DARIEN, Conn.--(BUSINESS WIRE)--Genesee & Wyoming Inc. (G&W) (NYSE:GWR)
Fourth Quarter Highlights
- Reported diluted earnings per common share (EPS) of $1.03; adjusted diluted EPS of $1.07, a 35.4% increase in adjusted diluted EPS and a 19.0% increase in adjusted diluted EPS normalizing for the impact of the 2013 short line tax credit. (1)
- Total operating revenues increased 72.3% to $391.7 million.
-
Combined Company adjusted operating revenues, excluding the net impact
from foreign currency depreciation and fuel sales to third parties,
increased 8.2%. (2)
- To provide comparative context for 2013 consolidated revenues and traffic volumes, G&W is providing “Combined Company” comparisons as though the RailAmerica railroads were controlled by G&W during 2012. In doing so, G&W has reclassified RailAmerica's 2012 information to conform with G&W's presentation.
- Adjusted income from operations increased 65.6% to $95.7 million; Reported income from operations increased 181.7% to $94.8 million. (3)
- Adjusted operating ratio increased 100 basis points to 75.6% (excluding RailAmerica integration and acquisition-related costs, business development and financing costs and net gain on sale of assets); Reported operating ratio of 75.8% (77.2% North American & European Operations; 70.4% Australian Operations). (3)
Jack Hellmann, President and CEO of G&W, commented, “The overall trajectory of our business continues to be positive, with adjusted diluted EPS increasing 19% in the fourth quarter of 2013. However, G&W’s fourth quarter financial results were weaker than we expected. While carload levels were consistent with our expectations, with the exception of delayed movements in Australian grain, our operating income was lower than projected for three main reasons. First, the strengthening of the U.S. dollar reduced our income translation from Australia and Canada. Second, we experienced two costly derailments in the quarter, one in Alabama in November and another in the Northern Territory of Australia in December. Third, our diesel fuel consumption was unusually high due to extremely cold temperatures in the United States and Canada.” (1)
“For the year, our 2013 results were uniformly strong. Our safety results led the rail industry for the 5th consecutive year, we successfully integrated the $2 billion acquisition of RailAmerica, we generated record free cash flow, and our adjusted diluted earnings per share increased 50%.” (1)(4)
“We expect our positive momentum to continue in 2014, although the year is starting slowly due to extreme winter weather in North America. Our Australian business continues to perform well, we have completed necessary management changes following the RailAmerica acquisition and we have enhanced our North American commercial capabilities. With the expiration of the short line tax credit on December 31, 2013, the easiest way to visualize our business outlook for 2014 is growth in pre-tax income of approximately 20%, compared with our 2013 adjusted pre-tax income. Also, we expect additional earnings growth to be contributed by our recently announced acquisition of the western end of the Dakota Minnesota & Eastern railroad from Canadian Pacific, pending approval by the U.S. Surface Transportation Board.” (1)
Financial Results
G&W reported net income in the fourth quarter of 2013 of $58.1 million, compared with net income of $13.4 million in the fourth quarter of 2012. Excluding the net impact of certain significant items discussed below, G&W's adjusted net income in the fourth quarter of 2013 was $60.6 million, compared with adjusted net income of $44.2 million in the fourth quarter of 2012. (1)
G&W's reported diluted EPS in the fourth quarter of 2013 were $1.03 with 56.8 million weighted average shares outstanding, compared with diluted EPS in the fourth quarter of 2012 of $0.18 with 50.6 million weighted average shares outstanding. Excluding the net impact of significant items discussed below, G&W's adjusted diluted EPS in the fourth quarter of 2013 were $1.07 with 56.8 million weighted average shares outstanding, compared with adjusted diluted EPS in the fourth quarter of 2012 of $0.79 with 56.6 million weighted average shares outstanding. (1)
G&W's effective income tax rate was 29.0% in the fourth quarter of 2013, or an adjusted effective income tax rate of 26.8% after giving effect for the significant items discussed below. (1) The lower income tax rate in the fourth quarter of 2013, compared with the fourth quarter of 2012, was driven primarily by the extension of the United States Short Line Tax Credit on January 2, 2013, which had previously expired on December 31, 2011.
In the fourth quarter of 2013 and 2012, G&W's results included certain significant items that are set forth in the following table ($ in millions, except per share amounts).
