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 February 9, 2016 - 6:00 AM EST
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Genesee & Wyoming Reports Results for the Fourth Quarter of 2015

Genesee & Wyoming Inc. (G&W) (NYSE:GWR)

Fourth Quarter Highlights

  • Operating revenues increased 23.9% to $514.9 million from $415.6 million.
  • Same railroad operating revenues, excluding a $16.6 million negative impact of foreign currency depreciation, declined 13.8%, primarily due to weakness in iron ore, coal, metals and agricultural products shipments.
  • Adjusted income from operations (adjusted operating income) decreased 16.9% to $94.2 million; Reported income from operations (operating income) decreased 16.6% to $94.6 million.(1)
  • Adjusted diluted earnings per common share (EPS) decreased 24.1%, to $0.85, or 20.6%, excluding a $0.05 negative impact of foreign currency; Reported diluted EPS decreased 3.9% to $1.47, including a $0.47 impact from the Short Line Tax Credit and a $0.17 impact from a reduction in U.K. tax rates.(1)

Comments on Fourth Quarter

Jack Hellmann, President and CEO of G&W, commented, “Our financial results for the fourth quarter of 2015 were consistent with our updated guidance, with adjusted diluted EPS of $0.85 down 24% versus last year, or down 21% excluding the impact of foreign currency. Each of our three operating segments, North America, Australia and the U.K./Europe, continued to face weak shipments in most commodity groups with same railroad carloads down approximately 16%. The weakness in our rail shipments has been largely driven by three overarching trends: i) the collapse in the prices of global commodities such as iron ore, copper, manganese and crude oil, ii) the rapid shift of U.S. and U.K. power generation away from coal to cheaper natural gas, and iii) a strong U.S. dollar, which has been making our industrial customers, such as steel manufacturers, as well as our agricultural customers less competitive in global markets.”

“The trends that made 2015 difficult show few signs of abating in 2016. In North America, we anticipate our operating income to be down slightly as sustained weakness in coal and steel shipments is expected to offset positive trends such as core pricing. In Australia, we expect a decline in operating income due to the recent closure of a manganese mine and continued pressure on our remaining iron ore business. In the U.K./Europe, we expect operating income to be flat, but to improve in the second half of 2016 after we complete the restructuring of the U.K. coal business. The net impact of these trends and weaker foreign currencies is that we expect our adjusted diluted EPS to be down approximately 10% in 2016.”

“In response to this environment, we have been intensely focused on enhancing our free cash flow and positioning the business for improving trends in the future. With respect to costs, we have made expense reductions in every operating region, with Australia now initiating a second round of cost cuts and the U.K./Europe planning significant cost reductions and a restructuring of our U.K. coal business in the first half of 2016. With respect to revenues, we continue to concentrate on commercial development worldwide, and have achieved strong revenues per carload in North America led by effective yield management. With respect to capital expenditures, we have been reducing our investment in plant and equipment to be consistent with our lower traffic levels. As a result of these measures, we expect to increase our free cash flow by approximately 10% to around $285 million in 2016, prior to capital for new business investments.”

“Regarding acquisitions and investments, we continue to evaluate multiple opportunities worldwide and will weigh the relative value of these potential investments versus the intrinsic value of our own shares.” (1)

Fourth Quarter Financial Results

G&W's operating revenues increased $99.2 million, or 23.9%, to $514.9 million, in the fourth quarter of 2015, compared with $415.6 million in the fourth quarter of 2014. G&W's income from operations in the fourth quarter of 2015 was $94.6 million, compared with $113.5 million in the fourth quarter of 2014. G&W's operating ratio in the fourth quarter of 2015 was 81.6%, compared with an operating ratio of 72.7% in the fourth quarter of 2014, including lower operating margins from Freightliner Group Limited (Freightliner). G&W's same railroad operating ratio in the fourth quarter of 2015 was 76.1%, compared with 72.7% in the fourth quarter of 2014.

G&W reported net income in the fourth quarter of 2015 of $84.9 million, compared with net income of $87.4 million in the fourth quarter of 2014. Excluding the net impact of certain items affecting comparability between periods as discussed below, G&W’s adjusted net income in the fourth quarter of 2015 was $49.1 million, compared with adjusted net income of $63.8 million in the fourth quarter of 2014.(1)

G&W’s reported diluted EPS in the fourth quarter of 2015 were $1.47 with 57.9 million weighted average shares outstanding, compared with diluted EPS in the fourth quarter of 2014 of $1.53 with 57.1 million weighted average shares outstanding. Excluding the net impact of certain items affecting comparability discussed below, G&W’s adjusted diluted EPS in the fourth quarter of 2015 were $0.85 with 57.9 million weighted average shares outstanding, compared with adjusted diluted EPS in the fourth quarter of 2014 of $1.12 with 57.1 million weighted average shares outstanding.(1)

Items Affecting Comparability

In the fourth quarter of 2015 and 2014, G&W’s results included certain items affecting comparability between the periods that are set forth in the following table (in millions, except per share amounts).

     

Income/
(Loss)
Before
Taxes
Impact

After-Tax
Net Income/
(Loss)
Impact

Diluted
Earnings/
(Loss) Per
Common
Share
Impact

Three Months Ended December 31, 2015

Out of period benefit of final allocation of fair values to
Freightliner's assets & liabilities

$ 2.0 $ 1.6 $ 0.03
Business development and related costs $ (2.5 ) $ (1.7 ) $ (0.03 )
Net gain on sale of assets $ 0.3

$

0.2 $
2015 Short Line Tax Credit $

$

27.4

$ 0.47
Impact of reduction in U.K. effective tax rate $ $

9.7

$

0.17

Application of full year effective tax rate to Q1 - Q3 2015
results

$ $ (1.3 ) $ (0.02 )
 

Three Months Ended December 31, 2014

Business development and related costs $ (1.6 ) $ (1.0 ) $ (0.02 )
Net gain on sale of assets $ 1.7 $ 1.0 $ 0.02
2014 Short Line Tax Credit $ $ 27.0 $ 0.47

