Exhibit 99.1
Genesee & Wyoming Reports Results for the Fourth Quarter of 2011
GREENWICH, Conn.--(BUSINESS WIRE)--February 8, 2012--Genesee & Wyoming Inc. (GWI) (NYSE: GWR) reported net income in the fourth quarter of 2011 of $33.3 million, compared with net income of $19.9 million in the fourth quarter of 2010. GWI's diluted earnings per share (EPS) in the fourth quarter of 2011 were $0.77 with 42.9 million weighted average shares outstanding, compared with diluted EPS of $0.47 with 42.3 million weighted average shares outstanding in the fourth quarter of 2010.
In the fourth quarter of 2011 and 2010, GWI’s results included certain significant items that are set forth in the table below ($ in millions, except per share amounts).
Income Before Taxes Impact | Net Income Impact | Diluted EPS Impact | ||||||||||||||||||||
Q4 2011 | ||||||||||||||||||||||
Acquisition-Related Income Tax Benefits | $ | - | $ | 1.9 | $ | 0.04 | ||||||||||||||||
Gain/(Loss) on Sale and | ||||||||||||||||||||||
Impairment of Assets | $ | 3.0 | $ | 1.9 | $ | 0.04 | ||||||||||||||||
Edith River Derailment Costs | $ | (1.8 | ) | $ | (1.3 | ) | $ | (0.03 | ) | |||||||||||||
Business/Corporate Development Expenses | $ | (0.8 | ) | $ | (0.5 | ) | $ | (0.01 | ) | |||||||||||||
Q4 2010 | ||||||||||||||||||||||
Acquisition-Related Expenses | $ | (24.0 | ) | $ | (16.5 | ) | $ | (0.39 | ) | |||||||||||||
Retroactive Short Line Tax Credit | ||||||||||||||||||||||
for first nine months of 2010 | $ | - | $ | 7.8 | $ | 0.18 | ||||||||||||||||
Acquisition-Related Foreign | ||||||||||||||||||||||
Currency Expense | $ | (1.7 | ) | $ | (1.1 | ) | $ | (0.03 | ) | |||||||||||||
Gain on Legal Settlement | $ | 8.7 | $ | 5.1 | $ | 0.12 | ||||||||||||||||
Gain on Sale of Assets | $ | 2.2 | $ | 1.5 | $ | 0.03 | ||||||||||||||||
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GWI’s income from operations (operating income) in the fourth quarter of 2011 and for the twelve months ended December 31, 2011 was $45.4 million and $191.8 million respectively, with an operating ratio of 78.4% and 76.9% respectively.
Comments from the Chief Executive Officer
Jack Hellmann, President and CEO of GWI commented, "Our fourth quarter revenues increased 24% to $210 million and our adjusted operating income increased 22% to $45 million, with an adjusted operating ratio of 78.6% (1). Our diluted earnings per share of $0.77 were a Company-record for the fourth quarter. Nevertheless, our operating results in both North America and Australia were lower than our expectations. In North America, our results were affected by the extended outage of a transmission line to a major power plant, a lag in diesel fuel cost recovery and higher transportation expense. In Australia, our fourth quarter results were affected by the derailment resulting from the washout of a main line bridge over the Edith River by Cyclone Grant on December 27th, as well as higher operating expense in the Adelaide to Darwin corridor."
"Our 2011 results were good. First, we completed the year with a reportable injury index of 0.53 per 200,000 man hours, which made our consolidated results the safest in the railroad industry for the third consecutive year. Second, our revenue increased 32% to $829 million, our adjusted operating income increased 35% to $191 million and our adjusted operating ratio was 77.0%, all Company records (1). Finally, our reported earnings per share increased more than 40%."
"Looking ahead, we anticipate that our business will build over the course of 2012. During the first quarter of 2012, we expect our Australian operations to continue to be negatively impacted by the Edith River bridge closure until its scheduled reopening in mid-February and our North American operations to be adversely affected by lower steam coal shipments in the U.S. due to warm winter weather. Offsetting these items, we expect favorable 2012 contributions from the newly acquired Arizona Eastern Railway, the final delivery of new high horsepower locomotives for our Australian intermodal service in the second quarter, as well as the start-up of a new Australian iron ore contract in the fourth quarter of 2012. We believe that this ramp-up in our core business combined with several potential new investments in the natural resources sector in North America and Australia positions us well for the second half of 2012 and beyond.”
Results from Continuing Operations
In the fourth quarter of 2011, GWI's total operating revenues increased $40.7 million, or 24.0%, to $210.4 million, compared with $169.7 million in the fourth quarter of 2010. The increase included $27.5 million in revenues from acquisitions and a $13.2 million, or 7.8%, increase in same railroad operating revenues. During the fourth quarter of 2011, the net appreciation of foreign currencies increased same railroad operating revenues by $0.8 million. Other than the $0.8 million net impact from foreign currency, GWI’s same railroad operating revenues increased $12.5 million, or 7.3%.
Same railroad freight revenues in the fourth quarter of 2011 increased by $11.1 million, or 10.4%, to $117.8 million, compared with $106.7 million in the fourth quarter of 2010. Other than a $0.4 million increase from the net impact of foreign currency appreciation, GWI’s same railroad freight revenues increased by $10.7 million, or 10.0%.
GWI's traffic in the fourth quarter of 2011 was 246,794 carloads, an increase of 21,824 carloads, or 9.7%, compared with the fourth quarter of 2010. The increase in carloads included 19,030 carloads from acquisitions and an increase of 2,794 carloads, or 1.2%, from same railroad traffic in the fourth quarter of 2011. The same railroad traffic increase was principally due to increases of 6,257 carloads of metals traffic, 3,112 carloads of minerals and stone traffic, 2,149 carloads of farm and food products traffic, partially offset by a decline of 5,626 carloads of coal and coke traffic and 2,497 carloads of other commodity traffic. All remaining traffic decreased by a net 601 carloads.
Average same railroad freight revenues per carload increased 9.1% in the fourth quarter of 2011. The net appreciation of the Australian and Canadian dollars versus the U.S. dollar, higher fuel surcharges and changes in commodity mix increased average revenues per carload by 0.5%, 2.3% and 0.6%, respectively. Other than these factors, same railroad average freight revenues per carload increased 5.7%. Average freight revenues per carload were impacted by changes in the mix of customers within certain commodity groups, primarily coal and metals.
GWI’s same railroad non-freight revenues in the fourth quarter of 2011 increased by $2.1 million, or 3.3%, to $65.1 million compared with $63.0 million in the fourth quarter of 2010. Other than a $0.3 million increase from the net impact from foreign currency, GWI’s same railroad non-freight revenues increased by $1.8 million, or 2.8%, primarily due to higher railcar switching revenues in the U.S. and Canada.
GWI's operating income in the fourth quarter of 2011 was $45.4 million, an increase of $21.5 million, compared with $23.9 million in the fourth quarter of 2010. The operating ratio was 78.4% in the fourth quarter of 2011 compared with an operating ratio of 85.9% in the fourth quarter of 2010. In the fourth quarter of 2011, operating income benefited $3.0 million from net gain/(loss) on the sale and impairment of assets, partially offset by Edith River derailment costs of $1.8 million and business/corporate development costs of $0.8 million. In the fourth quarter of 2010, operating income was reduced $24.0 million as a result of FreightLink acquisition-related expenses, partially offset by an $8.7 million gain from a legal settlement associated with a past acquisition and $2.2 million in gains on the sale of assets. Excluding these items, GWI's adjusted operating ratio was 78.6% in the fourth quarter of 2011, compared with an adjusted operating ratio of 78.2% in the fourth quarter of 2010. (1)
GWI’s effective tax rate was 16.0% in the fourth quarter of 2011, which included acquisition-related tax benefits of approximately $1.9 million. The fourth quarter 2011 tax rate also reflects the benefit of a valuation allowance reduction of $0.9 million and a benefit of $1.2 million related to the cumulative effect of adjusting the first nine months of 2011 to the full year 2011 effective tax rate. GWI’s effective tax rate in the fourth quarter of 2010 was a negative 22.4%, driven primarily by the retroactive impact of the Short Line Tax Credit for the first nine months of 2010 of $7.8 million. The Short Line Tax Credit was extended during the fourth quarter of 2010 for the period from January 1, 2010, through December 31, 2011.
