Mark George, CFO. They have some quick slides they're going to run through, and then we'll get to questions. Alan, Mark, thank you guys for being here, and I pass it to you guys. Hey, thanks for the opportunity, Scott. It's always good to be with you, and I appreciate you hosting this and giving Mark and I an opportunity to talk about the outlook at Norfolk Southern. Before we start, I want to do a little quick housekeeping. These slides are posted on our website. I am going to make some forward-looking statements subject to risks and uncertainties. The results may differ materially from the forward-looking statements. I would invite your audience to take a look at our website or our SEC filings for more detail on our risk factors. We'll talk a little bit about our volume environment. I would say that our service has stabilized. It's absolutely not where it needs to be. With stabilization of our service product, we are developing a little bit more capacity, and you're starting to see a little bit of improvement in our volume levels. Since March, they've kind of stabilized at a higher level than what we saw in January and February, which really put a lot of pressure on our first-quarter margins. This is not, for us, an issue with demand. It really is our ability to apply capacity to the market opportunities that are out there. You see that we've seen some declines in our coal network. That really is about negative comps. We're running up against some of our highest volume months of the year in 2021. We'll get into it a little bit later. The outlook for coal is tremendous right now. We'll only be limited by overall production. Chemicals is up, as you would expect. We're seeing a lot of demand in energy-related products with chemicals. Let me talk a little bit about the longer-term outlook as we look into the rest of this year. Scott, we see strength in our consumer-oriented products. We could see strength in manufacturing, and we see strength in commodities. When you think about merchandise, ISM is in expansion territory for 23 consecutive months. Ag is probably going to lead the way for us because of demand for food products. The OEMs, the automotive producers that we serve, are really optimistic. Downtime this year, because of chip shortages, is measured in days instead of weeks. Going forward, we are expecting U.S. light vehicle production to be up 19% year- over- year for the remainder of the year. As you know, we serve more vehicle production than any other railroad in North America. That's the strength of our franchise, and we and our shareholders ought to benefit from that going forward. Intermodal demand is white-hot right now. The trucking market, while it has cooled off a little bit, still remains extremely strong, and inventories do need to be rebuilt. There's a lot of demand for our intermodal product. As we improve our on-time trade performance, that'll manifest itself into more volumes. With respect to coal, you follow that closely, and so you see what's going on with overseas prices. We've been able to restructure our export met contracts so that we participate in more of the upside and the underlying commodity prices. Scott, you should probably see that appear in our RPU figures as we move into the third quarter. A lot of optimism in overall all the markets that we serve. We know we got to fix service, and we're taking a two-pronged approach to that, the first of which is resources. I'm going to talk about resources and plan. We've talked about the need to hire conductors. Right now, we've got over 900 conductor trainees in our pipeline. That's the highest we've had in the last four years. Think in terms of it taking about four months to get a conductor trainee out on the ground, safely qualified to be productive and operate. That can kind of give you a timeline as to when we would see pretty significant improvements in our T&E labor force availability. One of the good things that we've seen recently is that qualified T&E employees are now outpacing normal weekly attrition. We're no longer seeing a decline in our qualified engineers and conductors. That number has shown an inflection point, and we're starting to see that move up. That's a positive outlook for us. The other thing that we're pulling on really hard to improve service is re-engineering our operating plan. I need to be perfectly clear. This is about improving service. It's about simplifying our network, driving more balance into our network, which helps crews and locomotives and cars, all the rolling stock. It's about execution. We've gone through and we've looked at individual work events at distinct geographic locations and gotten a sign-off from our transportation team on what we can execute consistently and reliably. We've built that into the operating plan. We started with a focus on Intermodal. This will be a phased approach. We'll move on to merchandise. It's part of the continual improvement process that you generally see with PSR. It's going to drive improved service. It's going to drive improved productivity through fuel efficiency, through labor efficiency, through locomotives, through rolling stock and equipment rents. It's going to create a platform for growth. Right now, we're in detailed conversations with our intermodal customers about what they can expect. One of the things that you might have seen in our network is, in many of our major markets, we've got more than one intermodal tunnel. Frankly, that's a strength of ours. As you know, we've got the most powerful intermodal franchise in the East. In the past, let's say you're running between Chicago and Eastern Pa., we may have run from two different origins and served two different destinations in Eastern Pa., which would give you four different