Application of full year effective tax rate to Q1 - Q3 2014
results

$ $ (3.5 ) $ (0.06 )
 

In December 2015, the U.S. Short Line Tax Credit (which had previously expired on December 31, 2014), was extended for fiscal years 2015 and 2016. In the fourth quarter of 2015, G&W recorded a tax benefit of $27.4 million associated with the extension of the Short Line Tax Credit, as well as a tax benefit of $9.7 million associated with a prospective change in U.K. tax rates enacted during the fourth quarter. In December 2014, the U.S. Short Line Tax Credit (which had previously expired on December 31, 2013) was extended for fiscal year 2014. In the fourth quarter of 2014, G&W recorded a tax benefit of $27.0 million associated with the extension of the Short Line Tax Credit. In addition, net income for the fourth quarter of 2015 and 2014 were reduced by $1.3 million and $3.5 million, respectively, due to the application of the full year effective tax rate to the results of the first three quarters of each year.

In the fourth quarter of 2015, G&W finalized its allocation of fair values to Freightliner's assets and liabilities, which resulted in a decrease in operating expenses of $3.9 million and an increase in interest expense of $1.0 million. Of the $3.9 million decrease in operating expenses and the $1.0 million increase in interest expense recorded in the fourth quarter of 2015, $2.6 million and $0.7 million, respectively, do not relate to the current period, and, accordingly, have been included as adjustments to our fourth quarter results. In the fourth quarter of 2015, G&W’s results also included business development and related costs of $2.5 million primarily related to the integration of Freightliner and net gain on sale of assets of $0.3 million. G&W's fourth quarter of 2014 results included business development and related costs of $1.6 million and a net gain on the sale of assets of $1.7 million.

Fourth Quarter Results by Segment

Operating revenues from G&W's North American Operations decreased $39.6 million, or 11.7%, to $298.6 million in the fourth quarter of 2015, compared with $338.3 million in the fourth quarter of 2014. Excluding $3.0 million of revenues from new operations and a $4.5 million decrease due to the impact of foreign currency depreciation, North American Operations same railroad revenues decreased by $38.1 million, or 11.4%, primarily due to declines in coal, metals and agricultural products shipments.

North American Operations traffic decreased 67,557 carloads, or 14.8%, to 388,228 carloads in the fourth quarter of 2015. Excluding 7,018 carloads from new operations, same railroad traffic decreased 74,575 carloads, or 16.4%, in the fourth quarter of 2015 compared with the fourth quarter of 2014. The same railroad traffic decrease was principally due to decreases of 40,043 carloads of coal and coke (Midwest, Central and Ohio Valley regions), 15,641 carloads of metals traffic (primarily in the Southern, Ohio Valley and Northeast regions), 4,880 carloads of minerals and stone traffic (primarily in the Midwest, Central and Northeast regions), 3,769 carloads of Other traffic (primarily overhead Class I shipments), 3,420 carloads of agricultural products traffic (primarily in the Mountain West and Ohio Valley regions) and 3,364 carloads of auto and auto parts traffic (primarily in the Pacific Region). All remaining traffic decreased by a net 3,458 carloads.

Income from operations from G&W's North American Operations in the fourth quarter of 2015 was $73.2 million, compared with $90.3 million in the fourth quarter of 2014. The operating ratio for North American Operations was 75.5% in the fourth quarter of 2015, compared with an operating ratio of 73.3% in the fourth quarter of 2014.

Operating revenues from G&W's Australian Operations decreased $17.2 million, or 23.8%, to $55.2 million in the fourth quarter of 2015, compared with $72.4 million in the fourth quarter of 2014. Excluding $11.8 million of revenues from the newly acquired operations of Freightliner Australia and an $11.5 million decrease due to the impact of foreign currency depreciation, Australian Operations same railroad revenues decreased by $17.5 million, or 28.8%, primarily due to a decrease in freight revenues resulting from a decline in iron ore shipments.

Australian Operations traffic decreased 8,111 carloads, or 14.9%, to 46,245 carloads in the fourth quarter of 2015. The traffic decrease was principally due to a decrease of 11,039 carloads of metallic ores traffic, partially offset by an increase of 2,525 in minerals and stone traffic. All remaining traffic increased by a net 403 carloads.

Income from operations from G&W's Australian Operations in the fourth quarter of 2015 was $10.5 million, compared with $23.8 million in the fourth quarter of 2014. The operating ratio for Australian Operations was 81.0% in the fourth quarter of 2015, compared with an operating ratio of 67.2% in the fourth quarter of 2014.

Operating revenues from G&W's U.K./European Operations increased $156.1 million to $161.0 million in the fourth quarter of 2015, compared with $5.0 million in the fourth quarter of 2014 as a result of the newly acquired Freightliner U.K./European operations. U.K./European Operations traffic consisted of 278,150 carloads in the fourth quarter of 2015, which was entirely related to traffic from G&W’s recently acquired Freightliner U.K./European operations.

Income from operations from U.K./European Operations in the fourth quarter of 2015 was $10.9 million with an operating ratio of 93.2%. The prior year is not comparable because over 95% of the revenue and income from operations was generated from the recently acquired Freightliner business. As a reminder, our U.K./European Operations require substantially lower capital expenditures and generate a higher operating ratio than our other segments.

Consolidated Annual Results

G&W reported net income for the year ended December 31, 2015 of $225.0 million ($300.9 million pre-tax), compared with net income of $260.8 million ($367.9 million pre-tax) for the year ended December 31, 2014. Excluding the impact of certain items affecting comparability listed below, G&W’s adjusted net income for the year ended December 31, 2015 was $212.9 million ($339.0 million adjusted pre-tax), compared with adjusted net income of $233.3 million ($372.6 million adjusted pre-tax) for the year ended December 31, 2014. (1)

G&W’s diluted EPS for the year ended December 31, 2015 were $3.89 with 57.8 million weighted average shares outstanding, compared with diluted EPS of $4.58 with 57.0 million weighted average shares outstanding for the year ended December 31, 2014. Excluding certain items affecting comparability listed below, G&W’s adjusted diluted EPS for the year ended December 31, 2015 were $3.68 with 57.8 million weighted average shares outstanding, compared with adjusted diluted EPS of $4.10 with 57.0 million weighted average shares outstanding for the year ended December 31, 2014. (1)

G&W’s 2015 and 2014 annual results included certain items affecting comparability between the periods that are set forth in the following table (in millions, except per share amounts).

