PITTSBURGH & WEST VIRGINIA RAILROAD
Pittsburgh & West Virginia Railroad (the Registrant) was organized in Pennsylvania in 1967, as a business trust, for the purpose of acquiring the business and property of a small leased railroad.  The railroad was leased in 1964 to Norfolk and Western Railway Company, now known as Norfolk Southern Corporation ("NSC"), by Registrant's predecessor company for 99 years with the right of unlimited renewal for additional 99 year periods under the same terms and conditions, including annual rent payments.      Registrant's business consists solely of the ownership of the properties subject to the lease, and of collection of rent thereon.  The rent received is $915,000 per year, in cash, which amount is fixed and unvarying for the life of the lease, including any renewal periods.  In addition, the lease provides that certain non-cash items be recorded as rent income each year.  These entries are equal in amount to the sum of (1) Registrant's federal income tax deductions for depreciation, retirements, and amortization of debt discount expense, and (2) all other expenses of the Registrant, except those expenses incurred for the benefit of its shareholders.  For financial reporting purposes, only the cash income is reported, as the non-cash items, although recorded under the terms of the lease, have no financial value because of the indeterminate settlement date.      Registrant has elected to be treated for tax purposes as a real estate investment trust.  As such, the trust itself is exempt from federal income tax, to the extent that its income is distributed to shareholders.  However, dividends paid by Registrant are ordinary taxable income to its shareholders. In order to maintain qualified status, at least 90% of ordinary taxable income must be distributed.  It is Registrant's policy to distribute annually approximately 100% of ordinary taxable income.
None
The properties leased to NSC consist of 112 miles of main line road extending from Pittsburgh Junction, Ohio, through parts of West Virginia, to Connellsville, Pennsylvania; approximately 20 miles of branch lines; and other assets used in the operation of the railroad, such as real estate, machinery and equipment, and supplies, but excluding rolling stock all of which was sold to NSC prior to the effective date of the lease.      The more significant provisions of the lease applicable to the properties are:      NSC at its own expense and without deduction from the rent, will maintain, manage and operate the leased property and make such improvements thereto as it considers desirable.  Such improvements made by NSC become the property of the Registrant, and the cost thereof constitutes a recorded indebtedness of Registrant to NSC.  The indebtedness is offset when non-cash rental is recorded over the depreciable life of the improvements.  Such part of the leased property as is, in the opinion of NSC, not necessary, may be disposed of. The proceeds of any disposition are retained by NSC and constitute an indebtedness of NSC to Registrant. These amounts are due and payable upon termination of the lease, whether by default or expiration. Because of the indeterminate settlement date for these items, such transactions and balances have not been reported in the financial statements since 1982.      Upon termination of the lease, all properties covered by the lease would be returned to Registrant, together with sufficient cash and other assets to permit operation of the railroad for one year.      Following is summary financial data for Norfolk Southern Corporation (NSC), the lessee of the Registrant's properties, as reported in the NSC Form 10-K filed February 23, 2006:                NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES                  ($ in millions, except per share amounts)                              2005       2004       2003       2002       2001 RESULTS OF OPERATION   Railway operating     revenues            $   8,527   $  7,312   $  6,468   $  6,270   $  6,170   Railway operating     expenses                6,410      5,610      5,404      5,112      5,163        Income from          railway          operations         2,117      1,702      1,064      1,158      1,007   Other income-net             74         89         19         66         99   Interest expense on debt    494        489        497        518        553     Income from continuing       operations before       income tax and       accounting changes    1,697      1,302        586        706        553    Provision for income     taxes                     416        379        175        246        191        Income from          continuing          operations before          accounting          changes            1,281        923        411        460        362   Discontinued operations      -          -          10         -          13   Cumulative effect of     changes in accounting     principles, net of     taxes                      -          -         114         -          -        Net income       $   1,281   $    923   $    535   $    460   $    375  PER SHARE DATA   Income from continuing     operations before     accounting changes      - basic            $    3.17   $   2.34   $   1.05   $  1.18    $   0.94      - diluted          $    3.11   $   2.31   $   1.05   $  1.18    $   0.94   Net income - basic    $    3.17   $   2.34   $   1.37   $  1.18    $   0.97              - diluted  $    3.11   $   2.31   $   1.37   $  1.18    $   0.97   Dividends             $    0.48   $   0.36   $   0.30   $  0.26    $   0.24   Stockholders' equity     at Year end         $   22.66   $  19.95   $  17.83   $ 16.71    $  15.78  FINANCIAL POSITION   Total assets          $  25,861   $ 24,750   $ 20,596   $ 19,956   $ 19,418   Total long-term debt,     including current     maturities          $   6,930   $  7,525   $  7,160   $  7,364   $  7,632   Stockholders' equity  $   9,289   $  7,990   $  6,976   $  6,500   $  6,090
There were no legal proceedings.