Consolidated Annual Results – Continuing Operations
GWI reported net income for the twelve months ended December 31, 2011, of $119.5 million, compared with net income of $81.3 million for the twelve months ended December 31, 2010. GWI's diluted EPS for the twelve months ended December 31, 2011 were $2.79 with 42.8 million weighted average shares outstanding, compared with diluted EPS of $1.94 with 41.9 million weighted average shares outstanding for the twelve months ended December 31, 2010. For the twelve months ended December 31, 2011, GWI reported income from continuing operations of $119.5 million, a 51.9% increase over $78.7 million for the twelve months ended December 31, 2010. GWI's diluted earnings per share from continuing operations were $2.79 for the twelve months ended December 31, 2011 (with 42.8 million weighted average shares outstanding), a 48.4% increase over $1.88 for the twelve months ended December 31, 2010 (with 41.9 million weighted average shares outstanding).
GWI’s 2011 results included $5.7 million in net gain/(loss) on the sale and impairment of assets ($3.9 million after-tax, or $0.09 per diluted share), $3.5 million of business/corporate development costs ($2.3 million after-tax, or $0.05 per diluted share), $1.8 million of Edith River derailment costs ($1.3 million after-tax, or $0.03 per diluted share), $1.9 million of acquisition-related income tax benefits ($0.04 per diluted share) and a $0.9 million gain on sale of investments ($0.8 million after-tax, or $0.02 per diluted share). GWI’s 2010 results included a total of $28.2 million in FreightLink acquisition-related expenses ($19.2 million after-tax, or $0.46 per diluted share), $6.4 million in gains on the sale of assets ($4.3 million after-tax, or $0.10), a $2.3 million gain on the reversal of restructuring charges ($1.5 million after-tax, or $0.04 per diluted share) related to the Huron Central Railway, an $8.7 million gain associated with a legal settlement ($5.1 million after-tax, or $0.12 per diluted share) and $1.7 million of acquisition-related foreign currency expense ($1.1 million after-tax, or $0.03 per diluted share).
Free Cash Flow from Continuing Operations (2)
(in millions) | Twelve Months Ended December 31, | ||||||||
2011 | 2010 | ||||||||
Net cash provided by operating activities | $ 173.5 | $ 171.8 | |||||||
Net cash used in investing activities, excluding new | |||||||||
Australian equipment investments | (156.9) | (388.9) | |||||||
Net cash paid/(received) for acquisitions/divestitures (a) | 88.6 | 319.8 | |||||||
Cash paid for acquisition-related expenses (b) | 13.0 | 14.9 | |||||||
Free cash flow before new Australian | |||||||||
equipment investments | 118.1 | 117.6 | |||||||
New Australian equipment | (78.2) | - | |||||||
Free cash flow (2) | $ 39.9 | $ 117.6 | |||||||
(a) | The 2011 period primarily included $89.9 million in net cash paid for the acquisition of AZER. The 2010 period primarily included $320.0 million in net cash paid for the acquisition of FreightLink. |
(b) | The 2011 period includes Australian stamp duty expenses accrued as of December 31, 2010, but paid in 2011. The 2010 period includes Australian stamp duty expense incurred and paid in 2010. |
GWI’s continuing operations generated free cash flow of $39.9 million and $117.6 million for the twelve months ended December 31, 2011 and 2010, respectively. For the twelve months ended December 31, 2011, changes in working capital decreased net cash flow from operating activities by $36.8 million. Of the $36.8 million, $12.3 million was due to an increase in accounts receivable driven by an increase in business in 2011 and $25.6 million was due to a reduction in accounts payable and accrued expenses. The $25.6 million included $13.0 million associated with the payment of Australian stamp duty for the acquisition of Freightlink in Australia. For the twelve months ended December 31, 2010, changes in working capital increased net cash flow from operating activities by $18.5 million.
Net cash used in investing activities of $235.1 million for the twelve months ended December 31, 2011, included $178.7 million in purchases of property and equipment, including $78.2 million for the investment in new Australian locomotives and wagons and $89.9 million in net cash paid for acquisitions, partially offset by $22.6 million in grant proceeds received from outside parties and $9.5 million from the sale of assets. Net cash used in investing activities of $388.9 million for the twelve months ended December 31, 2010, included $320.0 million in net cash paid for acquisitions, $119.8 million in purchases of property and equipment, partially offset by $40.8 million in grant proceeds received from outside parties and $10.0 million from the sale of assets.
Conference Call and Webcast Details
As previously announced, GWI's conference call to discuss financial results for the fourth quarter and full year will be held Wednesday, February 8, 2012, at 11 a.m. EST. The dial-in number for the teleconference is (800) 230-1059; outside U.S., call (612) 234-9960, or the call may be accessed live over the Internet (listen only) under the "Investors" tab of GWI's website (http://www.gwrr.com), by selecting "Fourth Quarter and Full Year Earnings Audio Webcast." Management will be referring to a slide presentation that will also be available under the “Investors” tab of GWI’s website prior to the conference call. An audio replay of the conference call will be accessible via the “Investors” tab of GWI's website starting at 1 p.m. EST on February 8, 2012, until the following quarter’s earnings press release. Telephone replay is available for 30 days beginning at 1 p.m. EST on February 8, 2012, by dialing (800) 475-6701 (or outside U.S., dial 320-365-3844). The access code is 222297.
About Genesee & Wyoming Inc.
GWI owns and operates short line and regional freight railroads and provides railcar switching services in the United States, Australia, Canada, the Netherlands and Belgium. In addition, we operate the Tarcoola to Darwin rail line, which links the Port of Darwin with the Australian interstate rail network in South Australia. Operations currently include 65 railroads organized in 10 regions, with more than 7,600 miles of owned and leased track and approximately 1,400 additional miles under track access arrangements. We provide rail service at 17 ports in North America and Europe and perform contract coal loading and railcar switching for industrial customers.
Cautionary Statement Concerning Forward-Looking Statements
This press release contains forward-looking statements regarding future events and the future performance of Genesee & Wyoming Inc. that are based on current expectations, estimates and projections about our industry, management's beliefs, and assumptions made by management. Words such as "anticipates," "intends," "plans," "believes," “will,” "seeks," "expects," "estimates," variations of these words and similar expressions are intended to identify these forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions, including the following risks applicable to all of our operations: risks related to the acquisition and integration of railroads; economic, political and industry conditions; customer demand, retention and contract continuation; legislative and regulatory developments, including changes in environmental and other laws and regulations to which we are subject; increased competition in relevant markets; funding needs and financing sources; unpredictability of fuel costs; susceptibility to various legal claims and lawsuits; strikes or work stoppages; severe weather conditions and other natural occurrences; and others including but not limited to, those noted in our 2010 Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q under “Risk Factors.” Therefore, actual results may differ materially from those expressed or forecasted in any such forward-looking statements. Forward-looking statements speak only as of the date of this press release or as of the date they were made. GWI disclaims any intention to update the current expectations or forward-looking statements contained in this press release.
(1) The operating income and operating ratios that exclude the items described above are non-GAAP financial measures and are not intended to replace the operating income and operating ratios calculated using total operating expenses and total revenues, calculated on a basis consistent with GAAP. The information required by Item 10(e) of Regulation S-K under the Securities Act of 1933 and the Securities Exchange Act of 1934 and Regulation G under the Securities Exchange Act of 1934, including reconciliation to the operating income and operating ratios calculated using amounts determined in accordance with GAAP, is included in the tables attached to this press release.
(2) Free cash flow is a non-GAAP financial measure and is not intended to replace net cash provided by operating activities, its most directly comparable GAAP measure. The information required by Item 10(e) of Regulation S-K under the Securities Act of 1933 and the Securities Exchange Act of 1934 and Regulation G under the Securities Exchange Act of 1934, including a reconciliation to net cash provided by operating activities, is included in the tables attached to this press release.
GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||||||||
FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2011 AND 2010 | ||||||||||||||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||||||||||||||
OPERATING REVENUES | $ | 210,386 | $ | 169,671 | $ | 829,096 | $ | 630,195 | ||||||||||||||||||||
OPERATING EXPENSES | 164,998 | 145,752 | 637,317 | 499,785 | ||||||||||||||||||||||||
INCOME FROM OPERATIONS | 45,388 | 23,919 | 191,779 | 130,410 | ||||||||||||||||||||||||
INTEREST INCOME | 757 | 800 | 3,243 | 2,397 | ||||||||||||||||||||||||
INTEREST EXPENSE | (7,852 | ) | (6,900 | ) | (38,617 | ) | (23,147 | ) | ||||||||||||||||||||
GAIN ON SALE OF INVESTMENT | 13 | - | 907 | - | ||||||||||||||||||||||||
OTHER INCOME/(EXPENSE), NET | 1,307 | (1,520 | ) | 712 | (827 | ) | ||||||||||||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 39,613 | 16,299 | 158,024 | 108,833 | ||||||||||||||||||||||||
PROVISION FOR/(BENEFIT FROM) INCOME TAXES | 6,339 | (3,653 | ) | 38,531 | 30,164 | |||||||||||||||||||||||
INCOME FROM CONTINUING OPERATIONS | 33,274 | 19,952 | 119,493 | 78,669 | ||||||||||||||||||||||||
INCOME/(LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX | 1 | (82 | ) | (9 | ) | 2,591 | ||||||||||||||||||||||
NET INCOME | $ | 33,275 | $ | 19,870 | $ | 119,484 | $ | 81,260 | ||||||||||||||||||||
BASIC EARNINGS PER SHARE: | ||||||||||||||||||||||||||||
BASIC EARNINGS PER COMMON SHARE FROM CONTINUING OPERATIONS | $ | 0.83 | $ | 0.51 | $ | 2.99 | $ | 2.02 | ||||||||||||||||||||
BASIC EARNINGS PER COMMON SHARE FROM DISCONTINUED OPERATIONS | - | - | - | 0.07 | ||||||||||||||||||||||||
BASIC EARNINGS PER COMMON SHARE | $ | 0.83 | $ | 0.51 | $ | 2.99 | $ | 2.09 | ||||||||||||||||||||
WEIGHTED AVERAGE SHARES - BASIC | 40,166 | 39,219 | 39,912 | 38,886 | ||||||||||||||||||||||||
DILUTED EARNINGS PER SHARE: | ||||||||||||||||||||||||||||
DILUTED EARNINGS PER COMMON SHARE FROM CONTINUING OPERATIONS | $ | 0.77 | $ | 0.47 | $ | 2.79 | $ | 1.88 | ||||||||||||||||||||
DILUTED EARNINGS PER COMMON SHARE FROM DISCONTINUED OPERATIONS | - | - | - | 0.06 | ||||||||||||||||||||||||
DILUTED EARNINGS PER COMMON SHARE | $ | 0.77 | $ | 0.47 | $ | 2.79 | $ | 1.94 | ||||||||||||||||||||
WEIGHTED AVERAGE SHARES - DILUTED | 42,946 | 42,313 | 42,772 | 41,889 | ||||||||||||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||||||||
AS OF DECEMBER 31, 2011 AND 2010 | ||||||||||||||||
(in thousands) | ||||||||||||||||
(unaudited) | ||||||||||||||||
December 31, | December 31, | |||||||||||||||
ASSETS | 2011 | 2010 | ||||||||||||||
CURRENT ASSETS: | ||||||||||||||||
Cash and cash equivalents | $ | 27,269 | $ | 27,417 | ||||||||||||
Accounts receivable, net | 165,768 | 132,225 | ||||||||||||||
Materials and supplies | 14,445 | 13,259 | ||||||||||||||
Prepaid expenses and other | 13,332 | 14,529 | ||||||||||||||
Deferred income tax assets, net | 19,385 | 21,518 | ||||||||||||||
Total current assets | 240,199 | 208,948 | ||||||||||||||
PROPERTY AND EQUIPMENT, net | 1,643,589 | 1,444,177 | ||||||||||||||
GOODWILL | 160,277 | 160,629 | ||||||||||||||
INTANGIBLE ASSETS, net | 230,628 | 237,355 | ||||||||||||||
DEFERRED INCOME TAX ASSETS, net | 2,342 | 2,879 | ||||||||||||||
OTHER ASSETS, net | 17,122 | 13,572 | ||||||||||||||
Total assets | $ | 2,294,157 | $ | 2,067,560 | ||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||
CURRENT LIABILITIES: | ||||||||||||||||
Current portion of long-term debt | $ | 57,168 | $ | 103,690 | ||||||||||||
Accounts payable | 134,081 | 124,948 | ||||||||||||||
Accrued expenses | 69,097 | 76,248 | ||||||||||||||
Deferred income tax liabilities, net | 925 | - | ||||||||||||||
Total current liabilities | 261,271 | 304,886 | ||||||||||||||
LONG-TERM DEBT, less current portion | 569,026 | 475,174 | ||||||||||||||
DEFERRED INCOME TAX LIABILITIES, net | 285,780 | 263,361 | ||||||||||||||
DEFERRED ITEMS - grants from outside parties | 198,824 | 183,356 | ||||||||||||||
OTHER LONG-TERM LIABILITIES | 18,622 | 23,543 | ||||||||||||||
TOTAL STOCKHOLDERS' EQUITY | 960,634 | 817,240 | ||||||||||||||
Total liabilities and stockholders' equity | $ | 2,294,157 | $ | 2,067,560 | ||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||||
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2011 AND 2010 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||
(unaudited) | ||||||||||||||||||
Twelve Months Ended | ||||||||||||||||||
December 31, | ||||||||||||||||||
2011 | 2010 | |||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||||||
Net income | $ | 119,484 | $ | 81,260 | ||||||||||||||
Adjustments to reconcile net income to net cash provided | ||||||||||||||||||
by operating activities: | ||||||||||||||||||
Loss/(income) from discontinued operations, net of tax | 9 | (2,591 | ) | |||||||||||||||
Depreciation and amortization | 66,481 | 51,166 | ||||||||||||||||
Compensation cost related to equity awards | 7,776 | 7,174 | ||||||||||||||||
Excess tax benefits from share-based compensation | (2,820 | ) | (1,975 | ) | ||||||||||||||
Deferred income taxes | 26,291 | 12,009 | ||||||||||||||||
Stamp duty | - | 12,625 | ||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (5,660 | ) | (6,441 | ) | ||||||||||||||
Gain on sale of investments | (907 | ) | - | |||||||||||||||
Gain on insurance recoveries | (1,061 | ) | - | |||||||||||||||
Insurance proceeds received | 646 | - | ||||||||||||||||
Changes in assets and liabilities which provided (used) cash, net of effect of acquisitions: | ||||||||||||||||||
Accounts receivable, net | (12,307 | ) | (18,402 | ) | ||||||||||||||
Materials and supplies | (1,206 | ) | (205 | ) | ||||||||||||||
Prepaid expenses and other | 3,543 | (762 | ) | |||||||||||||||
Accounts payable and accrued expenses | (25,556 | ) | 36,243 | |||||||||||||||
Other assets and liabilities, net | (1,235 | ) | 1,651 | |||||||||||||||
Net cash provided by operating activities from continuing operations | 173,478 | 171,752 | ||||||||||||||||
Net cash (used in)/provided by operating activities from discontinued operations | (13 | ) | 933 | |||||||||||||||
Net cash provided by operating activities | 173,465 | 172,685 | ||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||||||
Purchase of property and equipment | (178,668 | ) | (119,840 | ) | ||||||||||||||
Grant proceeds from outside parties | 22,642 | 40,802 | ||||||||||||||||
Cash paid for acquisitions, net of cash acquired | (89,935 | ) | (320,023 | ) | ||||||||||||||
Proceeds from sale of investments | 1,369 | 208 | ||||||||||||||||
Proceeds from disposition of property and equipment | 9,464 | 9,991 | ||||||||||||||||
Net cash used in investing activities from continuing operations | (235,128 | ) | (388,862 | ) | ||||||||||||||
Net cash provided by investing activities from discontinued operations | - | 1,831 | ||||||||||||||||
Net cash used in investing activities | (235,128 | ) | (387,031 | ) | ||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||||||