     
 

Income/(Loss)
Before Taxes
Impact

After-Tax Net
Income/(Loss)
Impact

Diluted
Earnings/(Loss)
Per Common
Share Impact

Twelve Months Ended December 31, 2015

Business development and related costs $ (9.1 ) $ (5.6 ) $ (0.10 )
Net gain on sale of assets $ 2.3 $ 1.7 $ 0.03
Freightliner acquisition-related costs $ (12.6 ) $ (9.5 ) $ (0.16 )

Loss on settlement of Freightliner acquisition-related
foreign currency forward purchase contracts

$ (18.7 ) $ (11.6 ) $ (0.20 )
2015 Short Line Tax Credit $ $ 27.4 $

0.47

Impact of reduction in U.K. effective tax rate

$

$

9.7

$

0.17

 

Twelve Months Ended December 31, 2014

Business development and related costs $ (5.2 ) $ (3.2 ) $ (0.06 )
Net gain on sale of assets $ 5.1 $ 3.5 $ 0.06
Credit facility refinancing costs $ (4.7 ) $ (2.9 ) $ (0.05 )
2014 Short Line Tax Credit $ $ 27.0 $ 0.47
RailAmerica-related tax benefit $ $ 3.9 $ 0.07
Adjustment for tax returns from previous fiscal year $ $ (0.7 ) $ (0.01 )
 

Free Cash Flow (1)

G&W’s free cash flow for the twelve months ended December 31, 2015 and 2014 was as follows (in millions):

 
Twelve Months Ended
2015   2014
Net cash provided by operating activities $

475.1

$ 491.5

Net cash used in investing activities, excluding new business
investments

(1,008.6

) (417.0 )
Net cash used for acquisitions (a)

792.2

  221.5  
Free cash flow before new business investments

258.7

295.9
New business investments (65.6 ) (92.9 )
Free cash flow (1) $

193.0

  $ 203.1  
 
(a)   The 2015 period primarily consisted of net cash used for the acquisition of Freightliner and Pinsly Arkansas as well as $33.2 million in cash paid for incremental expenses related to the purchase and integration of the Freightliner acquisition. The 2014 period primarily consisted of cash paid for the Rapid City, Pierre & Eastern Railroad, Inc. (RCP&E) acquisition.
 

Conference Call and Webcast Details

As previously announced, G&W’s conference call to discuss financial results for the fourth quarter of 2015 will be held on Tuesday, February 9, 2016, at 11 a.m. EST. The dial-in number for the teleconference in the U.S. is (800) 230-1074; outside the U.S. is (612) 288-0337, or the call may be accessed live over the Internet (listen only) at www.gwrr.com/investors. Management will be referring to a slide presentation that will also be available at gwrr.com/investors. The webcast will be archived at www.gwrr.com/investors, until the following quarter’s earnings press release. Telephone replay is available for 30 days beginning at 1 p.m. EST on February 9, 2016 by dialing (800) 475-6701 (or outside the U.S., dial 320-365-3844). The access code is 372876.

About G&W

G&W owns or leases 120 freight railroads worldwide that are organized in 11 operating regions with 7,500 employees and more than 2,500 customers.

  • G&W's nine North American regions serve 41 U.S. states and four Canadian provinces and include 113 short line and regional freight railroads, with more than 13,000 track-miles.
  • G&W's Australia Region provides rail freight services in New South Wales, the Northern Territory and South Australia and operates the 1,400-mile Tarcoola-to-Darwin rail line.
  • G&W's U.K./European Region is led by Freightliner, the U.K.'s largest rail maritime intermodal operator and second-largest rail freight company. Operations also include heavy-haul in Poland and Germany and cross-border intermodal services connecting Northern Europe seaports with key industrial regions throughout the continent.

G&W subsidiaries provide rail service at more than 40 major ports in North America, Australia, 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,” “could,” “should,” “seeks,” “expects,” “will,” “estimates,” “trends,” “outlook,” 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 that are difficult to forecast, including the following: risks related to the operation of our railroads; severe weather conditions and other natural occurrences, which could result in shutdowns, derailments, railroad network congestion or other substantial disruption of operations; customer demand and changes in our operations; exposure to the credit risk of customers and counterparties; changes in commodity prices; consummation and integration of acquisitions; economic, political and industry conditions (including employee strikes or work stoppages); 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, including our ability to obtain government funding for capital projects; international complexities of operations, currency fluctuations, finance, tax and decentralized management; challenges of managing rapid growth including retention and development of senior leadership; unpredictability of fuel costs; susceptibility to various legal claims and lawsuits; increase in, or volatility associated with, expenses related to estimated claims, self-insured retention amounts, and insurance coverage limits; consummation of new business opportunities; decrease in revenues and/or increase in costs and expenses; susceptibility to the risks of doing business in foreign countries; our ability to realize the expected synergies associated with acquisitions; and others including, but not limited to, those noted in our 2014 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. G&W does not undertake, and expressly disclaims, any duty to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

1. Adjusted income from operations (adjusted operating income), adjusted net income, adjusted diluted earnings per common share (EPS) and free cash flow are non-GAAP financial measures and are not intended to replace financial measures calculated in accordance 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 a reconciliation to their most directly comparable financial measures calculated in accordance with GAAP, 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, 2015 AND 2014
(in thousands, except per share amounts)
(unaudited)
       
Three Months Ended Twelve Months Ended
December 31, December 31,
2015 2014 2015 2014
OPERATING REVENUES $ 514,853 $ 415,627 $ 2,000,401 $ 1,639,012
OPERATING EXPENSES 420,222   302,156   1,616,140   1,217,441  
INCOME FROM OPERATIONS 94,631 113,471 384,261 421,571
INTEREST INCOME 106 88 481 1,445
INTEREST EXPENSE (18,329 ) (12,053 ) (67,073 ) (56,162 )

