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On Friday, Providence and Worcester Railroad Co. (P&W) reported third-quarter net income of $158,000 compared with $534,000 in third-quarter 2008. Diluted income per common share fell from 11 cents in the year-ago period to three cents.

Operating revenue declined 25.4 percent to $6.1 million primarily because of lower conventional freight and container volumes.

“Signs indicating future increases in traffic volume have been mixed and, therefore, management cannot definitely predict when economic conditions will improve sufficiently to enable the company to return to operating profitability,” P&W officials said in a prepared statement.

Quarterly operating expenses decreased 24.4 percent to $6 million as fuel costs and usage accounted for about one-third of the decline. P&W also reduced operating expenses by $390,000 because of net funds received from a third-party shipper to fund track maintenance expenditures in exchange for certain track maintenance credits.

The 545-mile P&W operates lines in Rhode Island, New York, Connecticut and Massachusetts, as well as two intermodal yards in Worcester, Mass.