法。但當你思考 2018 年時，我這樣想會不會不對：也就是你們在 2017 年累積的一些效益，會在 2018 年持續展現？也許我們可以想像 2018 年大概是低 60% 左右，或是[較慢]的營運比率（OR）。

Is that bait? Send me your model, Chris, and I'll fill it in. I think you're right on. Look, this is not the first time this movie's played out. We see opportunities. It's not going to happen overnight. Is it going to be exactly linear? No. Will there be a stairstep approach? Yes. Do we have any barriers here, structural issues that we've dealt with before that says we can't do what's been done before and even go beyond that? No reason.

這是在釣我嗎？把你的模型寄給我，Chris，我來幫你填。我想你說得很對。你看，這部電影不是第一次上演了。我們看到機會。它不會一夕之間發生。會完全線性嗎？不會。會是階梯式的推進嗎？會。我們這裡有沒有任何障礙、結構性問題，是我們以前處理過、會讓我們無法做到過去做過的事，甚至做得更好？沒有理由。

Our next question comes from Tom Wadewitz with UBS.

我們的下一個問題來自瑞銀（UBS）的 Tom Wadewitz。

Hunter, I wanted to see if you could offer some thoughts on the opportunity at CSX versus what you saw at CP. I think of your approach being one of the things you do is simplify the flow of traffic and reduce work events. If CSX has a greater complexity in the network to begin with versus CP, that would imply maybe greater opportunity for cost takeout and OR as you take out that complexity, right, and simplify things. So I don't know if that's the right framework or not, but wanted to see if you could comment on that and maybe compare the opportunity you see so far at CSX versus what you had at CP.

Hunter，我想請你談談在 CSX 的機會，相較於你在 CP 看到的情況。我認為你的方法之一，是簡化車流的流動並減少作業事件（work events）。如果 CSX 一開始的路網複雜度比 CP 更高，那就意味著當你去除這些複雜度、把事情簡化時，可能有更大的成本削減空間，以及營運比率（OR）的改善空間，對吧？所以我不確定這是不是正確的思考框架，但想請你就此評論一下，並且比較你目前在 CSX 看到的機會，與你在 CP 時看到的機會。

Well, I mean, Tom, as you know, they're totally different franchises, the make-up, the markets, as generally speaking, a lot of roads are in North America. So you look at the hand you're dealt and you say, "Look, what is the best way to operate and run this franchise?" And I think that before I arrived, there was a lot of talk about this is not a simple key operation that it's got all the complexities and the density and the spaghetti bowls. Well, the way to handle that, eat the spaghetti and get rid of it. So one of the things we're doing, that Cindy and her team are working diligently on, is being sure that we're not going through terminals and processing cars just because the terminal's there. So it's almost kind of the old term we've used before, the whiteboard approach of let's start over with this franchise. The last -- and I was in error yesterday when I talked to a group, but the last hump yard that was built in North America, the last 2, was one at Waycross, Georgia, which is the heart of the CSX, in my view; and the other one was, I believe, Galesburg, Illinois, which I had something to do with the construction of it at Burlington North in the mid-'80s. Markets have changed since the mid-'80s. The amount of traffic that's bulk, that it's intermodal, that's unit grain, unit coal, crude trains that don't have to be sorted and switched. So you adapt your operating strategies to the markets. And I just think that there's much more of a natural fit to make some of the changes that we need to make here that will present even more opportunities. Because to your point, of the complexity that it's had in the past and the ability to simplify, this franchise, if you apply it to my career to some degree, has more potential than anyone I've dealt with.

嗯，我是說，Tom，如你所知，它們是完全不同的特許經營體系，無論是組成、市場；而且一般來說，很多路線都在北美。所以你看你手上拿到的牌，然後你會說：「看，經營與運作這個特許經營體系的最佳方式是什麼？」我認為在我來之前，外界談了很多，說這不是一個簡單的關鍵作業，它有所有的複雜性、密度，還有像義大利麵一樣糾結的路網。嗯，處理的方法就是把義大利麵吃掉，然後把它清掉。所以我們正在做的一件事——Cindy 和她的團隊正努力在做——就是確保我們不是因為終端站在那裡，就一定要經過終端、處理車輛。所以這幾乎有點像我們以前用過的老說法：白板方法——讓我們從頭開始重新規劃這個特許經營體系。最後——我昨天跟一個團體談時講錯了——但北美最後建成的驼峰編組場，最後兩座，一座在喬治亞州的 Waycross，我認為那是 CSX 的核心；另一座我相信是在伊利諾伊州的 Galesburg，而我在 80 年代中期於 Burlington North 參與過它的建設。自 80 年代中期以來，市場已經改變了。交通量中屬於散裝的、屬於聯運的、屬於整列穀物、整列煤炭、原油列車的比例——這些都不需要被分類、調車。所以你要讓你的營運策略去適應市場。而我只是認為，為了推動我們在這裡需要做的一些改變，有更自然的契合度，這將帶來更多機會。因為如你所說，過去的複雜性以及簡化的能力——如果把它某種程度上套用到我的職涯來看——這個特許經營體系的潛力比我接觸過的任何一個都更大。

Okay, great. That's helpful. I appreciate it. Then the second question or the follow-up would be, CSX's approach to intermodal has been a bit different than I think what's typical. If you look at Norfolk, they have the corridor strategy. I think that would be more characteristic maybe of the Canadian roads. But CSX has this Baltimore, Ohio hub strategy and has talked about one in the southeast. Do you think that that's -- do you think that is the right approach to continue? Or do you think on the intermodal network, is there opportunity to maybe simplify and go towards more of a kind of origin to destination as opposed to sending it to the hub that you have in Baltimore, Ohio?

好的，很好。這很有幫助。謝謝你。那第二個問題或追問是，CSX 在聯運方面的做法一直有點不同於我認為的典型作法。如果你看 Norfolk，他們有走廊策略。我想那可能更像加拿大鐵路的特徵。但 CSX 有這種以巴爾的摩（俄亥俄州）為樞紐的策略，並且談到在東南部也要有一個。你認為那——你認為這是應該繼續的正確做法嗎？或者就聯運網路而言，是否有機會也許簡化，走向更偏向起點到終點的模式，而不是把貨送到你們在巴爾的摩（俄亥俄州）的樞紐？

Well, Tom, I don't want to get ahead of myself. I'm sure the people here, they had potentially a different set of strategies given what they had to work with. The operating group's challenge is to present velocity and speed and customer requirements to the marketing sales group. And then given how well that service can apply to the market, then it's Fred's team's job then to design the service to take that to the market. And I think the better product, raw product that Cindy and team can produce, the more successful and more latitude it will give Fred and company. So I think that -- I think the competition, we're going to get bigger in the rearview mirror. And they're going to be looking at the rear, and we're going to be passing them on the left.

嗯，Tom，我不想操之過急。我相信這裡的人，基於他們手上可用的條件，可能有一套不同的策略組合。營運團隊的挑戰，是把速度、時效以及客戶需求呈現給行銷銷售團隊。然後在那樣的服務能多好地對應市場之後，就輪到 Fred 的團隊去設計服務，把它推向市場。我認為 Cindy 和團隊能產出的「更好的產品」——也就是更好的原始產品——越好，Fred 和公司就會越成功、也會有更大的操作空間。所以我認為——我認為競爭對手在後視鏡裡會變得更大。他們會往後看，而我們會從左側超車。

Our next question comes from Allison Landry with Credit Suisse.

我們下一個問題來自 Credit Suisse 的 Allison Landry。

Hunter, Chicago has always been at the forefront of your mind. And historically, you've made comments that CSX used the Chicago belt and perhaps the Indiana belt for switching more than any of the other rails. So now that you're in arguably a much better seat to effect change, do you have any plans to fix Chicago? And if so, could you provide some context surrounding that?

Hunter，芝加哥一直是你心中最優先考量的議題。而且過去你曾評論，CSX 使用芝加哥環線（Chicago belt），也許還有印第安納環線（Indiana belt）來做調車，程度比其他鐵路都更高。所以現在你可以說坐在一個更有利的位置來推動改變，你有任何計畫要整頓芝加哥嗎？如果有，能否提供一些相關背景脈絡？

I don't know that I'm equipped to fix Chicago, but Chicago is a special issue. And if you noticed in a lot of our -- what we discussed and talked about, it hadn't included Chicago. Because Chicago, we have effectively carved out and are taking a different special-type look at. Chicago has some real challenges to this whole North American infrastructure. Chicago cannot survive as it's headed today. You've got lawsuits now with eminent domain, taking -- want to take rail infrastructure up to replace it with tollways. You got it right beside O'Hare, okay? Everybody wants to grow. They want to grow in Chicago, and it's not going to work. Now the plus for us is this: We own a lot of assets in Chicago, and we can be a more significant player than in positions I've been in, in the past. And only one move could change things in Chicago, and so people have to be aware of that. And I don't mean -- I'm not going to mention the term, but just the stroke of a pen of a partnership could shift a lot of traffic away from Chicago, and infrastructure and things that people think is needed for Chicago won't be needed. For example, if you look at Kansas City today, Kansas City used to be a Chicago. And we were a little late in the rail business, and we built tons of infrastructure. And now you look at Kansas City, and you don't see much rail business relative to the infrastructure. So Chicago is going to be gravy on top of this plan of what we eventually decide we're able to do with our partners and fellow owners and all the other entities that want to be part of Chicago. So it's real opportunities that we're taking a special look at.

我不確定我是否有能力修好芝加哥，但芝加哥是一個特殊議題。而且如果你注意到，我們很多——我們討論與談到的內容——其實沒有包含芝加哥。因為芝加哥我們基本上已經切割出來，並以不同的、特殊類型的角度來看待。芝加哥對整個北美基礎設施確實帶來一些真正的挑戰。照芝加哥目前的走向，它無法存續。你現在有訴訟，涉及徵收權（eminent domain），要徵收——想把鐵路基礎設施拿掉，改成收費公路。而且它就在 O'Hare 機場旁邊，對吧？每個人都想成長。他們想在芝加哥成長，但那行不通。不過對我們的好處是：我們在芝加哥擁有很多資產，因此我們可以成為比我過去所處位置更重要的參與者。而且只要一個動作就能改變芝加哥的局面，所以人們必須意識到這點。我不是指——我不會提那個詞——但只要一紙合作的簽署，就可能把大量運量從芝加哥移走，那麼人們以為芝加哥需要的基礎設施與各種建設就不再需要。例如，如果你看今天的堪薩斯市，堪薩斯市以前就像芝加哥。而我們在鐵路業稍微晚了一點，所以我們建了大量基礎設施。但現在你看堪薩斯市，相對於那些基礎設施，你看不到太多鐵路業務。所以芝加哥將會是在我們最終決定、並且看我們能與合作夥伴、共同持有人以及所有想參與芝加哥的其他實體一起做到什麼之後，這個計畫之上的額外紅利。所以這裡有真正的機會，我們正在以特殊方式深入檢視。

Okay, and when you refer to the stroke of a pen of a partnership, is that a single partnership that you have in mind? Or could it be multiple?

好的，那你提到「一紙合作的簽署」時，你心裡指的是某一個單一的合作夥伴關係嗎？還是可能是多個？

Look, I don't have anything in mind. I've got a 4-year contract. I want to go out at CSX with a green -- with a blue and gold jersey running under the goalposts, okay? If anybody wants to do something after that, it's up to them. I'm only pointing out that one of the challenges that's brought to my attention almost every time I deal with a big customer is rail consolidation, and in spite of the fact that what you might hear in public statements. We go to L.A. to a customer and talk about providing service to New York, and I'll talk to you about half of it. They don't want to hear about half of it. They want to hear about all of it. And until one entity can control movement, rail is never going to have the competitive alternative to the highway. But I'm just pointing out that for a lot of these reasons, Chicago is kind of a wildcard.

聽著，我心裡沒有任何特定想法。我有一份 4 年合約。我希望離開 CSX 時，是穿著藍金配色的球衣衝過球門柱下，好嗎？之後如果有人想做什麼，那就由他們決定。我只是指出，有一個挑戰幾乎每次我和大客戶打交道時都會被提到，那就是鐵路整併，儘管你可能在公開聲明中聽到不同說法。我們到洛杉磯去跟客戶談提供到紐約的服務，我只能跟你談其中一半。他們不想只聽一半。他們想聽全部。在有某一個實體能控制整段運輸移動之前，鐵路永遠不會成為公路的具競爭力替代方案。但我只是指出，基於很多這類原因，芝加哥有點像一張王牌變數。

Okay. And then as a follow-up question, how are you thinking about the coal network or other areas of the network that doesn't necessarily have as much density as you would like? And I know there was sort of a question earlier in this realm. But asked a little bit differently, is there any opportunity to short line any of this business? And are there any carriers or holding companies that you think would be a good fit?

好的。接著作為追問，你們如何看待煤炭網路或網路中其他密度未必如你們所希望那麼高的區域？我知道先前在這方面也有類似的問題。但換個方式問，這塊業務是否有任何機會改由短線鐵路（short line）來承接？另外，有沒有你們認為很適合的承運商或控股公司？

Look, I think that -- well, I think if you give thought to and buy into what we say we're going to do, that you don't need to think about short line or alternatives. I do think that we do domestically move coal a little bit different than I'm traditionally used to in a very disciplined, closed-loop unit train operation that can be much more efficient. You can't move unit trains, coal trains for 3 days and then park them 2 days and then run them for 3 days and then park them a while and then move them again and do it very efficiently. Now if you do that, there's a higher cost associated with it. And with higher cost maybe comes a higher price. So what we're trying to do, both with Fred and Cindy's teams both, is to create and encourage our shippers to work with us to create a more disciplined approach. And we can do it with fewer sets and fewer locomotives. And we can be more competitive for them and give them a constant supply of coal, which is what they want. And if we develop the reliability we need, then it'll all come together.