Principal payments on long-term borrowings, including capital leases | (533,544 | ) | (82,296 | ) | ||||||||||||||
Proceeds from issuance of long-term debt | 581,394 | 205,446 | ||||||||||||||||
Debt amendment/issuance costs | (4,742 | ) | (2,514 | ) | ||||||||||||||
Proceeds from employee stock purchases | 17,433 | 18,205 | ||||||||||||||||
Treasury stock purchases | (1,326 | ) | (850 | ) | ||||||||||||||
Excess tax benefits from share-based compensation | 2,820 | 1,975 | ||||||||||||||||
Net cash provided by financing activities from continuing operations | 62,035 | 139,966 | ||||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | (521 | ) | (4,009 | ) | ||||||||||||||
CHANGE IN CASH BALANCES INCLUDED IN CURRENT ASSETS OF DISCONTINUED OPERATIONS | 1 | 99 | ||||||||||||||||
DECREASE IN CASH AND CASH EQUIVALENTS | (148 | ) | (78,290 | ) | ||||||||||||||
CASH AND CASH EQUIVALENTS, beginning of period | 27,417 | 105,707 | ||||||||||||||||
CASH AND CASH EQUIVALENTS, end of period | $ | 27,269 | $ | 27,417 | ||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||
SELECTED CONSOLIDATED FINANCIAL INFORMATION | ||||||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
December 31, | ||||||||||||||||||||||||||||
2011 | 2010 | |||||||||||||||||||||||||||
% of | % of | |||||||||||||||||||||||||||
Amount | Revenue | Amount | Revenue | |||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||
Freight | $ | 148,793 | 70.7 | % | $ | 106,655 | 62.9 | % | ||||||||||||||||||||
Non-freight | 61,593 | 29.3 | % | 63,016 | 37.1 | % | ||||||||||||||||||||||
Total revenues | $ | 210,386 | 100.0 | % | $ | 169,671 | 100.0 | % | ||||||||||||||||||||
Operating Expense Comparison: | ||||||||||||||||||||||||||||
Natural Classification | ||||||||||||||||||||||||||||
Labor and benefits | $ | 60,118 | 28.6 | % | $ | 55,379 | 32.6 | % | ||||||||||||||||||||
Equipment rents | 11,023 | 5.2 | % | 8,375 | 4.9 | % | ||||||||||||||||||||||
Purchased services | 21,249 | 10.1 | % | 14,941 | 8.8 | % | ||||||||||||||||||||||
Depreciation and amortization | 17,700 | 8.4 | % | 13,760 | 8.1 | % | ||||||||||||||||||||||
Diesel fuel used in operations | 22,958 | 10.9 | % | 14,170 | 8.5 | % | ||||||||||||||||||||||
Diesel fuel sold to third parties | 4,745 | 2.3 | % | 4,779 | 2.8 | % | ||||||||||||||||||||||
Casualties and insurance | 5,783 | 2.7 | % | 4,104 | 2.4 | % | ||||||||||||||||||||||
Materials | 6,902 | 3.3 | % | 5,450 | 3.2 | % | ||||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (2,952 | ) | (1.4 | %) | ( 2,159 | ) | (1.3 | %) | ||||||||||||||||||||
Gain on settlement | - | 0.0 | % | (8,707 | ) | (5.1 | %) | |||||||||||||||||||||
Gain on insurance recoveries | (18 | ) | 0.0 | % | - | 0.0 | % | |||||||||||||||||||||
Stamp duty | - | 0.0 | % | 16,369 | 9.6 | % | ||||||||||||||||||||||
Restructuring charges | - | 0.0 | % | - | 0.0 | % | ||||||||||||||||||||||
Other expenses | 17,490 | 8.3 | % | 19,291 | 11.4 | % | ||||||||||||||||||||||
Total operating expenses | $ | 164,998 | 78.4 | % | $ | 145,752 | 85.9 | % | ||||||||||||||||||||
Functional Classification | ||||||||||||||||||||||||||||
Transportation | $ | 68,810 | 32.7 | % | $ | 53,524 | 31.5 | % | ||||||||||||||||||||
Maintenance of ways and structures | 22,468 | 10.6 | % | 15,224 | 9.0 | % | ||||||||||||||||||||||
Maintenance of equipment | 22,669 | 10.8 | % | 18,027 | 10.6 | % | ||||||||||||||||||||||
Diesel fuel sold to third parties | 4,745 | 2.3 | % | 4,779 | 2.8 | % | ||||||||||||||||||||||
General and administrative | 31,576 | 15.0 | % | 34,935 | 20.6 | % | ||||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (2,952 | ) | (1.4 | %) | ( 2,159 | ) | (1.3 | %) | ||||||||||||||||||||
Gain on settlement | - | 0.0 | % | (8,707 | ) | (5.1 | %) | |||||||||||||||||||||
Gain on insurance recoveries | (18 | ) | 0.0 | % | - | 0.0 | % | |||||||||||||||||||||
Stamp duty | - | 0.0 | % | 16,369 | 9.7 | % | ||||||||||||||||||||||
Restructuring charges | - | 0.0 | % | - | 0.0 | % | ||||||||||||||||||||||
Depreciation and amortization | 17,700 | 8.4 | % | 13,760 | 8.1 | % | ||||||||||||||||||||||
Total operating expenses | $ | 164,998 | 78.4 | % | $ | 145,752 | 85.9 | % | ||||||||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||
SELECTED CONSOLIDATED FINANCIAL INFORMATION | |||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||||||||
(unaudited) | |||||||||||||||||||||||||||||||||||||||
Three Months Ended December 31, 2011 | North American & European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||||||||||||||
% of Total | % of Total | % of Total | |||||||||||||||||||||||||||||||||||||
Revenues: | Amount | Revenues | Amount | Revenues | Amount | Revenues | |||||||||||||||||||||||||||||||||
Freight | $ | 98,643 | 70.4 | % | $ | 50,150 | 71.4 | % | $ | 148,793 | 70.7 | % | |||||||||||||||||||||||||||
Non-freight (excluding fuel sales) | 41,529 | 29.6 | % | 15,010 | 21.4 | % | 56,539 | 26.9 | % | ||||||||||||||||||||||||||||||
Fuel sales to third parties | - | 0.0 | % | 5,054 | 7.2 | % | 5,054 | 2.4 | % | ||||||||||||||||||||||||||||||
Total revenues | 140,172 | 100.0 | % | 70,214 | 100.0 | % | 210,386 | 100.0 | % | ||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||
Labor and benefits | 47,367 | 33.8 | % | 12,751 | 18.1 | % | 60,118 | 28.6 | % | ||||||||||||||||||||||||||||||
Equipment rents | 6,609 | 4.7 | % | 4,414 | 6.3 | % | 11,023 | 5.2 | % | ||||||||||||||||||||||||||||||
Purchased services | 7,478 | 5.3 | % | 13,771 | 19.6 | % | 21,249 | 10.1 | % | ||||||||||||||||||||||||||||||
Depreciation and amortization | 12,375 | 8.8 | % | 5,325 | 7.6 | % | 17,700 | 8.4 | % | ||||||||||||||||||||||||||||||
Diesel fuel used in operations | 14,984 | 10.7 | % | 7,974 | 11.4 | % | 22,958 | 10.9 | % | ||||||||||||||||||||||||||||||
Diesel fuel sold to third parties | - | 0.0 | % | 4,745 | 6.8 | % | 4,745 | 2.3 | % | ||||||||||||||||||||||||||||||
Casualties and insurance | 3,293 | 2.3 | % | 2,490 | 3.5 | % | 5,783 | 2.7 | % | ||||||||||||||||||||||||||||||
Materials | 6,060 | 4.3 | % | 842 | 1.2 | % | 6,902 | 3.3 | % | ||||||||||||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (2,473 | ) | (1.8 | %) | (479 | ) | (0.7 | %) | (2,952 | ) | (1.4 | %) | |||||||||||||||||||||||||||
Gain on insurance recoveries | (18 | ) | (0.0 | %) | - | 0.0 | % | (18 | ) | (0.0 | %) | ||||||||||||||||||||||||||||
Restructuring charges | - | 0.0 | % | - | 0.0 | % | - | 0.0 | % | ||||||||||||||||||||||||||||||
Other expenses | 13,486 | 9.6 | % | 4,004 | 5.7 | % | 17,490 | 8.3 | % | ||||||||||||||||||||||||||||||
Total operating expenses | 109,161 | 77.9 | % | 55,837 | 79.5 | % | 164,998 | 78.4 | % | ||||||||||||||||||||||||||||||
Income from Operations | $ | 31,011 | $ | 14,377 | $ | 45,388 | |||||||||||||||||||||||||||||||||
Carloads | 194,217 | 52,577 | 246,794 | ||||||||||||||||||||||||||||||||||||
Net expenditures for additions to property & equipment | $ | 25,518 | $ | 42,895 | $ | 68,413 | |||||||||||||||||||||||||||||||||