| Diluted | |||||||||||||||||||
| Income/(Loss) | After-Tax Net | Earnings/(Loss) | |||||||||||||||||
| Before Taxes | Income/(Loss) | Per Common | |||||||||||||||||
| Impact | Impact | Share Impact | |||||||||||||||||
|
Three Months Ended December 31, 2013 |
|||||||||||||||||||
| RailAmerica integration/acquisition costs | $ | (1.0 | ) | $ | (0.6 | ) | $ | (0.01 | ) | ||||||||||
| Business development and financing costs | $ | (1.2 | ) | $ | (0.7 | ) | $ | (0.01 | ) | ||||||||||
| Net gain on sale of assets | $ | 1.3 | $ | 0.8 | $ | 0.01 | |||||||||||||
|
Valuation allowance on FTC |
$ |
- |
$ | (2.0 | ) |
$ |
(0.03 |
) | |||||||||||
|
Three Months Ended December 31, 2012 |
|||||||||||||||||||
| RailAmerica integration/acquisition costs | $ | (23.5 | ) | $ | (17.4 | ) | $ | (0.36 | ) | ||||||||||
| Business development and financing costs | $ | (16.7 | ) | $ | (10.1 | ) | $ | (0.20 | ) | ||||||||||
|
Acquisition/integration costs incurred by RailAmerica |
$ |
- |
$ | (3.5 | ) |
$ |
(0.06 |
) | |||||||||||
| Gain on insurance recoveries | $ | 0.6 | $ | 0.4 | $ | 0.01 | |||||||||||||
| Net gain on sale of assets | $ | 0.8 | $ | 0.6 | $ | 0.01 | |||||||||||||
| Contract termination expense in Australia | $ | (1.1 | ) | $ | (0.8 | ) | $ | (0.01 | ) | ||||||||||
Explanation of Significant Items
In the fourth quarter of 2013, G&W's results included RailAmerica integration and acquisition-related costs of $1.0 million, $1.2 million of business development and financing costs, primarily related to the recently announced pending acquisition of the western end of the Dakota Minnesota & Eastern railroad from Canadian Pacific (which we expect to be operated by our new railroad, Rapid City Pierre and Eastern (RCP&E)), net gain on sale of assets of $1.3 million and a valuation allowance on foreign tax credits (FTC) generated in prior years of $2.0 million (after-tax). In the fourth quarter of 2012, G&W incurred $23.5 million of RailAmerica integration and acquisition-related costs, primarily associated with closing costs and severance benefits for RailAmerica senior executives and $16.7 million of business development and financing costs, primarily associated with the financing of the RailAmerica acquisition. In the fourth quarter of 2012, G&W also recorded $1.4 million in net gains on the Edith River Bridge-related insurance recoveries and the sale of assets and incurred $1.1 million of expense associated with the termination of a contract with a track maintenance service provider in Australia. In addition, RailAmerica's reported equity earnings included $3.5 million (after-tax) of expense associated with the integration, primarily related to severance obligations.
Quarterly Results
In the fourth quarter of 2013, G&W's total operating revenues increased $164.4 million, or 72.3%, to $391.7 million, compared with $227.3 million in the fourth quarter of 2012. The increase included $152.9 million in revenues from new operations, partially offset by a $9.4 million decrease from the net depreciation of foreign currencies relative to the U.S. dollar. Excluding the net impact from foreign currency depreciation, G&W's same railroad operating revenues, which exclude former RailAmerica railroads, increased $20.9 million, or 9.2%.
G&W's same railroad freight revenues in the fourth quarter of 2013 were $178.5 million, compared with $165.4 million in the fourth quarter of 2012. Excluding a $7.7 million decrease from the impact of foreign currency depreciation, G&W's same railroad freight revenues increased by $20.7 million, or 12.5%.
G&W's same railroad non-freight revenues in the fourth quarter of 2013 were $60.3 million, compared with $61.9 million in the fourth quarter of 2012. Excluding a $1.8 million decrease from the net impact of foreign currency depreciation, G&W's same railroad non-freight revenues increased by $0.2 million.
In the fourth quarter of 2013, Combined Company operating revenues increased $18.5 million, or 5.0%, to $391.7 million. Excluding a $10.3 million decrease from the net depreciation of foreign currencies relative to the U.S. dollar and a $0.9 million decrease in third-party fuel sales, Combined Company adjusted operating revenues increased by $29.8 million, or 8.2%. Combined Company adjusted freight revenues increased by $29.6 million, or 11.0%, to $297.5 million in the fourth quarter of 2013, excluding $8.2 million from the impact of foreign currency depreciation. Combined Company adjusted non-freight revenues increased by $0.2 million, or 0.2%, to $94.2 million in the fourth quarter of 2013, excluding a $2.1 million decrease from the net impact of foreign currency depreciation and a $0.9 million decrease in third-party fuel sales. (2)
G&W's traffic in the fourth quarter of 2013 was 471,906 carloads. On a Combined Company basis, traffic increased 32,988 carloads, or 7.5%, compared with traffic in the fourth quarter of 2012. The traffic increase was principally due to increases of 9,358 carloads of coal and coke traffic (primarily in the Central, Midwest and Ohio regions), 6,566 carloads of metallic ores traffic (primarily in the Australian Region), 4,515 carloads of agricultural products traffic (primarily in the Australian Region), 4,479 carloads of metals traffic (primarily in the Northeast and Mountain West regions) and 3,898 carloads of petroleum products traffic (primarily in the Pacific Region). All remaining traffic increased by a net 4,172 carloads.