LOSS ON SETTLEMENT OF FOREIGN CURRENCY
FORWARD PURCHASE CONTRACTS

(18,686 )
OTHER INCOME, NET

1,403

  562  

1,948

  1,008  
INCOME BEFORE INCOME TAXES

77,811

102,068

300,931

367,862

BENEFIT FROM/(PROVISION FOR) INCOME TAXES

7,123

  (14,695 )

(75,894

) (107,107 )
NET INCOME

84,934

  87,373  

225,037

  260,755  
BASIC EARNINGS PER COMMON SHARE $

1.49

  $ 1.57   $

3.97

  $ 4.71  
WEIGHTED AVERAGE SHARES - BASIC 56,915   55,715   56,734   55,305  
DILUTED EARNINGS PER COMMON SHARE $

1.47

  $ 1.53   $

3.89

  $ 4.58  
WEIGHTED AVERAGE SHARES - DILUTED 57,886   57,062   57,848   56,972  
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2015 AND 2014
(in thousands)
(unaudited)
   
December 31,
2015 2014
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 35,941 $ 59,727
Accounts receivable, net 382,458 357,278
Materials and supplies 45,790 30,251
Prepaid expenses and other

43,197

24,176
Deferred income tax assets, net 69,174   76,994
Total current assets

576,560

  548,426
PROPERTY AND EQUIPMENT, net 4,190,618 3,788,482
GOODWILL

812,695

628,815
INTANGIBLE ASSETS, net 1,123,937 587,663
DEFERRED INCOME TAX ASSETS, net

2,110

2,500
OTHER ASSETS, net 43,871   39,867
Total assets $

6,749,791

  $ 5,595,753
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $

81,953

$ 67,398
Accounts payable 282,275 290,746
Accrued expenses

169,586

106,094
Total current liabilities

533,814

  464,238
LONG-TERM DEBT, less current portion

2,223,306

1,548,051
DEFERRED INCOME TAX LIABILITIES, net

1,045,727

908,852
DEFERRED ITEMS - grants from outside parties 292,198 279,286
OTHER LONG-TERM LIABILITIES 174,675 37,346
TOTAL EQUITY

2,480,071

  2,357,980
Total liabilities and equity $

6,749,791

  $ 5,595,753
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2015 AND 2014
(in thousands)
(unaudited)
  Twelve Months Ended
December 31,
2015   2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $

225,037

$ 260,755
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 188,535 157,081
Stock-based compensation 14,649 12,858
Excess tax benefits from share-based compensation (1,477 ) (6,221 )
Deferred income taxes

33,872

70,131
Net gain on sale of assets (2,291 ) (5,100 )
Loss on settlement of foreign currency forward purchase contracts 18,686
Insurance proceeds received 5,527

Changes in assets and liabilities which (used) provided cash, net of effect of
acquisitions:

Accounts receivable, net

28,905

(39,107 )
Materials and supplies (4,073 ) 2,600
Prepaid expenses and other

7,462

17,451
Accounts payable and accrued expenses

(39,881

) 14,703
Other assets and liabilities, net

5,723

  786  
Net cash provided by operating activities

475,147

  491,464  
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (371,504 ) (331,499 )
Grant proceeds from outside parties 41,742 27,980
Cash paid for acquisitions, net of cash acquired

(740,237

) (221,451 )

Net payment from settlement of foreign currency forward purchase contracts related
to an acquisition

(18,686 )
Insurance proceeds for the replacement of assets 10,394 8,029
Proceeds from disposition of property and equipment 4,018   7,096  
Net cash used in investing activities

(1,074,273

) (509,845 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term borrowings, including capital leases (676,257 ) (538,035 )
Proceeds from issuance of long-term debt 1,261,640 543,300
Debt amendment costs (9,622 ) (3,880 )
Proceeds from employee stock purchases 6,829 11,819
Excess tax benefits from share-based compensation 1,477 6,221
Treasury stock acquisitions (3,261 ) (4,186 )
Net cash provided by financing activities 580,806   15,239  
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

(5,466

) (7 )
DECREASE IN CASH AND CASH EQUIVALENTS (23,786 ) (3,149 )
CASH AND CASH EQUIVALENTS, beginning of period 59,727   62,876  
CASH AND CASH EQUIVALENTS, end of period $ 35,941   $ 59,727  
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)
       
Three Months Ended December 31,
2015 2014
Amount % of Revenue Amount % of Revenue

Operating revenues:

Freight revenues $ 350,513 68.1% $ 316,415 76.1%
Freight-related revenues 138,833 27.0% 74,422 17.9%
All other revenues 25,507

 

4.9%

 

24,790 6.0%
Total operating revenues $ 514,853 100.0% $ 415,627 100.0%
 

Operating Expense Comparison:

Natural Classification

Labor and benefits $ 158,878 30.8% $ 116,324 28.0%
Equipment rents 39,680 7.7% 20,864 5.0%
Purchased services 51,056 9.9% 22,851 5.5%
Depreciation and amortization 49,967 9.7% 40,951 9.9%
Diesel fuel used in train operations 30,293 5.9% 33,644 8.1%
Electricity used in train operations 3,184 0.6% 149 —%
Casualties and insurance 12,467 2.4% 10,481 2.5%
Materials 24,484 4.8% 21,656 5.2%
Trackage rights 20,870 4.1% 13,322 3.2%
Net gain on sale of assets (310) (0.1)% (1,656) (0.4)%
Other expenses 29,653 5.8% 23,570 5.7%
Total operating expenses $ 420,222 81.6% $ 302,156 72.7%
 

Functional Classification

Transportation $ 175,316 34.1% $ 109,839 26.3%
Maintenance of ways and structures 52,109 10.1% 43,555 10.5%
Maintenance of equipment 66,538 12.9% 42,315 10.2%
General and administrative 75,119 14.6% 59,258 14.3%
Construction costs 1,483 0.3% 7,894 1.9%
Net gain on sale of assets (310) (0.1)% (1,656) (0.4)%
Depreciation and amortization 49,967 9.7% 40,951 9.9%
Total operating expenses $ 420,222 81.6% $ 302,156 72.7%
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)
       

