Genesee & Wyoming Inc. (G&W) (NYSE:GWR)
Second Quarter 2018 Consolidated Highlights Compared with
Second Quarter 2017
- Operating revenues increased 10.1% to
$595.0 million from $540.4 million.
- Reported operating income increased
3.4% to $103.1 million; Adjusted operating income increased 1.1% to
$107.0 million.(1)
- Reported diluted earnings per common
share (EPS) decreased 1.4% to $0.73 with 60.9 million weighted
average shares outstanding, compared with reported diluted EPS in
the second quarter of 2017 of $0.74 with 62.4 million weighted
average shares outstanding; Adjusted diluted EPS increased 17.5% to
$0.94.(1)
- G&W repurchased approximately 1.9
million shares of its Class A Common Stock for $134.9 million
during the second quarter of 2018.
Jack Hellmann, Chairman, President and CEO of G&W,
commented, “Our reported financial results for the second quarter
of 2018 of $0.73 per diluted share were generally consistent with
the second quarter of 2017, primarily because of our previously
announced U.K. restructuring charges. Our adjusted diluted EPS of
$0.94 for the second quarter of 2018 were at the high end of our
outlook as business conditions continued to improve in each of our
three geographies, led by North America. Our same railroad carloads
increased 8% in North America with particular strength in coal,
steel and minerals and stone traffic. While our operating leverage
in North America during the quarter was adversely impacted by
several variables including the mix of business, the lag in fuel
surcharge recovery, and legal fees associated with an arbitration
proceeding, we expect to see our customarily strong operating
leverage for the remainder of 2018 based on our current volume
outlook.”
“In Australia, our second quarter results were as expected with
particular growth in our spot coal traffic due to the early
delivery of a new train set. In the UK/Europe, we successfully
initiated our restructuring activities and achieved financial
results that were ahead of our expectations.”
“Our business outlook for the remainder of 2018 remains
promising thanks to growing customer demand for rail shipments
across most commodity groups, particularly in North America. In
addition, we have refinanced our senior credit facility with
improved terms through 2023, we have more than $600 million of
capacity under our revolving credit facility, and we continue to
evaluate investment opportunities in multiple markets including the
opportunistic purchase of our own shares.”
Second Quarter Segment Highlights
- North America: Operating revenues from
G&W's North American Operations increased 7.6% to $339.6
million from $315.7 million. Reported operating income from
G&W's North American Operations increased 0.7% to $80.3
million; Adjusted operating income from G&W's North American
Operations remained relatively flat at $81.0 million.(1)
- Australia: Operating revenues from
G&W's 51.1% owned Australian Operations increased 2.9% to $79.0
million from $76.8 million. Reported operating income from
G&W's Australian Operations increased 27.9% to $25.9 million;
Adjusted operating income from G&W's Australian Operations
decreased 3.6% to $19.6 million.(1)
- U.K./Europe: Operating revenues from
G&W's U.K./European Operations increased 19.2% to $176.4
million from $148.0 million, primarily due to new operations and
the impact from foreign currency appreciation. Reported operating
loss from G&W's U.K./European Operations increased to $3.0
million from $0.2 million; Adjusted operating income from G&W's
U.K./European Operations increased to $6.3 million from $4.2
million.(1)
Financial Results
G&W's operating revenues increased $54.6 million, or 10.1%,
to $595.0 million in the second quarter of 2018, compared with
$540.4 million in the second quarter of 2017. G&W's operating
income in the second quarter of 2018 was $103.1 million, compared
with $99.7 million in the second quarter of 2017. G&W's
adjusted operating income in the second quarter of 2018 was $107.0
million, compared with $105.8 million in the second quarter of
2017.(1)
Reported net income attributable to G&W in the second
quarter of 2018 was $44.2 million, compared with reported net
income attributable to G&W of $46.0 million in the second
quarter of 2017. Excluding the net impact of certain items
affecting comparability between periods discussed below, G&W's
adjusted net income attributable to G&W in the second quarter
of 2018 was $57.2 million, compared with $49.9 million in the
second quarter of 2017.(1)
G&W's reported diluted EPS in the second quarter of 2018
were $0.73 with 60.9 million weighted average shares outstanding,
compared with reported diluted EPS in the second quarter of 2017 of
$0.74 with 62.4 million weighted average shares outstanding.
G&W's adjusted diluted EPS in the second quarter of 2018 were
$0.94 with 60.9 million weighted average shares outstanding,
compared with adjusted diluted EPS in the second quarter of 2017 of
$0.80 with 62.4 million weighted average shares outstanding.(1)
Items Affecting Comparability
In the second quarter of 2018 and 2017, 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 Income
Taxes Impact
After-Tax Net Income/(Loss)
Attributable to G&W Impact
Diluted EPS Impact
Three Months Ended
June 30, 2018
Corporate development and related costs $ (0.4 ) $ (0.3 ) $ —
Restructuring costs $ (9.4 ) $ (7.6 ) $ (0.12 ) Loss on sale of
business $ (1.4 ) $ (1.4 ) $ (0.02 ) Gain on settlement $ 6.3 $ 2.3
$ 0.04 Credit facility refinancing-related costs $ (2.7 ) $ (2.0 )
$ (0.03 ) Prior period tax adjustment $ — $ (4.1 ) $ (0.07 )
Three Months Ended
June 30, 2017
Corporate development and related costs $ (3.7 ) $ (2.7 ) $ (0.04 )
Restructuring costs $ (2.4 ) $ (2.2 ) $ (0.03 ) Gain on sale of
investment $ 1.6 $ 1.0 $ 0.02
In the second quarter of 2018, G&W's results included
corporate development and related costs of $0.4 million,
restructuring and related costs of $9.4 million, primarily driven
by our optimization activities in the U.K., a $1.4 million loss on
sale of our Continental Europe intermodal business, ERS Railways
B.V. (ERS), and a gain on settlement of $6.3 million from the
recovery of pre-petition claims associated with Arrium Limited's
voluntary administration (bankruptcy) in the second quarter of
2016. The second quarter of 2018 also included credit facility
refinancing-related costs of $2.7 million and a $4.1 million income
tax expense associated with uncertain tax deductions on
intercompany financing arrangements in the U.K. previously recorded
from March 25, 2015, the date of the Freightliner acquisition when
the arrangements were established, through March 31, 2018.