G&W's income from operations in the fourth quarter of 2013 was $94.8 million, compared with $33.7 million in the fourth quarter of 2012. G&W's operating ratio in the fourth quarter of 2013 was 75.8%, compared with an operating ratio of 85.2% in the fourth quarter of 2012. Income from operations in the fourth quarter of 2013 included $1.0 million of RailAmerica integration and acquisition-related costs, $1.2 million of business development and financing costs and net gain on sale of assets of $1.3 million. Income from operations in the fourth quarter of 2012 included $23.5 million of RailAmerica integration and acquisition-related costs, primarily associated with closing costs and severance benefits, a $1.1 million contract termination payment in Australia associated with outsourced maintenance of way activities and business development and financing costs of $1.0 million, partially offset by $1.4 million of gains on insurance recoveries and sale of assets. Excluding these items, G&W's adjusted income from operations increased $37.9 million, or 65.6%, to $95.7 million. G&W's adjusted operating ratio increased 100 basis points to 75.6% in the fourth quarter of 2013, compared with 74.6% in the fourth quarter of 2012. (3)
Consolidated Annual Results
G&W reported net income for the year ended December 31, 2013 of $272.1 million ($318.4 million pre-tax), compared with net income of $52.4 million ($83.3 million pre-tax) for the year ended December 31, 2012. Excluding the impact of certain significant items listed below that primarily related to the RailAmerica acquisition, G&W's adjusted net income for the year ended December 31, 2013 was $242.0 million ($332.9 million adjusted pre-tax), compared with adjusted net income of $129.7 million ($170.0 million adjusted pre-tax) for the year ended December 31, 2012. (1)
G&W's diluted EPS for the year ended December 31, 2013 were $4.79 with 56.7 million weighted average shares outstanding, compared with diluted EPS of $1.02 with 51.3 million weighted average shares outstanding for the year ended December 31, 2012. Excluding the significant items listed below, G&W's adjusted diluted EPS for the year ended December 31, 2013 were $4.26 with 56.7 million weighted average shares outstanding, compared with adjusted diluted EPS of $2.53 with 51.3 million weighted average shares outstanding for the year ended December 31, 2012. (1)
G&W’s 2013 and 2012 results included certain significant items that are set forth in the following table ($ in millions, except per share amounts).
|
Diluted |
||||||||||||||||||
|
Income/(Loss) |
After-Tax Net |
Earnings/(Loss) |
||||||||||||||||
|
Before Taxes |
Income/(Loss) |
Per Common |
||||||||||||||||
|
Impact |
Impact |
Share Impact |
||||||||||||||||
|
Twelve Months Ended December 31, 2013 |
||||||||||||||||||
| RailAmerica integration/acquisition costs | $ | (17.0 | ) | $ | (10.7 | ) | $ | (0.19 | ) | |||||||||
| Business development and financing costs | $ | (2.2 | ) | $ | (1.4 | ) | $ | (0.03 | ) | |||||||||
| Net gain on sale of assets | $ | 4.7 | $ | 3.2 | $ | 0.06 | ||||||||||||
| Retroactive Short Line Tax Credit for 2012 | $ |
- |
$ | 41.0 | $ | 0.72 | ||||||||||||
| Valuation allowance on FTC | $ |
- |
$ | (2.0 | ) | $ | (0.03 | ) | ||||||||||
|
|
||||||||||||||||||
|
Twelve Months Ended December 31, 2012 |
||||||||||||||||||
| RailAmerica integration/acquisition costs | $ | (29.5 | ) | $ | (21.0 | ) | $ | (0.41 | ) | |||||||||
| Business development and financing costs | $ | (18.1 | ) | $ | (11.0 | ) | $ | (0.21 | ) | |||||||||
| Acquisition/integration costs incurred by RailAmerica | $ |
- |
$ | (3.5 | ) | $ | (0.07 | ) | ||||||||||
| Gain on insurance recoveries | $ | 0.8 | $ | 0.5 | $ | 0.01 | ||||||||||||
| Net gain on sale of assets | $ | 11.2 | $ | 8.6 | $ | 0.17 | ||||||||||||
| Contract termination expense in Australia | $ | (1.1 | ) | $ | (0.8 | ) | $ | (0.02 | ) | |||||||||
| Contingent forward sale contract mark-to-market expense | $ | (50.1 | ) | $ | (50.1 | ) | $ | (0.98 | ) | |||||||||
Free Cash Flow (4)
G&W's free cash flow for the twelve months ended December 31, 2013 and 2012 was as follows ($ in millions):
|
Twelve Months Ended |
||||||||||||
|
2013 |
2012 |
|||||||||||
| Net cash provided by operating activities |
$ |
411.9 | $ | 170.7 | ||||||||
| Net cash used in investing activities, excluding new business investments |
(174.5 |
) |
(1,999.8 |
) |
||||||||
| Net cash used for acquisitions | 12.9 | 1,964.2 | ||||||||||
| Free cash flow before new business investments | 250.2 | 135.0 | ||||||||||
| New business investments | (34.2 | ) | (101.9 | ) | ||||||||
|
Free cash flow (4) |
$ |
216.1 |
$ |
33.2 |
||||||||
Conference Call and Webcast Details
As previously announced, G&W's conference call to discuss financial results for the fourth quarter will be held on Tuesday, February 11, 2014, at 8:30 am EST. The dial-in number for the teleconference in the U.S. is (800) 553-5260; outside the U.S. is (612) 234-9959, or the call may be accessed live over the Internet (listen only) at www.gwrr.com/investors, by selecting "Fourth Quarter Earnings Conference Call Webcast." Management will be referring to a slide presentation that will also be available at gwrr.com/ investors at approximately 8:00 am EST on February 11, 2014. 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 10:30 a.m. EST on February 11 by dialing (800) 475-6701 (or outside the U.S., dial 320-365-3844). The access code is 309987.
