PWX Providence And Worcester Railroad Company

Providence and Worcester Railroad Company (NASDAQ: PWX) today reported its results for the second quarter of 2008. The Company had net income for the quarter of $320,000 compared to net income of $347,000 in the second quarter of 2007. Diluted income per common share was $0.07 for each quarter. Other income for the second quarter of 2007 included $269,000 of gains realized from the sale of property and easements compared to just $26,000 of such gains in 2008. Operating revenues for the second quarter of 2008 increased $1.1 million, or 16.1% from the second quarter of 2007. This increase is the result of a 23.9% increase in conventional freight revenues partially offset by a 45.9% decline in container freight revenues. Shipments of ethanol and automobiles, two commodities which the Company began handling during the second half of 2007, as well as increased shipments of coal and steel ingots, account for the increase in conventional freight revenues. That increase was offset somewhat by decreases in shipments of construction aggregates, chemicals, building products and other commodities during the quarter, which appears to be largely attributable to the economic slow-down experienced by the United States economy. The sharp decrease in container revenue results from a continuing decline in container traffic volume which began midway through 2007. Diesel fuel expense for the quarter increased by $618,000 (103.5%) from the second quarter of 2007, primarily as a result of sharply-increased prices for petroleum products. During the six months ended June 30, 2008, the Company had a net loss of $602,000 ($0.13 per common share) compared to a net loss of $814,000 ($0.18 per common share) during the six months ended June 30, 2007. Statement of Operations (Unaudited) (Dollars in Thousands Except Per Share Amounts) � � For the Three Months � For the Six Months Ended June 30, Ended June 30, 2008 � 2007 2008 � � 2007 � � � Operating Revenues $8,094 $6,972 $14,090 $12,157 Other Income 188 478 307 � 593 � Total Revenues 8,282 7,450 14,397 12,750 Operating Expenses 7,802 6,893 15,289 � 13,994 � Income (Loss) before Income Taxes 480 557 (892 ) (1,244 ) Provision for Income Taxes (Benefit) 160 210 (290 ) (430 ) Net Income (Loss) $ 320 $ 347 $ (602 ) $ (814 ) Weighted Average Number of �Shares Outstanding, Diluted 4,875,813 4,635,486 4,782,213 4,540,460 Diluted Income (Loss) Per Share $.07 $.07 $(.13 ) $(.18 ) �Safe harbor� statement under the Private Securities Litigation Reform Act of 1955 This release contains �forward-looking statements� within the meaning of section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements represent the Company�s present expectations or beliefs concerning future events. The Company cautions that such statements are necessarily based on certain assumptions which are subject to risks and uncertainties, including, but not limited to, changes in general economic condition, and changing competition which could cause actual results to differ materially from those indicated herein. Further information on these risk factors is included in the Company�s filings with the Securities and Exchange Commission.