Providence and Worcester Railroad Company Announces 2007 Results

WORCESTER, Mass.--(BUSINESS WIRE)--Providence and Worcester Railroad Company (AMEX: PWX) today announced its results of operations for the year ended December 31, 2007. The Company incurred a net loss of $652,000 in 2007 compared to net income of $1.0 million 2006. The diluted loss per common share for 2007 was $0.14 compared to diluted income per common share of $.0.23 in 2006.

Operating revenues for 2007 were $26.2 million, a decrease of $2.3 million (8.0%) from $28.5 million in 2006. A 35.9% decline in container traffic volume accounted for $1.2 million of this decrease in operating revenues. Among other factors, rate increases imposed by western rail carriers in the Untied States resulted in steamship lines using “all water” routings to the East Coast for a larger portion of container traffic thereby significantly reducing the volume of such traffic shipped cross-country by rail. This trend began during the second quarter of 2007 and the Company is unable to predict if and when this trend will be reversed. The largest single decline in conventional traffic revenues was in construction aggregates. Revenue from shipment of this commodity decreased by $603,000 during 2007 from 2006.

Operating expenses for 2007 decreased by $366,000 (1.3%) from 2006. Because of the highly fixed nature of most of the Company’s operating expenses, such expenses do not increase or decrease proportionally with changes in operating revenues.

(in thousands, except per share amounts)		Years Ended December 31,
			2007				2006
Income Statement Data:
Operating Revenues		$	26,164			$	28,451
Other Income			890				1,373
Total Revenues			27,054				29,824
Total Operating Expenses			27,856				28,222
(Loss) Income Before Income Taxes			(802	)			1,602
Provision for Income Taxes (Benefits)			(150	)			560
Net (Loss) Income		$	(652	)		$	1,042
Diluted (Loss) Income Per Share		$	(.14	)		$	.23
Weighted Average Shares – Diluted			4,545				4,602
(in thousands)			2007				2006
Balance Sheet Data:
Total assets		$	95,158			$	95,024
Shareholders' equity			69,675				70,624

This release contains “forward-looking statements” within the meaning of section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements represent the Company’s present expectations or beliefs concerning future events. The Company cautions that such statements are necessarily based on certain assumptions which are subject to risks and uncertainties, including, but not limited to, changes in general economic condition, and changing competition which could cause actual results to differ materially from those indicated herein. Further information on these risk factors is included in the Company’s filings with the Securities and Exchange Commission.