No matters were submitted during the fourth quarter to a vote of security holders.                                         PART II
Registrant's shares are listed for trading on the American Stock Exchange under the symbol of "PW".  At February 3, 2006, there were approximately 784 holders of record of registrant's shares of beneficial interest   Stock Market and Dividend information per share of beneficial interest.                                         2005 Quarters Ended                                     3/31         6/30         9/30        12/31     Sales price of traded shares          High................... $ 9.80    $    9.49   $     9.44   $     9.75          Low....................   9.10         9.02         8.95         9.03     Dividends paid                  .14          .12          .13          .13                                         2004 Quarters Ended                                     3/31         6/30         9/30        12/31     Sales price of traded shares          High................... $ 9.70    $    9.60   $     9.95   $     9.45          Low....................   8.81         8.75         8.90         8.99     Dividends paid                  .13          .13          .12          .13      It is the Registrant's intention to continue distributing quarterly dividends.  A quarterly dividend of $.13 per share is payable March 31, 2006 to shareholders of record on March 10, 2006.
($Thousands, except per share amounts)                                2005       2004       2003       2002       2001  Revenues                  $    915  $     915  $     915   $    915   $    915 Income available for   distribution                 780        805        799        821        830 Net income                     780        805        799        821        830 Total assets                 9,204      9,209      9,190      9,190      9,200 Per share amounts: Net income                     .52        .53        .53        .54        .55 Income available for   distribution                 .52        .53        .53        .54        .55 Cash dividends                 .52        .51        .53        .55        .55
All of the Registrant's railroad properties are leased to Norfolk and Western Railway Company, now known as Norfolk Southern Corporation (NSC), for 99 years, with unlimited renewals on the same terms.  Cash rental is a fixed amount of $915,000 per year, with no provision for change during the term of the lease and any renewal periods.  This cash rental is the only source of funds.  Although the lease provides for additional rentals to be recorded, these amounts do not increase cash flow or net income as they are charged to NSC's settlement account with no requirement for payment, except at termination or non renewal of the lease.  Due to the indeterminate settlement date, these additional rental amounts are not recorded for financial reporting purposes.  Income available for distribution in 2005 and in 2004 was approximately $780,000 and $805,000, respectively.      Registrant's only cash outlays, other than dividend payments, are for general and administrative expenses, which include professional fees, office rental and director's fees.  Professional fees have increased primarily due to the costs of complying with the requirements of the Sarbanes-Oxley Act of 2002. The leased properties are maintained entirely at NSC's expense.      Since cash revenue is fixed in amount and outlays for general and administrative expenses are relatively modest, inflation has had no material impact on Registrant's reported net income for the past three years.  Although recent inflationary trends have been relatively low, annual rental income is a fixed amount for the current lease term and any renewal periods, and inflation could affect the real dollar value of the rental income over time. Changes in inflationary trends could also affect the general and administration expenses.
Not applicable.