Three Months Ended December 31, 2010 | North American & European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||||||||||||||
% of Total | % of Total | % of Total | |||||||||||||||||||||||||||||||||||||
Revenues: | Amount | Revenues | Amount | Revenues | Amount | Revenues | |||||||||||||||||||||||||||||||||
Freight | $ | 83,343 | 66.2 | % | $ | 23,312 | 53.3 | % | $ | 106,655 | 62.9 | % | |||||||||||||||||||||||||||
Non-freight (excluding fuel sales) | 42,557 | 33.8 | % | 15,303 | 35.0 | % | 57,860 | 34.1 | % | ||||||||||||||||||||||||||||||
Fuel sales to third parties | - | 0.0 | % | 5,156 | 11.8 | % | 5,156 | 3.0 | % | ||||||||||||||||||||||||||||||
Total revenues | 125,900 | 100.0 | % | 43,771 | 100.0 | % | 169,671 | 100.0 | % | ||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||
Labor and benefits | 44,908 | 35.8 | % | 10,471 | 23.9 | % | 55,379 | 32.7 | % | ||||||||||||||||||||||||||||||
Equipment rents | 6,270 | 5.0 | % | 2,105 | 4.8 | % | 8,375 | 4.9 | % | ||||||||||||||||||||||||||||||
Purchased services | 6,357 | 5.0 | % | 8,584 | 19.6 | % | 14,941 | 8.8 | % | ||||||||||||||||||||||||||||||
Depreciation and amortization | 11,123 | 8.8 | % | 2,637 | 6.0 | % | 13,760 | 8.1 | % | ||||||||||||||||||||||||||||||
Diesel fuel used in operations | 11,251 | 8.9 | % | 2,919 | 6.7 | % | 14,170 | 8.4 | % | ||||||||||||||||||||||||||||||
Diesel fuel sold to third parties | - | 0.0 | % | 4,779 | 10.9 | % | 4,779 | 2.8 | % | ||||||||||||||||||||||||||||||
Casualties and insurance | 3,768 | 3.0 | % | 336 | 0.8 | % | 4,104 | 2.4 | % | ||||||||||||||||||||||||||||||
Materials | 4,923 | 3.9 | % | 527 | 1.2 | % | 5,450 | 3.2 | % | ||||||||||||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (2,054 | ) | (1.6 | %) | (105 | ) | (0.2 | %) | (2,159 | ) | (1.3 | %) | |||||||||||||||||||||||||||
Gain on settlement | (8,707 | ) | (6.9 | %) | - | 0.0 | % | (8,707 | ) | (5.1 | %) | ||||||||||||||||||||||||||||
Gain on insurance recoveries | - | 0.0 | % | - | 0.0 | % | - | 0.0 | % | ||||||||||||||||||||||||||||||
Stamp Duty | - | 0.0 | % | 16,369 | 37.4 | % | 16,369 | 9.6 | % | ||||||||||||||||||||||||||||||
Restructuring charges | - | 0.0 | % | - | 0.0 | % | - | 0.0 | % | ||||||||||||||||||||||||||||||
Other expenses | 16,927 | 13.4 | % | 2,364 | 5.4 | % | 19,291 | 11.4 | % | ||||||||||||||||||||||||||||||
Total operating expenses | 94,766 | 75.3 | % | 50,986 | 116.5 | % | 145,752 | 85.9 | % | ||||||||||||||||||||||||||||||
Income from Operations | $ | 31,134 | $ | (7,215 | ) | $ | 23,919 | ||||||||||||||||||||||||||||||||
Carloads | 187,831 | 37,139 | 224,970 | ||||||||||||||||||||||||||||||||||||
Net expenditures for additions to property & equipment | $ | 35,868 | $ | 10,726 | $ | 46,594 | |||||||||||||||||||||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||||||||||
RAILROAD FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD | ||||||||||||||||||||||||||||||||||||||||||||||
COMPARISON BY COMMODITY GROUP | ||||||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands, except average revenues per carload) | ||||||||||||||||||||||||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended December 31, 2011 | ||||||||||||||||||||||||||||||||||||||||||||||
North American & European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||||||||||||||||||||||
Freight | Average Revenues | Freight | Average Revenues | Freight | Average Revenues | |||||||||||||||||||||||||||||||||||||||||
Commodity Group | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | |||||||||||||||||||||||||||||||||||||
Intermodal* | $ | 83 | 712 | $ | 117 | $ | 24,265 | 16,500 | $ | 1,471 | $ | 24,348 | 17,212 | $ | 1,415 | |||||||||||||||||||||||||||||||
Coal & Coke | 17,280 | 50,473 | 342 | - | - | - | 17,280 | 50,473 | 342 | |||||||||||||||||||||||||||||||||||||
Farm & Food Products | 5,935 | 12,300 | 483 | 10,655 | 16,986 | 627 | 16,590 | 29,286 | 566 | |||||||||||||||||||||||||||||||||||||
Pulp & Paper | 14,952 | 23,572 | 634 | - | - | - | 14,952 | 23,572 | 634 | |||||||||||||||||||||||||||||||||||||
Metallic Ores | 2,701 | 3,187 | 848 | 12,239 | 5,658 | 2,163 | 14,940 | 8,845 | 1,689 | |||||||||||||||||||||||||||||||||||||
Metals | 14,398 | 22,667 | 635 | - | - | - | 14,398 | 22,667 | 635 | |||||||||||||||||||||||||||||||||||||
Minerals & Stone | 9,672 | 21,096 | 458 | 2,240 | 13,314 | 168 | 11,912 | 34,410 | 346 | |||||||||||||||||||||||||||||||||||||
Chemicals & Plastics | 12,589 | 16,025 | 786 | - | - | - | 12,589 | 16,025 | 786 | |||||||||||||||||||||||||||||||||||||
Lumber & Forest Products | 7,769 | 15,764 | 493 | - | - | - | 7,769 | 15,764 | 493 | |||||||||||||||||||||||||||||||||||||
Petroleum Products | 6,199 | 7,504 | 826 | 751 | 119 | 6,311 | 6,950 | 7,623 | 912 | |||||||||||||||||||||||||||||||||||||
Autos & Auto Parts | 1,647 | 2,246 | 733 | - | - | - | 1,647 | 2,246 | 733 | |||||||||||||||||||||||||||||||||||||
Other | 5,418 | 18,671 | 290 | - | - | - | 5,418 | 18,671 | 290 | |||||||||||||||||||||||||||||||||||||
Totals | $ | 98,643 | 194,217 | $ | 508 | $ | 50,150 | 52,577 | $ | 954 | $ | 148,793 | 246,794 | $ | 603 | |||||||||||||||||||||||||||||||
* Represents intermodal units | ||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended December 31, 2010 | ||||||||||||||||||||||||||||||||||||||||||||||
North American & European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||||||||||||||||||||||
Freight | Average Revenues | Freight | Average Revenues | Freight | Average Revenues | |||||||||||||||||||||||||||||||||||||||||
Commodity Group | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | |||||||||||||||||||||||||||||||||||||
Intermodal* | $ | 87 | 781 | $ | 111 | $ | 7,488 | 5,706 | 1,312 | $ | 7,575 | 6,487 | $ | 1,168 | ||||||||||||||||||||||||||||||||
Coal & Coke | 19,342 | 56,099 | 345 | - | - | - | 19,342 | 56,099 | 345 | |||||||||||||||||||||||||||||||||||||
Farm & Food Products | 5,777 | 13,600 | 425 | 8,804 | 13,537 | 650 | 14,581 | 27,137 | 537 | |||||||||||||||||||||||||||||||||||||
Pulp & Paper | 13,861 | 23,153 | 599 | - | - | - | 13,861 | 23,153 | 599 | |||||||||||||||||||||||||||||||||||||
Metallic Ores | 1,435 | 2,803 | 512 | 3,626 | 1,747 | 2,076 | 5,061 | 4,550 | 1,112 | |||||||||||||||||||||||||||||||||||||
Metals | 6,913 | 15,384 | 449 | - | - | - | 6,913 | 15,384 | 449 | |||||||||||||||||||||||||||||||||||||
Minerals & Stone | 6,663 | 15,103 | 441 | 3,226 | 16,114 | 200 | 9,889 | 31,217 | 317 | |||||||||||||||||||||||||||||||||||||
Chemicals & Plastics | 10,022 | 14,643 | 684 | - | - | - | 10,022 | 14,643 | 684 | |||||||||||||||||||||||||||||||||||||
Lumber & Forest Products | 6,974 | 15,004 | 465 | - | - | - | 6,974 | 15,004 | 465 | |||||||||||||||||||||||||||||||||||||
Petroleum Products | 5,454 | 7,665 | 712 | 168 | 35 | 4,800 | 5,622 | 7,700 | 730 | |||||||||||||||||||||||||||||||||||||
Autos & Auto Parts | 1,539 | 2,431 | 633 | - | - | - | 1,539 | 2,431 | 633 | |||||||||||||||||||||||||||||||||||||