Three Months Ended
December 31, 2015

North American
Operations

Australian
Operations

U.K./European
Operations

Total
Operations

Amount  

% of
Revenue

Amount  

% of
Revenue

Amount  

% of
Revenue

Amount  

% of
Revenue

Operating revenues:

Freight revenues $ 226,435 75.8 % $ 28,248 51.2 % $ 95,830 59.5 % $ 350,513 68.1 %
Freight-related revenues 56,681 19.0 % 25,373 46.0 % 56,779 35.3 % 138,833 27.0 %
All other revenues 15,532   5.2 % 1,568   2.8 % 8,407   5.2 % 25,507   4.9 %
Total operating revenues $ 298,648   100.0 % $ 55,189   100.0 % $ 161,016   100.0 % $ 514,853   100.0 %

Operating expenses:

Labor and benefits $ 94,276 31.6 % $ 15,735 28.5 % $ 48,867

30.3

% $ 158,878 30.8 %
Equipment rents 14,978 5.0 % 3,009 5.5 % 21,693 13.5 % 39,680 7.7 %
Purchased services 17,374 5.8 % 3,722 6.7 % 29,960 18.6 % 51,056 9.9 %

Depreciation and
amortization

36,415 12.2 % 6,654 12.1 % 6,898 4.3 % 49,967 9.7 %

Diesel fuel used in train
operations

15,404 5.2 % 5,247 9.5 % 9,642 6.0 % 30,293 5.9 %

Electricity used in train
operations

% % 3,184 2.0 % 3,184 0.6 %
Casualties and insurance 8,913 3.0 % 3,035 5.5 % 519 0.3 % 12,467 2.4 %
Materials 12,419 4.2 % 3,510 6.4 % 8,555 5.3 % 24,484 4.8 %
Trackage rights 5,785 1.9 % 2,357 4.3 % 12,728 7.9 % 20,870 4.1 %
Net gain on sale of assets (277 ) (0.1 )% (3 ) % (30 ) % (310 ) (0.1 )%
Other expenses 20,141   6.7 % 1,414   2.5 % 8,098   5.0 % 29,653   5.8 %
Total operating expenses $ 225,428   75.5 % $ 44,680   81.0 % $ 150,114  

93.2

% $ 420,222   81.6 %
Income from operations $ 73,220   $ 10,509   $ 10,902   $ 94,631  

Net expenditures for additions
to property & equipment

$ 61,218 $ 11,051 $ 12,799 $ 85,068
 

Three Months Ended
December 31, 2014

North American
Operations

Australian
Operations

U.K./European
Operations

Total
Operations

Amount

% of
Revenue

Amount

% of
Revenue

Amount

% of
Revenue

Amount

% of
Revenue

Operating revenues:

Freight revenues $ 259,345 76.7 % $ 57,070 78.8 % $ % $ 316,415 76.1 %
Freight-related revenues 57,242 16.9 % 12,219 16.9 % 4,961 100.0 % 74,422 17.9 %
All other revenues 21,698   6.4 % 3,092   4.3 %   % 24,790   6.0 %
Total operating revenues $ 338,285   100.0 % $ 72,381   100.0 % $ 4,961   100.0 % $ 415,627   100.0 %

Operating expenses:

Labor and benefits $ 98,029 29.0 % $ 16,516 22.8 % $ 1,779 35.9 % $ 116,324 28.0 %
Equipment rents 17,758 5.2 % 2,431 3.4 % 675 13.6 % 20,864 5.0 %
Purchased services 15,838 4.7 % 6,350 8.8 % 663 13.4 % 22,851 5.5 %

Depreciation and
amortization

33,788 10.0 % 6,789 9.4 % 374 7.5 % 40,951 9.9 %

Diesel fuel used in train
operations

28,045 8.3 % 5,147 7.1 % 452 9.1 % 33,644 8.1 %

Electricity used in train
operations

% % 149 3.0 % 149 %
Casualties and insurance 8,433 2.5 % 1,684 2.3 % 364 7.4 % 10,481 2.5 %
Materials 18,826 5.5 % 2,655 3.7 % 175 3.5 % 21,656 5.2 %
Trackage rights 7,466 2.2 % 5,184 7.2 % 672 13.5 % 13,322 3.2 %
Net gain on sale of assets (1,436 ) (0.4 )% (195 ) (0.3 )% (25 ) (0.5 )% (1,656 ) (0.4 )%
Other expenses 21,271   6.3 % 2,045   2.8 % 254   5.1 % 23,570   5.7 %
Total operating expenses $ 248,018   73.3 % $ 48,606   67.2 % $ 5,532   111.5 % $ 302,156   72.7 %
Income from operations $ 90,267   $ 23,775   $ (571 ) $ 113,471  

Net expenditures for additions
to property & equipment

$ 65,667 $ 9,389 $ 285 $ 75,341
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
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,
2015

North American Operations Australian Operations U.K./European Operations Total Operations

Commodity Group

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*  

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Agricultural Products $ 28,354 53,463 $ 530 $ 4,392 10,680 $ 411 $ 248 234 $ 1,060 $ 32,994 64,377 $ 513
Autos & Auto Parts 3,638 6,068 600 3,638 6,068 600
Chemicals & Plastics 34,219 43,493 787 34,219 43,493 787
Coal & Coke 19,828 53,004 374 7,428 17,711 419 27,256 70,715 385
Food & Kindred Products 8,664 15,270 567 8,664 15,270 567
Intermodal 2 29 69 17,136 15,608 1,098 70,956 215,644 329 88,094 231,281 381
Lumber & Forest Products 20,062 34,684 578