About G&W
G&W owns and operates short line and regional freight railroads in the United States, Australia, Canada, the Netherlands and Belgium. In addition, G&W operates the 1,400-mile Tarcoola to Darwin rail line, which links the Port of Darwin with the Australian interstate rail network in South Australia. Operations currently include 111 railroads organized in 11 regions, with nearly 15,000 miles of owned and leased track, 4,600 employees and over 2,000 customers. We provide rail service at 35 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," "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; integration of acquisitions; economic, political and industry conditions (including employee strikes or work stoppages); customer demand and changes in our operations, 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; exposure to the credit risk of customers and counterparties; severe weather conditions and other natural occurrences, which could result in shutdowns, derailments or other substantial disruption of operations; decrease in revenues and/or increase in costs and expenses; susceptibility to the risks of doing business in foreign countries; our success integrating RailAmerica railroads into our operations and our ability to realize the expected synergies associated with the acquisition of RailAmerica; and others including, but not limited to, those noted in our 2012 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.
- Adjusted net income, adjusted diluted earnings per common share, adjusted income before income taxes and income from equity investment (adjusted pre-tax income) and adjusted effective income tax rate are non-GAAP financial measures and are not intended to replace the net income, diluted earnings per common share, income before income taxes and income from equity investment and effective income tax rate calculated on a basis consistent with GAAP. The information required by Item 10(e) of Regulation S-K under the Securities Act of 1933 and the Securities Exchange Act of 1934 (Item 10(e)) and (Regulation G) under the Securities Exchange Act of 1934 (Regulation G), including a reconciliation to net income, diluted earnings per common share and income before income taxes and income from equity investment calculated using amounts determined in accordance with GAAP, is included in the tables attached to this press release.
- To provide comparative context for 2013 consolidated operating revenues and traffic volumes, G&W is providing “Combined Company” comparisons for those items as though the RailAmerica railroads were owned by G&W during 2012. In doing so, G&W has amended RailAmerica's 2012 information to conform with G&W's reporting methodology. Combined Company operating revenues include both RailAmerica and G&W operating revenues for the fourth quarter of 2012. Combined Company adjusted operating revenues exclude revenues from fuel sales to third parties and the net impact from foreign currency depreciation. The Combined Company adjusted operating revenues described above is a non-GAAP financial measure and is not intended to replace operating revenues, its most directly comparable GAAP measure. The information required by Item 10(e) and Regulation G, including a reconciliation to operating revenues calculated using amounts determined in accordance with GAAP, is included in the tables attached to this press release.
- Adjusted income from operations and adjusted operating ratios are non-GAAP financial measures and are not intended to replace income from operations and operating ratios calculated using total operating expenses and total revenues, calculated on a basis consistent with GAAP. The information required by Item 10(e) and Regulation G, including a reconciliation to income from operations and operating ratios calculated using amounts determined in accordance with GAAP, is included in the tables attached to this press release.
- Free cash flow is a non-GAAP financial measure and is not intended to replace net cash provided by operating activities, its most directly comparable GAAP measure. The information required by Item 10(e) and Regulation G, including a reconciliation to net cash provided by operating activities, is included in the tables attached to this press release.