origin point pairs. Generally, what you would then have is you'd have switching between the terminals in the two cities, and they very well could be only 10 miles apart. That creates a lot of complexity. What we've done is we've really looked at where the flows want to go, where the ultimate destination is, and we're going to run single origin to destination point pairs between these locations. That gives us the opportunity to add more density into the network. It gives us the opportunity to really simplify operations so that we can execute it much more consistently, much more reliably. Scott, because we've got more density, we can launch more frequent trains, which is a huge bonus to our customers. It allows us to clear off the terminals more frequently because we may be launching multiple trains a day. It allows the customers to have more flexibility with drop-off times throughout the day. I think this is going to be a big platform for growth and service improvement and productivity for us. In close, we'll kind of talk about where we think we're headed. You may have seen the letter that I wrote to our employees on day one as CEO, and it really was focused on being customer-centric and operations-driven. Right? To To me, that means we are going to listen to our customers. A healthy company listens to its customers and looks for opportunities to serve market needs. Operations-driven means our entire company is aligned around operations as we restore our service product. That's job number one because it drives a lot of benefits for us. We've got a lot of unique assets at Norfolk Southern, which we fully intend to leverage. That includes our physical network. Right? We serve a majority of the consumption. We serve a majority of the manufacturing in the United States. We've got the most powerful intermodal franchise in the East. We're going to leverage that. Another real benefit for us is our best-in-class customers. We've got powerful channel partners within our intermodal franchise. I've talked about the strength of our automotive franchise. We serve more integrated steel mills than any other railroad in North America, and we serve more short lines than any other railroad in North America. We have a really strong, dedicated team of employees. You couple those three together, and I think the outlook for us looks really good as we restore service moving into the second half of the year, bring on additional revenue, and drive more margin improvement. We had a first quarter in which we had a record EPS despite some difficulties. Right? Our EPS, we're very confident that we're going to continue to see improvements in EPS, which denotes margin improvement supported by share repurchases. OR in the near term is probably going to be pressured by fuel headwinds. In the longer term, as we drive upper single-digit revenue growth with upside to that based on what happens with the underlying commodities, we're going to see a lot of margin improvement, particularly in the second half of this year. Okay. Great. Maybe, can you go back to the headcount slide for a second? Yeah. Okay. You and I think all the rails are talking about we're going to have better second-half service, which is going to lead to better second-half volume. Yes. We are a month away from second half of the year. How confident are you based on what you're seeing end of May that we're going to get to that better service starting in the second half of the year? I'm very confident in it. Right? What I've talked about is we've seen a stabilization in our service product. We've arrested the decline in T&E employees. Now we're starting to see increases. We've got more conductors in our training class than we've had in the last four years, and we're implementing a new operating plan that's going to be simpler, drive more balance, and it's going to be much easier to execute. You couple all that together, and that's going to drive improvements in service. We've got 900 conductor trainees right now, and they said that takes about four months. What's the typical amount of attrition you would see in a four-month period in conductors? It's materially higher than what you see overall within our network. I would not expect those 900 fully to mark up. It'll be a number below that. It's still going to be something that's impactful and meaningful to us. Remember, those 900, they are at various vintages within their four-month training period. Some are ready, and some are just beginning the training. Where do you think, now moving to the right side, where do you think that qualified T&E headcount needs to be to get the service to where you want it to be? I'm not sure where it needs to be, Scott, because at the same time, we are implementing a new operating plan. Frankly, we're going to pay really close attention to what's on the horizon in the macroeconomic environment. I think by the end of the year, the overall employee count for Norfolk Southern is going to be about 1,000 higher than it was at the end of 2021. The majority of that increase will be in T&E. Okay. Okay. We should start to see that qualified T&E start, that should start to rise month over month over month. You'll start to see qualified T&E move up. We'll implement our new operating plan. You're going to start to see improvements in train speed, the weekly metric there, and the weekly metric with respect to terminal dwell, and you're going to be able to match that up against improvements in weekly volumes. Okay. Mark, bringing into the guidance that you guys had, you guys have talked about high single-digit revenue growth for the year. You have talked about 50 to 100 basis points of margin improvement. I think that there is upside on the revenue. I think there is risk on the margin, but