Quarterly financial data (in $thousands, except per share amounts)  2005                  1st Qtr.        2nd Qtr.        3rd Qtr.        4th Qtr.  Revenues           $      229      $      229      $      229      $      228 Net income                164             202             207             209 Per share                 .11             .13             .14             .14 2004  Revenues           $      229      $      229      $      229      $      228 Net income                194             187             214             211 Per share                 .13             .12             .14             .13      Detailed financial statements of Registrant appear on pages F-3 through F-8 of this report.  Per share data for the year is slightly different from the sum of four quarters due to rounding.
None
The President and Vice President and Secretary-Treasurer of Registrant have evaluated the effectiveness of the disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as required by paragraph (b) of Rules 13a-15 and 15d-15 under the Exchange Act, and have concluded that as of the end of the period covered by this report the disclosure controls and procedures were effective.      There was no change in Registrant's internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act during Registrant's last fiscal quarter that materially affected, or is reasonably likely to materially affect, Registrant's internal control over financial reporting.                                     PART III
This information is incorporated herein by reference to Registrant's 2006 Proxy Statement.
Not applicable.
Management's ownership of Registrant's shares of beneficial interest as of February 3, 2006.                                                   Shares         Percent of                                              Beneficially      Outstanding         Name                                     Owned            Shares      Virgil E. Wenger, Trustee                      200             0.001     Herbert E. Jones, Jr.,Trustee                4,000             0.264     Larry R. Parsons, Trustee                   12,500             0.828     C. Howard Capito, Trustee                    1,000             0.066     Herbert E. Jones, III, Trustee        and President                                 0             0.000     All trustees and officers        as a group (6 persons)                   17,700             1.172
This information is set forth in Registrant's 2006 Proxy Statement, which is incorporated herein by reference.
This information is set forth in Registrant's 2006 Proxy Statement, which is incorporated herein by reference.                                        PART IV
(a) 1-2.  A list of all financial statements and financial statement               schedules filed as part of this report is set forth on page               F-1 herein.           3.    Exhibits - all the exhibits listed below are incorporated               herewith by reference to Form 8 Amendment to Annual Report on               Form 10-K for the year ended December 31, 1988:                   3.1  Pittsburgh & West Virginia Railroad Declaration of                       Trust dated February 18, 1967.                  3.2  Pittsburgh & West Virginia Railroad Regulations.                  3.3  Plan and Agreement of Reorganization, dated February 18,                       1967, between Pittsburgh & West Virginia Railroad and                       The Pittsburgh and West Virginia Railway Company                  3.4  Amendment No. 1 to Plan and Agreement of Reorganization                       dated February 18, 1967, between The Pittsburgh and West                       Virginia Railway Company and Pittsburgh & West Virginia                       Railroad.                  10.1 Lease of railroad properties, dated July 12, 1962,                       between the Pittsburgh and West Virginia Railway Company                       and Norfolk and Western Railway Company.                  10.2 Assignment of lease by The Pittsburgh and West Virginia                       Railway Company to Pittsburgh & West Virginia Railroad.           31.  Section 302 Certifications                 31.1   Certifications of Chief Executive Officer pursuant to                       Rule 13a-14(a) of the Securities Exchange Act of 1934,                       as adopted pursuant to Section 302 of the Sarbanes-Oxley                       Act of 2002 (filed herewith).                31.2   Certification of Chief Financial Officer pursuant to                       Rule 13a-14(a) of the Securities Exchange Act of 1934,                       as adopted pursuant to Section 302 of the Sarbanes-Oxley                       Act of 2002 (filed herewith).          32.  Section 906 Certifications                 32.1   Certification of Chief Executive Officer pursuant to                       18 U.S.C. Section 1350, as adopted pursuant to Section                       906 of the Sarbanes-Oxley Act of 2002 (filed herewith).                32.2   Certification of Chief Financial Officer pursuant to                       18 U.S.C. Section 1350, as adopted pursuant to Section                       907 of the Sarbanes-Oxley Act of 2002 (filed herewith).       (b)  An 8-K was filed on December 9, 2005 regarding the resignation of             Charles T. Jones as President and the election of Herbert E.             