|
GENESEE & WYOMING INC. AND SUBSIDIARIES |
|||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
| FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2013 AND 2012 | |||||||||||||||||||||||||
| (in thousands, except per share amounts) | |||||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||||
|
Three Months Ended |
Twelve Months Ended |
||||||||||||||||||||||||
|
|
December 31, |
December 31, |
|||||||||||||||||||||||
|
2013 |
2012 |
2013 |
2012 |
||||||||||||||||||||||
| OPERATING REVENUES | $ | 391,674 | $ | 227,316 | $ | 1,569,011 | $ | 874,916 | |||||||||||||||||
| OPERATING EXPENSES | 296,844 | 193,656 | 1,188,823 | 684,594 | |||||||||||||||||||||
| INCOME FROM OPERATIONS | 94,830 | 33,660 | 380,188 | 190,322 | |||||||||||||||||||||
| INTEREST INCOME | 986 | 966 | 3,971 | 3,725 | |||||||||||||||||||||
| INTEREST EXPENSE | (14,542 | ) | (36,793 | ) | (67,894 | ) | (62,845 | ) | |||||||||||||||||
| CONTINGENT FORWARD SALE CONTRACT MARK- TO-MARKET EXPENSE |
- |
- |
- |
(50,106 | ) | ||||||||||||||||||||
| OTHER INCOME, NET | 592 | 357 | 2,122 | 2,182 | |||||||||||||||||||||
|
INCOME/(LOSS) BEFORE INCOME TAXES AND INCOME FROM EQUITY INVESTMENT |
81,866 | (1,810 | ) | 318,387 | 83,278 | ||||||||||||||||||||
| PROVISION FOR INCOME TAXES | (23,778 | ) | (351 | ) | (46,296 | ) | (46,402 | ) | |||||||||||||||||
| INCOME FROM EQUITY INVESTMENT, NET |
- |
15,557 |
- |
15,557 | |||||||||||||||||||||
| NET INCOME | 58,088 | 13,396 | 272,091 | 52,433 | |||||||||||||||||||||
|
LESS: NET (LOSS)/INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST |
(189 | ) |
- |
795 |
- |
||||||||||||||||||||
|
LESS: SERIES A-1 PREFERRED STOCK DIVIDEND |
- |
4,375 | 2,139 | 4,375 | |||||||||||||||||||||
|
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS |
$ | 58,277 | $ | 9,021 | $ | 269,157 | $ | 48,058 | |||||||||||||||||
| BASIC EARNINGS PER COMMON SHARE ATTRIBUTABLE TO GENESEE & WYOMING INC. COMMON STOCKHOLDERS | $ | 1.07 | $ | 0.19 | $ | 5.00 | $ | 1.13 | |||||||||||||||||
| WEIGHTED AVERAGE SHARES - BASIC | 54,727 | 48,116 | 53,788 | 42,693 | |||||||||||||||||||||
| DILUTED EARNINGS PER COMMON SHARE ATTRIBUTABLE TO GENESEE & WYOMING INC. COMMON STOCKHOLDERS | $ | 1.03 | $ | 0.18 | $ | 4.79 | $ | 1.02 | |||||||||||||||||
| WEIGHTED AVERAGE SHARES - DILUTED | 56,808 | 50,590 | 56,679 | 51,316 | |||||||||||||||||||||
|
GENESEE & WYOMING INC. AND SUBSIDIARIES |
||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||
|
AS OF DECEMBER 31, 2013 AND DECEMBER 31, 2012 |
||||||||||
| (in thousands) | ||||||||||
| (unaudited) | ||||||||||
|
December 31, |
December 31, |
|||||||||
| 2013 | 2012 | |||||||||
| ASSETS | ||||||||||
| CURRENT ASSETS: | ||||||||||
| Cash and cash equivalents | $ | 62,876 | $ | 64,772 | ||||||
| Accounts receivable, net | 325,453 | 262,949 | ||||||||
| Materials and supplies | 31,295 | 32,389 | ||||||||
| Prepaid expenses and other | 52,584 | 33,586 | ||||||||
| Deferred income tax assets, net | 76,122 | 71,556 | ||||||||
| Total current assets | 548,330 | 465,252 | ||||||||
| PROPERTY AND EQUIPMENT, net | 3,440,744 | 3,396,295 | ||||||||
| GOODWILL | 630,462 | 634,953 | ||||||||
| INTANGIBLE ASSETS, net | 613,933 | 670,206 | ||||||||
| DEFERRED INCOME TAX ASSETS, net | 2,405 | 2,396 | ||||||||
| OTHER ASSETS, net | 83,947 | 57,013 | ||||||||
| Total assets | $ | 5,319,821 | $ | 5,226,115 | ||||||
|
LIABILITIES AND EQUITY |
||||||||||
|
CURRENT LIABILITIES: |
||||||||||
| Current portion of long-term debt | $ | 84,366 | $ | 87,569 | ||||||
| Accounts payable | 242,010 | 232,121 | ||||||||
| Accrued expenses | 130,132 | 93,971 | ||||||||
| Deferred income tax liabilities, net |
- |
3,083 | ||||||||
| Total current liabilities | 456,508 | 416,744 | ||||||||
| LONG-TERM DEBT, less current portion | 1,540,346 | 1,770,566 | ||||||||
| DEFERRED INCOME TAX LIABILITIES, net | 863,051 | 862,734 | ||||||||
