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Rail News: Short Lines & Regionals
Genesee & Wyoming's combined-company 2Q financial results reveal 'continued strength,' says CEO Hellmann
Today, Genesee & Wyoming Inc. (GWI) reported that its total second-quarter operating revenue leaped 84.3 percent to $400.7 million compared with second-quarter 2012. But in a more comparative context for revenue consolidated with former RailAmerica Inc. holdings, the "combined company, same-railroad adjusted" operating revenue increased 10 percent in the quarter.
GWI is providing combined company comparisons as though it owned the RailAmerica railroads — which were acquired late last year — during 2012, company officials said in a press release, adding that they reclassified RailAmerica's 2012 information to conform with GWI's financial reporting.
"The second quarter was the second reporting period in which GWI's consolidated results included the former RailAmerica railroads. We are pleased to report continued strength in our financial results, with adjusted earnings per share up more than 50 percent," said GWI President and Chief Executive Officer Jack Hellmann. "Our combined company same-railroad adjusted revenue [gain was] led by iron ore in Australia, petroleum products in North America and improving steam coal shipments in the United States."
On a combined company/same-railroad basis, GWI also reported that freight revenue rose 12.6 percent to $297.7 million, non-freight revenue increased 2.9 percent to $100.7 million and traffic climbed 7.7 percent to 34,296 carloads. In addition, income from operations ballooned from $62.5 million in second-quarter 2012 to $107.4 million in second-quarter 2013, net income nearly doubled from $36.4 million in the year-ago period to $65.1 million and GWI's adjusted operating ratio improved 2.5 points to 73.2.
"Each of our 11 operating regions effectively managed its costs. As a result, in North America, our adjusted operating ratio improved 2.1 percentage points to 74, and in Australia, our adjusted operating ratio improved 4.8 percentage points to 70," said Hellmann.
For the remainder of 2013, GWI plans to focus on commercial development across its broad national footprint, further reduce costs, and ensure a successful startup of new iron-ore projects in both Australia and Canada, he said.
"With our integrated operations performing well, our balance sheet deleveraging and $400 million of revolver capacity, we also continue to evaluate multiple investment opportunities," said Hellmann.
GWI owns and operates 111 railroads in the United States, Australia, Canada, Netherlands and Belgium, including 108 regionals and short lines in North America.
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