20,062 34,684 578
Metallic Ores 4,738 6,042 784 4,538 3,308 1,372 9,276 9,350 992
Metals 23,963 29,683 807 23,963 29,683 807
Minerals & Stone 26,996 49,724 543 1,870 16,572 113 15,473 42,071 368 44,339 108,367 409
Petroleum Products 18,167 26,605 683 312 77 4,052 18,479 26,682 693
Pulp & Paper 28,108 43,206 651 28,108 43,206 651
Waste 4,688 9,957 471 4,688 9,957 471
Other 5,008   17,000   295     1,725   2,490   693 6,733   19,490   345
Totals $ 226,435   388,228   $ 583 $ 28,248   46,245   $ 611 $ 95,830   278,150   $ 345 $ 350,513   712,623   $ 492
 

Three Months Ended December 31,
2014

North American Operations Australian Operations U.K./European Operations Total Operations
Commodity Group

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*  

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Agricultural Products $ 34,511 56,612 $ 610 $ 5,657 9,312 $ 607 $ $ $ 40,168 65,924 $ 609
Autos & Auto Parts 5,883 9,432 624 5,883 9,432 624
Chemicals & Plastics 34,461 43,153 799 34,461 43,153 799
Coal & Coke 31,469 93,047 338 31,469 93,047 338
Food & Kindred Products 9,383 15,937 589 9,383 15,937 589
Intermodal 57 542 105 22,323 16,575 1,347 22,380 17,117 1,307
Lumber & Forest Products 20,334 33,549 606

20,334 33,549 606
Metallic Ores 4,414 5,619 786 26,581 14,347 1,853 30,995 19,966 1,552
Metals 31,744 45,122 704 31,744 45,122 704
Minerals & Stone 31,273 51,231 610 2,141 14,047 152 33,414 65,278 512
Petroleum Products 15,694 26,249 598 368 75 4,907 16,062 26,324 610
Pulp & Paper 29,854 44,447 672 29,854 44,447 672
Waste 4,793 10,076 476 4,793 10,076 476
Other 5,475   20,769   264         5,475   20,769   264
Totals $ 259,345   455,785   $ 569 $ 57,070   54,356   $ 1,050 $     $ $ 316,415   510,141   $ 620
 

* Represents physical railcars and the estimated railcar equivalents of commodities transported by metric ton or other measure, as well as intermodal units.

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)
       
Twelve Months Ended December 31,
2015 2014
Amount

% of
Revenue

Amount

% of
Revenue

Operating revenues:

Freight revenues $ 1,405,114 70.2 % $ 1,251,941 76.4 %
Freight-related revenues 497,516 24.9 % 290,787 17.7 %
All other revenues 97,771   4.9 % 96,284   5.9 %
Total operating revenues $ 2,000,401   100.0 % $ 1,639,012   100.0 %
 

Operating Expense Comparison:

Natural Classification

Labor and benefits $ 614,967 30.7 % $ 469,503 28.7 %
Equipment rents 149,825 7.5 % 82,730 5.0 %
Purchased services 186,905 9.3 % 100,108 6.1 %
Depreciation and amortization 188,535 9.4 % 157,081 9.6 %
Diesel fuel used in train operations 132,149 6.6 % 149,047 9.1 %
Electricity used in train operations 13,714 0.7 % 1,058 0.1 %
Casualties and insurance 42,494 2.1 % 41,552 2.5 %
Materials 95,248 4.9 % 78,366 4.8 %
Trackage rights 78,140 3.9 % 53,783 3.3 %
Net gain on sale of assets (2,291 ) (0.1 )% (5,100 ) (0.3 )%
Other expenses 116,454   5.8 % 89,313   5.4 %
Total operating expenses $ 1,616,140   80.8 % $ 1,217,441   74.3 %
 

Functional Classification

Transportation $ 666,511 33.3 % $ 460,051 28.1 %
Maintenance of ways and structures 203,369 10.2 % 174,716 10.7 %
Maintenance of equipment 260,286 13.0 % 175,433 10.7 %
General and administrative 291,897 14.6 % 231,725 14.1 %
Construction costs 7,833 0.4 % 23,535 1.4 %
Net gain on sale of assets (2,291 ) (0.1 )% (5,100 ) (0.3 )%
Depreciation and amortization 188,535   9.4 % 157,081   9.6 %
Total operating expenses $ 1,616,140   80.8 % $ 1,217,441   74.3 %
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)
       

Twelve Months Ended
December 31, 2015

North American
Operations

Australian
Operations

U.K./European
Operations

Total
Operations

Amount  

% of
Revenue

Amount  

% of
Revenue

Amount  

% of
Revenue

Amount  

% of
Revenue

Operating revenues:

Freight revenues $ 949,028 76.4 % $ 146,850 60.4 % $ 309,236 60.0 % $ 1,405,114 70.2 %
Freight-related revenues 227,154 18.3 % 87,616 36.1 % 182,746 35.4 % 497,516 24.9 %
All other revenues 65,633   5.3 % 8,486   3.5 % 23,652   4.6 % 97,771   4.9 %
Total operating revenues $ 1,241,815   100.0 % $ 242,952   100.0 % $ 515,634   100.0 % $ 2,000,401   100.0 %

Operating expenses:

Labor and benefits $ 397,911 32.0 % $ 67,947 28.0 % $ 149,109 28.9 % $ 614,967 30.7 %
Equipment rents 65,918 5.3 % 12,298 5.1 % 71,609 13.9 % 149,825 7.5 %
Purchased services 63,986 5.1 % 19,560 8.0 % 103,359 20.0 % 186,905 9.3 %

Depreciation and
amortization

141,814 11.4 % 27,425 11.3 % 19,296 3.7 % 188,535 9.4 %

Diesel fuel used in train
operations

75,630 6.1 % 21,150 8.7 % 35,369 6.9 % 132,149 6.6 %

Electricity used in train
operations

% % 13,714 2.7 % 13,714 0.7 %
Casualties and insurance 29,574 2.4 % 8,498 3.5 % 4,422 0.9 % 42,494 2.1 %
Materials 57,808 4.7 % 11,408 4.7 % 26,032 5.0 % 95,248 4.9 %
Trackage rights 24,601 2.0 % 13,234 5.4 % 40,305 7.8 % 78,140 3.9 %
Net gain on sale of assets (2,001 ) (0.2 )% (48 ) % (242 ) % (2,291 ) (0.1 )%
Other expenses 89,088   7.2 % 6,638   2.7 % 20,728   4.0 % 116,454   5.8 %
Total operating expenses $ 944,329   76.0 % $ 188,110   77.4 % $ 483,701   93.8 % $ 1,616,140   80.8 %
Income from operations $ 297,486   $ 54,842   $ 31,933   $ 384,261  