Jones, III to serve as President until the next annual meeting,             May 18, 2006.                                   SIGNATURES        Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.   PITTSBURGH & WEST VIRGINIA RAILROAD   By  /s/ Robert A. Hamstead     Robert A. Hamstead     Vice President and Secretary-Treasurer  Date: March 27, 2006       Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.        /s/ Herbert E. Jones, Jr.                  /s/ Herbert E. Jones, III          Herbert E. Jones, Jr.                      Herbert E. Jones, III          Chairman of the Board and Trustee          President and Trustee    Date:March 27,2006    CERTIFICATION:  I, Herbert E. Jones, Jr., Chairman of the Board, certify that;  1.  I have reviewed this annual report on Form 10-K of The Pittsburgh & West     Virginia Railroad;  2.  Based on my knowledge, this annual report does not contain any untrue     statement of a material fact or omit to state a material fact necessary     to make the statements made, in light of the circumstances under which     such statements were made, not misleading with respect to the period     covered by this annual report;  3.  Based on my knowledge, the financial statements, and other financial     information included in this report, fairly present in all material     respects the financial condition, results of operations and cash flows of     the registrant as of, and for, the periods presented in this report;  4.  The registrant's other certifying officers and I are responsible for     establishing and maintaining disclosure controls and procedures (as     defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and     we have:      a)  designed such disclosure controls and procedures to ensure that         material information relating to the registrant is made known to us         by others within those entities, particularly during the period in         which this report is being prepared;      b)  evaluated the effectiveness of the registrant's disclosure controls         and procedures as of a date within 90 days prior to the filing date         of this report (the "Evaluation Date"); and      c)  presented in this report our conclusions about the effectiveness of         the disclosure controls and procedures based on our evaluation as of         the Evaluation Date;  5.  The registrant's other certifying officers and I have disclosed, based on     our most recent evaluation, to the registrant's auditors and the audit     committee of registrant's Board of Trustees:      a)  all significant deficiencies in the design or operation of internal         controls which could adversely affect the registrant's ability to         record, process, summarize and report financial data and have         identified for the registrant's auditors any material weaknesses in         internal controls; and      b)  any fraud, whether or not material, that involves management or other         employees who have a significant role in the registrant's internal         controls; and  6.  The registrant's other certifying officers and I have indicated in this     report whether or not there were significant changes in internal controls     or in other factors that could significantly affect internal controls     subsequent to the date of our most recent evaluation, including any     corrective actions with regard to significant deficiencies and material     weaknesses.  Date: March 27, 2006                 /s/ Herbert E. Jones, Jr.                                          Herbert E. Jones, Jr.                                          Chairman of the Board  CERTIFICATION:  I, Herbert E. Jones, III, President, certify that;  1.  I have reviewed this annual report on Form 10-K of The Pittsburgh & West     Virginia Railroad;  2.  Based on my knowledge, this annual report does not contain any untrue     statement of a material fact or omit to state a material fact necessary     to make the statements made, in light of the circumstances under which     such statements were made, not misleading with respect to the period     covered by this annual report;  3.  Based on my knowledge, the financial statements, and other financial     information included in this report, fairly present in all material     respects the financial condition, results of operations and cash flows of     the registrant as of, and for, the periods presented in this report;  4.  The registrant's other certifying officers and I are responsible for     establishing and maintaining disclosure controls and procedures (as     defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we     have:      a)  designed such disclosure controls and procedures to ensure that         material information relating to the registrant is made known to us         by others within those entities, particularly during the period in         which this report is being prepared;      b)  evaluated the effectiveness of the registrant's disclosure controls         and procedures as of a date within 90 days prior to the filing date of         this report (the "Evaluation Date"); and      c)  presented in this report our conclusions about the effectiveness of         the disclosure controls and procedures based on our evaluation as of         the Evaluation Date;  5.  