that is just me. I do not know what you have to. No, I think there is upside on the top line, for sure. We talked about that recently, and I think with every passing week, we start to feel a little more confident. As Alan said, the end markets are strong, for sure. Pricing environment and the RPU environment, especially in the energy sector, is really strong. Should that hold, there's going to be upside. We will talk about that more in July when we close out the year. That really defines the path where we see us getting to our margin target. If we get that top line upside like we're talking about, we still see an ability to get to the 50-100 basis points of margin expansion. You got to understand, as service recovers, we're going to start taking on more volume. That incremental volume drops through in very accretive levels. At the same time, some of the service disruption costs that we're suffering through start to go away. That's all part of the equation of how we still feel pretty good about our margin guidance. I mean, you kind of saw that relationship in the first quarter. Right, Mark? Yeah. I mean, you saw the volume charts that Alan showed there on the carloads. The weekly carloads in January, February were rather weak. We suffered a lot within the quarter on our operating ratio. In March, as we dug out, we saw a significant improvement in our profitability. We are up a little bit from March levels on the carload. That should sustain us. Frankly, that's the number I look at pretty much every morning is that seven-day rolling carloads. Because as that goes up, I feel really good about our margin prospects going into the back half of the year. Okay. Any near-term thoughts on second quarter operating ratio? I think on the first quarter call, you said maybe, maybe we can get towards a 60 operating ratio. Any update you can share? Other than the fact that fuel has gone up about 10% since that call, and that does represent a headwind for us that we have to fight, I still think we can get close to where we were last year before the property gain. Somewhere, hopefully, with a 60 handle. I'd like to be sub-61 for sure. Okay. Right. So X the property gain last year, you did a 60.3. So somewhere between 60.3 and 61, you feel like is a good place to be? I'm hoping, yeah. Okay. That's very hopeful. We're going to keep an eye on those weekly carloads. We kind of need them to continue to tick up a little bit like you've seen the past couple of weeks. We should be okay. Okay. You mentioned restructuring some of the coal contracts. Yeah. Can you just give a little bit of color what you mean there? Is that just that you haven't fully participated in where met prices are, and so you're going to increasingly participate in that? As you know, some of our met coal export contracts are tied to the underlying industry. You participate in that with kind of the range of what our rate can be and also how much leverage we have against the underlying industry. We have tried to address both of those in our latest renegotiations with our customers. That starts, we'll see that more so starting in third quarter. Yeah. It kind of moves into our revenue accrual in the second quarter. It'll be fully baked as we move into third quarter. As part of this, are you doing anything to sort of lock in this upside in the case that met prices start to fall, or that's just not how the business? Yeah. We adjust those prices almost on a monthly basis based on the underlying industry. That is what has allowed us to participate in the upside. With our new contracts, we are going to participate more in the upside. Okay. By the way, if anyone has questions, raise your hand. We'll make sure you get involved. Just back to service for a second. We talked about labor. You talked about what you're doing with the operating plan. Anything in terms of locomotives or cars that you need to be doing? Do we need to take more locomotives out of storage? Have we done that at this point? Really, the biggest generator of locomotives for us is going to be speeding up our network. We feel very comfortable with the amount of locomotives we have. Our issue has been a crew issue and then the executability of the plan. Mark, do you want to talk about our overall locomotive strategy? Yeah. I mean, like Alan said, we've got enough locomotives right now. I think the bigger issue we're going to get for every mile an hour we raise our network speed, it's going to take locomotives out of circulation, about 50 or so for every mile an hour, given where we currently are. On top of that, we've got this DC to AC conversion program. We're going to be getting in another 120 or so this year that will be upgraded from DC to AC. That enters the fleet. They're currently being worked on now. Power is not the concern whatsoever. Speaking of the AC conversion program, just you may have seen at the end of the year we announced that we've committed with Wabtec to convert another 380 or so over the next several years. We're going to end up getting our AC fleet almost to 80%, which is great for us because that really provides a lot of flexibility with regard to railroading. We can DP a lot more trains. Right now, we're a little bit constrained in certain places and certain times. We have to limit our train length because we just don't have AC units, and therefore we can't use DP. Once we get more and more AC penetration, we're going to have a lot more flexibility. That also drives fuel efficiency. It sounds like you're a ways away from thinking about buying new locos. I would hope that we don't have to buy any new locomotives of this technology at least. Hopefully, it'll be whatever that future technology is going to be, whether it's hydrogen or some other hybrid form. Let's take