In the second quarter of 2017, G&W's results included
corporate development and related costs of $3.7 million, primarily
related to the acquisition and integration of Pentalver Transport
Limited, as well as restructuring costs of $2.4 million, primarily
in G&W's U.K./European Region. The second quarter of 2017 also
included a $1.6 million gain on the sale of an investment in the
U.S.
Second Quarter Results by Segment
Operating revenues from G&W's North American Operations
increased $23.9 million, or 7.6%, to $339.6 million in the second
quarter of 2018, compared with $315.7 million in the second quarter
of 2017.
North American Operations traffic increased 33,306 carloads, or
8.4%, to 430,353 carloads in the second quarter of 2018. Excluding
1,243 carloads from new operations, same railroad traffic increased
32,063 carloads, or 8.1%. The same railroad traffic increase was
principally due to increases of 12,845 carloads of coal and coke
traffic (primarily in the Central, Midwest and Northeast regions),
6,111 carloads of metals traffic (primarily in the Southern,
Midwest and Central regions), 5,383 carloads of mineral and stone
products traffic (primarily in the Northeast and Coastal regions),
2,841 carloads of other commodity traffic (primarily in the
Southern, Central and Midwest regions), 1,949 carloads of pulp and
paper products traffic (primarily in the Coastal and Central
regions), 1,449 carloads of intermodal traffic (primarily in the
Northeast Region) and 1,438 carloads of lumber and forest products
traffic (primarily in the Western and Central regions), partially
offset by a decrease of 1,256 carloads of agricultural products
traffic (primarily in the Central Region). All remaining traffic
increased by a net 1,303 carloads.
G&W's North American Operations had operating income of
$80.3 million in the second quarter of 2018, compared with $79.7
million in the second quarter of 2017. The operating ratio for
North American Operations was 76.4% in the second quarter of 2018,
compared with an operating ratio of 74.8% in the second quarter of
2017. Adjusted operating income from G&W's North American
Operations in the second quarter of 2018 was $81.0 million,
compared with adjusted operating income of $81.2 million in the
second quarter of 2017. The adjusted operating ratio for North
American Operations was 76.1% in the second quarter of 2018,
compared with an adjusted operating ratio of 74.3% in the second
quarter of 2017.(1)
Operating revenues from G&W's Australian Operations
increased $2.2 million, or 2.9%, to $79.0 million in the second
quarter of 2018, compared with $76.8 million in the second quarter
of 2017. Excluding a $0.6 million increase due to the impact of
foreign currency appreciation, Australian Operations revenues
increased $1.6 million, or 2.1%, primarily due to an increase in
freight revenues.(2)
Australian Operations traffic increased 1,876 carloads to
147,965 carloads in the second quarter of 2018. The traffic
increase was principally due to increases of 4,623 carloads of coal
and coke traffic and 2,913 carloads of minerals and stone traffic,
partially offset by decreases of 3,268 carloads of metallic ores
traffic, 1,202 carloads of intermodal traffic and 1,200 carloads of
agricultural products traffic. All remaining traffic increased by
10 carloads.
G&W's Australian Operations had operating income of $25.9
million in the second quarter of 2018, compared with $20.3 million
in the second quarter of 2017. The operating ratio for Australian
Operations was 67.2% in the second quarter of 2018, compared with
an operating ratio of 73.6% in the second quarter of 2017. Adjusted
operating income from G&W's Australian Operations was $19.6
million in the second quarter of 2018, compared with adjusted
operating income of $20.3 million in the second quarter of 2017.
The adjusted operating ratio for Australian Operations was 75.2% in
the second quarter of 2018, compared with an adjusted operating
ratio of 73.5% in the second quarter of 2017.(1)
Operating revenues from G&W's U.K./European Operations
increased $28.5 million, or 19.2%, to $176.4 million in the second
quarter of 2018, compared with $148.0 million in the second quarter
of 2017. Excluding $12.0 million from new operations, a decrease of
$3.8 million from G&W's divested ERS operations and a
$9.2 million increase due to the impact of foreign currency
appreciation, U.K./European same railroad revenues increased
$11.0 million, or 7.7%, primarily due to an increase in
freight revenues in the U.K. and Poland.(2)
U.K./European Operations traffic decreased 10,901 carloads, or
4.1%, to 256,045 carloads in the second quarter of 2018. Excluding
traffic from ERS, same railroad traffic decreased 4,076 carloads,
or 1.7%, to 235,222. The same railroad traffic decrease was
principally due to decreases of 9,208 carloads of intermodal
traffic in the U.K., partially offset by an increase of 5,187
carloads of minerals and stone traffic (primarily in the U.K.). All
remaining traffic decreased by 55 carloads.
G&W's U.K./European Operations had an operating loss of $3.0
million in the second quarter of 2018, compared with an operating
loss of $0.2 million in the second quarter of 2017. The operating
ratio for U.K./European Operations was 101.7% in the second quarter
of 2018, compared with an operating ratio of 100.1% in the second
quarter of 2017. Adjusted operating income from G&W's
U.K./European Operations was $6.3 million in the second quarter of
2018, compared with adjusted operating income of $4.2 million in
the second quarter of 2017. The adjusted operating ratio for
U.K./European Operations was 96.4% in the second quarter of 2018,
compared with an adjusted operating ratio of 97.1% in the second
quarter of 2017.(1)
Adjusted Free Cash Flow Measures (1)
Adjusted free cash flow measures for the six months ended
June 30, 2018 and 2017 were as follows (in millions):
Six Months Ended June 30,
2018 2017 Net cash provided by
operating activities $ 231.3 $ 224.3 Allocation of adjusted cash
flow to noncontrolling interest(a) (13.0 ) (18.7 ) Adjusted net
cash provided by operating activities attributable to G&W $
218.3 $ 205.6 Core capital expenditures(b) (95.3 ) (74.7 ) Adjusted
free cash flow attributable to G&W before new business
investments and grant funded projects $ 123.1 $ 130.9 New business
investments (21.5 ) (1.6 ) Grant funded projects, net of proceeds
received from outside parties(c) $ 1.0 $ 1.1 Adjusted
free cash flow attributable to G&W $ 102.5 $ 130.4
(a) Allocation of adjusted cash flow to
noncontrolling interest (Macquarie Infrastructure and Real Assets'
(MIRA's) 48.9% equity ownership of G&W Australia Holdings LP
(GWA) since December 1, 2016) is calculated as 48.9% of the total
of (i) cash flow provided by operating activities of G&W’s
Australian Operations, less (ii) net purchases of property and
equipment of G&W’s Australian Operations. The timing and amount
of actual distributions, if any, from GWA to G&W and MIRA made
in any given period will vary and could differ materially from the
amounts presented. There were A$40.0 million (or $30.0 million at
the average exchange rate in June 2018) of such distributions made
for the six months ended June 30, 2018, of which $15.3 million and
$14.9 million was distributed to G&W and MIRA, respectively,
and no such distributions were made for the six months ended June
30, 2017. G&W expressly disclaims any direct correlation
between the allocation of adjusted cash flow to noncontrolling
interest and actual distributions made in any given period. (b)
Core capital expenditures represent purchases of property and
equipment as presented on the Statement of Cash Flows less grant
proceeds from outside parties, insurance proceeds for the
replacement of assets and proceeds from disposition of property and
equipment, each of which as presented on the Statement of Cash
Flows, less new business investments and grant funded projects. (c)
Grant funded projects represent purchases of property and equipment
for projects partially or entirely funded by outside parties, net
of grant proceeds from outside parties as presented on the
Statement of Cash Flows.