The registrant's other certifying officers and I have disclosed, based on     our most recent evaluation, to the registrant's auditors and the audit     committee of registrant's Board of Trustees:      a)  all significant deficiencies in the design or operation of internal         controls which could adversely affect the registrant's ability to         record, process, summarize and report financial data and have         identified for the registrant's auditors any material weaknesses in         internal controls; and      b)  any fraud, whether or not material, that involves management or other         employees who have a significant role in the registrant's internal         controls; and  6.  The registrant's other certifying officers and I have indicated in this     report whether or not there were significant changes in internal controls     or in other factors that could significantly affect internal controls     subsequent to the date of our most recent evaluation, including any     corrective actions with regard to significant deficiencies and material     weaknesses.  Date: March 27, 2006                      /s/ Herbert E. Jones, III                                               Herbert E. Jones, III                                               President  CERTIFICATION:  I, Robert A. Hamstead, Vice President, Secretary and Treasurer, certify that;  1.  I have reviewed this annual report on Form 10-K of The Pittsburgh & West     Virginia Railroad;  2.  Based on my knowledge, this annual report does not contain any untrue     statement of a material fact or omit to state a material fact necessary     to make the statements made, in light of the circumstances under which     such statements were made, not misleading with respect to the period     covered by this annual report;  3.  Based on my knowledge, the financial statements, and other financial     information included in this report, fairly present in all material     respects the financial condition, results of operations and cash flows     of the registrant as of, and for, the periods presented in this report;  4.  The registrant's other certifying officers and I are responsible for     establishing and maintaining disclosure controls and procedures (as     defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and     we have:      a)  designed such disclosure controls and procedures to ensure that         material information relating to the registrant is made known to us         by others within those entities, particularly during the period in         which this report is being prepared;      b)  evaluated the effectiveness of the registrant's disclosure controls         and procedures as of a date within 90 days prior to the filing date         of this report (the "Evaluation Date"); and      c)  presented in this report our conclusions about the effectiveness of         the disclosure controls and procedures based on our evaluation as of         the Evaluation Date;  5.  The registrant's other certifying officers and I have disclosed, based on     our most recent evaluation, to the registrant's auditors and the audit     committee of registrant's Board of Trustees:      a)  all significant deficiencies in the design or operation of internal         controls which could adversely affect the registrant's ability to         record, process, summarize and report financial data and have         identified for the registrant's auditors any material weaknesses in         internal controls; and      b)  any fraud, whether or not material, that involves management or other         employees who have a significant role in the registrant's internal         controls; and  6.  The registrant's other certifying officers and I have indicated in this     report whether or not there were significant changes in internal controls     or in other factors that could significantly affect internal controls     subsequent to the date of our most recent evaluation, including any     corrective actions with regard to significant deficiencies and material     weaknesses.  Date: March 27, 2006                     /s/ Robert A. Hamstead                                              Robert A. Hamstead                                              Vice President, Secretary                                              and Treasurer                             SECTION 906 CERTIFICATION        In connection with the annual report of the Pittsburgh & West Virginia Railroad (the Trust) on Form 10-K for the period ending December 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Herbert E. Jones, III, President of the Trust, certify, to the best of my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:      (1)  The Report fully complies with the requirements of Section 13(a) or          15(d) of the Securities Exchange Act of 1934; and      (2)  The information contained in the Report fairly presents, in all          material respects, the financial condition and results of operations          of the Trust.   /s/ Herbert E. Jones, III     Herbert E. Jones, III     President  Date: March 27, 2006                             SECTION 906 CERTIFICATION        In connection with the annual report of the Pittsburgh & West Virginia Railroad (the Trust) on Form 10-K for the period ending December 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert A. Hamstead, Vice President, Secretary, and Treasurer of the Trust, certify, to the best of my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:      (1)  The Report fully complies with the requirements of Section 13(a) or          15(d) of the Securities Exchange Act of 1934; and      (2)  The information contained in the Report fairly presents, in all          material respects, the financial condition and results of operations          of the Trust.   /s Robert A. Hamstead    Robert A. Hamstead    Vice President, Secretary, and Treasurer  Date: March 27, 2006                             Audited Financial Statements                        Pittsburgh & West Virginia Railroad                       Years Ended December 31, 2005 and 2004                             TABLE OF CONTENTS                                                                        Page  Report of Independent Registered Public Accounting Firm                F-2  Financial Statements:      Balance Sheet                                                      F-3      Statement of Operations                                            F-4      Statement of Changes in Shareholders' Equity                       F-5      Statement of Cash Flows                                            F-6      Notes to Financial Statements                               F-7 - F-10                                             F-1                    REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM   To the Trustees and Shareholders Pittsburgh & West Virginia Railroad      We have audited the accompanying balance sheet of Pittsburgh & West Virginia Railroad, a Pennsylvania business trust (the Trust), as of December 31, 2005 and 2004, and the related statements of operations, changes in shareholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2005.  These financial statements are the responsibility of the Trust's management.  Our responsibility is to express an opinion on these financial statements based on our audits.      We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.      In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Pittsburgh & West Virginia Railroad as of December 31, 2005 and 2004, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2005, in conformity with U.S. generally accepted accounting principles.     /s/ Gibbons & Kawash Charleston, West Virginia January 27, 2006                                          F-2                          PITTSBURGH & WEST VIRGINIA RAILROAD                                    BALANCE SHEET                               December 31, 2005 and 2004   ASSETS                                           2005                    2004  Net investment in capital lease           $   9,150,000       $      9,150,000 Cash                                             54,343                 59,306                                            $   9,204,343       $       9,209,306   LIABILITIES AND SHAREHOLDERS' EQUITY  Liabilities:     Accounts payable and accrued       liabilities                         $       8,950       $          8,950  Shareholders' equity:     Shares of beneficial interest,        without par value.          Authorized number of          shares - unlimited;          issued and          outstanding - 1,510,000 shares          at December 31, 2005 and 2004        9,145,359              9,145,359     Retained earnings                            50,034                 54,997                                                9,195,393              9,200,356                                            $   9,204,343       $      9,209,306        The accompanying notes are an integral part    of these financial statements.                                         F-3                          PITTSBURGH & WEST VIRGINIA RAILROAD                                STATEMENT OF OPERATIONS                       Years Ended December 31,2005,2004 and 2003                                              2005          2004          2003  Interest income from capital lease     $  915,000   $   915,000   $   915,000 Less general and administrative    expenses                               134,763       110,034       116,404     Net income                          $  780,237   $   804,966   $   798,596  Per share:    Net income                          $      .52   $       .53   $       .53          The accompanying notes are an integral part    of these financial statements.                                         F-4                          PITTSBURGH & WEST VIRGINIA RAILROAD                      STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY                         Years Ended December 2005,2004 and 2003                                                     Shares of                                                 Beneficial            Retained                                                  Interest             Earnings  Balance at December 31, 2002               $     9,145,359        $     21,835     Net income                                          -               798,596    Cash dividends paid ($.53 per share)                -              (800,300)  Balance at December 31, 2003                     9,145,359              20,131     Net income                                          -               804,966    Cash dividends paid ($.51 per share)                -              (770,100)  Balance at December 31, 2004                     9,145,359              54,997     Net income                                          -               780,237    Cash dividends paid ($.52 per share)                -              (785,200)  Balance at December 31, 2005               $     9,145,359        $     50,034            The accompanying notes are an integral part    of these financial statements.                                         