Other | 5,276 | 21,165 | 249 | - | - | - | 5,276 | 21,165 | 249 | |||||||||||||||||||||||||||||||||||||
Totals | $ | 83,343 | 187,831 | $ | 444 | $ | 23,312 | 37,139 | $ | 628 | $ | 106,655 | 224,970 | $ | 474 | |||||||||||||||||||||||||||||||
* Represents intermodal units | ||||||||||||||||||||||||||||||||||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||
SELECTED CONSOLIDATED FINANCIAL INFORMATION | |||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||
(unaudited) | |||||||||||||||||||||||||||
Twelve Months Ended | |||||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||||
2011 | 2010 | ||||||||||||||||||||||||||
% of | % of | ||||||||||||||||||||||||||
Amount | Revenue | Amount | Revenue | ||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Freight | $ | 582,947 | 70.3 | % | $ | 392,272 | 62.2 | % | |||||||||||||||||||
Non-freight | 246,149 | 29.7 | % | 237,923 | 37.8 | % | |||||||||||||||||||||
Total revenues | $ | 829,096 | 100.0 | % | $ | 630,195 | 100.0 | % | |||||||||||||||||||
Operating Expense Comparison: | |||||||||||||||||||||||||||
Natural Classification | |||||||||||||||||||||||||||
Labor and benefits | $ | 236,152 | 28.5 | % | $ | 207,736 | 33.0 | % | |||||||||||||||||||
Equipment rents | 43,984 | 5.3 | % | 32,491 | 5.2 | % | |||||||||||||||||||||
Purchased services | 78,710 | 9.5 | % | 52,198 | 8.3 | % | |||||||||||||||||||||
Depreciation and amortization | 66,481 | 8.0 | % | 51,166 | 8.1 | % | |||||||||||||||||||||
Diesel fuel used in operations | 88,400 | 10.7 | % | 45,849 | 7.3 | % | |||||||||||||||||||||
Diesel fuel sold to third parties | 16,986 | 2.0 | % | 17,322 | 2.7 | % | |||||||||||||||||||||
Casualties and insurance | 22,469 | 2.7 | % | 14,235 | 2.3 | % | |||||||||||||||||||||
Materials | 26,419 | 3.2 | % | 22,280 | 3.5 | % | |||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (5,660 | ) | (0.7 | %) | (6,441 | ) | (1.0 | %) | |||||||||||||||||||
Gain on settlement | - | 0.0 | % | (8,707 | ) | (1.4 | %) | ||||||||||||||||||||
Gain on insurance recoveries | (1,061 | ) | (0.1 | %) | - | 0.0 | % | ||||||||||||||||||||
Stamp duty | - | 0.0 | % | 16,369 | 2.6 | % | |||||||||||||||||||||
Restructuring charges | - | 0.0 | % | (2,349 | ) | (0.4 | %) | ||||||||||||||||||||
Other expenses | 64,437 | 7.8 | % | 57,636 | 9.1 | % | |||||||||||||||||||||
Total operating expenses | $ | 637,317 | 76.9 | % | $ | 499,785 | 79.3 | % | |||||||||||||||||||
Functional Classification | |||||||||||||||||||||||||||
Transportation | $ | 268,447 | 32.4 | % | $ | 189,942 | 30.1 | % | |||||||||||||||||||
Maintenance of ways and structures | 81,354 | 9.8 | % | 56,012 | 8.9 | % | |||||||||||||||||||||
Maintenance of equipment | 91,042 | 11.0 | % | 72,178 | 11.5 | % | |||||||||||||||||||||
Diesel fuel sold to third parties | 16,986 | 2.1 | % | 17,322 | 2.8 | % | |||||||||||||||||||||
General and administrative | 119,728 | 14.4 | % | 114,293 | 18.1 | % | |||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (5,660 | ) | (0.7 | %) | (6,441 | ) | (1.0 | %) | |||||||||||||||||||
Gain on settlement | - | 0.0 | % | (8,707 | ) | (1.4 | %) | ||||||||||||||||||||
Gain on insurance recoveries | (1,061 | ) | (0.1 | %) | - | 0.0 | % | ||||||||||||||||||||
Stamp duty | - | 0.0 | % | 16,369 | 2.6 | % | |||||||||||||||||||||
Restructuring charges | - | 0.0 | % | (2,349 | ) | (0.4 | %) | ||||||||||||||||||||
Depreciation and amortization | 66,481 | 8.0 | % | 51,166 | 8.1 | % | |||||||||||||||||||||
Total operating expenses | $ | 637,317 | 76.9 | % | $ | 499,785 | 79.3 | % | |||||||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||
SELECTED CONSOLIDATED FINANCIAL INFORMATION | ||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||||||||||||||||
North American & European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||||||||||||||
Twelve Months Ended December 31, 2011 | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||||||||
Revenues | Revenues | Revenues | ||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Freight | $ | 388,797 | 69.7 | % | $ | 194,150 | 71.5 | % | $ | 582,947 | 70.3 | % | ||||||||||||||||||||||||||
Non-freight (excluding fuel sales) | 168,824 | 30.3 | % | 59,323 | 21.9 | % | 228,147 | 27.5 | % | |||||||||||||||||||||||||||||
Fuel sales to third parties | - | 0.0 | % | 18,002 | 6.6 | % | 18,002 | 2.2 | % | |||||||||||||||||||||||||||||
Total revenues | 557,621 | 100.0 | % | 271,475 | 100.0 | % | 829,096 | 100.0 | % | |||||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||||||||||||||
Labor and benefits | 186,467 | 33.4 | % | 49,685 | 18.3 | % | 236,152 | 28.5 | % | |||||||||||||||||||||||||||||
Equipment rents | 26,460 | 4.7 | % | 17,524 | 6.5 | % | 43,984 | 5.3 | % | |||||||||||||||||||||||||||||
Purchased services | 27,880 | 5.0 | % | 50,830 | 18.7 | % | 78,710 | 9.5 | % | |||||||||||||||||||||||||||||
Depreciation and amortization | 47,218 | 8.5 | % | 19,263 | 7.1 | % | 66,481 | 8.0 | % | |||||||||||||||||||||||||||||
Diesel fuel used in operations | 57,394 | 10.3 | % | 31,006 | 11.4 | % | 88,400 | 10.7 | % | |||||||||||||||||||||||||||||
Diesel fuel sold to third parties | - | 0.0 | % | 16,986 | 6.3 | % | 16,986 | 2.0 | % | |||||||||||||||||||||||||||||
Casualties and insurance | 14,710 | 2.6 | % | 7,759 | 2.9 | % | 22,469 | 2.7 | % | |||||||||||||||||||||||||||||
Materials | 24,138 | 4.3 | % | 2,281 | 0.8 | % | 26,419 | 3.2 | % | |||||||||||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (5,167 | ) | (0.9 | %) | (493 | ) | (0.2 | %) | (5,660 | ) | (0.7 | %) | ||||||||||||||||||||||||||
Gain on insurance recoveries | (43 | ) | (0.0 | %) | (1,018 | ) | (0.4 | %) | (1,061 | ) | (0.1 | %) | ||||||||||||||||||||||||||
Restructuring charges | - | 0.0 | % | - | 0.0 | % | - | 0.0 | % | |||||||||||||||||||||||||||||
Other expenses | 48,918 | 8.8 | % | 15,519 | 5.7 | % | 64,437 | 7.8 | % | |||||||||||||||||||||||||||||
Total operating expenses | 427,975 | 76.8 | % | 209,342 | 77.1 | % | 637,317 | 76.9 | % | |||||||||||||||||||||||||||||
Income from Operations | $ | 129,646 | $ | 62,133 | $ | 191,779 | ||||||||||||||||||||||||||||||||
Carloads | 785,377 | 211,671 | 997,048 | |||||||||||||||||||||||||||||||||||
Net expenditures for additions to property & equipment | $ | 59,383 | $ | 96,643 | $ | 156,026 | ||||||||||||||||||||||||||||||||
North American & European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||||||||||||||
Twelve Months Ended December 31, 2010 | Amount | % of Total Revenues | Amount | % of Total Revenues | Amount | % of Total Revenues | ||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Freight | $ | 336,771 | 68.1 | % | $ | 55,501 | 41.0 | % | $ | 392,272 | 62.2 | % | ||||||||||||||||||||||||||
Non-freight (excluding fuel sales) | 158,016 | 31.9 | % | 61,163 | 45.2 | % | 219,179 | 34.8 | % | |||||||||||||||||||||||||||||
Fuel sales to third parties | - | 0.0 | % | 18,744 | 13.8 | % | 18,744 | 3.0 | % | |||||||||||||||||||||||||||||