Net expenditures for additions
to property & equipment

$ 266,548 $ 31,179 $ 32,035 $ 329,762
 

Twelve Months Ended
December 31, 2014

North American
Operations

Australian
Operations

U.K./European
Operations

Total
Operations

Amount % of Revenue Amount % of Revenue Amount   % of Revenue Amount % of Revenue

Operating revenues:

Freight revenues $ 1,008,236 77.3 % $ 243,705 77.8 % $ % $ 1,251,941 76.4 %
Freight-related revenues 214,388 16.4 % 55,461 17.7 % 20,938 99.8 % 290,787 17.7 %
All other revenues 82,137   6.3 % 14,104   4.5 % 43   0.2 % 96,284   5.9 %
Total operating revenues $ 1,304,761   100.0 % $ 313,270   100.0 % $ 20,981   100.0 % $ 1,639,012   100.0 %

Operating expenses:

Labor and benefits $ 390,755 29.9 % $ 71,216 22.7 % $ 7,532 35.9 % $ 469,503 28.7 %
Equipment rents 70,150 5.4 % 9,973 3.1 % 2,607 12.4 % 82,730 5.0 %
Purchased services 62,826 4.8 % 34,092 10.9 % 3,190 15.2 % 100,108 6.1 %

Depreciation and
amortization

127,421 9.8 % 28,095 9.0 % 1,565 7.5 % 157,081 9.6 %

Diesel fuel used in train
operations

120,729 9.3 % 26,346 8.4 % 1,972 9.4 % 149,047 9.1 %

Electricity used in train
operations

% % 1,058 5.0 % 1,058 0.1 %
Casualties and insurance 30,124 2.3 % 10,899 3.5 % 529 2.5 % 41,552 2.5 %
Materials 69,840 5.4 % 7,656 2.4 % 870 4.1 % 78,366 4.8 %
Trackage rights 28,928 2.2 % 22,095 7.1 % 2,760 13.2 % 53,783 3.3 %
Net gain on sale of assets (4,582 ) (0.4 )% (432 ) (0.1 )% (86 ) (0.4 )% (5,100 ) (0.3 )%
Other expenses 75,376   5.8 % 12,934   4.1 % 1,003   4.8 % 89,313   5.4 %
Total operating expenses $ 971,567   74.5 % $ 222,874   71.1 % $ 23,000   109.6 % $ 1,217,441   74.3 %
Income/(loss) from operations $ 333,194   $ 90,396   $ (2,019 ) $ 421,571  

Net expenditures for additions
to property & equipment

$ 277,725 $ 24,930 $ 864 $ 303,519
 

 
GENESEE & WYOMING INC. AND SUBSIDIARIES
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, 2015

North American Operations Australian Operations U.K./European Operations Total Operations
Commodity Group

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Agricultural Products $ 123,116 216,500 $ 569 $ 22,614 51,534 $ 439 $ 520 610 $ 852 $ 146,250 268,644 $ 544
Autos & Auto Parts 17,313 27,738 624 17,313 27,738 624
Chemicals & Plastics 140,400 179,002 784 140,400 179,002 784
Coal & Coke 93,541 267,258 350 23,896 60,873 393 117,437 328,131 358
Food & Kindred Products 34,899 61,145 571 34,899 61,145 571
Intermodal 9 107 84 71,429 61,659 1,158 227,526 692,304 329 298,964 754,070 396
Lumber & Forest Products 80,209 137,009 585 80,209 137,009 585
Metallic Ores 19,756 24,812 796 44,204 26,915 1,642 63,960 51,727 1,236
Metals 103,898 133,915 776 103,898 133,915 776
Minerals & Stone 116,537 209,957 555 7,306 60,490 121 52,596 133,656 394 176,439 404,103 437
Petroleum Products 67,584 102,759 658 1,297 307 4,225 68,881 103,066 668
Pulp & Paper 113,830 176,543 645 113,830 176,543 645
Waste 18,078 38,927 464 18,078 38,927 464
Other 19,858   68,728   289     4,698   8,682   541 24,556   77,410   317
Totals $ 949,028   1,644,400   $ 577 $ 146,850   200,905   $ 731 $ 309,236   896,125   $ 345 $ 1,405,114   2,741,430   $ 513
 

Twelve Months Ended
December 31, 2014

North American Operations Australian Operations U.K./European Operations Total Operations

Commodity Group

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Freight
Revenues

Carloads*

Average
Revenues
Per
Carload

Agricultural Products $ 121,265 210,316 $ 577 $ 32,003 54,184 $ 591 $ $ $ 153,268 264,500 $ 579
Autos & Auto Parts 23,619 34,470 685 23,619 34,470 685
Chemicals & Plastics 136,492 169,160 807 136,492 169,160 807
Coal & Coke 126,377 355,762 355 126,377 355,762 355
Food & Kindred Products 35,534 60,741 585 35,534 60,741 585
Intermodal 390 3,442 113 91,895 63,475 1,448 92,285 66,917 1,379
Lumber & Forest Products 82,271 136,768 602 82,271 136,768 602
Metallic Ores 17,795 22,123 804 109,439 56,542 1,936 127,234 78,665 1,617
Metals 131,161 184,264 712 131,161 184,264 712
Minerals & Stone 112,999 194,335 581 8,921 53,407 167 121,920 247,742 492
Petroleum Products 63,051 104,672 602 1,447 286 5,059 64,498 104,958 615
Pulp & Paper 117,299 174,942 671 117,299 174,942 671
Waste 18,449 39,994 461 18,449 39,994 461
Other 21,534   88,168   244         21,534   88,168   244
Totals $ 1,008,236   1,779,157   $ 567 $ 243,705   227,894   $ 1,069 $     $ $ 1,251,941   2,007,051   $ 624
 

* Represents physical railcars and the estimated railcar equivalents of commodities transported by metric ton or other measure, as well as intermodal units.