F-5                        PITTSBURGH & WEST VIRGINIA RAILROAD                             STATEMENT OF CASH FLOWS                     Years Ended December 31,2005,2004 and 2003                                            2005          2004           2003  Cash flows from operating   activities:      Net income                   $   780,237    $  804,966    $   798,596      Adjustments to reconcile        net income to net cash        provided by operating        activities:           Increase (decrease)             in accounts payable             and accrued             liabilities                   -           6,000)         2,000                 Net cash                 provided by                 operating                 activities            780,237       788,966        800,596  Cash flows used in financing   activities:      Dividends paid                  (785,200)     (770,100)      (800,300)          Net increase           (decrease) in cash           (4,963)       18,866            296  Cash, beginning of year                59,306        40,440         40,144  Cash, end of year                 $    54,343    $   59,306    $    40,440            The accompanying notes are an integral part    of these financial statements.                                         F-6                          PITTSBURGH & WEST VIRGINIA RAILROAD                            NOTES TO FINANCIAL STATEMENTS    1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES      Nature of Operations           Pittsburgh & West Virginia Railroad (the Trust) is a business trust     organized under the laws of Pennsylvania on February 18, 1967, for the     purpose of leasing railroad properties to Norfolk Southern Corporation.     The leased properties consist of a railroad line 112 miles in length,     extending from Connellsville, Washington, and Allegheny Counties in the     Commonwealth of Pennsylvania, Brooke County in the State of West Virginia,     and Jefferson and Harrison Counties in the State of Ohio, to Pittsburgh     Junction, Harrison County, State of Ohio.  There are also branch lines that     total 20 miles in length located in Washington County and Allegheny County     in Pennsylvania and Brooke County, West Virginia.  The lease provides the     Trust's source of revenue, which is received in quarterly installments.      Revenue Recognition           Interest on the capital lease is recognized as earned based on an     implicit rate of 10% over the life of the lease which is assumed to be     perpetual.      Use of Estimates           The preparation of financial statements in conformity with U.S.     generally accepted accounting principles requires management to make     estimates and assumptions that affect certain reported amounts and     disclosures.  Accordingly, actual results could differ from those     estimates.   2 - CAPITAL LEASE           Under the terms of a lease which became effective October 16, 1964     (the "lease"), Norfolk Southern Corporation (formerly Norfolk and Western     Railway Company) (Norfolk Southern) - (the "lessee") leased all of     Pittsburgh & West Virginia Railroad's (the "Trust") real properties,     including its railroad lines, for a term of 99 years, renewable by the     lessee upon the same terms for additional 99-year terms in perpetuity.     The lease provides for a cash rental of $915,000 per annum for the current     99 year lease period and all renewal periods.  The leased properties are     maintained entirely at Norfolk Southern's expense.           The lease may be terminated by the lessee either by expiration of the     initial or any renewal term, or by default of Norfolk Southern.  In the     event of termination, Norfolk Southern is obligated to return to the Trust     all properties covered by the lease, together with sufficient cash and     other assets to permit operation of the railroad for a period of one year.                                         F-7                           PITTSBURGH & WEST VIRGINIA RAILROAD                               NOTES TO FINANCIAL STATEMENTS                                       (Continued)   2 - CAPITAL LEASE (Continued)           Prior to 1983, the lease was accounted for as an operating lease in     accordance with the Statement of Financial Accounting Standards (SFAS)     No. 13, "Accounting for Leases," because the railroad assets as accounted     for under "betterment accounting" were considered similar to land.     Effective January 1, 1983, the Interstate Commerce Commission (ICC)     changed the method of accounting for railroad companies from "betterment     accounting" (which was previously used by the Trust and most railroads) to     "depreciation accounting."  