a step back for a second now that you're in the CEO role. What changes to the long-term vision, long-term outlook do you see under your leadership than what we had? I would say right now, everyone's focus is on restored service because of the margin improvement opportunities that creates for us, because of the credibility it builds with our customers. I think when you look at kind of where we're headed, just take a look at how we've defined our new operating plan with service, productivity, and growth. We're going to look for a balance of that as we approach markets, as we approach our operations moving forward. We've got a fantastic franchise, whether it's intermodal, whether it's steel, whether it's automotive. The consumer-facing markets are really strong for Norfolk Southern. We've invested in a lot of joint partnerships, the Meridian Speedway, Pan Am Southern, which generates benefits for our shareholders as well. We're going to make sure that we really leverage those. We're going to make sure that we deliver a consistent and reliable service product for our customers that they can trust over time, over economic cycles, and that they can use to build their supply chains around going forward. How does operating ratio tie into long-term growth views? I think what we're going to be looking for is continual improvement in our margins. I think that's with that balance of service, productivity, and growth. The growth algorithm is volume, continued inflation plus price. And then if we're doing that with good service, margin should continue to improve over time. Absolutely. We will continue to focus on productivity as well. There is a P in that TOP SPG. Right. Right. Can you talk about the pricing environment that you're seeing? Any trucking spot rates you mentioned are down a little bit. Is that having any impact on underlying pricing trends, or are we still seeing same-store pricing accelerate? What are you seeing in the pricing? Yeah. We're seeing a lot of strength in prices, as you can imagine. Scott, you and I have talked about this a lot. We take a longer-term view of our markets. We take a long-term view of our customers, and we take a long-term view of our approach to price. That's one of the reasons that we've delivered 21 consecutive quarters of RPU increase in intermodal excluding fuel. Within our merchandise network, that's 27 of the last 28 quarters. That is through upcycles, and that is through downcycles. We're going to continue along on that approach. I can tell you right now, the differential between contract rates and truck and what our intermodal rates are provides a pretty good umbrella into which to price. I feel confident about pricing in our intermodal franchise. We've talked about commodity pricing and the opportunities that that presents to us as well. Our merchandise network is designed to compete with truck. We've invested in sustainability. That's becoming more of a focal point, more of a decision maker for our customers than it was, say, two and a half years ago. There are a lot of opportunities for us and upside in price as we look into all three of our major markets. Why aren't coal volumes better? Production. It's mine production and then your service? No, I would say that our service is pretty good in coal, particularly to the export market. That's one of the reasons that our volumes were flat in coal in the first quarter of this year. You take a look at the producers, they're having the same issues that everyone else is tracking labor. In the past, they've had difficulty attracting capital for investment, and folks weren't really sure how long the strength in the coal market would last. That didn't necessarily create an environment for investment and opening mines. We're now seeing more interest and more investment in production. We'll see some of that in the second half of this year. We'll see more of that show up on our network in next year. I think overall, it's production. Producers are having to make that choice right now between placing that product, which is in high demand, in the export market or in the domestic market. We talked about that a little bit with CSX, that it feels like given the stockpile levels in the U.S. and maybe in some places getting to dangerously low levels, that the market is prioritizing the domestic market over the export market. Are you seeing the same? I'm seeing different decisions by different producers. Because ultimately, it's a producer issue, not a Norfolk Southern issue about where that coal goes. Yeah. We don't own the commodity, as you know. We never take physical ownership of it. We're tender to bill of lading, and we handle wherever the producer tells us to go as long as we have a rate structure in place for it. We see in our utility franchise, stockpiles are down 25%-30% over last year or below last year. So there's some demand for stockpile rebuilding there. At the same time, there's a lot of demand for coal in Europe, and there's a lot of demand for coal in India. Are you seeing more utility volumes south or north right now? Right now, it's pretty much the same balance as we've had recently, kind of 50/50. Okay. Okay. Let's talk Intermodal. Maybe first on the international side, what is your expectation of what's going to happen as China reopens? What does this mean for freight? What does it mean for supply chains, your volumes? Yeah. I think you could see more volumes showing up in the United States in about a month with that reopening. We've seen the continuation of that secular trend of business moving from West Coast to East Coast in our franchise. I think that will continue. Within the domestic franchise, I think there's, as I noted, there's a lot of demand for inventory rebuilding and taking trucks off