Providence and Worcester Railroad Company (PWX)

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Providence and Worcester Railroad Company Announces Dividend

Providence and Worcester Railroad Company (NASDAQ: “PWX”) announced that, at its regular quarterly meeting on January 25, 2012, the Board of Directors of the Company declared a dividend of $.04 per share on the outstanding Common Stock of the Company, payable on February 24, 2012 to common shareholders of record on February 10, 2012.

In addition, the Board of Directors declared a 10% noncumulative annual dividend of $5.00 per share on the outstanding preferred stock of the Company, payable on February 24, 2012 to preferred shareholders of record on February 10, 2012.

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.

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