你看，我認為——嗯，我認為如果你仔細思考並認同我們所說我們將要做的事，那你就不需要去想短線鐵路或其他替代方案。我確實認為，我們在國內運煤的方式，與我傳統上習慣的做法有些不同：我們採用非常嚴謹、封閉迴圈的整列（unit train）運行模式，效率可以高得多。你不可能讓整列煤車跑3天、停放2天、再跑3天、再停一段時間、再移動，還能把它做得非常有效率。如果你那樣做，成本就會更高。而成本更高，可能就意味著價格也更高。所以我們正在做的——Fred 和 Cindy 兩個團隊都在做——是建立並鼓勵我們的託運人與我們合作，採取更有紀律的方法。這樣我們可以用更少的車組與更少的機車來完成。我們就能對他們更具競爭力，並提供他們想要的穩定煤炭供應。而如果我們建立起所需的可靠性，那一切就會水到渠成。

Our next question comes from Amit Mehrotra with Deutsche Bank.

我們的下一個問題來自德意志銀行（Deutsche Bank）的 Amit Mehrotra。

The first one is just on the operating expectations for this year. It looks like the OR target of the mid-60s implies around $800 million of year-on-year profit improvement. It just seems, by our estimate at least, that only about $300 million of that will come from revenue growth and improved fixed cost absorption, which leaves about, call it, somewhere close to $0.5 billion of absolute reduction in the cost base. So first of all, is that the type of cost takeout that you, Hunter and the team, are targeting to realize this year? And just for our own -- my own edification, how does one achieve sort of $0.5 billion of cost takeout without maybe driving a significant amount of disruption, at least in the near term?

第一個問題是關於今年的營運預期。看起來 OR（營運比率）目標在 60% 中段，意味著年對年利潤改善約 8 億美元。但至少依我們的估算，其中只有約 3 億美元會來自營收成長與固定成本吸收改善，剩下大約接近 5 億美元，應該是成本基礎的絕對下降。所以首先，這是否就是你、Hunter 以及團隊今年要實現的成本削減幅度？另外就我自己想釐清的部分，要在不造成（至少短期內）顯著干擾的情況下，如何做到大約 5 億美元的成本削減？

Amit, let me -- it's Frank. Let me take that one first and then turn it over to Hunter for additional commentary. In the targets that we gave you, one of the things that we mentioned was record productivity. Embedded within that is, obviously, the prior record of $427 million in 2016. So clearly, you can have your own estimate in terms of how much we will exceed that by. We're off to a very good start in terms of $123 million of efficiency. I think from just a line item perspective, other than fuel, you should expect us to continue to drive cost out across the board in terms of the various items there. When you look at better service, you look at better productivity, you look at the ability to absorb volume with literally no additional cost associated with that, you get huge flow-through from whatever your expectations are on the revenue side. So we're kicking on all cylinders here in terms of the volume side, the pricing side and the efficiency side. So that's what gave us the confidence to put out the targets that we did this morning. Hunter?

Amit，我先——我是 Frank。我先回答這題，然後再交給 Hunter 補充評論。在我們給你的目標中，我們提到的一件事是創紀錄的生產力。其中顯然包含了 2016 年 4.27 億美元的前一項紀錄。所以很明顯，你可以自行估算我們會超過那個數字多少。我們在效率方面已經有非常好的開局，達到 1.23 億美元。我認為從各項費用科目的角度來看，除了燃料之外，你應該預期我們會在各個項目上持續推動降本。當你看到更好的服務、更好的生產力，以及在幾乎不增加任何額外成本的情況下吸收運量的能力時，無論你對營收端的預期是什麼，都會帶來非常高的流量轉換（flow-through）。所以在運量、定價與效率三個面向，我們都在全力推進。這也是我們有信心在今天早上提出這些目標的原因。Hunter？

Yes, I mean I'd only add one example that -- which you want look at hard numbers to see how you might achieve that. Prior to my arrival, this group had already taken on some initiatives to take 1,000 positions out of this organization. Now those 1,000 positions were -- a lot of them were voluntary, and there was a severance program. And those were all, I think, if I'm accurate here, those were all management positions. That has not touched any of the people on the ground. We have put in place a hiring freeze. We're going to utilize the people internally we have. We're very sensitive to your comments of disruption and of morale. And we have attrition that is a little higher than normal. And so I think if you had to kind of put a number on it, and I haven't gotten to that kind of level yet, but I think the potential is there that sometime around the first of the year, by then, there'll probably be a similar number taken out also. Now it doesn't take many of those to take some real cost out without impacting the service or safety or anything else. These are just the different ways of doing things. We're bringing some jobs home. We have, I don't know, about 250 or 300 employees in India. Well, we're bringing those jobs back here. So there'll be some loss of some jobs, but I'm really -- to be honest with you, I can't worry about India right now. I'm more worried about CSX and Jacksonville and made in America. So there's a lot of opportunity, and I don't think it's a stretch to say if we do the job that we have the ability to do, that we can achieve all these things that we've talked about.

是的，我只想再補充一個例子——如果你想看硬數字，看看可能如何做到。在我到任之前，這個團隊就已經推動一些措施，將這個組織的 1,000 個職位裁減掉。這 1,000 個職位——其中很多是自願離職，並且有資遣方案。而且我想如果我沒記錯的話，那些全部都是管理職位。這並沒有影響到第一線現場的人員。我們已經實施凍結招募。我們會運用現有內部人力。我們對你提到的干擾與士氣問題非常敏感。而我們的自然流失率也比正常略高。所以如果你要大概估個數字——我還沒細到那個層級——但我認為潛力在那裡：大概到明年年初之前，可能也會再裁減出相近的數量。而其實不需要裁很多，就能在不影響服務、安全或其他任何事情的情況下，實質降低成本。這些只是不同的做事方式。我們也把一些工作帶回本土。我們在印度大概有 250 到 300 名人員。我們會把那些工作移回這裡。所以會有一些工作流失，但老實說，我現在無法去擔心印度。我更擔心的是 CSX、傑克遜維爾（Jacksonville），以及美國製造（made in America）。所以機會很多，我不認為這是牽強地說：如果我們把該做的工作做好，我們就有能力達成我們談到的所有這些事情。

Amit, one other point on the folks in India, they're contractors, not employees. But obviously, we're going to insource that work and really look to absorb that with the existing workforce. I know, Cindy also had some points she wanted to make here.

Amit，關於印度那邊的人員還有一點：他們是承包商，不是員工。但很明顯，我們會把那部分工作內製（insource），並且真正去看如何用現有的人力來吸收。我知道 Cindy 也有一些想補充的點。

Yes, I'll just put it in a couple of broad categories as I think about it. Hunter mentioned the reduction in management that took place last month. I think as you think about the hump yard conversions and so forth, those types of actions I would call core operations, and we expect to do more of that.

是的，我就用幾個大類別來說明我對這件事的看法。Hunter 提到了上個月發生的管理層縮減。我認為，當你去看像是驼峰調車場（hump yard）改造等等，這類行動我會稱之為核心營運（core operations），而我們預期會做得更多。

Volume absorption, we are seeing our outlook with a higher level of volume for us to move, and we think we can absorb that more efficiently than putting resources back one for one. And then I would also say some of the -- looking back at some of the improvements that were made at other railroads, as Hunter's ride of call it network efficiency, cars online, velocity, dwell, those types of things, we think we'll see improvements there. So I'd call that just network efficiencies going forward. And when you put all that together, that's what's given us our confidence to move forward with another record year.

在運量吸收方面，我們看到展望是我們要運送的運量水準更高，而我們認為可以更有效率地吸收，而不是一比一地把資源加回去。另外我也會說，回頭看其他鐵路公司曾做出的改善——用 Hunter 的說法，像是網路效率、線上車輛數（cars online）、速度（velocity）、停留時間（dwell）這些，我們認為也會看到改善。所以我會把這稱為未來的網路效率提升。而當你把這些全部加總起來，這就是讓我們有信心再往前推進、並迎來另一個創紀錄年度的原因。

Let me just ask one follow-up, if I could. Frank, on your comments about productivity, maybe I'm thinking about it incorrectly, but I feel like productivity is different than absolute reduction in the cost structure. Because productivity is, in my view, the way I understand it, you're optimizing the cost structure to maximize the incrementals, maybe minimize the decrementals. But it doesn't necessarily mean the cost structure is declining. So you guys achieved 72% incremental operating margins in the quarter, which is unbelievably great. Is there a way to understand or help us in terms of what was that with actually fixed cost absorption? What was that, actually, absolute reduction in the cost structure?

我想再追問一個問題，如果可以的話。Frank，關於你對生產力的評論，也許是我理解錯了，但我覺得生產力不同於成本結構的絕對下降。因為在我看來，生產力是——以我的理解——你是在優化成本結構，以最大化增量、也許最小化減量。但這不一定代表成本結構在下降。所以你們本季達成了72%的增量營業利益率，這好得令人難以置信。有沒有辦法幫我們理解：其中有多少其實來自固定成本吸收？又有多少其實是成本結構的絕對下降？

So when we think about productivity and how we, I'll say, keep score internally, we do look for structural cost reductions. So a big part of that record productivity is structural cost reductions, meaning, each line item in the expenses is going to get lower. Again, I'm excluding fuel just given the price environment that we're in. But we are focused on fuel efficiency as well. I think what we see from an incremental margin perspective, we're off to a very good start with about 72% incrementals for the first quarter. When you understand what we're trying to do on the cost side and you understand what the volume outlook looks like, I would estimate that the incremental margins will actually improve throughout the year, which is going to give you the bottom line flow-through of the revenue that we're bringing on.

所以當我們思考生產力以及我們如何——我會說——在內部記分時，我們確實會尋求結構性成本降低。因此，那些創紀錄的生產力很大一部分來自結構性成本降低，也就是說，費用中的每一個科目都會變得更低。再次說明，我排除燃料，因為目前所處的價格環境使然。但我們也同樣專注於燃油效率。我認為，從增量利潤率的角度來看，我們第一季以約72%的增量有了非常好的開局。當你理解我們在成本端想做什麼，也理解運量展望會是什麼樣子時，我會估計增量利潤率其實會在全年持續改善，這將使我們新增收入能更有效地流入到底線。

That's great. Hunter, one last one for me, if I could. Could you just comment on your relationship with the union so far? I mean you have -- the company has over 20,000 union employees. Can you just talk about those initial meetings and conversations and just in the context of all the operational changes to come? That's it for me.

太好了。Hunter，如果可以的話，我最後再問一個。你能否評論一下你到目前為止與工會的關係？我的意思是，你們——公司有超過20,000名工會員工。你能否談談那些初期會面與對話，以及在未來所有營運變革將要到來的背景下，這些互動是怎麼樣的？我就問到這裡。

Well, I hope it's pretty good. I've worked most of my career, the first 4 years, alongside of these various roads that now make up CSX. I know some of the leadership. I've had some -- I'm being careful what I say here. I've had some very fascinating conversations, exploring opportunities with those individuals. Now look, it's not real common for a new CEO to come in, and I don't care what your last name is, and the labor leaders to be bringing in a brass band and red carpet welcoming you to town. That's just not their style, and I recognize and understand that. But at the same time, I think, for example, to be approached, unofficially at least, to conversations about potentially doing something like an hourly agreement that's been extended and that is on part of the U.S. system on the -- now the Canadian National that we developed, it's very encouraging to say that we would even enter a dialogue like that. And one of the things -- the beauty of that would be a couple things that people should think about: One, those agreements guarantee people positions. That's important today, people that can have a job and have a job guarantee. That's very important and people -- and at the same time for us, it lowers our -- potentially our T&E, train and engine room cost 30%, 35%. So look, we're going to have some squabbles. They don't like to see their people disrupted, nor do I, but you got to do what you got to do sometimes. And so there'll be some -- I'm sure there'll be some negative comments that all I care about is the bottom line or profit or what. But I hope that's not true. We're very sensitive to the employees and the part they play in this. And so I think we'll do fine with labor.

嗯，我希望相當不錯。我職涯的大部分時間——前4年——都在這些如今組成CSX的各條鐵路旁工作。我認識一些領導層。我有過一些——我在這裡得小心措辭。我和那些人進行過一些非常耐人尋味的對話，探討合作機會。現在你看，新任CEO上任並不常見——不管你姓什麼——勞方領袖會帶著銅管樂隊、鋪紅地毯歡迎你進城。那不是他們的風格，我也理解並明白這點。但同時，例如，至少在非正式層面，有人主動來談，是否可能推動類似「按時計薪協議」那樣的安排——這種協議已被延伸，並在美國系統的一部分、也就是我們在如今的加拿大國家鐵路（Canadian National）所建立的那套——這非常令人鼓舞，因為這表示我們甚至願意進入那樣的對話。而其中一個——那種安排的美妙之處在於，有幾點值得大家思考：第一，那些協議能保障員工的職位。這在今天很重要，能有工作、而且有工作保障，非常重要。同時，對我們而言，它可能讓我們的——可能讓我們的T&E（列車與機務段）成本降低30%、35%。所以你看，我們會有一些爭執。他們不喜歡看到他們的人被打亂，我也不喜歡，但有時候你必須做你必須做的事。因此會有一些——我相信會有一些負面評論，說我只在乎底線或利潤之類的。但我希望那不是真的。我們對員工以及他們在其中扮演的角色非常敏感。所以我認為我們和勞方會合作得很好。

Our next question comes from Ravi Shanker with Morgan Stanley.