the highway. You're not hearing anything about what we heard from Target and Walmart who said they've got too much inventory. You're still hearing that you need inventory building. We do need inventory building. We do understand that consumers may have changed buying patterns in this inflationary environment or through the reopening of the economy itself. Some inventory that's out there might be stale. Some of it might be seasonal that missed its time on the store shelf, pardon me, because of supply chain disruptions. That's part of that consumer dynamic that we're monitoring really closely. I can tell you demand remains really high from the consumer. Look at retail sales in April. Real retail sales were at 0.9%. Okay. J.B. Hunt was talking about some of the same thing about the inventory that we've got. Maybe it's seasonal for first quarter or even fourth quarter inventory that we have now too much of. The spring-summer inventory, we're not necessarily full of. Right. Okay. Now, J.B. Hunt making a big investment in containers and growth. You're their primary partner in the east. How much of what they're investing in ultimately accrues to you over the next bunch of years? Do you have to make investments in line with that? We've made some pretty substantial investments in our intermodal franchise over the last 10 to 15 years. That's the reason we've got such a powerful intermodal franchise. The other reason we got a powerful intermodal franchise is we are aligned with the best channel partners out there. That includes J.B. Hunt. That includes Hub Group. Our channel partners are investing in growth. They really want to grow. They want to grow on Norfolk Southern. They're aligned with the opportunities that our franchise presents to them. We've seen some movement in channel partners out west. Is that something that you think could happen out in the east? It feels like that'd be more of a risk than an opportunity for you. You've got the bigger domestic intermodal business. Yeah. I think our channel partners really value the franchise that we provide. They value the relationships that we've built with them over time. They understand our commitment to Intermodal going forward. Okay. Shifting gears, a lot of noise activity from the STB. What's your expectation? We've seen them. You have to give them more data, more transparency. What are your other expectations for what could be coming from the STB? What can we live with? What are we really hoping doesn't happen? Yeah. I understand what they're doing with respect to data. They're exercising their oversight. We're aligned with them as are our shareholders and our customers. We want to get service fixed. That's our responsibility to do. We've got a lot of things in play that are aligned with goals of the administration. That's high-paying union jobs. We're hiring aggressively. You've seen that. That's capital investment. That is taking trucks off the highway. That is sustainability. I think with the STB, forced access is out there. We hope that they take a really hard look at the cost benefits associated with that. Okay. Quickly, just because we're getting out of time. Labor. When realistically can we get a labor deal? Then do you think there's any shot this labor cycle for one-person crew? Or do we now need to push that to the next contract? We've got a three-day meeting starting today between the NCCC and the CBC, and then BMWED and SMART-MD in front of the National Mediation Board. We are engaged in discussions right now. I'm hopeful ultimately we come to a deal soon. I don't know if we will or not. I'm confident that when we do, rail employees will still be among the highest paid in the industry. That's okay. These are tough jobs. I'm also hopeful that we push forward on work rule changes, repurposing the conductor to a ground-based conductor. I think that offers a lot of benefit for our employees. It improves quality of life. There's a safety component to it as well. It's going to make it easier for us to attract employees. It's going to make it easier for us to retain employees. We're going to be able to adapt to market conditions and customer needs much better. CSX purchase quality and now Pan Am. Trucking, shortline rail, anything like that that interests you that you want to do? I think if you look at the strength of our franchise and where we're headed, there's a lot of upside to Norfolk Southern from just a pure rail play. We've invested in our intermodal franchise. We've invested in our shortline partnerships. We've invested in sustainability, and we've invested in the best industrial development team in the industry. My focus right now is improving the quality of our service product and really leveraging the strength of the investments that we've already made. Just last two things quickly. CPKCS merger, you're comfortable what you want to get out of Meridian Speedway and anything else that you're going to get all that? Yeah. Again, we've made a pretty important and pretty strategic investment in the Meridian Speedway. It's that link between the fastest-growing regions of the U.S. economy. That joint venture that we've got with KCS will fall right under the umbrella of CPKCS. Mark, just quickly, as we wrap up, just anything changing in terms of capital spending, budget, buyback expectations? Yeah. The CapEx guidance we gave was $1.8 billion-$1.9 billion. I'd say with some of the incremental inflationary pressures, we're probably trending toward the high end of that range. Share repurchases, really, that's excess earnings after CapEx and dividends. Earnings are good. I predict we'll have a good year with regard to share repurchases. Okay. Great. We got to wrap it there. Thank you guys so much. This was great. Thank you. Thanks, Scott.