| DEFERRED ITEMS - grants from outside parties | 267,098 | 228,579 | ||||||||
| OTHER LONG-TERM LIABILITIES | 43,748 | 47,506 | ||||||||
| SERIES A-1 PREFERRED STOCK |
- |
399,524 | ||||||||
| TOTAL EQUITY | 2,149,070 | 1,500,462 | ||||||||
| Total liabilities and equity | $ | 5,319,821 | $ | 5,226,115 | ||||||
|
GENESEE & WYOMING INC. AND SUBSIDIARIES |
|||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2013 AND 2012 | |||||||||||
| (in thousands) | |||||||||||
| (unaudited) | |||||||||||
| Twelve Months Ended | |||||||||||
| December 31, | |||||||||||
| 2013 | 2012 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
|
Net income |
$ |
272,091 |
$ |
52,433 |
|||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Income from equity investment in RailAmerica, net |
- |
(15,557 | ) | ||||||||
| Depreciation and amortization | 141,644 | 73,405 | |||||||||
| Compensation cost related to equity awards | 16,951 | 12,151 | |||||||||
| Excess tax benefits from share-based compensation | (8,453 | ) | (5,335 | ) | |||||||
| Deferred income taxes | 10,683 | 29,926 | |||||||||
| Net gain on sale of assets | (4,677 | ) | (11,225 | ) | |||||||
| Gain on insurance recoveries | (1,465 | ) | (5,760 | ) | |||||||
| Insurance proceeds received | 11,053 | 21,479 | |||||||||
| Contingent forward sale contract mark-to-market expense |
- |
50,106 | |||||||||
| Changes in assets and liabilities which (used) provided cash, net of effect of acquisitions: | |||||||||||
| Accounts receivable, net | (44,454 | ) | (262 | ) | |||||||
| Materials and supplies | (1,839 | ) | (567 | ) | |||||||
| Prepaid expenses and other | (22 | ) | (5,384 | ) | |||||||
| Accounts payable and accrued expenses | 15,929 | (30,051 | ) | ||||||||
| Other assets and liabilities, net | 4,471 | 5,320 | |||||||||
| Net cash provided by operating activities | 411,912 | 170,679 | |||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
|
Purchase of property and equipment |
(249,318 |
) |
(231,694 |
) |
|||||||
| Grant proceeds from outside parties | 33,913 | 39,632 | |||||||||
| Cash paid for acquisitions, net of cash acquired |
- |
(1,925,296 | ) | ||||||||
| Insurance proceeds for the replacement of assets |
- |
370 | |||||||||
| Proceeds from disposition of property and equipment | 6,687 | 15,298 | |||||||||
| Net cash used in investing activities | (208,718 | ) | (2,101,690 | ) | |||||||
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|||||||
|
Principal payments on long-term borrowings, including capital leases |
(471,957 |
) |
(1,013,166 |
) |
|||||||
| Proceeds from issuance of long-term debt | 262,651 | 2,192,916 | |||||||||
| Debt amendment costs | (2,773 | ) | (38,839 | ) | |||||||
| Net proceeds from Class A common stock issuance |
- |
234,340 | |||||||||
| Net proceeds from TEU issuance |
- |
222,856 | |||||||||
| Net proceeds from Series A-1 Preferred Stock issuance |
- |
349,418 | |||||||||
| Dividends paid on Series A-1 Preferred Stock | (2,139 | ) | (4,375 | ) | |||||||
| Proceeds from employee stock purchases | 12,510 | 19,320 | |||||||||
| Excess tax benefits from share-based compensation | 8,453 | 5,335 | |||||||||
| Treasury stock acquisitions | (11,095 | ) | (4,314 | ) | |||||||
| Net cash (used in)/provided by financing activities | (204,350 | ) | 1,963,491 | ||||||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | (740 | ) | 5,023 | ||||||||
| (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS | (1,896 | ) | 37,503 | ||||||||
| CASH AND CASH EQUIVALENTS, beginning of period | 64,772 | 27,269 | |||||||||
| CASH AND CASH EQUIVALENTS, end of period | $ | 62,876 | $ | 64,772 | |||||||
|
GENESEE & WYOMING INC. AND SUBSIDIARIES |
|||||||||||||||||
| SELECTED CONSOLIDATED FINANCIAL INFORMATION | |||||||||||||||||
| (dollars in thousands) | |||||||||||||||||
|
(unaudited) |
|||||||||||||||||
|
Three Months Ended December 31, |
|||||||||||||||||