Total revenues | 494,787 | 100.0 | % | 135,408 | 100.0 | % | 630,195 | 100.0 | % | |||||||||||||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||||||||||||||||
Labor and benefits | 171,669 | 34.7 | % | 36,067 | 26.6 | % | 207,736 | 33.0 | % | |||||||||||||||||||||||||||||
Equipment rents | 26,898 | 5.4 | % | 5,593 | 4.1 | % | 32,491 | 5.2 | % | |||||||||||||||||||||||||||||
Purchased services | 25,583 | 5.2 | % | 26,615 | 19.7 | % | 52,198 | 8.3 | % | |||||||||||||||||||||||||||||
Depreciation and amortization | 43,807 | 8.9 | % | 7,359 | 5.4 | % | 51,166 | 8.1 | % | |||||||||||||||||||||||||||||
Diesel fuel used in operations | 39,240 | 7.9 | % | 6,609 | 4.9 | % | 45,849 | 7.3 | % | |||||||||||||||||||||||||||||
Diesel fuel sold to third parties | - | 0.0 | % | 17,322 | 12.8 | % | 17,322 | 2.7 | % | |||||||||||||||||||||||||||||
Casualties and insurance | 12,887 | 2.6 | % | 1,348 | 1.0 | % | 14,235 | 2.3 | % | |||||||||||||||||||||||||||||
Materials | 20,778 | 4.2 | % | 1,502 | 1.1 | % | 22,280 | 3.5 | % | |||||||||||||||||||||||||||||
Net (gain)/loss on sale and impairment of assets | (6,317 | ) | (1.3 | %) | (124 | ) | (0.1 | %) | (6,441 | ) | (1.0 | %) | ||||||||||||||||||||||||||
Gain on settlement | (8,707 | ) | (1.8 | %) | - | 0.0 | % | (8,707 | ) | (1.4 | %) | |||||||||||||||||||||||||||
Gain on insurance recoveries | - | 0.0 | % | - | 0.0 | % | - | 0.0 | % | |||||||||||||||||||||||||||||
Stamp duty | - | 0.0 | % | 16,369 | 12.1 | % | 16,369 | 2.6 | % | |||||||||||||||||||||||||||||
Restructuring charges | (2,349 | ) | (0.5 | %) | - | 0.0 | % | (2,349 | ) | (0.4 | %) | |||||||||||||||||||||||||||
Other expenses | 51,396 | 10.4 | % | 6,240 | 4.6 | % | 57,636 | 9.1 | % | |||||||||||||||||||||||||||||
Total operating expenses | 374,885 | 75.8 | % | 124,900 | 92.2 | % | 499,785 | 79.3 | % | |||||||||||||||||||||||||||||
Income from Operations | $ | 119,902 | $ | 10,508 | $ | 130,410 | ||||||||||||||||||||||||||||||||
Carloads | 736,552 | 127,170 | 863,722 | |||||||||||||||||||||||||||||||||||
Net expenditures for additions to property & equipment | $ | 59,153 | $ | 19,885 | $ | 79,038 | ||||||||||||||||||||||||||||||||
GENESEE & WYOMING INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||
RAILROAD FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD | |||||||||||||||||||||||||||||||||||||
COMPARISON BY COMMODITY GROUP | |||||||||||||||||||||||||||||||||||||
(dollars in thousands, except average revenues per carload) | |||||||||||||||||||||||||||||||||||||
(unaudited) | |||||||||||||||||||||||||||||||||||||
Twelve Months Ended December 31, 2011 | |||||||||||||||||||||||||||||||||||||
North American & European Operations | Australian Operations | Total Operations | |||||||||||||||||||||||||||||||||||
Freight | Average Revenues | Freight | Average Revenues | Freight | Average Revenues | ||||||||||||||||||||||||||||||||
Commodity Group | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | ||||||||||||||||||||||||||||
Intermodal* | $ | 371 | 3,150 | $ | 118 | $ | 87,286 | 58,836 | $ | 1,484 | $ | 87,657 | 61,986 | $ | 1,414 | ||||||||||||||||||||||
Coal & Coke | 77,104 | 205,761 | 375 | - | - | - | 77,104 | 205,761 | 375 | ||||||||||||||||||||||||||||
Farm & Food Products | 24,237 | 53,653 | 452 | 43,270 | 69,673 | 621 | 67,507 | 123,326 | 547 | ||||||||||||||||||||||||||||
Pulp & Paper | 61,350 | 96,597 | 635 | - | - | - | 61,350 | 96,597 | 635 | ||||||||||||||||||||||||||||
Metallic Ores | 7,614 | 10,731 | 710 | 48,536 | 21,951 | 2,211 | 56,150 | 32,682 | 1,718 | ||||||||||||||||||||||||||||
Metals | 51,461 | 90,153 | 571 | - | - | - | 51,461 | 90,153 | 571 | ||||||||||||||||||||||||||||
Minerals & Stone | 35,549 | 77,963 | 456 | 12,417 | 60,746 | 204 | 47,966 | 138,709 | 346 | ||||||||||||||||||||||||||||
Chemicals & Plastics | 46,444 | 60,958 | 762 | - | - | - | 46,444 | 60,958 | 762 | ||||||||||||||||||||||||||||
Lumber & Forest Products | 31,502 | 64,914 | 485 | - | - | - | 31,502 | 64,914 | 485 | ||||||||||||||||||||||||||||
Petroleum Products | 23,274 | 29,563 | 787 | 2,641 | 465 | 5,680 | 25,915 | 30,028 | 863 | ||||||||||||||||||||||||||||
Autos & Auto Parts | 7,826 | 10,425 | 751 | - | - | - | 7,826 | 10,425 | 751 | ||||||||||||||||||||||||||||
Other | 22,065 | 81,509 | 271 | - | - | - | 22,065 | 81,509 | 271 | ||||||||||||||||||||||||||||
Totals | $ | 388,797 | 785,377 | $ | 495 | $ | 194,150 | 211,671 | $ | 917 | $ | 582,947 | 997,048 | $ | 585 | ||||||||||||||||||||||
* Represents intermodal units | |||||||||||||||||||||||||||||||||||||
Twelve Months Ended December 31, 2010 | |||||||||||||||||||||||||||||||||||||
North American & European Operations | Australian Operations | Total Operations | |||||||||||||||||||||||||||||||||||
Freight | Average Revenues | Freight | Average Revenues | Freight | Average Revenues | ||||||||||||||||||||||||||||||||
Commodity Group | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | ||||||||||||||||||||||||||||
Intermodal* | $ | 363 | 3,305 | $ | 110 | $ | 7,488 | 5,706 | 1,312 | $ | 7,851 | 9,011 | $ | 871 | |||||||||||||||||||||||
Coal & Coke | 73,880 | 202,267 | 365 | - | - | - | 73,880 | 202,267 | 365 | ||||||||||||||||||||||||||||
Farm & Food Products | 23,632 | 52,440 | 451 | 32,355 | 56,401 | 574 | 55,987 | 108,841 | 514 | ||||||||||||||||||||||||||||
Pulp & Paper | 53,652 | 88,852 | 604 | - | - | - | 53,652 | 88,852 | 604 | ||||||||||||||||||||||||||||
Metallic Ores | 4,887 | 9,918 | 493 | 3,626 | 1,747 | 2,076 | 8,513 | 11,665 | 730 | ||||||||||||||||||||||||||||
Metals | 36,788 | 76,343 | 482 | - | - | - | 36,788 | 76,343 | 482 | ||||||||||||||||||||||||||||
Minerals & Stone | 29,083 | 66,000 | 441 | 11,864 | 63,281 | 187 | 40,947 | 129,281 | 317 | ||||||||||||||||||||||||||||
Chemicals & Plastics | 38,951 | 56,515 | 689 | - | - | - | 38,951 | 56,515 | 689 | ||||||||||||||||||||||||||||
Lumber & Forest Products | 28,791 | 63,340 | 455 | - | - | - | 28,791 | 63,340 | 455 | ||||||||||||||||||||||||||||
Petroleum Products | 20,462 | 28,997 | 706 | 168 | 35 | 4,800 | 20,630 | 29,032 | 711 | ||||||||||||||||||||||||||||
Autos & Auto Parts | 6,962 | 10,242 | 680 | - | - | - | 6,962 | 10,242 | 680 | ||||||||||||||||||||||||||||
Other | 19,320 | 78,333 | 247 | - | - | - | 19,320 | 78,333 | 247 | ||||||||||||||||||||||||||||
Totals | $ | 336,771 | 736,552 | $ | 457 | $ | 55,501 | 127,170 | $ | 436 | $ | 392,272 | 863,722 | $ | 454 | ||||||||||||||||||||||
* Represents intermodal units | |||||||||||||||||||||||||||||||||||||
Reconciliation of non-GAAP Financial Measures
This earnings release contains references to adjusted operating income, adjusted operating ratios and free cash flow, which are "non-GAAP financial measures" as this term is defined in Regulation G of the Securities Exchange Act of 1934. In accordance with Regulation G, GWI has reconciled each of these non-GAAP financial measures to its most directly comparable U.S. GAAP measure.