下一個問題來自摩根士丹利（Morgan Stanley）的Ravi Shanker。

Thanks, good morning, everyone. Hunter, just to summarize or tie up everything you've said on the call so far, in terms of playbooks, the precision railroading playbook that you've so effectively deployed several times before at other railroads, do you think that's kind of directly applicable to CSX here? Or do you think the complexity of the network here involves changes to the way it's been done before? And also, CSX has in recent years had a playbook of deemphasizing coal and becoming more of an intermodal rail. Do you agree with that? And do you think that kind of becomes part of your playbook as well?

謝謝，大家早安。Hunter，為了總結或把你到目前為止在電話會議上所說的串起來，關於作戰手冊（playbooks）——你在其他鐵路公司多次非常有效地部署過的精準鐵路營運（precision railroading）作戰手冊——你認為這套在CSX這裡也能直接適用嗎？還是你認為這裡的路網複雜度，會需要改變以往的做法？另外，CSX近年來的作戰手冊是淡化煤炭、轉型成更偏向聯運（intermodal）的鐵路。你同意這個方向嗎？你認為這也會成為你作戰手冊的一部分嗎？

Well, question one, yes, it applies. Look, I think one of the things that people miss is the more complexity there is to the network, the better models you can apply to it, you could take more advantage of the opportunity. If you've just got a linear, straight-line railroad that goes from A to B, a lot of people can design a model for that. So yes, this has certainly those implications.

嗯，第一個問題，是的，適用。你看，我認為人們常忽略的一點是：路網越複雜，你越能套用更好的模型，也就越能把握機會、發揮優勢。如果你只有一條線性的、筆直的鐵路，從A到B，很多人都能為那樣的情況設計模型。所以是的，這裡當然具備那些意涵。

Now strategically going down the line as far as -- look, I think the -- if you're looking 3 years out or 5 years out or 10 years out, it's a lot different. Look, we need to understand that the world is going to continue to change on us, and we need to be flexible and to have a plan that allows us to change with those changes, okay? And we have things going on as we speak, okay, from an energy standpoint. What's the future of fossil fuel? What's the future of crude? How much influence are the environmentalists going to have? What's the net going to do with the way freight -- you go out here in Jacksonville, you drive by this huge warehouse of Amazon. And so the supply chain is going to change, and we have to be -- it's not going to be some of the game that I've played before, the traditional intermodal, coal, merchandise. We have to be more flexible and more creative to be able to deal with those changes in the world.

至於策略上往後看——你看，我認為——如果你看的是3年後、5年後或10年後，那就很不一樣。我們必須理解，世界會持續改變，而我們需要保持彈性，並且要有一個能讓我們隨著這些變化而調整的計畫，好嗎？而且我們此刻就有一些事情正在發生，好嗎，從能源的角度來看。化石燃料的未來是什麼？原油的未來是什麼？環保人士會有多大的影響力？網路（the net）會如何改變貨運的方式——你到傑克遜維爾這裡，開車經過亞馬遜那座巨大的倉庫。因此供應鏈將會改變，而我們必須——這不會是我以前玩過的那種傳統遊戲：傳統聯運、煤炭、一般貨運（merchandise）。我們必須更有彈性、更有創意，才能應對世界的這些變化。

Yes, to echo on Hunter's point. I mean, we haven't deemphasized coal at CSX. Coal has been deemphasized by the utilities, and so we want as much business as we can, whether it's coal, intermodal, or anything else. But we will deploy our strategies where we can capture the growth and create bottom line value for CSX through excellent service for our customers.

是的，我呼應Hunter的觀點。我的意思是，我們在CSX並沒有淡化煤炭。煤炭是被公用事業（電力公司）淡化的，因此我們希望能拿到盡可能多的業務，不論是煤炭、聯運或其他任何業務。但我們會在能夠抓住成長的地方部署我們的策略，並透過為客戶提供卓越服務，為CSX創造底線價值。

Got it. And your vision of intermodal, is this largely -- I know you spoke about service initiatives a little earlier on the call, but is it largely a case of improving the service levels and getting to a point where it becomes super competitive versus truck? Or are you looking for more demand improvements from macro or kind of being able to take price in segments? And between service and demand and price, kind of which do you think is the most important lever for intermodal?

了解。那你對聯運的願景是什麼？這主要是——我知道你稍早在電話會議上談到一些服務改善措施——主要是提升服務水準，讓它在與卡車競爭時變得非常有競爭力嗎？還是你在期待更多來自總體環境的需求改善，或是在某些區隔具備提價能力？在服務、需求與價格之間，你認為哪一個是聯運最重要的槓桿？

I don't know that you're -- look, the market would have you believe, to begin with, that it's price, okay? We are not going to sit here and let our precious service become a commodity. And so the better we create in service, velocity -- and I would hasten to add this: When just in time and intermodal get real hot, if you look back and do a little history lesson, you'd see that prime then was knocking on 20%. The interest rates aren't there today. [You got] interest rates, and they're going back up. I predict that, okay. I just can't tell you when, but they're going back up. And when they do, people that move merchandise will be rewarded because carrying costs are going to go up. The beauty is this: The quicker we move it, the cheaper it is. And so it grows on itself. And so we turn the equipment quicker, we give better service to the customer, and we got lower cost and then we can be more competitive, and it all fits in this model.

我不知道你們是不是——你看，市場一開始會讓你相信那是價格，對吧？我們不會坐在這裡，任由我們珍貴的服務變成大宗商品。所以我們把服務做得更好、提升周轉速度——我還要趕緊補充這點：當「即時制」和「聯運」變得非常熱門時，如果你回頭做一點歷史回顧，你會看到當時的最優惠利率（prime）接近20%。今天的利率水準不是那樣。[你有]利率，而且它們正在回升。我預測會這樣，好嗎。我只是沒辦法告訴你什麼時候，但它們會回升。而當它們回升時，搬運商品的人會得到回報，因為持有成本會上升。美妙之處在於：我們移動得越快，成本就越低。因此它會自我強化。所以我們更快周轉設備、給客戶更好的服務、成本更低，然後我們就能更具競爭力，而這一切都符合這個模型。

Our next question comes from Ken Hoexter with Merrill Lynch.

下一個問題來自美林（Merrill Lynch）的Ken Hoexter。

Hunter, you sound well. I look forward to your tenure at CSX. You noted you're going to be an advocate for customers in your internal remarks. Is that a change in how you're going to attack the plan? I mean, after you've left, obviously, we heard Keith talk about fixing ruffled feathers, and Claude launch a customer focus. So sounds like you may start this with a little bit of a different tact. Maybe you can just talk about that a bit.

Hunter，你聽起來狀態很好。我期待你在CSX的任期。你提到你會在內部談話中成為客戶的倡議者。這是否代表你推動計畫的方式會有改變？我的意思是，你離開之後，很明顯我們聽到Keith談到要修補受損的關係，Claude也啟動了以客戶為中心的做法。所以聽起來你可能會用稍微不同的策略來開始。也許你可以談談這點。

Well, I'm going to talk to Claude and Keith later on today, okay? We'll mentor them a little bit, okay? But look, I've -- my whole career, in fact, one of the reasons why I'm sitting here was I happened to be an operating guy that thought we ought to provide good service to the customer, okay? Now I got a little bad reputation in Canada because I asked people to pay their bills, and that wasn't the thing to do in the crown court. But look, there's no one more sensitive than I am and more appreciative than I am of the business that our customers give us, okay? I am the greatest advocate in the world, and I wish you could sit in some of our meetings when we talk about service and when we talk about car delays. Because that's not just about car delay, it's about creating pain and suffering for our customer, which I don't want to see created, okay? And I can't get anybody to give me one example of a customer, except during a turnover period just -- where we're going through a transition, that's had any problem or issues from a systemic standpoint that says, "We've got service problems," okay? It doesn't exist, okay? So I'm going to do a little coaching to a couple of my former sidekicks and see what their comments are. And I can anticipate right now the response: misquoted.

嗯，我今天晚些時候會跟Claude和Keith談談，好嗎？我們會稍微指導他們一下，好嗎？但你看，我——我整個職涯，其實我之所以坐在這裡，其中一個原因是：我剛好是個營運出身的人，認為我們應該提供客戶良好的服務，好嗎？我在加拿大名聲有點不好，因為我要求大家把帳單付清，而在王室法院那不是大家想做的事。但你看，沒有人比我更敏感、也更感激客戶帶給我們的業務，好嗎？我是全世界最強的倡議者；我希望你能坐在我們某些會議裡，聽我們談服務、談車輛延誤。因為那不只是車輛延誤而已，那是在為客戶製造痛苦與折磨，而我不希望看到這種情況發生，好嗎？而且除了在交接期間——就是我們正在過渡的時候——我找不到任何一個客戶的例子，從系統性角度來說曾有任何問題或議題，說「我們有服務問題」，好嗎？那不存在，好嗎？所以我會對我以前的幾個老搭檔做點教練式的溝通，看看他們怎麼說。而我現在就可以預期回應：被誤引了。

Let me just revisit something you talked about on the unions. Because the U.S., it seems like historically, have been a little bit different, right, in terms of all the rails kind of negotiating in one team against kind of the -- all the unions in one group. You've always had things maybe a bit differently in Canada. Can you -- is that something you think you need to shift how you address that as you move forward?

我想再回到你談到工會的那件事。因為在美國，歷史上看起來有點不同，對吧？就好像所有鐵路公司作為一個團隊談判，對上——所有工會作為一個團體。而在加拿大，你一向可能是比較不同的做法。你能不能——你覺得在往前走的過程中，你需要調整你處理這件事的方式嗎？

Well, I think it's something we're going to look at. If you look back at parts of when I was at Canadian National, the parts of the U.S. operation that we had when we had Illinois Central, we were not part of "national handling". So we negotiated our labor agreements on our own. And that's not to say that we're going to do that now. It's -- we're going to have some dialogue. It appears to me, and I haven't had a chance to visit with some of my colleagues about this, but it appears to me that some of the big 6, if you will, or 7 Class Is see the world a little differently. And if they start to see the world differently and they're not all on one page, I'm not so sure that makes a lot of sense to have this one big carriers' conference negotiating for us. I would much prefer, I think, us to sit down with our employees and do what's the best for the CSX organization and CSX employees. So I think that all those things that deal with policies and coalitions and all, we'll take a look at it and see how others see the world and how we see it going forward and what's the most appropriate action for us to take.

嗯，我認為這是我們會去檢視的事情。如果你回頭看我在加拿大國家鐵路（Canadian National）任內的一些時期，我們在美國的那部分營運——當我們擁有Illinois Central時——我們並不屬於「全國統一處理」（national handling）。所以我們是自行談判我們的勞動協議。這並不是說我們現在也會這麼做。只是——我們會進行一些對話。在我看來，而且我還沒機會跟一些同業同事聊這件事，但在我看來，所謂六大（big 6）或七家一級鐵路（7 Class Is）對世界的看法有些不同。如果他們開始用不同方式看世界、彼此不在同一頁上，我不太確定還讓這個大型承運人協會替我們談判是否有太大意義。我更希望——我想——我們能坐下來和我們的員工一起，做對CSX組織與CSX員工最好的事。所以我想，所有涉及政策、聯盟等等的事情，我們都會檢視一下，看看別人怎麼看世界、我們未來怎麼看，以及對我們而言最適當的行動是什麼。

Our next question comes from Brandon Oglenski with Barclays.

下一個問題來自巴克萊（Barclays）的Brandon Oglenski。

And Hunter, definitely welcome back. I know there's a lot of investors excited to see you back in the seat, too.

Hunter，真的歡迎你回來。我知道也有很多投資人很期待看到你回到這個位置上。

Thanks, buddy.

謝了，老兄。

So surprisingly, though, it just keeps coming back, we hear it a lot, that length of haul and the shorter length of haul in the East Coast just means that the return on invested capital or the margin potential is not as high as some of your predecessor railroads or some of the stuff going out out west in the U.S. Can you just talk to that dynamic and whether or not you think length of haul plays a lot of determination in the ultimate profitability of the network?

不過很意外地，這個話題一直被提起，我們常常聽到：在東岸，運距（length of haul）較短、以及較短運距的特性，意味著投入資本報酬率（ROIC）或利潤率的上限，不如你的一些前任鐵路公司，或美國西部那邊的一些業務那麼高。你能不能談談這個動態？以及你是否認為運距在決定整個網路最終獲利能力方面扮演很大的角色？

Well, longer length of haul is better than short. But if you only have short, you got to deal with short. The markets are the markets. We don't get a chance to make the market. I know this: The more productive we are, the better we are at, "controlling costs," not cutting and slashing -- the operative word is controlling costs -- will put us in a position that says -- people used to say if you weren't hauling intermodal 800 miles plus, you couldn't make $1. Well, that's not true. If your operating ratio is 90, it's true. If you're operating ratio is 58, it's wrong. So it's -- I don't really focus necessarily on the long and the short. It's the bottom line margin that we can make on all the business and what -- I don't think we set the price out there. The market sets the price. We decide whether we want to play or not. And if we keep ourselves competitive with the market, we'll do fine, both with long and short haul.