|
2013 |
2012 |
||||||||||||||||
|
Amount |
% of Revenue |
Amount |
% of Revenue |
||||||||||||||
|
Revenues: |
|||||||||||||||||
|
Freight |
$ |
297,500 |
76.0 |
% |
$ |
165,410 |
72.8 |
% |
|||||||||
|
Non-freight |
94,174 |
24.0 |
% |
61,906 |
27.2 |
% |
|||||||||||
|
Total revenues |
$ |
391,674 |
100.0 |
% |
$ |
227,316 |
100.0 |
% |
|||||||||
|
Operating Expense Comparison: |
|||||||||||||||||
|
Natural Classification |
|||||||||||||||||
| Labor and benefits | $ | 111,622 | 28.5 | % | $ | 66,543 | 29.3 | % | |||||||||
| Equipment rents | 19,667 | 5.0 | % | 9,252 | 4.1 | % | |||||||||||
| Purchased services | 29,110 | 7.4 | % | 22,241 | 9.8 | % | |||||||||||
| Depreciation and amortization | 35,926 | 9.2 | % | 18,458 | 8.1 | % | |||||||||||
| Diesel fuel used in operations | 37,633 | 9.6 | % | 23,756 | 10.5 | % | |||||||||||
| Diesel fuel sold to third parties | 6 |
- |
% |
862 | 0.4 | % | |||||||||||
| Casualties and insurance | 12,348 | 3.2 | % | 7,131 | 3.1 | % | |||||||||||
| Materials | 16,315 | 4.2 | % | 6,116 | 2.7 | % | |||||||||||
| Trackage rights | 13,854 | 3.5 | % | 6,443 | 2.8 | % | |||||||||||
| Net gain on sale of assets | (1,258 | ) | (0.3 | )% | (778 | ) | (0.3 | )% | |||||||||
| Gain on insurance recoveries |
- |
- |
% |
(574 | ) | (0.3 | )% | ||||||||||
| Other expenses | 20,609 | 5.3 | % | 10,256 | 4.5 | % | |||||||||||
| RailAmerica acquisition-related costs | 77 |
- |
% |
12,591 | 5.5 | % | |||||||||||
| RailAmerica integration costs | 935 | 0.2 | % | 11,359 | 5.0 | % | |||||||||||
| Total operating expenses | $ | 296,844 | 75.8 | % | $ | 193,656 | 85.2 | % | |||||||||
|
Functional Classification |
|||||||||||||||||
| Transportation | $ | 117,510 | 30.0 | % | $ | 72,945 | 32.1 | % | |||||||||
| Maintenance of ways and structures | 41,114 | 10.5 | % | 21,655 | 9.5 | % | |||||||||||
| Maintenance of equipment | 40,762 | 10.4 | % | 23,920 | 10.5 | % | |||||||||||
| Diesel fuel sold to third parties | 6 |
- |
% |
862 | 0.4 | % | |||||||||||
| General and administrative | 54,100 | 13.8 | % | 33,218 | 14.7 | % | |||||||||||
| Construction costs | 7,672 | 2.0 | % |
- |
- |
% |
|||||||||||
| RailAmerica acquisition-related costs | 77 |
- |
% |
12,591 | 5.5 | % | |||||||||||
| RailAmerica integration costs | 935 | 0.2 | % | 11,359 | 5.0 | % | |||||||||||
| Net gain on sale of assets | (1,258 | ) | (0.3 | )% | (778 | ) | (0.3 | )% | |||||||||
| Gain on insurance recoveries |
- |
- |
% |
(574 | ) | (0.3 | )% | ||||||||||
| Depreciation and amortization | 35,926 | 9.2 | % | 18,458 | 8.1 | % | |||||||||||
| Total operating expenses | $ | 296,844 | 75.8 | % | $ | 193,656 | 85.2 | % | |||||||||
|
GENESEE & WYOMING INC. AND SUBSIDIARIES |
||||||||||||||||||||||||||||||||||||
|
SELECTED CONSOLIDATED FINANCIAL INFORMATION |
||||||||||||||||||||||||||||||||||||
|
(dollars in thousands) |
||||||||||||||||||||||||||||||||||||
|
(unaudited) |
||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||
|
|
North American & |
|||||||||||||||||||||||||||||||||||
|
Three Months Ended December 31, 2013 |
European Operations |
Australian Operations |
Total Operations |
|||||||||||||||||||||||||||||||||
|
% of |
% of |
% of |
||||||||||||||||||||||||||||||||||
|
|
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
||||||||||||||||||||||||||||||
|
Revenues: |
||||||||||||||||||||||||||||||||||||
| Freight | $ | 230,844 | 74.8 | % | $ | 66,656 | 80.1 | % | $ | 297,500 | 76.0 | % | ||||||||||||||||||||||||
| Non-freight | 77,613 | 25.2 | % | 16,555 | 19.9 | % | 94,168 | 24.0 | % | |||||||||||||||||||||||||||
| Fuel sales to third parties |
- |
- |
% |
6 |
- |
% |
6 |
- |
% |
|||||||||||||||||||||||||||
| Total revenues | 308,457 | 100.0 | % | 83,217 | 100.0 | % | 391,674 | 100.0 | % | |||||||||||||||||||||||||||
|
Operating expenses |
||||||||||||||||||||||||||||||||||||