Share Repurchase Program
During the second quarter of 2018, G&W repurchased
approximately 1.9 million shares of Class A Common Stock for $134.9
million, which resulted in a reduction of approximately 1.3 million
shares in our weighted average diluted shares during the second
quarter.
Conference Call and Webcast Details
As previously announced, G&W's conference call to discuss
financial results for the second quarter of 2018 will be held on
Friday, July 27, 2018, at 11 a.m. EDT. The dial-in number for
the teleconference in the U.S. is (800) 288-9626; outside the U.S.,
the dial-in number is (612) 332-0345, 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. EDT on July 27, 2018, by dialing (800) 475-6701 (or
outside the U.S., dialing 320-365-3844). The access code is
439196.
About G&W
G&W owns or leases 121 freight railroads organized in nine
locally managed operating regions with 8,000 employees serving
3,000 customers.
- G&W's seven North American regions
serve 41 U.S. states and four Canadian provinces and include 115
short line and regional freight railroads with more than 13,000
track-miles.
- G&W's Australia Region serves New
South Wales, the Northern Territory and South Australia and
operates the 1,400-mile Tarcoola-to-Darwin rail line. The Australia
Region is 51.1% owned by G&W and 48.9% owned by a consortium of
funds and clients managed by Macquarie Infrastructure and Real
Assets.
- G&W's U.K./Europe Region includes
the U.K.'s largest rail maritime intermodal operator and
second-largest freight rail provider, as well as regional services
in Continental Europe.
G&W subsidiaries and joint ventures also provide rail
service at more than 40 major ports, rail-ferry service between the
U.S. Southeast and Mexico, transload services, contract coal
loading, and industrial railcar switching and repair.
From time to time, we may use our website as a channel of
distribution of material company information. Financial and other
material information regarding G&W is routinely posted on and
accessible at www.gwrr.com/investors. In addition, you may
automatically receive email alerts and other information about us
by enrolling your email address in the "Email Alerts" section of
www.gwrr.com/investors. The information contained on or connected
to our Internet website is not deemed to be incorporated by
reference in this press release or filed with the United States
Securities and Exchange Commission.
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 and port
congestion or other substantial disruption of operations; customer
demand and changes in our operations or loss of important
customers; 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 or our customers 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 and
outcome of various legal claims, lawsuits and arbitrations;
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;
uncertainties arising from a referendum in which voters in the
United Kingdom (U.K.) approved an exit from the European Union
(E.U.), commonly referred to as Brexit; our ability to integrate
acquired businesses successfully or to realize the expected
synergies associated with acquisitions; risks associated with our
substantial indebtedness; failure to maintain satisfactory working
relationships with partners in Australia; failure to maintain an
effective system of internal control over financial reporting as
well as disclosure controls and procedures and other risks
including, but not limited to, those noted in our 2017 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 operating income, adjusted operating ratio,
adjusted net income attributable to G&W, adjusted diluted
earnings per common share (EPS), and the adjusted free cash flow
measures of adjusted net cash provided by operating activities
attributable to G&W, adjusted free cash flow attributable to
G&W and adjusted free cash flow attributable to G&W before
new business investments and grant funded projects 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. 2. Foreign exchange impact is
calculated by comparing the prior period results translated from
local currency to U.S. dollars using current period exchange rates
to the prior period results in U.S. dollars as reported.
GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND
SIX MONTHS ENDED JUNE 30, 2018 AND 2017 (in thousands,
except per share amounts) (unaudited)
Three Months
Ended Six Months Ended June 30, June 30,
2018 2017 2018 2017 OPERATING REVENUES
$ 594,990 $ 540,433 $ 1,169,651 $ 1,059,541 OPERATING EXPENSES
491,865 440,700 979,613 883,908
OPERATING INCOME 103,125 99,733 190,038 175,633 INTEREST INCOME 584
581 1,082 808 INTEREST EXPENSE (28,940 ) (25,785 ) (54,176 )
(52,150 ) OTHER LOSS, NET 288 3,196 (1,752 ) 2,651
INCOME BEFORE INCOME TAXES 75,057 77,725 135,192 126,942
PROVISION FOR INCOME TAXES (26,446 ) (29,597 ) (10,556 ) (51,525 )
NET INCOME $ 48,611 $ 48,128 $ 124,636 $ 75,417 LESS: NET INCOME
ATTRIBUTABLE TO NONCONTROLLING INTEREST 4,443 2,121
5,370 3,172 NET INCOME ATTRIBUTABLE TO GENESEE &
WYOMING INC. $ 44,168 $ 46,007 $ 119,266 $
72,245 BASIC EARNINGS PER COMMON SHARE ATTRIBUTABLE TO
GENESEE & WYOMING INC. COMMON STOCKHOLDERS: $ 0.74 $
0.75 $ 1.96 $ 1.18 WEIGHTED AVERAGE SHARES -
BASIC 59,996 61,551 60,946 61,472
DILUTED EARNINGS PER COMMON SHARE ATTRIBUTABLE TO GENESEE &
WYOMING INC. COMMON STOCKHOLDERS: $ 0.73 $ 0.74 $
1.93 $ 1.16 WEIGHTED AVERAGE SHARES - DILUTED 60,879
62,415 61,841 62,371
GENESEE & WYOMING INC. AND SUBSIDIARIES CONSOLIDATED
BALANCE SHEETS AS OF JUNE 30, 2018 AND DECEMBER 31, 2017
(in thousands) (unaudited)
June 30, December 31, 2018
2017 ASSETS CURRENT ASSETS: Cash and cash equivalents $
69,702 $ 80,472 Accounts receivable, net 436,149 416,705 Materials
and supplies 53,775 57,750 Prepaid expenses and other 51,263
34,606 Total current assets 610,889 589,533 PROPERTY AND
EQUIPMENT, net 4,613,849 4,656,921 GOODWILL 1,136,985 1,165,587
INTANGIBLE ASSETS, net 1,495,458 1,567,038 DEFERRED INCOME TAX
ASSETS, net 3,608 3,343 OTHER ASSETS 59,696 52,475 Total
assets $ 7,920,485 $ 8,034,897 LIABILITIES AND EQUITY
CURRENT LIABILITIES: Current portion of long-term debt $ 19,074 $
27,853 Accounts payable 271,672 253,993 Accrued expenses 152,016
185,935 Total current liabilities 442,762 467,781
LONG-TERM DEBT, less current portion 2,357,245 2,303,442 DEFERRED
INCOME TAX LIABILITIES, net 853,933 873,194 DEFERRED ITEMS - grants
from outside parties 318,611 321,592 OTHER LONG-TERM LIABILITIES
165,556 172,796 TOTAL EQUITY 3,782,378 3,896,092 Total
liabilities and equity $ 7,920,485 $ 8,034,897
GENESEE & WYOMING INC. AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30,
2018 AND 2017 (in thousands) (unaudited)
Six Months Ended June 30, 2018
2017 CASH FLOWS FROM OPERATING ACTIVITIES: Net
income $ 124,636 $ 75,417 Adjustments to reconcile net income to
net cash provided by operating activities: Depreciation and
amortization 131,735 122,287 Stock-based compensation 8,601 8,857
Deferred income taxes (11,489 ) 34,320 Net gain on sale and
impairment of assets (1,859 ) (781 ) Changes in assets and
liabilities which provided/(used) cash, net of effect of
acquisitions: Accounts receivable, net (46,519 ) 10,066 Materials
and supplies 2,460 2,198 Prepaid expenses and other (7,587 ) 14,617
Accounts payable and accrued expenses 20,665 (48,282 ) Other assets
and liabilities, net 10,684 5,627 Net cash provided
by operating activities 231,327 224,326 CASH FLOWS
FROM INVESTING ACTIVITIES: Purchases of property and equipment
(133,328 ) (91,498 ) Grant proceeds from outside parties 12,901
11,630 Net cash paid for acquisitions, net of cash acquired —
(102,655 ) Proceeds from sale of business 7,927 — Proceeds from
sale of investment — 2,100 Insurance proceeds for the replacement
of assets 1,866 1,406 Proceeds from disposition of property and
equipment 2,795 3,280 Other investing activities (2,921 ) —
Net cash used in investing activities (110,760 ) (175,737 ) CASH
FLOWS FROM FINANCING ACTIVITIES: Principal payments on revolving
line-of-credit, long-term debt and capital leases (673,952 )
(322,446 ) Proceeds from revolving line-of-credit and long-term
borrowings 762,228 320,191 Debt amendment/issuance costs (5,303 ) —
Common share repurchases (192,324 ) — Distribution to
noncontrolling interest (14,898 ) — Installment payments on
Freightliner deferred consideration (6,255 ) — Other financing
related activities, net (893 ) 1,708 Net cash used in
financing activities (131,397 ) (547 ) EFFECT OF EXCHANGE RATE
CHANGES ON CASH AND CASH EQUIVALENTS 60 3,382
(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (10,770 ) 51,424
CASH AND CASH EQUIVALENTS, beginning of period 80,472 32,319
CASH AND CASH EQUIVALENTS, end of period $ 69,702 $
83,743
GENESEE & WYOMING INC. AND
SUBSIDIARIES SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands) (unaudited)
Three Months Ended
June 30, Six Months Ended June 30, 2018
2017 2018 2017 Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Operating
revenues:
Freight revenues $ 418,232 70.3 % $ 383,155 70.9 % $ 817,871 69.9 %
$ 760,900 71.8 % Freight-related revenues 142,402 23.9 % 127,621
23.6 % 283,599 24.2 % 246,958 23.3 % All other revenues 34,356
5.8 % 29,657 5.5 % 68,181 5.8 % 51,683
4.9 % Total operating revenues $ 594,990 100.0 % $ 540,433
100.0 % $ 1,169,651 100.0 % $ 1,059,541 100.0
%
Operating
expenses:
Labor and benefits(a) $ 179,838 30.2 % $ 164,222 30.4 % $ 363,554
31.1 % $ 331,360 31.3 % Equipment rents 34,802 5.9 % 33,237 6.2 %
68,889 5.9 % 67,108 6.3 % Purchased services(b) 61,045 10.3 %
56,795 10.5 % 125,147 10.7 % 107,796 10.2 % Depreciation and
amortization 65,745 11.0 % 61,513 11.4 % 131,735 11.3 % 122,287
11.5 % Diesel fuel used in train operations 45,623 7.7 % 33,030 6.1
% 91,774 7.9 % 71,183 6.7 % Electricity used in train operations
2,044 0.3 % 2,134 0.4 % 4,278 0.4 % 5,307 0.5 % Casualties and
insurance 12,984 2.2 % 10,179 1.9 % 22,950 2.0 % 22,722 2.1 %
Materials 32,376 5.4 % 26,651 4.9 % 64,845 5.5 % 47,197 4.5 %
Trackage rights 23,303 3.9 % 21,797 4.0 % 44,281 3.8 % 44,020 4.2 %
Net gain on sale and impairment of assets (823 ) (0.1 )% (354 )
(0.1 )% (1,859 ) (0.2 )% (781 ) (0.1 )% Restructuring costs 9,362
1.6 % 2,361 0.4 % 9,645 0.8 % 6,116 0.6 % Other expenses(c) 25,566
4.3 % 29,135 5.4 % 54,374 4.6 % 59,593
5.6 % Total operating expenses $ 491,865 82.7 % $ 440,700
81.5 % $ 979,613 83.8 % $ 883,908 83.4 % (a)
Includes $0.3 million and $0.4 million of corporate
development and related costs for the three and six months ended
June 30, 2018, respectively. Includes $0.5 million and $2.8 million
of corporate development and related costs for the three and six
months ended June 30, 2017, respectively, primarily associated with
severance costs related to the integration of the Providence &
Worcester Railroad Company (P&W). (b) Includes $0.1 million of
corporate development and related costs for both the three and six
months ended June 30, 2018. Includes $0.2 million and $0.3 million
of corporate development and related costs for the three and six
months ended June 30, 2017, respectively. (c) Includes $6.3 million
gain on settlement related to Arrium Limited's voluntary
administration for both the three and six months ended June 30,
2018. Includes $0.4 million of credit facility refinancing-related
costs for both the three and six months ended June 30, 2018.