嗯，長運距比短運距好。但如果你只有短運距，你就得面對短運距。市場就是市場。我們沒有機會去創造市場。我知道的是：我們越有生產力、越擅長「控制成本」——不是砍到見骨——關鍵字是控制成本——就越能讓我們處在一個位置：以前人們常說，如果聯運運距不到800英里以上，你就賺不到1美元。嗯，那不是真的。如果你的營運比率（operating ratio）是90，那就是真的。如果你的營運比率是58，那就不對了。所以——我不會特別把焦點放在長或短。而是我們在所有業務上能做出的最終利潤率，以及——我不認為是我們在外面訂價格。是市場在訂價格。我們決定要不要參與。只要我們讓自己在市場上保持競爭力，不管長運距或短運距，我們都會做得很好。

And if I could follow up kind of off of that question, maybe what Ken was asking as well, just there's some fear that as you go through these operational changes and focus more on service that maybe some of your customers are disrupted from the way business was done in the past. Is there potential here that you see some share shift as you go through this transition period? Or do you think as service improves, you could actually improve top line at the same time?

如果我可以就這個問題再追問一下，也有點呼應 Ken 剛才問的，就是有人擔心當你們推動這些營運變革、並把重心更放在服務上時，可能會讓部分客戶相較於過去的做法而受到干擾。在你們度過這段轉型期的過程中，你們是否看到市占可能出現移轉的風險？或者你認為隨著服務改善，你們其實也能同時帶動營收成長？

Yes, that's the story. That's why you provide good service, selfishly, okay. It starts with your product. If you don't have a product, you don't have anything. So we start with a product. And the better we make that product, the more we can extract the value out of it, both in market share and what I refer to as quality revenue. So this is not a "one side of the ledger" game. This is revenue up and costs down and investors get rewarded. And it's fun, okay.

是的，這就是重點。這也是你提供優質服務的原因，坦白說，是為了自己，好嗎。一切從你的產品開始。如果你沒有產品，你就什麼都沒有。所以我們從產品做起。而我們把產品做得越好，就越能把它的價值釋放出來，無論是在市占，或是我所說的「高品質營收」。所以這不是「資產負債表的一邊」的遊戲。這是營收上升、成本下降，投資人就會得到回報。而且這很有趣，好嗎。

Our next question comes from Scott Group with Wolfe Research.

下一個問題來自 Wolfe Research 的 Scott Group。

So maybe, Fredrik, can you isolate the strength in export pricing from the mix benefit of losing the short-haul business? I'm just trying to understand which had a bigger impact on coal yields in the quarter. And then can you just kind of confirm if the guidance for the year assumes kind of export pricing stays where it is or that it does come down in the back half of the year? And then bigger picture on coal, maybe for you, Hunter, I mean, we can see this quarter how profitable the coal franchise is. If we kind of assume that coal resumes its secular decline the next couple of years, do you think that maybe could impact the ability to get to a sub-60% OR in a couple of years?

所以也許，Fredrik，你能否把出口定價的強勁表現，與失去短途業務所帶來的組合效益區分開來？我只是想了解，這一季煤炭單位收益（yield）的變動，哪一個影響更大。另外，你能否確認一下，全年指引是否假設出口價格維持在目前水準，或是下半年會回落？再從更宏觀的煤炭角度來看，可能問你，Hunter——我們可以看到這一季煤炭業務的獲利能力很強。如果我們假設未來幾年煤炭延續其長期結構性下滑，你認為這是否可能影響到兩三年後把營業比率（OR）降到 60% 以下的能力？

So let me take the first part of your question first. I would say that the majority of the coal RPU change was favorable mix. We had favorable mix, on one hand, that some of that short-haul traffic obviously went away, which was short-haul and marginal. But also we saw more replenishment of utilities in the south versus last year where, if you recall, natural gas prices were tremendously low for a period of time. And then also on the export side, we saw additional traffic going into Virginia, which is generally a little bit of (inaudible) there but is a little bit longer length of haul. So we had a couple of things that was favorable from a mix perspective that certainly helped. So that was the majority of the driver that we saw. And then I'll turn the question about the coal franchise to Hunter.

我先回答你問題的第一部分。我會說，煤炭每車收入（RPU）的變動，大多數來自有利的組合。一方面，我們的組合變得更有利，因為部分短途運量顯然消失了，而那是短途且邊際貢獻較低的業務。但同時，我們也看到南部公用事業的補庫需求增加；相較之下，去年如你所記得的，天然氣價格在一段時間內非常低。另外在出口端，我們看到更多運量流向維吉尼亞，通常那邊有一點（聽不清楚），但運距會稍微更長一些。所以從組合角度來看，有幾個因素都偏正面，確實帶來幫助。因此這是我們看到的主要驅動因素。接著關於煤炭業務的問題，我把它交給 Hunter。

Look, my numbers, my analysis as a short-timer, it doesn't include some big rebound on coal. If coal comes back stronger than anticipated, it's gravy. Will it change any of these numbers? I don't think so. If you looked at the last story, we had the same thing, except it was crude oil. And you still get to the numbers. I think that group has done an excellent job and they continue to do it. I think they bounded through 60%, and I don't know what their last quarter was, but it started with a 5, it was 58%. So no, I don't think that -- I've said longer term, it almost ran me out of Western Canada, that fossil fuels are dead in my view. I've said it and I can't retract it. I just think longer term, coal is not something that rails should depend on. Now it's going to take a while to transition out. It's not going to happen overnight. And we might see another 10, 15 years. But longer term, I don't think that fuel -- I mean, coal is going to be the energy source of the future.

你看，以我這個「短期任職者」的數字與分析來說，並沒有把煤炭的大幅反彈納入假設。如果煤炭回升得比預期更強，那就是額外的好處。它會改變這些數字嗎？我不這麼認為。如果你回頭看上一個案例，我們遇到的是同樣的情況，只是當時是原油。你仍然能達到那些數字。我認為那個團隊做得非常出色，而且他們會持續這麼做。我想他們已經突破 60% 了，我不知道他們上一季是多少，但開頭是 5，是 58%。所以不，我不認為——我長期以來一直說，這句話差點讓我在加拿大西部待不下去：在我看來，化石燃料已經走向終結。我說過了，也收不回來。我只是認為從長期來看，煤炭不是鐵路應該依賴的東西。當然，轉型退出需要時間。不會一夕之間發生。我們可能還會再看到 10 年、15 年。但長期來看，我不認為燃料——我是說，煤炭——會是未來的能源來源。

Okay. And just that part about coal pricing assumed in the guidance in the back half?

好的。那關於指引中下半年所假設的煤炭定價那一部分呢？

Well, overall, we feel on the export side that we follow the indexes that are out there, a variety of them. And as you can see in the forward curve currently, that is coming down as we move through the second half of the year, and then certainly, then our expectations as well. But we'll ultimately see where the market ends up.

嗯，整體而言，在出口端我們是跟隨市場上各種指數，有好幾種。而如你目前在遠期曲線上所看到的，隨著我們進入下半年，價格確實在走低，當然這也符合我們的預期。但最終還是要看市場最後會落在哪裡。

Okay. And then just, Hunter, since this is your first call, there's a couple of things that I want to address. There's some people that presume that ultimately M&A is part of the strategy, and maybe you can talk about that. And then also in some of your past rails, you've brought some people on in terms of the team. Should we be expecting something similar here?

好的。另外，Hunter，既然這是你第一次電話會議，有幾件事我想談一下。有些人推測，最終併購（M&A）會是策略的一部分，也許你可以談談這點。還有，在你過去任職的鐵路公司，你曾在團隊方面引進一些人。我們是否也應該預期在這裡會有類似的動作？

Well, look, I don't know what I can say, but I would emphasize and emphasize this, okay? M&A has nothing to do with the strategy of me being here at all, okay? And one thing I take great pride in is my integrity, okay? I'm telling you, there's no such plan. I don't have time. Look, I've got 4 years. It's not going to happen in my tenure to have anything to do with me. Number two, my MO is I like to play with the hand I'm dealt, okay? And we've got a good hand here. Now do we have a couple of missing cards in a fixed 2-card deck? Maybe. But we're looking internally. In fact, I was here late last night talking about some people, and going through, and I'm not sure that we've taken advantage of all of the internal talent that we have here. But if we hit a void, that we have a void here that we need, then we always have the ability to go externally. Is there anybody who wants to get into the workforce? The list is long, okay? And we don't have any restrictions about who can leave and you can't go here, you can't go there. We're free agents. So if people don't want to work here, they can leave, okay? In fact, if they want to go to some other railroad, let them go, okay? But we've got -- we will not have a short of talent or resources to be able to operate this railroad like we've described.

嗯，你看，我不知道我能說到什麼程度，但我要強調、再強調一次，好嗎？併購（M&A）跟我來到這裡的策略完全沒有關係，好嗎？而我非常引以為傲的一點就是我的誠信，好嗎？我告訴你，沒有這樣的計畫。我沒有時間。你看，我只有 4 年。在我的任期內，不會發生任何與我有關的這類事情。第二，我的做事方式是：我喜歡用手上拿到的牌來打，好嗎？而我們在這裡拿到的是一手好牌。那在一副固定的兩張牌的牌組裡，我們是不是少了幾張牌？也許。但我們會先從內部找。事實上，我昨晚很晚還在這裡談一些人選、逐一檢視，我不確定我們是否已經充分運用這裡所有的內部人才。但如果我們遇到缺口——也就是我們確實需要某項能力的缺口——那我們一向也有能力向外部延攬。有人想進入勞動市場嗎？名單很長，好嗎？而且我們不會限制誰可以離開、你不能去這裡、不能去那裡。我們是自由球員。所以如果有人不想在這裡工作，他們可以離開，好嗎？事實上，如果他們想去其他鐵路公司，就讓他們去，好嗎？但我們——我們不會缺乏人才或資源，來把這條鐵路按照我們所描述的方式營運起來。

Our next question comes from Jeff Kauffman with Aegis Capital.

我們的下一個問題來自 Aegis Capital 的 Jeff Kauffman。

Welcome back, Hunter. Good to have you back, Hunter. My question has been asked 6 ways to Sunday how CSX differs from some other rails you've been at. But what I'd like to know is at CP, there needed to be a capital investment in sidings and some other portions of the rail to achieve the things you wanted to achieve. At CN, it was a different investment. Can you talk a little bit, not so much about multiple yards because we've been built for acquisition, but talk about the capital plan at CSX? And is there investment that needs to occur for what you need to do and kind of how we think about that strategically?

歡迎回來，Hunter。很高興你回來，Hunter。我的問題已經被用各種方式問過了：CSX 與你待過的其他一些鐵路公司有何不同。但我想了解的是，在 CP，為了達成你想要達成的目標，需要在會車線（sidings）以及鐵路的其他部分進行資本投資。在 CN，則是不同的投資。你能否談談 CSX 的資本計畫？不必太著重於多個編組場，因為我們一直是為了併購而建置的；但請談談 CSX 的資本計畫。以及為了你需要做的事情，是否必須進行投資，還有我們在策略上該如何思考？

Well, overall, just to look at it without starting to break it down, I think it's clear to me that the capital investment will come down over time. There's been a good deal spent the last few years, if I looked at kind of the graph. If you take a look at just what's been spent the last few years on locomotives, you would say, "We're not going to have to do that for a while." If we've got 550, 600 locomotives stored, and I can know one of our previous experiences there, that we went through similar numbers. And we said, "Well, maybe we can take a couple-year holiday for locomotives," and we did. And I think they're on their fifth year holiday. So do you say, "Well, we don't have to spend anything on locomotives generally for 4 or 5 years"? Clearly, a lot of the replacements that were an issue with the hump yards are not there. Clearly, if we have sidings that are too short with the longer trains, we're certainly not going to leave those sitting in the ground and not being utilized. So we'll pick up 1 6,500-foot siding and put it 15 miles down the railroad and put it with another 6,500. And then we've got a 13,000-foot siding and the only thing we've capitalized is effectively the labor. We don't have to capitalize the rail but once. And so there's some ways to save capital. And another issue that people overlook is this: The better productivity you have with capital, the more you can put in. The higher productive your yard, you take $100 and you can put in more ties with the $100 being productive. So there's a productivity factor to the capital. So I think, Jeff, overall, I'm not -- well, I'm a little embarrassed that the numbers don't jump. But I think my numbers were that over the 3- or 4-year period, we can see $500 million or $600 million reductions in the capital spend. And then there will be a point where it will potentially trend back up. And if we don't have something else like PTC come along with all the brains in Washington to help us with our capital spend -- and I'm not a big advocate of 7% of revenue. I wish it worked that way, it doesn't. When ties were out, ties were out, whatever the revenue is. But I think, overall, to answer your question, there will be some positive for free cash flow out of the reduction in capital.

