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Rail News: Financials

RailAmerica's first-quarter revenue, carloads rise but earnings, income fall

Rising fuel and labor costs dampened RailAmerica Inc.'s quarterly financial results, which were released yesterday.

Although the short-line holding company's consolidated first-quarter revenue of $97 million rose 12.2 percent, quarterly earnings from continuing operations of $4.6 million dropped 20 percent, operating income of $15.7 million decreased 7.6 percent, net income of $1.3 million fell 70 percent and operating expenses increased 17.2 percent to $81.4 million compared with first-quarter 2003. Also, RailAmerica's quarterly operating ratio worsened 2.9 points to 80.8.

"[However], we were encouraged with our improving North American 'same railroad' carload levels, which increased 4.3 percent to 286,981 from 275,219 during the first quarter of 2003," said RailAmerica Chairman Gus Pagonis in a prepared statement. "The 4.3 percent increase is higher than any quarter last year."

During the quarter, RailAmerica sold its 55 percent interest in Chilean railroad Ferronor and reached an agreement to sell Freight Australia to Pacific National for $206 million.

"The [Ferronor] sale eliminated $20 million of debt from our balance sheet," said RailAmerica Executive Vice President and Chief Financial Officer Micahel Howe. "Additionally during the quarter, $8.1 million of our junior convertible bonds were converted into common stock at the conversion price of $10 per share, resulting in a remaining balance of $13.7 million, which will either be converted or redeemed by July 31."

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More News from 4/30/2004