Includes $0.1 million of corporate development and related costs
for both the three and six months ended June 30, 2018. Includes
$3.0 million and $6.0 million of corporate development and related
costs for the three and six months ended June 30, 2017,
respectively, primarily associated with the acquisition and
integration of Pentalver as well as expenses related to ongoing
corporate development projects and projects that are no longer
active.
GENESEE & WYOMING INC. AND
SUBSIDIARIES NORTH AMERICAN OPERATIONS SELECTED CONSOLIDATED
FINANCIAL INFORMATION (dollars in thousands)
(unaudited)
Three Months Ended June 30, Six Months Ended June
30, 2018 2017 2018
2017 Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Operating
revenues:
Freight revenues $ 259,868 76.5 % $ 238,373 75.5 % $ 505,285 76.0 %
$ 476,654 75.0 % Freight-related revenues 63,467 18.7 % 61,183 19.4
% 127,299 19.1 % 126,528 20.0 % All other revenues 16,222
4.8 % 16,118 5.1 % 32,603 4.9 % 31,968 5.0 %
Total operating revenues $ 339,557 100.0 % $ 315,674
100.0 % $ 665,187 100.0 % $ 635,150 100.0 %
Operating
expenses:
Labor and benefits(a) $ 109,289 32.2 % $ 102,082 32.4 % $ 221,206
33.3 % $ 212,240 33.4 % Equipment rents 13,633 4.0 % 13,380 4.3 %
26,133 3.9 % 27,370 4.3 % Purchased services(b) 14,652 4.3 % 15,423
4.9 % 28,582 4.3 % 30,096 4.7 % Depreciation and amortization
41,247 12.2 % 38,919 12.3 % 81,878 12.3 % 77,786 12.3 % Diesel fuel
used in train operations 23,253 6.8 % 16,546 5.2 % 48,733 7.3 %
37,104 5.8 % Casualties and insurance 10,156 3.0 % 7,811 2.5 %
16,613 2.5 % 18,044 2.8 % Materials 13,163 3.9 % 13,061 4.1 %
26,353 4.0 % 26,524 4.2 % Trackage rights 10,527 3.1 % 9,189 2.9 %
19,639 2.9 % 18,707 3.0 % Net gain on sale and impairment of assets
(706 ) (0.2 )% (328 ) (0.1 )% (1,618 ) (0.2 )% (760 ) (0.1 )%
Restructuring costs 7 — % 14 — % 41 — % 68 — % Other expenses(c)
24,062 7.1 % 19,898 6.3 % 44,193 6.6 % 40,629
6.4 % Total operating expenses $ 259,283 76.4 % $
235,995 74.8 % $ 511,753 76.9 % $ 487,808 76.8
% Operating income $ 80,274 $ 79,679 $ 153,434
$ 147,342 Expenditures for additions to property &
equipment, net of grants from outside parties $ 48,924 $ 40,012 $
87,487 $ 64,227 (a) Includes $0.3 million and $0.4 million
of corporate development and related costs for the three and six
months ended June 30, 2018, respectively. Includes $0.4 million and
$2.7 million of corporate development and related costs for the
three and six months ended June 30, 2017, respectively, primarily
associated with severance costs related to the integration of
P&W. (b) Includes $0.1 million of corporate development and
related costs for the six months ended June 30, 2017. (c) Includes
$0.4 million of credit facility refinancing-related costs for both
the three and six months ended June 30, 2018. Includes $0.1 million
of corporate and development and related costs for both the three
and six months ended June 30, 2018. Includes $1.1 million and $4.0
million of corporate development and related costs for the three
and six months ended June 30, 2017, respectively, primarily
associated with ongoing corporate development projects as well as
projects that are no longer active.
GENESEE &
WYOMING INC. AND SUBSIDIARIES AUSTRALIAN OPERATIONS SELECTED
CONSOLIDATED FINANCIAL INFORMATION (dollars in
thousands) (unaudited)
Three Months Ended June 30,
Six Months Ended June 30, 2018 2017
2018 2017 Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Operating
revenues:
Freight revenues $ 66,075 83.6 % $ 63,753 83.0 % $ 129,086 83.9 % $
124,627 82.7 % Freight-related revenues 11,515 14.6 % 11,500 15.0 %
22,078 14.3 % 23,209 15.4 % All other revenues 1,439 1.8 %
1,556 2.0 % 2,699 1.8 % 2,880 1.9 % Total
operating revenues $ 79,029 100.0 % $ 76,809 100.0 %
$ 153,863 100.0 % $ 150,716 100.0 %
Operating
expenses:
Labor and benefits $ 18,886 23.9 % $ 17,775 23.1 % $ 37,918 24.7 %
$ 34,829 23.1 % Equipment rents 1,183 1.5 % 1,334 1.7 % 2,498 1.6 %
2,735 1.8 % Purchased services 6,895 8.7 % 6,470 8.4 % 13,284 8.6 %
12,682 8.4 % Depreciation and amortization 15,288 19.4 % 14,970
19.5 % 31,295 20.3 % 30,162 20.0 % Diesel fuel used in train
operations 8,173 10.3 % 6,320 8.2 % 15,483 10.1 % 12,910 8.6 %
Casualties and insurance 1,766 2.2 % 1,379 1.8 % 3,547 2.3 % 2,852
1.9 % Materials 2,761 3.5 % 2,517 3.3 % 5,722 3.7 % 5,231 3.5 %
Trackage rights 2,364 3.0 % 3,484
4.6
% 4,578 3.0 % 6,892 4.6 % Net gain on sale and impairment of assets
(67 ) (0.1 )% (20 ) — % (113 ) (0.1 )% (22 ) — % Restructuring
costs — — % — — % — — % 338 0.2 % Other expenses, net(a) (4,116 )
(5.2 )% 2,330 3.0 % (2,221 ) (1.4 )% 4,698 3.1 %
Total operating expenses $ 53,133 67.2 % $ 56,559
73.6 % $ 111,991 72.8 % $ 113,307 75.2 % Operating
income $ 25,896 $ 20,250 $ 41,872 $ 37,409
Expenditures for additions to property & equipment, net
of grants from outside parties $ 14,489 $ 3,714 $ 19,751 $ 5,176
(a) Includes $6.3 million gain on settlement related to
Arrium Limited's voluntary administration for both the three and
six months ended June 30, 2018. Includes $0.1 million and $0.2
million of corporate development and related costs for the three
and six months ended June 30, 2017, respectively.