整體而言，如果先不拆解細項、只從大方向來看，我很清楚資本投資會隨時間下降。過去幾年花了不少錢，如果我看那張趨勢圖的話。如果你只看過去幾年在機車頭上的支出，你會說：「我們暫時不需要再做這件事。」如果我們有 550、600 台機車頭封存，而我也知道我們之前有過類似的經驗，當時也有相近的數字。我們說：「那也許我們可以讓機車頭支出休假兩年」，而我們確實這麼做了。我想他們現在已經休假到第五年了。所以你會說：「那我們一般在機車頭上 4 到 5 年都不用花錢」嗎？很明顯，過去在驼峰編組場（hump yards）所面臨的許多汰換問題已經不存在了。也很明顯，如果因為列車變長而導致某些會車線太短，我們當然不會讓那些資產就這樣躺在地上不被利用。所以我們會把一段 6,500 英尺的會車線拆起來，往鐵路線下游 15 英里移動，與另一段 6,500 英尺的會車線接在一起。這樣我們就有一段 13,000 英尺的會車線，而我們資本化的其實只有人力成本。鋼軌不需要重複資本化。因此有一些方法可以節省資本。另外一個大家常忽略的點是：你的資本生產力越好，你就越能投入更多資本。編組場的生產力越高，你拿 100 美元，就能因為這 100 美元更有效率而鋪設更多枕木（ties）。所以資本本身也有生產力因素。所以 Jeff，我想整體而言，我不是——嗯，我有點尷尬，因為數字沒有那麼直觀地跳出來。但我記得我的數字是，在 3 到 4 年期間，我們可以看到資本支出減少 5 億到 6 億美元。然後會有一個時間點，可能又會開始回升。如果沒有像 PTC 這類事情出現——以及華盛頓那些「聰明人」來幫我們增加資本支出——而且我也不是「營收的 7%」這種說法的強烈支持者。我希望事情能那樣運作，但事實不是。枕木該換的時候就得換，不管營收是多少。但我想整體來回答你的問題：資本支出下降將對自由現金流帶來一些正面貢獻。

Our next question comes from David Vernon with Bernstein.

我們的下一個問題來自 Bernstein 的 David Vernon。

Hunter, maybe just a quick question for you on the presence of the shared asset areas, the old legacy, the Conrail acquisition. Does that sort of joint operations in some of those bigger eastern metros create any challenges or opportunities for you when you think about implementing that precision railroading model into CSX?

Hunter，想請你快速談一下共享資產區（shared asset areas）的存在，也就是過去的歷史遺產、Conrail 併購所留下的部分。當你思考要在 CSX 導入精準鐵路（precision railroading）模式時，那種在一些較大的東部都會區進行聯合營運，是否會帶來任何挑戰或機會？

You know what, I'm going to have to defer to Cindy there. I don't -- I have not spent in my first 30 days a lot of time in that area. And I'm limited on my knowledge there. And I don't want to try to baffle you with a story that I don't know a lot of about. So Cindy, if you've got any comments there...

你知道嗎，這題我得請 Cindy 來回答。我——在我上任的前 30 天，沒有在那個領域花太多時間。我對那部分的了解也有限。我不想用我其實不太了解的事情編個故事來糊弄你。所以 Cindy，如果你有任何看法……

Yes, David, I think we're always looking for efficiencies where we hand off cars, whether it's for the jointly owned facility known as Conrail or IHB in Chicago. And there's nothing that really jumps off the page. But as we've said many, many times, everything is on the table. If we can find opportunities, we will certainly take advantage of them.

是的，David，我想我們一直在尋找在交接車輛時的效率提升，不論是在共同持有的設施（也就是 Conrail），或是在芝加哥的 IHB。目前沒有什麼特別顯眼、讓人一看就覺得是重大問題的地方。但正如我們一再說過的，一切都可以討論。如果我們能找到機會，當然會加以利用。

But would you think there are any sort of constraints because you're tied to a schedule that maybe the Conrail is serving for -- that meets both your and Norfolk's needs and it's harder to change? Or is that just something that's probably not an issue?

但你會不會覺得有任何限制，因為你們被綁在某個時刻表上——也許是 Conrail 為了同時滿足你們與 Norfolk 的需求而提供的——因此更難去改變？還是說那大概不是問題？

That's really not an issue. It's in all of our best interest to serve our customer better. And they just simply supply the last-mile service and do a very good job of it. And we work very closely together on making sure that's efficient and effective for our customers.

那真的不是問題。把客戶服務得更好，符合我們所有人的最大利益。而他們只是提供最後一哩（last-mile）的服務，而且做得非常好。我們彼此合作非常緊密，確保對客戶而言既有效率又有效果。

Okay. And Fredrik, maybe just as a quick follow-up, when we look at that same-store sales pricing, I heard your comments on mix in coal. And I think what I've heard is we should expect that to continue to happen. But I think in the intermodal merchandise, the deceleration in the core price, is that something that we should also expect to kind of happen here? Or are we starting to see some signs of improvement in that domestic intermodal market that would help kind of shore up that number?

好的。Fredrik，再追問一下，當我們看同店銷售（same-store sales）的定價時，我聽到你對煤炭組合（mix）的評論。我理解到的是，我們應該預期這種情況會持續發生。但我想問的是，在聯運與一般貨運（intermodal merchandise）方面，核心價格的放緩，這是否也是我們應該預期會在這裡發生的情況？或者我們是否開始看到一些國內聯運市場改善的跡象，能夠在某種程度上支撐那個數字？

Well, yes, listen, just to clarify also, and I'm not sure that's where you were going with the question, the mix is obviously out of the same-store sale number, which is why we're doing it. Second, once again, we don't forecast price. But I think it's clear that we've been in a place over the last few years where there's been a fair amount of excess capacity in the marketplace. And all our customers, as Hunter alluded to before, have alternatives, so we've got to price to market. The key thing is as I look forward now between what I think you guys write a lot about, which is there's a structural change coming in the truckload market with some of the ELD implementations and the shortage of drivers and hopefully getting to a better place from a capacity perspective, and couple that with what we were doing with this operating model, where I already see a significantly improved service, I think there's an opportunity as we move into '18 to really capitalize on that. So we feel good about where we are. We price to market each and every day. And as we move forward, we will do the same.

嗯，是的，聽我先澄清一下，而且我不確定你的問題是否是指這個方向：組合（mix）顯然已經被排除在同店銷售數字之外，這也是我們這麼做的原因。第二，再說一次，我們不做價格預測。但很明顯，過去幾年市場上存在相當程度的過剩運能。而我們所有客戶——如同 Hunter 先前提到的——都有替代方案，所以我們必須依市場定價。關鍵在於，往前看，我認為你們也寫了很多：卡車整車（truckload）市場將出現結構性變化，包含部分 ELD 的導入、司機短缺，以及希望在運能面能走向更好的狀態；再加上我們在這個營運模式上所做的事情，我已經看到服務顯著改善，我認為當我們進入 2018 年時，有機會真正把握並變現這些優勢。所以我們對目前的狀況感到樂觀。我們每天都依市場定價。而往前走，我們也會一樣做。

But as we think about rail right now, are we starting to see things kind of improve sequentially? Or are we still kind of in a soft patch on the domestic market?

但當我們現在來看鐵路業時，我們是否開始看到情況在環比上有所改善？還是說國內市場仍然處於一段疲弱期？

I see some opportunities on the spot market side that I follow closely, where things to be seem to be moving in the right direction. I do think that obviously if you see some of the -- and you follow this more than I do, on the trucking side that there's some challenges out there. But I see that the light is coming closer at the end of the tunnel. And supply and demand should be getting to a better place as we move through the second half of the year and into '18.

在我密切關注的現貨市場那一端，我看到一些機會，情況似乎正朝著正確的方向發展。我確實認為，顯然如果你看看一些——而且你比我更關注——卡車運輸那邊，外面確實有一些挑戰。但我看到隧道盡頭的光正越來越近。隨著我們走過今年下半年並進入 2018 年，供需應該會到達一個更好的狀態。

Our next question comes from Bascome Majors with Susquehanna Financial Group.

下一個問題來自 Susquehanna Financial Group 的 Bascome Majors。

Just real quickly on the attrition rate, can you guys help quantify that for us, whether in percentage terms or the number of people per year?

關於流失率，能否請你們很快幫我們量化一下，是用百分比或每年的人數都可以？

I think they were working on some numbers for me. And let me clarify something that I'm trying to -- we all have kind of semantically different types of explanations for -- I'm talking about contractors, consultants, employees, all of the above, everybody that gets a check, okay? I think, and I'll correct this if I'm wrong, that the attrition is going to come in at about a 9% level range, 8.5% to 9%. So if you look at those numbers as opposed to where we are, gives you some kind of order of magnitude of what we could absorb without adversely affecting people.

我想他們正在幫我整理一些數字。我再澄清一下我想表達的——我們在語意上對於解釋有些不同——我說的是承包商、顧問、員工，以上全部，所有領薪水、拿到支票的人，好嗎？我認為——如果我錯了我會更正——流失率大概會落在約 9% 的區間，8.5% 到 9%。所以如果你把這些數字和我們目前的狀況對照，就能大致了解我們在不對人員造成不利影響的情況下，能吸收的量級。

Yes. And Hunter, as we take a step back, if you look recently at least, management incentives have been based in the short term on operating income and the longer term on the mix of ROA. And as you and the reconstituted board look at the outcomes you want to drive over the next 4 years, is there a change to that comment? How do you want to incentivize the senior management team to accomplish what you want to accomplish?

是的。Hunter，退一步看，至少就近期而言，管理層激勵在短期是以營業利益為基礎，長期則是以 ROA 的組合為基礎。當你和重組後的董事會看向未來 4 年想要推動的成果時，這個做法會有改變嗎？你希望如何激勵高階管理團隊去完成你們想完成的目標？

Well, yes, I think that clearly -- look, we -- I am not obsessed, for example, with operating ratio, okay? The more I try to get away from it, the more people push me back in the middle of it. I mean, clearly there's some -- there are issues that are return on -- you name it, capital, equity, debt, whatever, there are more material ways over a longer time frame to -- look, the problem gets to be is to incorporate it into your yearly, daily operations and make the conversion, because there's a lag period that you go through. I think a lot of businesses, and I think we are -- a little bit that we have to address is this: We've got our compensation system so complex that employees don't understand it, then you've gone too far. But I think that that's something that the board talked about this week, the compensation committee discussed it. And I think it's something that we want to be sure that we're motivating the right behavior with employees of return effectively on capital. One of the rules of this model is this: Don't spend $1 in precious capital until you've looked and explored every operating alternative. And so I think there's going to be a push that way more and more for return numbers rather than just raw margins or operating ratios.

嗯，會的，我認為很明顯——你看，我並不會例如對營運比率（operating ratio）著迷，好嗎？我越想遠離它，大家就越把我推回到它的核心。我的意思是，很明顯有一些——有一些是關於報酬率——你說得出來的，資本、股權、負債，不管是什麼，在更長的時間框架下，有更重要的衡量方式；問題在於把它納入你每年的、每天的營運並完成轉換，因為中間會有一段滯後期。我認為很多企業——而我們也有一點需要處理的是：我們把薪酬制度弄得太複雜，員工都看不懂，那就做過頭了。但我認為這是董事會本週討論過的事情，薪酬委員會也討論了。我認為我們要確保的是，我們正在以資本的有效報酬來激勵員工做出正確的行為。這個模式的一條規則是：在你花掉 1 美元珍貴資本之前，先把所有營運上的替代方案都看過、都探索過。所以我認為未來會越來越朝向以報酬率指標來推動，而不只是單純的毛利或營運比率。

One second. You had talked about the long term being ROA. ROA is half of it and operating ratio is the other half of it. I just want to make sure you knew both of those.

等一下。你剛才提到長期是 ROA。ROA 佔一半，營運比率佔另一半。我只是想確認你知道這兩個都有。

Appreciate it. Is there a possibility for a free cash flow component? Is that something that you guys are considering?

感謝提醒。是否有可能加入自由現金流的構成要素？這是你們正在考慮的事情嗎？

Yes, free cash flow works. I mean, in all of the above, it's how you weigh those factors and if you do those things in a mature manner. Every one of them has got some downside to them. You focus this year on free cash flow and you make some immature decisions to make some artificial goal, which kills you next year. So it really takes a mature approach from management, and sometimes that's hard to put together.

是的，自由現金流可行。我的意思是，在上述所有指標中，關鍵在於你如何權衡這些因素，以及你是否以成熟的方式去做。每一個指標都有一些缺點。你今年把焦點放在自由現金流，然後為了達成某個人為目標做出一些不成熟的決策，可能會在明年反噬你。所以這真的需要管理層採取成熟的方法，而有時候這很難整合到位。

And certainly, a focus on cash is important. As you saw in the quarterly financial report we put out last night and the guidance we put out, I mean, we're certainly being transparent in terms of free cash flow and how we're calculating it and what the goals are for the year. So that's a new thing for us.

而且，聚焦現金當然很重要。正如你在我們昨晚發布的季度財務報告以及我們提供的指引中所看到的，我們在自由現金流、我們如何計算它，以及今年的目標是什麼方面，確實更透明。所以這對我們來說是新的做法。

Our next question comes from Jason Seidl with Cowen and Company.

下一個問題來自 Cowen and Company 的 Jason Seidl。

Hunter, welcome back. A couple of quick things, Hunter, when looking at intermodal, clearly it's an opportunity in the east. In your eyes, what's the most important piece of intermodal and how to get it more profitable for the railroad?