Adjusted Operating Income and Adjusted Operating Ratios Description and Discussion
Management views its Operating Income, calculated as Operating Revenues less Operating Expenses and Operating Ratio, calculated as Operating Expenses divided by Operating Revenues, as important measures of GWI’s operating performance. Because management believes this information is useful for investors in assessing GWI’s financial results compared with the same period in the prior year, the Operating Income and Operating Ratio for the three and twelve months ended December 31, 2011, used to calculate Adjusted Operating Income and Adjusted Operating Ratio, is presented excluding net gain/(loss) on sale and impairment of assets, the Edith River derailment costs and business/corporate development expenses. The Operating Income and Operating Ratio for the three and twelve months ended December 31, 2010, used to calculate Adjusted Operating Income and Adjusted Operating Ratio, is presented excluding net gain on sale of assets, the gain from a legal settlement associated with a past acquisition and FreightLink acquisition-related expenses. The Operating Income and Operating Ratio for the twelve months ended December 31, 2010, used to calculate Adjusted Operating Income and Adjusted Operating Ratio, is also presented excluding the reversal of restructuring charges associated with the second quarter 2009 impairment of Huron Central Railway Inc. (HCRY). The Adjusted Operating Income and Adjusted Operating Ratios presented excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, the Operating Income and Operating Ratios calculated using amounts in accordance with GAAP. Adjusted Operating Income and Adjusted Operating Ratio may be different from similarly-titled non-GAAP financial measures used by other companies.
The following tables set forth a reconciliation of GWI’s Operating Income and Operating Ratios calculated using amounts determined in accordance with GAAP to the Adjusted Operating Income and Adjusted Operating Ratios described above ($ in millions):
Three months ended December 31, 2011 | Operating Revenues | Operating Expenses | Operating Income | Operating Ratio | ||||||||||||||||||||||
As reported | $ | 210.4 | $ | 165.0 | $ | 45.4 | 78.4 | % | ||||||||||||||||||
Net gain/(loss) on sale and impairment of assets | - | 3.0 | (3.0 | ) | ||||||||||||||||||||||
Edith River derailment costs | - | (1.8 | ) | 1.8 | ||||||||||||||||||||||
Business/corporate development expenses | - | (0.8 | ) | 0.8 | ||||||||||||||||||||||
Adjusted | $ | 210.4 | $ | 165.3 | $ | 45.1 | 78.6 | % | ||||||||||||||||||
Three months ended December 31, 2010 | Operating Revenues | Operating Expenses | Operating Income | Operating Ratio | ||||||||||||||||||||||
As reported | $ | 169.7 | $ | 145.8 | $ | 23.9 | 85.9 | % | ||||||||||||||||||
Net gain on sale of assets | - | 2.2 | (2.2 | ) | ||||||||||||||||||||||
Gain on settlement | - | 8.7 | (8.7 | ) | ||||||||||||||||||||||
FreightLink acquisition-related expenses | - | (24.0 | ) | 24.0 | ||||||||||||||||||||||
Adjusted | $ | 169.7 | $ | 132.7 | $ | 37.0 | 78.2 | % | ||||||||||||||||||
Twelve months ended December 31, 2011 | Operating Revenues | Operating Expenses | Operating Income | Operating Ratio | ||||||||||||||||||||||
As reported | $ | 829.1 | $ | 637.3 | $ | 191.8 | 76.9 | % | ||||||||||||||||||
Net gain/(loss) on sale and impairment of assets | - | 5.7 | (5.7 | ) | ||||||||||||||||||||||
Edith River derailment costs | - | (1.8 | ) | 1.8 | ||||||||||||||||||||||
Business/corporate development expenses | - | (2.6 | ) | 2.6 | ||||||||||||||||||||||
Adjusted | $ | 829.1 | $ | 638.5 | $ | 190.6 | 77.0 | % | ||||||||||||||||||
Twelve months ended December 31, 2010 | Operating Revenues | Operating Expenses | Operating Income | Operating Ratio | ||||||||||||||||||||||
As reported | $ | 630.2 | $ | 499.8 | $ | 130.4 | 79.3 | % | ||||||||||||||||||
Net gain on sale of assets | - | 6.4 | (6.4 | ) | ||||||||||||||||||||||
Gain on settlement | - | 8.7 | (8.7 | ) | ||||||||||||||||||||||
FreightLink acquisition-related expenses | - | (28.2 | ) | 28.2 | ||||||||||||||||||||||
Reversal of restructuring charges | - | 2.3 | (2.3 | ) | ||||||||||||||||||||||
Adjusted | $ | 630.2 | $ | 489.0 | $ | 141.1 | 77.6 | % | ||||||||||||||||||
Free Cash Flow Description and Discussion
Management views Free Cash Flow as an important financial measure of how well GWI is managing its assets. Subject to the limitations discussed below, Free Cash Flow is a useful indicator of cash flow that may be available for discretionary use by GWI. Free Cash Flow is defined as Net Cash Provided by Operating Activities from Continuing Operations less Net Cash Used in Investing Activities from Continuing Operations, excluding the cost of acquisitions, proceeds received from divestitures and the cash paid for acquisition-related expenses. Key limitations of the Free Cash Flow measure include the assumptions that GWI will be able to refinance its existing debt when it matures and meet other cash flow obligations from financing activities, such as principal payments on debt. Free Cash Flow is not intended to represent, and should not be considered more meaningful than, or as an alternative to, measures of cash flow determined in accordance with GAAP. Free Cash Flow may be different from similarly-titled non-GAAP financial measures used by other companies.
The following table sets forth a reconciliation of GWI's Net Cash Provided by Operating Activities from Continuing Operations to GWI's Free Cash Flow ($ in millions):
Twelve Months Ended December 31, | |||||||||||||||
2011 | 2010 | ||||||||||||||
Net cash provided by operating activities from | |||||||||||||||
continuing operations | $ | 173.5 | $ | 171.8 | |||||||||||
Net cash used in investing activities from | |||||||||||||||
continuing operations (c) | (235.1 | ) | (388.9 | ) | |||||||||||
Net cash paid/(received) for acquisitions/divestitures (a) | 88.6 | 319.8 | |||||||||||||
Cash paid for acquisition-related expenses (b) | 13.0 | 14.9 | |||||||||||||
Free cash flow | $ | 39.9 | $ | 117.6 | |||||||||||
(a) | The 2011 period primarily included $89.9 million in net cash paid for the acquisition of AZER. The 2010 period primarily included $320.0 million in net cash paid for the acquisition of FreightLink. | |
(b) | The 2011 period included Australian stamp duty expenses accrued as of December 31, 2010, but paid in 2011. The 2010 period included Australian stamp duty expense incurred and paid in 2010. | |
(c) | Included $78.2 million for the investment in new Australian equipment in 2011. | |
CONTACT:
GWI Corporate Communications
Michael Williams, 1-203-629-3722
mwilliams@gwrr.com