GENESEE & WYOMING INC. AND SUBSIDIARIES U.K./EUROPEAN
OPERATIONS SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands) (unaudited)
Three Months Ended June
30, Six Months Ended June 30, 2018 2017
2018 2017 Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Amount
% of Revenue
Operating
revenues:
Freight revenues $ 92,289 52.3 % $ 81,029 54.8 % $ 183,500 52.3 % $
159,619 58.3 % Freight-related revenues 67,420 38.2 % 54,938 37.1 %
134,222 38.3 % 97,221 35.5 % All other revenues 16,695 9.5 %
11,983 8.1 % 32,879 9.4 % 16,835 6.2 % Total
operating revenues $ 176,404 100.0 % $ 147,950 100.0
% $ 350,601 100.0 % $ 273,675 100.0 %
Operating
expenses:
Labor and benefits(a) $ 51,663 29.3 % $ 44,365
29.9
% $ 104,430 29.8 % $ 84,291 30.8 % Equipment rents 19,986 11.3 %
18,523 12.5 % 40,258 11.5 % 37,003 13.5 % Purchased services(b)
39,498 22.4 % 34,902 23.6 % 83,281 23.8 % 65,018 23.8 %
Depreciation and amortization 9,210 5.2 % 7,624
5.1
% 18,562 5.3 % 14,339 5.2 % Diesel fuel used in train operations
14,197 8.0 % 10,164 6.9 % 27,558 7.9 % 21,169 7.7 % Electricity
used in train operations 2,044 1.2 % 2,134 1.4 % 4,278 1.2 % 5,307
2.0
% Casualties and insurance 1,062 0.6 % 989 0.7 % 2,790 0.8 % 1,826
0.7 % Materials 16,452 9.3 % 11,073 7.5 % 32,770 9.3 % 15,442 5.6 %
Trackage rights 10,412 5.9 % 9,124 6.2 % 20,064 5.7 % 18,421 6.7 %
Net (gain)/loss on sale and impairment of assets (50 ) — % (6 ) — %
(128 ) — % 1 — % Restructuring costs 9,355 5.3 % 2,347 1.6 % 9,604
2.7 % 5,710 2.1 % Other expenses(c) 5,620 3.2 % 6,907
4.7 % 12,402 3.5 % 14,266 5.2 % Total operating
expenses $ 179,449 101.7 % $ 148,146 100.1 % $
355,869 101.5 % $ 282,793 103.3 % Operating loss $
(3,045 ) $ (196 ) $ (5,268 ) $ (9,118 ) Expenditures for
additions to property & equipment, net of grants from outside
parties $ 4,726 $ 6,175 $ 13,189 $ 10,465 (a) Includes $0.1
million of corporate development and related costs for both the
three and six months ended June 30, 2017, associated with severance
costs related to the integration of Pentalver. (b) Includes $0.2
million of corporate development and related costs for both the
three and six months ended June 30, 2017, associated with severance
costs related to the integration of Pentalver. (c) Includes a
reduction of $0.1 million of corporate development and related
costs for the six months ended June 30, 2018. Includes $1.8 million
of corporate development and related costs for both the three and
six months ended June 30, 2017, associated with severance costs
related to the integration of Pentalver.
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 June 30, 2018 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 $ 29,693 51,762 $ 574 $ 6,006 14,175 $ 424 $
785 607 $ 1,293 $ 36,484 66,544 $ 548 Autos & Auto Parts 5,806
9,106 638 — — — — — — 5,806 9,106 638 Chemicals & Plastics
38,972 45,285 861 — — — — — — 38,972 45,285 861 Coal & Coke
19,087 59,346 322 32,570 97,282 335 2,687 4,038 665 54,344 160,666
338 Food & Kindred Products 8,476 14,907 569 — — — — — — 8,476
14,907 569 Intermodal 380 3,816 100 17,102 13,957 1,225 66,483
201,058 331 83,965 218,831 384 Lumber & Forest Products 23,810
37,733 631 — — — — — — 23,810 37,733 631 Metallic Ores 3,670 4,448
825 8,125 5,586 1,455 — — — 11,795 10,034 1,176 Metals 32,493
40,806 796 — — — — — — 32,493 40,806 796 Minerals & Stone
38,034 62,156 612 2,087 16,891 124 22,326 50,322 444 62,447 129,369
483 Petroleum Products 16,151 24,340 664 185 74 2,500 8 20 400
16,344 24,434 669 Pulp & Paper 29,514 41,762 707 — — — — — —
29,514 41,762 707 Waste 7,339 14,837 495 — — — — — — 7,339 14,837
495 Other 6,443 20,049 321 — — — —
— — 6,443 20,049 321 Totals $ 259,868
430,353 $ 604 $ 66,075 147,965 $ 447 $
92,289 256,045 $ 360 $ 418,232 834,363
$ 501
Three Months Ended June 30, 2017
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 $ 31,279 52,953 $ 591 $ 5,932 15,375 $ 386 $
829 746 $ 1,111 $ 38,040 69,074 $ 551 Autos & Auto Parts 5,730
9,184 624 — — — — — — 5,730 9,184 624 Chemicals & Plastics
37,400 44,814 835 — — — — — — 37,400 44,814 835 Coal & Coke
15,382 46,501 331 27,758 92,659 300 1,719 3,974 433 44,859 143,134
313 Food & Kindred Products 8,325 14,806 562 — — — — — — 8,325
14,806 562 Intermodal 238 2,367 101 17,234 15,159 1,137 60,793
217,091 280 78,265 234,617 334 Lumber & Forest Products 22,323
35,619 627 — — — — — — 22,323 35,619 627 Metallic Ores 2,920 4,249
687 10,659 8,854 1,204 — — — 13,579 13,103 1,036 Metals 26,079
34,695 752 — — — — — — 26,079 34,695 752 Minerals & Stone
34,562 56,768 609 2,016 13,978 144 17,688 45,135 392 54,266 115,881
468 Petroleum Products 15,844 23,912 663 154 64 2,406 — — — 15,998