Hunter，歡迎回來。幾個快速問題，Hunter，談到聯運（intermodal），很明顯在東部是一個機會。以你來看，聯運最重要的環節是什麼？以及如何讓它對鐵路公司更有利潤？

Well, I mean, clearly it's a pretty simple formula. Cindy talked about it this morning. The longer the trains, the fewer the train starts, the lower the cost, the better we can be in the terminals. And the service factor, that's all you've got to do, get the trailer, get the conveyor, get it on a train, get it to its destination and get it on the ground and have it available for the customer. And it's not so much -- you do the job right and that's -- and this organization is doing a pretty good job there. I mean, I look at some of our numbers that I'm learning, and with our domestic business, we're like up in the mid-, higher 90s, which is pretty admirable, with pretty demanding customers as they should be demanding, like UPS. I mean, UPS, just all they want you to do is write what we say in the model. Just do what you say you're going to do. If you say you're going to be here third morning by x, be here. And if you do that, okay. It's not -- sometimes we may see things too complex. It's just simply get it, move it and do what you say you're going to do and be efficient with it. And are we looking at some fine-tuning that we can do, a little bit here, a little bit there? Continually, but I think we're going to do fine there. And we're going to get even better there. And then we'll, at the same time, take advantage of this merchandise network.

嗯，我的意思是，這其實是一個相當簡單的公式。Cindy 今天早上談到了。列車越長、開行班次越少、成本越低，我們在場站（terminals）就能做得越好。還有服務因素——你要做的就是把拖車、把貨櫃（conveyor）弄上火車，送到目的地，卸到地面，並讓客戶可以使用。這並不是那麼——你把工作做好就行，而這個組織在這方面做得相當不錯。我的意思是，我在學習我們的一些數據時看到，在國內業務上，我們大概在 90% 中段到高段，這相當值得稱道，尤其面對像 UPS 這樣要求很高、也理應要求很高的客戶。我的意思是，UPS 只希望你照著我們在模式裡寫的去做。就是做你說你會做的事。如果你說你會在第三天早上某個時間到，就要到。如果你做到了，那就可以了。有時候我們可能把事情看得太複雜。其實就是把它接起來、運走，做到你說你會做到的事，並且有效率地完成。我們是否在看一些可以微調的地方，這裡一點、那裡一點？一直都在，但我認為我們會做得很好。而且我們會做得更好。同時，我們也會利用這個一般貨運（merchandise）網路。

And Hunter, is the offering as big as it needs to be? Does any investment beyond the typical investment that goes in need to be made at intermodal?

Hunter，那麼目前的產品/服務供給規模是否已經足夠？在聯運方面，除了通常會投入的資本支出之外，是否還需要做任何額外投資？

Well, I mean, Frank can -- I mean, Fred can probably and Frank can speak to that better than I can. I know that -- look, I know this company is going to be in a much better position from a cash standpoint. If we see the opportunities, we're ready to make whatever investments we need to take advantages of opportunities in the market out there.

嗯，我的意思是，Frank 可以——我是說，Fred 可能可以，而且 Frank 也能比我更好地說明這點。我知道——你看，我知道從現金的角度來看，這家公司將會處於更有利的位置。如果我們看到機會，我們已準備好進行任何必要的投資，以把握市場上的機會。

Yes. And we've talked about before that over time, in terms of the network itself, we're at 95% double-stacked clear, which is a critical component to driving efficiency. We are opening one new terminal in a white space that we felt was needed, which is in Pittsburgh here in July. And we are looking at longer-term terminals that we've announced out at -- in Carolina, the CCX terminal we talked about. And we're also, to Hunter's point earlier, trying to see where there are opportunities to leverage existing facilities and perhaps combine things to create value that way. So Hunter has been a great supporter of our intermodal franchise and what we're trying to do. And the essence of precision railroading is about running a scheduled network at a high-level reliability. And that is what we have been doing and we're going to do even more so going forward.

是的。而且我們之前也談過，隨著時間推移，就網路本身而言，我們有 95% 已達到雙層堆疊淨空，這是推動效率的關鍵要素。我們將在我們認為需要的空白區域新增一座新場站，也就是今年七月在匹茲堡這裡啟用。另外，我們也在看更長期的場站規劃，也就是我們已宣布的——在卡羅萊納那邊，我們提到的 CCX 場站。同時，也呼應 Hunter 先前的觀點，我們正嘗試看看哪裡有機會利用既有設施，並可能把一些項目整合起來，以此創造價值。因此，Hunter 一直大力支持我們的聯運業務，以及我們想要推動的方向。而精準鐵路營運（precision railroading）的核心，是以高可靠度來運行一個按時刻表運作的網路。這正是我們一直在做的，而且未來我們會做得更多。

I'm going to get my follow-up. Hunter, I'd love to hear your opinions on CSX and the rest of the rail industry pushing towards one-man crews. And when do you see that as a viable option?

我想追問一下。Hunter，我很想聽聽你對 CSX 以及整個鐵路產業推動單人乘務的看法。你認為什麼時候這會成為可行的選項？

I'm not a one-man crew advocate. There are special circumstances due to different issues. I mean, clearly if you're switching a rip track or you're switching a mine track that's one track or something, there's applications that we have today for 1 person. But today, to take a 20,000-ton train on a line of road with 1 person, I don't think it's good business. Number one, I don't think that -- and shame on us that we don't have, in my view, the quality control to do that. So if you've got one person on the train and you have an air hose failure or a drawbar or whatever, how's the one person going to deal with it, the delay to the customers, the domino effect and all that? And then some of my cohorts tell me, "Well, we're going to have people in trucks along the right-of-way with all these materials with them and they'll be dispatched to the train to help the engineer or the one-man crew." And I said, "Well, it's not one man then, it's one-point-whatever case." Particularly today with where rail is relative to safety issues and the whole issue of common carrier obligation, I just don't think that it's something that we're focusing on. If you look at the payload, and people will shudder when I say this, some of my peers who are labor leaders, if you look at the cost of the other person on that train that you've got a revenue and the payload of x, it's relatively a drop in the bucket to the values that person can bring. It's an additional eyes and ears. I mean, you can't watch both sides of the train. We've got a lot of things in ABCs that we needed to get better at before we start talking about one-man crews. And I guess, before it's over with, we will have -- we will be running an electric train with nobody up there, with somebody with a rheostat somewhere running it. I don't know how we're going to get to minus, but somebody would figure it out before it's over.

我不是單人乘務的倡議者。在一些特殊情況下，因為不同的議題，確實可能適用。我的意思是，很明顯地，如果你是在調車維修線（rip track），或是在調車礦區支線那種單一線路之類的情境，我們今天確實有一些只需要 1 個人的應用。但就今天而言，要讓一列 20,000 噸的列車在正線上由 1 個人運行，我不認為這是好的生意。第一，我不認為——而且在我看來，我們沒有做到那樣的品質控管，這點我們應該感到羞愧。所以如果列車上只有 1 個人，而發生了風管故障、車鉤拉桿（drawbar）或其他問題，這 1 個人要怎麼處理？對客戶造成的延誤、連鎖效應等等要怎麼辦？然後我的一些同業跟我說：「嗯，我們會在路權沿線安排卡車，車上帶著各種材料，然後派遣他們到列車那邊去協助司機或單人乘務。」我說：「那就不是一個人了，而是 1 點幾個人。」特別是以今天鐵路在安全議題上的處境，以及整個普通承運人義務（common carrier obligation）的問題，我就是不認為這是我們正在聚焦的事情。如果你看載重，有些人聽到我這樣說會倒抽一口氣——包括我一些身為勞工領袖的同儕——如果你看那列車上多一個人的成本，相對於你有的收入與 x 的載重而言，那其實只是九牛一毛，而那個人能帶來的價值卻很大。那是額外的一雙眼睛和一對耳朵。我的意思是，你不可能同時看著列車兩側。在我們開始談單人乘務之前，我們在很多基本功（ABCs）上還需要做得更好。而我想，在一切結束之前，我們會——我們會運行一列上面沒人的電力列車，由某個地方的人用變阻器（rheostat）來操控它。我不知道我們要怎麼走到「負數」，但在結束之前總會有人想出辦法。

Our next question comes from Ben Hartford with Baird.

我們下一個問題來自 Baird 的 Ben Hartford。

Hunter, I'm just curious about -- you talked a lot about intermodal on the call but curious about your go-to-market perspective on that. The focus has been on the operational side and improving service and efficiency for the customers. But as you think about being innovative and creative and flexible, as you see CSX's IMC partnerships, do you see opportunities to expand into new partnerships with new IMCs or even kind of go more direct to market on the intermodal side as you think about a marketing strategy? Do you have any perspective on that?

Hunter，我只是好奇——你在這通電話裡談了很多聯運，但我想了解你對聯運的市場推進（go-to-market）觀點。目前焦點一直放在營運面，以及為客戶改善服務與效率。但當你思考要更具創新、創意與彈性時，看到 CSX 的 IMC 合作夥伴關係，你是否看到機會去擴展到與新的 IMC 建立新合作，甚至在聯運端更直接面向市場，作為行銷策略的一部分？你對此有什麼看法嗎？

Under certain circumstances, I think they all work. I think there's a lot of things that we can do intermodally that, for whatever reason, some have tried before and it kind of gotten away from them. But I'm a big advocate of day-of-the-week pricing. One of the things that you have to do in our model that you'll hear a lot about is balance. Because when you look at that graph of intermodal trains and it's kind of at the bottom on Monday and it peaks on Thursday night, and then it sinks down on Sunday, it's just money that's being wasted. And I tried one experiment. When you hear and you listen to the market and you listen and you hear, "Service, service, service." And so we said, "Well, we're having to run 3 trains on Friday night, so maybe we can discount on Saturday and Sunday to move some of that business from Friday to Saturday and Sunday." And so we discounted 15% and 20%. Guess how many people came on Friday? Nobody. Everybody went Saturday and Sunday. So you start to find out what the real market is out there. So there's a lot of creative things I can see today that we're going to have dispatchers sitting there 2:00 in the afternoon selling the slot, saying, "I've got 8 slots left that are going to be open unless -- and they're going to discount." I see that -- my personal view is we'll see a day where there won't be "contracts" as such that we think about. There will be tariffs, but they will be shorter even in length. And so I think there's a lot of things to do, the way we compensate salespeople, for example. And a lot of things that rail can do that we've kind of been a little stuck in the mud with, that we can be much more creative to supplement the standard intermodal product.

在某些情況下，我認為這些方式都行得通。我認為我們在聯運上可以做很多事情；不知為何，有些事情以前有人嘗試過，但後來有點失控、偏離了原本的方向。但我非常支持按星期幾定價（day-of-the-week pricing）。在我們的模式裡，你必須做的一件事——你會常聽到——就是「平衡」。因為當你看那張聯運列車的圖表，週一在底部，週四晚上達到高峰，然後週日又沉下去，那就是在浪費錢。我做過一個實驗。當你聽市場、聽客戶的聲音，你會一直聽到「服務、服務、服務」。所以我們說：「好，我們週五晚上得跑 3 班車，那也許我們可以在週六和週日打折，把一些業務從週五移到週六和週日。」於是我們打了 15% 和 20% 的折扣。你猜週五來了多少人？沒有人。大家都改到週六和週日了。所以你開始了解外面真正的市場是什麼。所以我今天能看到很多有創意的做法：我們會讓調度員坐在那裡，下午 2:00 在賣時段（slot），說：「我還有 8 個時段空著，除非——」然後他們就會打折。我認為——就我個人看法——我們會看到有一天，不會再有我們現在所理解的那種「合約」。會有運價表（tariffs），但即便如此，期限也會更短。因此我認為有很多事情可以做，例如我們如何補償業務人員等。還有很多鐵路可以做、但我們有點陷在泥淖裡的事情；我們可以更有創意，來補強標準的聯運產品。

Our next question comes from Cherilyn Radbourne with TD Securities.

我們下一個問題來自 TD Securities 的 Cherilyn Radbourne。

Fredrik, wondered if you could talk about, at the margin, how you feel about the volume outlook for 2017 versus how you felt at the time of the Q4 call and just what influence that had on the team's confidence in providing 2017 guidance this morning.

Fredrik，想請你談談，就邊際上而言，你對 2017 年運量展望的感受，與你在第四季電話會議時的感受相比有何不同，以及這對團隊今天早上有信心提供 2017 年指引產生了什麼影響。

Sure. I would say that coming out of the, I guess, election -- I'm not sure it has anything to do with it. But at the end of the year, we did see a little bit of an uptick in our volume and our projections for the year. I'm not sure that it's translated into the macro numbers at this point. But we did see a little bit more volume than perhaps we would've anticipated at the beginning of the year. We obviously also saw a coal market on the export side that improved beyond what we had anticipated originally, even though we still expect it to taper off as we move through the year. So I would say that there's probably a slight increase in the top line projection, but it really isn't the foundation for what we did here in terms of the guidance, that incremental change. It is (inaudible) we've done here over the last quarter or so to put ourselves in a position, coupled with Hunter's arrival there and his operating model, that has allowed us to do this.