The leased assets, under "depreciation     accounting," are no longer similar to land; and, effective January 1, 1983,     under the provisions of Statement No. 13, the lease is considered a capital     lease and the property deemed sold in exchange for rentals receivable under     the lease.  The Trust has determined that the lease term is perpetual     based on substantial penalties to the lessee upon nonrenewal.  Accordingly,     as of January 1, 1983, the rentals receivable of $915,000 per annum,     recognizing renewal options by the lessee in perpetuity, were estimated to     have a present value of $9,150,000, assuming an implicit interest rate of     10%.   3 - NONCASH RENTAL SETTLEMENT           Under the terms of the lease, a noncash settlement account is     maintained to record amounts due to or due from Norfolk Southern upon     termination of the lease.  The amount is credited with noncash rent     equivalent to: (a) the deductions allowable to the Trust, for tax purposes     for depreciation, amortization or retirements of the leased properties and     amortization of debt discount and expense; and (b) all other expenses of     the Trust, except those incurred for the benefit of the shareholders.  The     settlement account is charged with the cost of capital asset acquisitions     and expenses of the Trust paid for by Norfolk Southern on behalf of the     Trust.           At December 31, 2005 and 2004, the noncash settlement account had a     balance of $13,885,185 and $13,498,805, respectively, receivable from     Norfolk Southern.  The account will not be settled until the expiration of     the lease, whether by default or nonrenewal.  Because of the indeterminate     settlement date of the account, no values have been reported in the     accompanying financial statements for the balance of the account or the     transactions affecting the balance.                                               F-8                           PITTSBURGH & WEST VIRGINIA RAILROAD                              NOTES TO FINANCIAL STATEMENTS                                     (Continued)   4 - INCOME TAXES           The Trust was organized as a Pennsylvania business trust and has     elected to be treated under the Internal Revenue Code as a real estate     investment trust.  As such, the Trust is exempt from Federal taxes on     taxable income and capital gains to the extent that they are distributed     to shareholders.  In order to maintain qualified status, at least 90% of     ordinary taxable income must be distributed; it is the intention of the     Trustees to continue to make sufficient distributions of ordinary taxable     income.  Dividends distributed for the years ended December 31, 2005,     2004, and 2003, were comprised entirely of ordinary income.   5 - RELATED PARTY TRANSACTIONS           A Trustee of the Trust serves as Chairman and CEO of Wheeling & Lake     Erie Railway Company which subleases from Norfolk Southern Corporation the     right of way and real estate owned by the Trust.  The Sublease is     substantially similar by virtue of assignment and assumption of rights and     obligations as the Lease between the Trust and Norfolk Southern     Corporation.  As Chairman and CEO of Wheeling & Lake Erie Railway, the     Trustee exercises the rights and obligations under the Sublease to maintain     the property, to operate the property, and to sell or dispose of the     property not needed for ongoing operations in accordance with the     provisions of the Lease and Sublease.           The Trust leases office space and equipment from a company related to     its Chairman.  Rent is paid on a month to month basis in the amount of     $1,500 per month.   6 - CONTINGENCY           Under the provisions of the lease, the Trust may not issue, without     the prior written consent of Norfolk Southern, any shares or options to     purchase shares or declare any dividends on its shares of beneficial     interest in an amount exceeding the value of the assets not covered by     the lease plus the annual cash rent of $915,000 to be received under the     lease, less any expenses incurred for the benefit of shareholders.  At     December 31, 2005, all net assets are covered by the lease.           The Trust may not borrow any money or assume any guarantees except     with the prior written consent of Norfolk Southern.                                         F-9                           PITTSBURGH & WEST VIRGINIA RAILROAD                              NOTES TO FINANCIAL STATEMENTS                                     (Continued)   7 - SUMMARY OF QUARTERLY RESULTS (UNAUDITED)           The following presents a summary of the unaudited quarterly     financial information for the years ended December 31, 2005 and 2004.                             1st Quarter  2nd Quarter  3rd Quarter  4th Quarter  Year Ended December 31, 2005      Revenue               $   228,750  $   228,750  $   228,750  $   228,750      Net income            $   163,470  $   202,046  $   206,323  $   208,398      Net income per share  $      0.11  $      0.13  $      0.14  $      0.14  Year Ended December 31, 2004      Revenue               $   228,750  $   228,750  $   228,750  $   228,750      Net income            $   193,632  $   186,354  $   214,192  $   210,788      Net income per share  $      0.13  $      0.12  $      0.14  $      0.13                                                   F-10        -----END PRIVACY-ENHANCED MESSAGE-----