23,976 667 Pulp & Paper 26,077 39,813 655 — — — — — — 26,077
39,813 655 Waste 7,144 14,387 497 — — — — — — 7,144 14,387 497
Other 5,070 16,979 299 — — — — —
— 5,070 16,979 299 Totals $ 238,373
397,047 $ 600 $ 63,753 146,089 $ 436 $ 81,029
266,946 $ 304 $ 383,155 810,082 $ 473
* 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
FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD
COMPARISON BY COMMODITY GROUP (dollars in thousands,
except average revenues per carload) (unaudited)
Six Months Ended June 30, 2018 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 $ 61,065 105,526 $ 579 $ 11,489 27,287 $ 421
$ 2,020 1,573 $ 1,284 $ 74,574 134,386 $ 555 Autos & Auto Parts
11,173 17,822 627 — — — — — — 11,173 17,822 627 Chemicals &
Plastics 75,189 88,627 848 — — — — — — 75,189 88,627 848 Coal &
Coke 39,032 121,312 322 64,149 194,138 330 6,163 9,933 620 109,344
325,383 336 Food & Kindred Products 16,826 30,090 559 — — — — —
— 16,826 30,090 559 Intermodal 689 6,900 100 33,075 26,711 1,238
133,804 411,838 325 167,568 445,449 376 Lumber & Forest
Products 46,249 73,983 625 — — — — — — 46,249 73,983 625 Metallic
Ores 7,243 8,844 819 15,856 10,457 1,516 — — — 23,099 19,301 1,197
Metals 60,887 76,044 801 — — — — — — 60,887 76,044 801 Minerals
& Stone 68,552 109,852 624 4,181 32,754 128 41,505 94,466 439
114,238 237,072 482 Petroleum Products 34,634 50,000 693 336 133
2,526 8 20 400 34,978 50,153 697 Pulp & Paper 58,385 83,119 702
— — — — — — 58,385 83,119 702 Waste 13,227 26,818 493 — — — — — —
13,227 26,818 493 Other 12,134 37,429 324 — —
— — — — 12,134 37,429 324 Totals
$ 505,285 836,366 $ 604 $ 129,086 291,480
$ 443 $ 183,500 517,830 $ 354 $ 817,871
1,645,676 $ 497
Six Months Ended June 30, 2017
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 $ 64,257 110,204 $ 583 $ 11,678 30,641 $ 381
$ 2,568 2,259 $ 1,137 $ 78,503 143,104 $ 549 Autos & Auto Parts
10,940 17,977 609 — — — — — — 10,940 17,977 609 Chemicals &
Plastics 74,915 90,822 825 — — — — — — 74,915 90,822 825 Coal &
Coke 37,115 109,800 338 57,279 190,343 301 5,119 14,535 352 99,513
314,678 316 Food & Kindred Products 16,599 29,676 559 — — — — —
— 16,599 29,676 559 Intermodal 415 4,168 100 33,101 28,737 1,152
122,789 440,904 278 156,305 473,809 330 Lumber & Forest
Products 42,699 69,174 617 — — — — — — 42,699 69,174 617 Metallic
Ores 6,816 9,173 743 18,290 15,760 1,161 — — — 25,106 24,933 1,007
Metals 52,673 70,493 747 — — — — — — 52,673 70,493 747 Minerals
& Stone 62,677 103,813 604 3,995 29,906 134 29,143 78,064 373
95,815 211,783 452 Petroleum Products 34,271 49,049 699 284 118
2,407 — — — 34,555 49,167 703 Pulp & Paper 51,555 78,587 656 —
— — — — — 51,555 78,587 656 Waste 12,338 25,131 491 — — — — — —
12,338 25,131 491 Other 9,384 31,996 293 — —
— — — — 9,384 31,996 293 Totals
$ 476,654 800,063 $ 596 $ 124,627 295,505
$ 422 $ 159,619 535,762 $ 298 $ 760,900
1,631,330 $ 466
* 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 operating
income, adjusted operating ratio, adjusted operating expenses,
adjusted net income attributable to G&W, adjusted diluted
earnings per common share (EPS) and the adjusted free cash flow
measures of adjusted net cash provided by operating activities
attributable to G&W, adjusted free cash flow attributable to
G&W and adjusted free cash flow attributable to G&W before
new business investments and grant funded projects, 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 the
adjusted free cash flow measures, 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 adjusted free
cash flow measures 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 per share amounts).
Reconciliations of Non-GAAP Financial
Measures
Adjusted Operating Income and Adjusted Operating
Ratio
Three Months Ended June 30, 2018
North American
Operations
Australian Operations
U.K./European
Operations
Total Operations
Operating revenues $ 339.6 $ 79.0 $ 176.4 $ 595.0 Operating
expenses 259.3 53.1 179.4 491.9
Operating income/(loss)(a) $ 80.3 $ 25.9 $ (3.0 ) $
103.1 Operating ratio (b) 76.4 % 67.2 % 101.7 % 82.7 %
Operating expenses $ 259.3 $ 53.1 $ 179.4 $ 491.9 Corporate
development and related costs (0.3 ) — — (0.4 ) Restructuring costs
— — (9.4 ) (9.4 ) Credit facility refinancing-related costs (0.4 )
— — (0.4 ) Gain on settlement — 6.3 — 6.3
Adjusted operating expenses $ 258.5 $ 59.4 $
170.1 $ 488.0 Adjusted operating income $ 81.0
$ 19.6 $ 6.3 $ 107.0 Adjusted operating ratio
76.1 % 75.2 % 96.4 % 82.0 % (a) Operating income is
calculated as operating revenues less operating expenses. (b)
Operating ratio is calculated as operating expenses divided by
operating revenues.