當然。我會說，從（我猜）選舉之後的情況來看——我不確定這是否與此有任何關係。但在年底，我們確實看到我們的運量以及我們對全年預測出現了一點上升。我不確定這在目前是否已反映到總體（宏觀）數據上。但我們確實看到的運量比年初可能預期的略多一些。很明顯地，我們也看到出口端的煤炭市場改善幅度超出我們原先的預期，儘管我們仍預期隨著今年推進它會逐步回落。所以我會說，營收端（top line）的預測可能略有上調，但就我們在指引（guidance）方面所做的而言，那個增量變化其實並不是基礎。這是（聽不清）我們在過去一季左右所做的工作，結合 Hunter 的到任以及他的營運模式，使我們得以做到這一點。

Okay. So it's more the operational side then.

好的。所以更多是營運面（operational side）對吧。

Which, Cherilyn, gives the flow-through obviously through the bottom line.

這樣一來，Cherilyn，顯然就會反映到最終盈餘（bottom line）的傳導效應（flow-through）。

Right. And then just a quick one on CapEx. You've adjusted down by about 5% for 2017. Can you just talk about where you've already found room to trim there?

對。另外再快速問一個關於資本支出（CapEx）的问题。你們把 2017 年的資本支出下調了大約 5%。能否談談你們已經在哪些地方找到可以削減的空間？

Sure. So you're right. We started out the year with about $1.97 billion in core capital, meaning before you get to Positive Train Control. We've trimmed a little over $100 million from that number as we gave you the free cash flow numbers for the year. What we really did was we looked at all of the network investments and decided to pause some of those, given the fact that we're making terminal changes, operating plan changes. We have higher expectations for service product. And so we've really got to give that some time to sink in before we decide exactly where we want to deploy some of that network capital. And then on some of the return-seeking projects, to the point Hunter made earlier, we really looked at ways that we could get there through better process, better execution of that process, better accountability, et cetera. So we found some opportunities in both of those categories.

當然。所以你說得沒錯。我們年初的核心資本（core capital）大約是 19.7 億美元，也就是在不包含正向列車控制（Positive Train Control）之前的數字。在我們向你們提供今年自由現金流（free cash flow）數字時，我們已從該數字中削減了略高於 1 億美元。我們真正做的是檢視所有的路網投資（network investments），並在考量我們正在進行場站（terminal）調整、營運計畫（operating plan）調整的情況下，決定暫停其中一些。我們對服務產品（service product）有更高的期待。因此，在我們決定究竟要把部分路網資本投放到哪裡之前，確實需要給這些變革一些時間沉澱。另外，在一些追求回報的專案（return-seeking projects）上，正如 Hunter 先前提到的，我們確實檢視了可以透過更好的流程、更好的流程執行、更好的問責等方式來達成目標的途徑。所以我們在這兩類別中都找到了一些機會。

Our next question comes from Walter Spracklin with RBC.

我們的下一個問題來自 RBC 的 Walter Spracklin。

Welcome back, Hunter. My question is on the free cash flow and how that's going to go into your buyback program leverage. I know you announced $1 billion new program here. But I know, Hunter, you've always liked your buyback. Leverage doesn't seem to be an issue at all. And I don't know if you've huddled with Frank here a little bit and talked about longer term, where you want to see your leverage ratio go to. And as a result and with the free cash flow you're going to generate from your initiatives, could we see a much more expanded buyback than the $1 billion announcement here this morning?

歡迎回來，Hunter。我的問題是關於自由現金流，以及它將如何納入你們的庫藏股回購（buyback）計畫與槓桿（leverage）運用。我知道你們在這裡宣布了一項新的 10 億美元計畫。但我也知道，Hunter，你一向很喜歡回購。槓桿看起來完全不是問題。我不確定你是否已和 Frank 稍微討論過較長期你們希望槓桿比率（leverage ratio）達到什麼水準。因此，隨著你們將從各項措施中產生的自由現金流，我們是否可能看到比今天早上宣布的 10 億美元更大幅擴張的回購？

Well, Frank spent a lot of time this week with the board and the finance committee. And I have, believe it or not, decided to back up from that discussion and be a little more operating focused. So let me let Frank help you there.

嗯，Frank 這週花了很多時間和董事會以及財務委員會在一起。而我（信不信由你）決定先從那個討論中退一步，更多聚焦在營運面。所以我讓 Frank 來協助你回答。

Yes, we had a great discussion this week. And obviously, you heard us reiterate the BBB+, Baa1 today. You saw the size of the program for the next 12 months. Obviously, as we get more and more months and quarters under our belt and we get an understanding of the free cash flow numbers both for coming quarters and coming years, we'll take a hard look at whether or not we're deploying capital in the correct way to shareholders and in the correct amounts. And we always look at the balance sheet and try to determine what the appropriate place is, given really the cyclicality of the business on the merchandise and intermodal side as well as the capital intensity of the business and making sure we preserve the access to the marketplace that we need in tougher times. So we want to stress test the numbers that we have internally to make sure if there is, in fact, a coal decline or an economic decline, that we can stomach that. So we think we're in pretty good shape. We put good numbers out for you in the quarter and the forward guidance as well as the buyback and the dividends. So right now, we feel like we're in pretty good shape.

是的，我們這週進行了一次很好的討論。而且很明顯地，你們今天也聽到我們重申 BBB+、Baa1 的評級目標。你們也看到未來 12 個月計畫的規模。當然，隨著我們累積更多月份與季度的實績，並更了解未來幾季與未來幾年的自由現金流數字，我們會嚴肅檢視我們是否以正確方式、以及以正確金額把資本配置回饋給股東。我們也一向會檢視資產負債表，並在考量商品（merchandise）與聯運（intermodal）業務的景氣循環性，以及本業的資本密集度後，判斷適當的位置，同時確保在艱困時期我們仍能維持所需的資本市場進入能力。因此，我們希望對內部的數字進行壓力測試，以確保若確實出現煤炭下滑或經濟下滑，我們能承受得住。所以我們認為目前狀況相當不錯。我們在本季以及前瞻指引、回購與股利方面都提供了不錯的數字。因此目前我們覺得我們的狀況相當良好。

Yes, Walter, I don't think our policy is going to be any different than what you've been familiar with us in the past. If you look at allocation of capital, the first call is going to be always reinvestment in this railroad. And hopefully, we've got opportunities to make the appropriate returns there. If those don't present themselves, then we're going to look at other ways, the most efficient ways, as Frank described, to return that cash to the owners. Whether it's through buyback, dividends and combinations thereof, we'll always be a little debated about what your structure is and what kind of funds you're managing and which customers want which and -- but I think the board yesterday has -- both -- for 2 days, that's committee meetings and board meetings, had a thorough discussion of our policies there. And there was a great deal of common understanding directionally which way we need to go.

是的，Walter，我不認為我們的政策會和你過去所熟悉的有任何不同。如果你看資本配置（allocation of capital），第一優先永遠會是再投資於這條鐵路。並且希望我們在那裡有機會取得適當的報酬。如果沒有出現那些機會，那麼我們就會如 Frank 所描述的，尋找其他最有效率的方式把現金回饋給所有人（股東）。不論是透過回購、股利或兩者的組合，我們總會就你們的結構、你們管理的是什麼類型的資金、以及不同客戶偏好哪一種方式等有所討論——但我認為董事會昨天——其實是兩天，包含委員會會議與董事會會議——已就我們的相關政策進行了充分討論。而且在方向上，大家對我們需要前進的方向有高度共識。

Okay. So the second question here is on the competitive response to your initiatives, both from a service standpoint but also from an operating standpoint as you get lower cost, your ability to more efficiently and at higher profitability service your customers. And I'm just interested in what the competitive response might be that might cause problems for you, Hunter, in terms of what you're trying to achieve. I know you've always had a great view on pricing. The pricing is what the market dictates. But often, we hear when market share shifts, they won it on price. So is there a risk that a competitive response might come in and make -- put problems on how you can effect change or make them a little -- lot longer to achieve at the end of the day? Do you have any views on that?

好的。那第二個問題是關於競爭對手對你們各項措施的回應：不僅是服務面，也包括營運面；當你們成本更低、能更有效率且以更高獲利能力服務客戶時。我想了解的是，競爭對手可能會有什麼反應，進而對你造成問題，Hunter，就你想達成的目標而言。我知道你一向對定價（pricing）有很好的觀點。定價由市場決定。但我們常聽到當市占率轉移時，他們是靠價格贏來的。所以是否存在風險：競爭對手的回應可能介入，並對你們推動變革的方式造成問題，或讓最終達成目標的時間變得更久？你對此有什麼看法嗎？

Well, yes. They ought to be careful with that, the response. Look, I think this is a pretty simple response. As long as we provide the service we've talked about today and we become, and we're going to get there, the low-cost carrier, okay, we've got the world by the tail. I don't know what they're going to do in the way of response that is smart that they could do to hurt us. Now if the competitors do anything stupid, that's good. Sometimes it's short-term pain, but I don't think that I see anything out there that says they're going to have some different response than they've had 6 months ago than what they're going to have in the future that's going to set this organization back. We've got an agenda. We've got a wonderful customer base. We're going to see some organic growth. I'm convinced we're going to see some market share growth. I've got to be a little patient there, but this is going to come together. And I don't think a lot of what takes place is going to be negatively impacted by the competition.

嗯，是的。他們在回應這件事上應該要小心。你看，我認為這是一個相當簡單的回應。只要我們提供今天談到的服務，並且我們成為——而且我們會做到——低成本承運商，好嗎？那我們就等於掌握了全世界。我不知道他們在回應上能做出什麼聰明的動作來傷害我們。現在如果競爭對手做了任何愚蠢的事，那反而是好事。有時候會有短期的痛苦，但我不認為我看到外面有任何跡象顯示，他們未來會有不同於6個月前的回應，會讓這個組織倒退。我們有一個計畫。我們有很棒的客戶基礎。我們會看到一些有機成長。我相信我們會看到一些市占率成長。我得稍微有點耐心，但這會整合起來的。而且我不認為競爭所發生的很多事情會對我們造成負面影響。

There's a view out there that it can be emulated, that some of your initiatives can just be copied and the efficiency you achieved can be followed by your competitors. Anything you'd respond to that with regards to what you're doing and the unique way you're doing it that will make it more difficult for the competition to copy you?

外界有一種看法認為這是可以被仿效的，你們的一些倡議可以被直接複製，而你們達成的效率也能被競爭對手跟上。就你們正在做的事，以及你們以獨特方式執行、使競爭更難複製這點，你會如何回應？

Tell them to buy the book. It's on eBay for $1,000, I think, and it's a bargain, okay? It's not -- we can't get it recopied. Some of the competition that I used to work for won't let us get the copyrights to it and they're sensitive about it. It's no secret, okay? It's one thing to write a playbook, okay? A lot of companies can sit down and give you Xs and Os, okay? The key is they've got to have players that can execute, okay? If you don't have the players that can execute, you can steal every playbook you want, okay? So I hope they do copy us because if they copy us, I think they might be more efficient. And I look at other rails, generally speaking, much more as our partners as I do our competitors because we have so much interline business together. So we don't -- if there's any secrets to this, I missed them.

叫他們去買那本書。我想在eBay上要價1,000美元，而且很划算，好嗎？那不是——我們沒辦法讓它被重新複製。我以前待過的一些競爭對手不讓我們取得它的版權，他們對此很敏感。這不是什麼秘密，好嗎？寫一本作戰手冊是一回事，好嗎？很多公司都能坐下來給你畫出戰術圖、X和O，好嗎？關鍵是他們得有能執行的球員，好嗎？如果你沒有能執行的球員，你想偷多少作戰手冊都可以，好嗎？所以我希望他們真的來抄我們，因為如果他們抄我們，我想他們可能會更有效率。而且一般來說，我看其他鐵路公司更像是我們的合作夥伴，而不是競爭對手，因為我們之間有很多聯運業務。所以我們不——如果這裡面有任何祕密，那我大概是錯過了。

Our next question comes from Scott Schneeberger with Oppenheimer.

我們的下一個問題來自Oppenheimer的Scott Schneeberger。

Hunter, I was curious, just your comment in taking 2 to 3 days out of the Chicago-Jacksonville route, curious what type of time it would take to do such a thing. And is that unique because it's Chicago? Or should we expect that more broadly?

Hunter，我很好奇，你提到在芝加哥—傑克遜維爾（Jacksonville）這條路線上縮短2到3天，我想知道要做到這件事大概需要多少時間。這是因為是芝加哥才特別如此嗎？還是我們應該更廣泛地預期會發生？

Well, I think you'll expect it broadly if you look at the overall velocity. I mean, I just used Chicago for an example. And how quick you can see it? You can see it overnight. I mean, we're starting to reschedule the railroad. I know that Cindy and company have gotten, I think, effectively Florida pretty well reworked and done. And I think that I've been doing some looking westward towards New Orleans. And so we're going to kind of go up the line. We'll have what you have been used to before with every car is going to have its own trip plan. One plan, you don't plan on getting retripped and retripped and retripped, you've got one plan. We're going to tell the customers it's going to be 83 hours door-to-door and we're going to do it. And one of the ways to do it is this. Look, we've got a lot of good things going. We've got some things we've got to fix. Our train speed is not where it ought to be. Our merchandise train speed between terminals is like 18 miles an hour. We've got the potential to be at 27, 28. And you start taking numbers like that, and then you avoid terminals, and rather than drive into a terminal and dwell for 26 hours, you can drive by that one and skip that 26 and pick up a little here. And you do the math, it doesn't take long, you get to Florida 2 or 3 days quicker, depending on where in Florida you're going. That's just an order of magnitude that impacts both service and cost and asset turns, and all that stuff is good.