Non-GAAP Financial Measures

This earnings release contains references to adjusted income from operations (adjusted operating income), adjusted operating ratio, adjusted net income, adjusted diluted earnings per common share and free cash flow, which are “non-GAAP financial measures” as this term is defined in 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. In accordance with these rules, G&W has reconciled these non-GAAP financial measures to their most directly comparable U.S. GAAP measures.

Management views these non-GAAP financial measures as important measures of G&W’s operating performance or, in the case of free cash flow, an important financial measure of how well G&W is managing its assets and a useful indicator of cash flow that may be available for discretionary use by G&W. Management also views these non-GAAP financial measures as a way to assess comparability between periods. Key limitations of the free cash flow measure include the assumptions that G&W 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.

These non-GAAP financial measures are not intended to represent, and should not be considered more meaningful than, or as an alternative to, their most directly comparable GAAP measures. These non-GAAP financial measures may be different from similarly-titled non-GAAP financial measures used by other companies.

The following tables set forth reconciliations of each of these non-GAAP financial measures to their most directly comparable GAAP measure (in millions, except percentages and per share amounts).

Reconciliations of Non-GAAP Financial Measures

Adjusted Income from Operations and Adjusted Operating Ratios

 

 
Three Months Ended
December 31,  
2015   2014  
Operating revenues $ 514.9 $ 415.6
Operating expenses 420.2   302.2  
Income from operations (a) $ 94.6   $ 113.5  
Operating ratio (b) 81.6 % 72.7 %
 
Operating expenses $ 420.2 $ 302.2
Business development and related costs (2.5 ) (1.6 )
Net gain on sale of assets 0.3 1.7

Out of period benefit of final allocation of fair values to Freightliner's
assets & liabilities

 

2.6  

 
Adjusted operating expenses $ 420.6   $ 302.2  
 
Adjusted income from operations $ 94.2   $ 113.4  
Adjusted operating ratio 81.7 % 72.7 %
 
(a)   Income from operations is calculated as operating revenues less operating expenses.
(b) Operating ratio is calculated as operating expenses divided by operating revenues.
 

Adjusted Net Income and Adjusted Diluted Earnings Per Common Share

Three Months Ended December 31, 2015   Net Income  

Diluted
Earnings Per
Common
Share

As reported $

84.9

$

1.47

Add back certain items:
Business development and related costs 1.7 0.03
Net gain on sale of assets (0.2 )

Out of period benefit of final allocation of fair values to Freightliner's assets & liabilities

(1.6 ) (0.03 )
Impact of reduction in U.K. effective tax rate

(9.7

)

(0.17

)
2015 Short Line Tax Credit (27.4 ) (0.47 )
Application of full year effective tax rate to Q1 - Q3 2015 results 1.3   0.02  
As adjusted $ 49.1   $ 0.85  
 
Three Months Ended December 31, 2014 Net Income

Diluted
Earnings Per
Common
Share

As reported $ 87.4 $ 1.53
Add back certain items:
Business development and related costs 1.0 0.02
Net gain on sale of assets (1.0 ) (0.02 )
2014 Short Line Tax Credit (27.0 ) (0.47 )
Application of full year effective tax rate to Q1 - Q3 2014 results 3.5   0.06  
As adjusted $ 63.8   $ 1.12
FX 0.05  
As adjusted (excluding FX) $ 1.07  
 
Twelve Months Ended December 31, 2015 Net Income

Diluted
Earnings Per
Common
Share

As reported $

225.0

$ 3.90
Add back certain items:
Business development and related costs 5.6 0.10
Freightliner acquisition-related costs 9.5 0.16
Net gain on sale of assets (1.7 ) (0.03 )

Loss on settlement of Freightliner acquisition-related foreign currency
forward purchase contracts

11.6 0.20
Impact of reduction in U.K. effective tax rate

(9.7

)

(0.17

)
As adjusted $ 240.3 $ 4.15
2015 Short Line Tax Credit (27.4 ) (0.47 )
As adjusted (excluding 2015 Short Line Tax Credit) $ 212.9   $ 3.68  
 
Twelve Months Ended December 31, 2014 Net Income

Diluted
Earnings Per
Common
Share

As reported $ 260.8 $ 4.58
Add back certain items:
Business development and related costs 3.2 0.06
Credit facility refinancing costs 2.9 0.05
Net gain on sale of assets (3.5 ) (0.06 )
RailAmerica-related tax benefit (3.9 ) (0.07 )
Adjustment for tax returns from previous fiscal year 0.7   0.01  
As adjusted $ 260.2 $ 4.57
2014 Short Line Tax Credit (27.0 ) (0.47 )
As adjusted (excluding 2014 Short Line Tax Credit) $ 233.3   $ 4.10  
 

Free Cash Flow

 

Twelve Months Ended
December 31,

       2015       

  2014
Net cash provided by operating activities $

475.1

$ 491.5
Net cash used in investing activities (a)

(1,074.3

) (509.8 )
Net cash used for acquisitions

792.2

  221.5  
Free cash flow $

193.0

  $ 203.1  
 

(a) The twelve months ended December 31, 2015 and 2014 includes $65.6 million and $92.9 million, respectively, of new business investments.

 

Twelve
Months Ended
December 31,
2016
(Outlook)

Net cash provided by operating activities $

475

Net cash used in investing activities, excluding new business investments

(225

)
Net cash used for acquisitions  
Free cash flow $

250

New business investments 35  
Free cash flow before new business investments $

285

 
 
 

G&W Corporate Communications
Michael Williams, 1-203-202-8900
mwilliams@gwrr.com


Source: Business Wire (February 9, 2016 - 6:00 AM EST)

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