Three Months
Ended June 30, 2017
North American
Operations
Australian Operations
U.K./European
Operations
Total Operations
Operating revenues $ 315.7 $ 76.8 $ 148.0 $ 540.4 Operating
expenses 236.0 56.6 148.1 440.7
Operating income/(loss) (a) $ 79.7 $ 20.3 $ (0.2 ) $
99.7 Operating ratio (b) 74.8 % 73.6 % 100.1 % 81.5 %
Operating expenses $ 236.0 $ 56.6 $ 148.1 $ 440.7 Corporate
development and related costs (1.5 ) (0.1 ) (2.1 ) (3.7 )
Restructuring costs — — (2.3 ) (2.4 ) Adjusted
operating expenses $ 234.5 $ 56.5 $ 143.7 $
434.7 Adjusted operating income $ 81.2 $ 20.3
$ 4.2 $ 105.8 Adjusted operating ratio 74.3 % 73.5 %
97.1 % 80.4 % (a) Operating income 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 EPS
Three Months Ended June 30, 2018
Income Before Income
Taxes
Provision for
Income Taxes
Net Income Attributable
to G&W
Diluted EPS As reported $ 75.1 $ (26.4 ) $ 44.2 $ 0.73 Add
back certain items: Corporate development and related costs 0.4
(0.1 ) 0.3 — Restructuring costs 9.4 (1.8 ) 7.6 0.12 Loss from sale
of ERS 1.4 — 1.4 0.02 Gain on settlement (6.3 ) 1.9 (2.3 ) (0.04 )
Credit facility refinancing-related costs 2.7 (0.7 ) 2.0 0.03 Prior
period tax adjustment — 4.1 4.1 0.07 As
adjusted $ 82.5 $ (23.0 ) $ 57.2 $ 0.94
Three Months Ended June 30, 2017
Income Before Income
Taxes
Provision forIncome
Taxes
Net Income Attributable
to G&W
Diluted EPS As reported $ 77.7 $ (29.6 ) $
46.0 $ 0.74 Add back certain items: Corporate development and
related costs 3.7 (0.9 ) 2.7 0.04 Restructuring costs 2.4 (0.2 )
2.2 0.03 Gain on sale of investment $ (1.6 ) $ 0.7 $ (1.0 )
$ (0.02 ) As adjusted $ 82.1 $ (30.0 ) $ 49.9 $ 0.80
Adjusted Free Cash Flow Measures
Six Months Ended June 30,
2018 2017 Net cash provided by
operating activities $ 231.3 $ 224.3 Allocation of adjusted cash
flow to noncontrolling interest(a) (13.0 ) (18.7 ) Adjusted net
cash provided by operating activities attributable to G&W $
218.3 $ 205.6 Core capital expenditures(b) (95.3 ) (74.7 ) Adjusted
free cash flow attributable to G&W before new business
investments and grant funded projects $ 123.1 $ 130.9 New business
investments(b) (21.5 ) (1.6 ) Grant funded projects, net of
proceeds received from outside parties(b) 1.0 1.1
Adjusted free cash flow attributable to G&W $ 102.5 $
130.4 (a) Allocation of adjusted cash flow to
noncontrolling interest (Macquarie Infrastructure and Real Assets'
(MIRA's) 48.9% equity ownership of G&W Australia Holdings LP
(GWA) since December 1, 2016) is calculated as 48.9% of the total
of (i) cash flow provided by operating activities of G&W’s
Australian Operations, less (ii) net purchases of property and
equipment of G&W’s Australian Operations. The timing and amount
of actual distributions, if any, from GWA to G&W and MIRA made
in any given period will vary and could differ materially from the
amounts presented. There were A$40.0 million (or $30.0 million at
the average exchange rate in June 2018) of such distributions made
for the six months ended June 30, 2018, of which $15.3 million and
$14.9 million was distributed to G&W and MIRA, respectively,
and no such distributions were made for the six months ended June
30, 2017. G&W expressly disclaims any direct correlation
between the allocation of adjusted cash flow to noncontrolling
interest and actual distributions made in any given period. (b) See
breakout below.
Six Months Ended
June 30, 2018
Core Capital(c)
New Business Investments
Grant Funded
Projects(d)
Total Purchase of property and equipment $
(99.9 ) $ (21.5 ) $ (11.9 ) $ (133.3 ) Grant proceeds from outside
parties — — 12.9 12.9 Insurance proceeds for the replacement of
assets 1.9 — — 1.9 Proceeds from disposition of property and
equipment 2.8 — — 2.8 Purchase of
property and equipment, net $ (95.3 ) $ (21.5 ) $ 1.0 $
(115.8 )
Six Months Ended June 30, 2017
Core Capital(c)
New Business Investments
Grant Funded
Projects(d)
Total Purchase of property and equipment $ (79.4 ) $ (1.6 )
$ (10.5 ) $ (91.5 ) Grant proceeds from outside parties — — 11.6
11.6 Insurance proceeds for the replacement of assets 1.4 — — 1.4
Proceeds from disposition of property and equipment 3.3 —
— 3.3 Purchase of property and equipment, net
$ (74.7 ) $ (1.6 ) $ 1.1 $ (75.2 ) (c) Core capital
expenditures represent purchases of property and equipment as
presented on the Statement of Cash Flows less grant proceeds from
outside parties, insurance proceeds for the replacement of assets
and proceeds from disposition of property a nd equipment, each of
which as presented on the Statement of Cash Flows, less new
business investments and grant funded projects. (d) Grant funded
projects represent purchases of property and equipment for projects
partially or entirely funded by outside parties, net of grant
proceeds from outside parties as presented on the Statement of Cash
Flows.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180727005074/en/
G&W Corporate CommunicationsMichael Williams,
1-203-202-8900mwilliams@gwrr.com
Genesee and Wyoming (NYSE:GWR)
Historical Stock Chart
From Jun 2024 to Jul 2024
Genesee and Wyoming (NYSE:GWR)
Historical Stock Chart
From Jul 2023 to Jul 2024