嗯，我認為如果你看整體的速度（velocity），你會更廣泛地預期會發生。我的意思是，我只是用芝加哥當例子。你問多快能看到？你可以一夜之間就看到。我的意思是，我們正開始重新排程鐵路運行。我知道Cindy和團隊已經把佛羅里達基本上有效地重新規劃得差不多並完成了。而我也一直在往西邊、朝新奧爾良方向做一些檢視。所以我們會沿著線路一路往上推進。我們會回到你們以前習慣的狀態：每一節車廂都會有自己的行程計畫（trip plan）。一個計畫，你不會預期被重新編排、再重新編排、再重新編排，你只有一個計畫。我們會告訴客戶門到門是83小時，而且我們會做到。而做到的方法之一就是這樣。你看，我們有很多事情做得不錯。也有一些事情必須修正。我們的列車速度沒有達到應有水準。我們的貨運列車在場站之間的速度大概是每小時18英里。我們有潛力做到27、28。當你把這些數字拉上來，然後你避開某些場站——與其開進場站停留26小時，你可以直接繞過那個場站，省下那26小時，再在別處補回一些——你算一算，不用多久，你到佛羅里達就能快2到3天，取決於你要去佛羅里達的哪裡。這大致上的量級會同時影響服務、成本、資產周轉等，而這些都很好。

Great. And then just separately, with regard to this year's operating ratio guidance, what is the one big bucket item that you think could -- where you could outperform, and then maybe a bucket item where you're most nervous where you may underperform?

很好。另外，關於今年的營運比率（operating ratio）指引，你認為哪一個最大的項目類別可能讓你們表現超預期？以及哪一個項目類別是你最擔心、可能會低於預期的？

There's nothing I lay awake late at night worried about in that regard, if something happens that I'm not aware of and there's some geopolitical or if something happens in Washington or something like that. But I mean, this is a pretty simple formula of doing something that most of us have done our whole life and we know how to do and that's railroad. And that's all we have to do to get these things accomplished. Now I mean, obviously -- look, when you take 1,000 people out of an organization, that's a big hit. That's big savings right here. So that's a lot of it. But the other thing that you look at, the railcars, the train starts, the yard start with the closures of the hump, all those things, those are natural that come about. Working capital will be down because we weren't going to be able to buy parts for some of these retarders in these old hump yards. They don't make them anymore. So we avoided a lot of problems there, but this is going to happen.

就這方面而言，沒有什麼事情會讓我半夜躺著睡不著；除非發生我不知道的事，例如某些地緣政治事件，或華盛頓發生了什麼之類的。但我的意思是，這是一個相當簡單的公式：做一件我們大多數人一輩子都在做、也知道怎麼做的事——那就是鐵路營運。而我們要做的就只是把鐵路做好，這些目標就能達成。當然——你看，當你從一個組織裡裁減1,000人，那衝擊很大。這裡就有很大的節省。所以這占了很大一部分。但你再看其他部分：車輛數、列車開行（train starts）、編組場開工（yard start），再加上關閉驼峰（hump）後的各種變化，這些都是自然會發生的。營運資金會下降，因為我們本來就買不到一些老舊驼峰編組場裡那些減速器（retarders）的零件。它們已經不再生產了。所以我們在那裡避免了很多問題，但這些事情就是會發生。

Our next question comes from Turan Quettawala with Scotiabank.

我們的下一個問題來自Scotiabank的Turan Quettawala。

Hunter, I guess just one question from me on the revenue side. I'm wondering, is there any sort of revenue that you see here in the book of business that maybe doesn't meet the return thresholds and maybe needs to be demarketed? I know some of that did happen with CP sort of early on in the process there.

Hunter，我想我這邊只有一個關於營收面的問題。我想知道，在你們的業務存量（book of business）中，你是否看到任何不符合報酬門檻、可能需要退出市場（demarketed）的營收？我知道CP在流程早期確實有做過一些類似的事。

No. Look, there's some odds and ends that just pops up every once in a while with an individual move or something. Everybody goes through a little bit of that. But generally speaking, I mean, Fred didn't need me to get here to point those kind of things out. And obviously, if they were there and I was coming, he might have been motivated to get them out of there, but he didn't have to. And so no, we're not looking at demarketing, we're looking at marketing.

沒有。你看，偶爾會有一些零星的東西冒出來，像是某一筆單獨的運輸之類的。每家公司都會遇到一點這種情況。但一般來說，Fred不需要等我來到這裡才指出這類事情。而且很顯然，如果那些東西真的存在、而我又要來了，他可能也會有動機把它們先清掉，但他其實不必。所以不，我們不是在考慮退出市場，我們是在考慮行銷、拓展。

Our next question comes from Justin Long with Stephens.

我們的下一個問題來自 Stephens 的 Justin Long。

I know it's still early, but I was wondering if you could talk about any structural changes to the network that we could see this year as it relates to divestitures of noncore assets. And when thinking about that mid-60s OR guidance for 2017, does that include the impact of any real estate gains?

我知道現在還很早，但我想請您談談今年在網路結構方面，是否可能因出售非核心資產而出現任何結構性變化。另外，在思考 2017 年營運比率（OR）約在 60% 中段的指引時，這是否包含任何不動產處分利益的影響？

The second part, no, it doesn't include any real estate gains. The real estate gains, to the degree there are, and that's being discussed internally, are all gravy. But I can tell you that experience in the past, there's lots of opportunities out there, even out in Chicago. And it's a big number in my book and it's something that we will be sensitive to and focus on. It's not going to drive the business, but it's certainly going to be in the bucket and the blender when we make certain operating decisions about where we operate from and locate. And let me be sure I understood the first part of the question.

第二部分，不，並不包含任何不動產處分利益。不動產處分利益若有的話——而這點目前仍在內部討論——都算是額外的好處。但我可以告訴你，依過去經驗，外面有很多機會，即使是在芝加哥也是如此。在我看來這是一個很大的數字，我們會對此保持敏感並加以聚焦。它不會驅動業務，但在我們做出某些營運決策、例如在哪裡營運與設點時，這肯定會被納入考量（放進同一個桶子、一起攪拌）。另外，讓我確認一下我是否理解了問題的第一部分。

Just asking about the potential for divestitures at some point this year, maybe some short-line assets that you would view as being noncore to the franchise.

我是在問今年某個時間點是否可能進行資產出售，例如一些你們認為對這個特許經營而言屬於非核心的短線資產。

There's not anything -- look, there's a lot of initiatives going on here that I'm sure that I'm not even aware of yet. But to my knowledge, there's nothing of any large nature that we're looking at. What we've been focusing on is just getting better at what we do with the franchise that we have.

目前沒有任何——你看，這裡正在推動很多項目，我相信其中有些我可能還不清楚。但就我所知，我們沒有在評估任何規模很大的事項。我們一直專注的是把現有這個特許經營做得更好。

Okay. And secondly, Hunter, you made the comment earlier that this franchise has more potential than any other you've dealt with. With that in mind, do you think there's a path for this business to have industry-leading margins? Or do you think there are structural limitations getting to an OR level that we've recently seen from the Canadian rails?

了解。第二個問題，Hunter，你先前提到這個特許經營的潛力比你過去接觸過的任何一個都更大。基於這點，你認為這項業務有機會達到業界領先的利潤率嗎？或者你認為在結構上存在限制，使得營運比率（OR）難以達到我們近期在加拿大鐵路公司看到的水準？

I think we can have industry-leading margins. I think we will have. The only issue there in my world is if I can get all that done before I have to go. I'd like to be here to cut the ribbon. (inaudible), it's just a little personal goal. But there's no reason that -- structurally, certain. I know of no reason that this railroad team cannot become the greatest railroad in North America and be the greatest in North America and probably the greatest in the world. And let me just end and say this thing, how people look at this. I went to Canada the first time as an American and that's not fun to begin with. But I got there and CN has just gone through a great restructuring, coming out of an IPO. They had some impressive numbers. But the one thing they said to the public, "Do not expect the Canadian railroad to ever achieve numbers like the U.S. rail. It's just not structurally possible, okay?" Until our operating ratio went to the leading operating ratio in North America. And then guess what the U.S. road said? The U.S. road said, "Look, we're going to improve but don't think we're ever going to reach the level of the Canadian roads. It's just not structurally possible." So it's got something to do with what your passport says and where you reside, but it's just the same thing. That little border up there doesn't mean that much.

我認為我們可以做到業界領先的利潤率。我也認為我們會做到。在我看來唯一的問題是，我能否在我必須離開之前把這些都完成。我希望能留在這裡剪綵。(聽不清楚)，這只是個小小的個人目標。但沒有任何理由——從結構上來說，當然。我不知道有任何理由會讓這支鐵路團隊不能成為北美最偉大的鐵路、成為北美最強，甚至可能是全世界最強。最後我想用這件事來作結，談談人們怎麼看待這件事。我第一次以美國人的身分去加拿大，這一開始就不太有趣。但我到了那裡，CN 剛完成一次很棒的重整，從 IPO 之後走出來。他們有一些令人印象深刻的數字。但他們對大眾說的一件事是：「不要期待加拿大鐵路能達到像美國鐵路那樣的數字。在結構上就是不可能，好嗎？」直到我們的營運比率成為北美領先的營運比率。然後你猜美國的鐵路怎麼說？美國的鐵路說：「看，我們會改善，但別以為我們能達到加拿大鐵路的水準。在結構上就是不可能。」所以這似乎跟你的護照寫什麼、你住在哪裡有關，但其實是同一回事。上面那條小邊界並沒有那麼重要。

And our next question comes from Brian Konigsberg with Vertical Research Partners.

我們的下一個問題來自 Vertical Research Partners 的 Brian Konigsberg。

Welcome, Hunter. And just almost all my questions have been answered. I think an award is deserved for many of the analysts still coming up with stuff this late into the call. But I guess just the one thing, just for the model's sake, obviously, Hunter, you've got an employment contract that has been stamped. We're still waiting for the result of the shareholder meeting, but we expect that to go through, most likely. So how should we be baking in just kind of the share grants and additional payments that have been agreed upon so far throughout this year in cash flows and into the share baseline?

歡迎你，Hunter。而且我幾乎所有問題都已經被回答了。我覺得在電話會議進行到這麼後面，還能有這麼多分析師想出問題，應該頒個獎。不過我想就一件事，為了模型的需要，顯然 Hunter，你的聘僱合約已經蓋章確認。我們仍在等待股東會的結果，但我們預期大概率會通過。那麼，我們應該如何在今年的現金流以及股數基準中，納入目前已同意的股票授予與額外付款？

Yes, I'm not sure that it's appropriate for me to address that. Let me let Frank address that.

是的，我不確定由我來回應這個是否合適。我讓 Frank 來回答。

So in terms of the share-based compensation, obviously we book expense on that one under the Black-Scholes model. And we've done that in terms of the guidance that we've given you. In terms of the shareholder vote, obviously you heard David's opening remarks, so we're not going to touch on that one. But the free cash flow number that we gave you for the year is excluding the existing restructuring charges and any subsequent restructuring charges that might happen in the second quarter.

就以股份為基礎的薪酬而言，顯然我們會依 Black-Scholes 模型認列其費用。而我們在提供給你們的指引中已經把這點納入。至於股東投票，顯然你們也聽到 David 的開場說明，所以我們不會談這一點。但我們給你們的年度自由現金流數字，是排除既有的重整費用以及第二季可能發生的任何後續重整費用。

Yes. And so just presumably though, the share count does not reflect any grant at this point, but that can certainly change after the shareholder meeting. Is that the message?

是的。所以推測一下，目前的股數應該還沒有反映任何授予，但在股東會之後當然可能會改變。這就是你們要傳達的訊息嗎？

I'm sorry. Could you repeat your question?

不好意思。你可以重複一下你的問題嗎？

I'm just saying the share grants, I presume it's not in the numbers now and likely not in the guidance that was provided, but that could change after the shareholder meeting. That could be baked in, in our next discussion, if it's approved.

我只是說股票授予，我推測目前的數字裡沒有，而且提供的指引裡也很可能沒有，但在股東會之後可能會改變。如果獲得核准，我們在下一次討論時就可以把它納入。

The numbers we gave you, around $1.5 billion in adjusted free cash flow excludes the cash impact of the things that we're discussing both from the first quarter and perhaps things that could happen subsequently in the second quarter. Does that clear it up?

我們給你們的數字——約 15 億美元的調整後自由現金流——不包含我們正在討論的事項所帶來的現金影響，這些事項包括第一季的，以及之後第二季可能發生的。這樣有釐清嗎？

Yes, I could follow it up offline, but that helps.

有，我之後也可以私下再追問，但這樣很有幫助。

And this does conclude the question-and-answer session. At this time, I'll turn the call over to Hunter Harrison for closing remarks.

問答環節到此結束。現在我把電話交給 Hunter Harrison 作結語。

Well, thanks very much for joining. It's been a very stimulating call. Hopefully, we have answered a lot of your questions. And I've got to run and call Keith, so if you'll excuse me. Thanks.

非常感謝各位參與。這是一場非常有啟發性的電話會議。希望我們已經回答了你們許多問題。我得去打給 Keith 了，先失陪。謝謝。

This concludes today's teleconference. Thank you for your participation in today's call. You may disconnect your lines at this time.

今天的電話會議到此結束。感謝各位參與今天的會議。您現在可以掛斷電話線。