| Labor and benefits | 95,840 | 31.1 | % | 15,782 | 18.9 | % | 111,622 | 28.5 | % | |||||||||||||||||||||||||||
| Equipment rents | 17,123 | 5.6 | % | 2,544 | 3.1 | % | 19,667 | 5.0 | % | |||||||||||||||||||||||||||
| Purchased services | 15,813 | 5.1 | % | 13,297 | 16.0 | % | 29,110 | 7.4 | % | |||||||||||||||||||||||||||
| Depreciation and amortization | 29,039 | 9.4 | % | 6,887 | 8.3 | % | 35,926 | 9.2 | % | |||||||||||||||||||||||||||
| Diesel fuel used in operations | 29,923 | 9.7 | % | 7,710 | 9.3 | % | 37,633 | 9.6 | % | |||||||||||||||||||||||||||
| Diesel fuel sold to third parties |
- |
- |
% |
6 |
- |
% |
6 |
|
- |
% |
||||||||||||||||||||||||||
| Casualties and insurance | 8,691 | 2.8 | % | 3,657 | 4.4 | % | 12,348 | 3.2 | % | |||||||||||||||||||||||||||
| Materials | 15,541 | 5.0 | % | 774 | 0.9 | % | 16,315 | 4.2 | % | |||||||||||||||||||||||||||
| Trackage rights | 8,216 | 2.7 | % | 5,638 | 6.8 | % | 13,854 | 3.5 | % | |||||||||||||||||||||||||||
| Net gain on sale of assets | (1,462 | ) | (0.5 | )% | 204 | 0.2 | % | (1,258 | ) | (0.3 | )% | |||||||||||||||||||||||||
| Gain on insurance recoveries |
- |
- |
% |
- |
- |
% |
- |
- |
% |
|||||||||||||||||||||||||||
| Other expenses | 18,539 | 6.0 | % | 2,070 | 2.5 | % | 20,609 | 5.3 | % | |||||||||||||||||||||||||||
| RailAmerica acquisition-related costs | 77 |
- |
% |
- |
- |
% |
77 |
- |
% |
|||||||||||||||||||||||||||
| RailAmerica integration costs | 935 | 0.3 | % |
- |
- |
% |
935 | 0.2 | % | |||||||||||||||||||||||||||
| Total operating expenses | 238,275 | 77.2 | % | 58,569 | 70.4 | % | 296,844 | 75.8 | % | |||||||||||||||||||||||||||
| Income from operations | $ | 70,182 | $ | 24,648 | $ | 94,830 | ||||||||||||||||||||||||||||||
| Carloads | 415,067 | 56,839 | 471,906 | |||||||||||||||||||||||||||||||||
| Net expenditures for additions to property & equipment | $ | 58,342 | $ | 10,506 | $ | 68,848 | ||||||||||||||||||||||||||||||
|
|
North American & |
|||||||||||||||||||||||||||||||||||
|
Three Months Ended December 31, 2012 |
European Operations |
Australian Operations |
Total Operations |
|||||||||||||||||||||||||||||||||
|
|
% of |
% of |
% of |
|||||||||||||||||||||||||||||||||
|
|
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
||||||||||||||||||||||||||||||
|
Revenues: |
||||||||||||||||||||||||||||||||||||
| Freight | $ | 101,228 | 69.1 | % | $ | 64,182 | 79.4 | % | $ | 165,410 | 72.8 | % | ||||||||||||||||||||||||
| Non-freight | 45,214 | 30.9 | % | 15,787 | 19.5 | % | 61,001 | 26.8 | % | |||||||||||||||||||||||||||
| Fuel sales to third parties |
- |
- |
% |
905 | 1.1 | % | 905 | 0.4 | % | |||||||||||||||||||||||||||
| Total revenues | 146,442 | 100.0 | % | 80,874 | 100.0 | % | 227,316 | 100.0 | % | |||||||||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||||||||||||||||||
| Labor and benefits | 50,226 | 34.3 | % | 16,317 | 20.2 | % | 66,543 | 29.3 | % | |||||||||||||||||||||||||||
| Equipment rents | 6,557 | 4.5 | % | 2,695 | 3.3 | % | 9,252 | 4.1 | % | |||||||||||||||||||||||||||
| Purchased services | 6,841 | 4.7 | % | 15,400 | 19.1 | % | 22,241 | 9.8 | % | |||||||||||||||||||||||||||
| Depreciation and amortization | 12,802 | 8.7 | % | 5,656 | 7.0 | % | 18,458 | 8.1 | % | |||||||||||||||||||||||||||
| Diesel fuel used in operations | 14,440 | 9.9 | % | 9,316 | 11.5 | % | 23,756 | 10.5 | % | |||||||||||||||||||||||||||
| Diesel fuel sold to third parties |
- |
- |
% |
862 | 1.1 | % | 862 | 0.4 | % | |||||||||||||||||||||||||||
| Casualties and insurance | 4,587 | 3.1 | % | 2,544 | 3.1 | % | 7,131 | 3.1 | % | |||||||||||||||||||||||||||
| Materials | 5,718 | 3.9 | % | 398 | 0.5 | % | 6,116 | 2.7 | % | |||||||||||||||||||||||||||
| Trackage rights | 3,840 | 2.6 | % | 2,603 | 3.2 | % | 6,443 | 2.8 | % | |||||||||||||||||||||||||||
| Net gain on sale of assets | (802 | ) | (0.5 | )% | 24 |
- |
% |
(778 | ) | (0.3 | )% | |||||||||||||||||||||||||
| Gain on insurance recoveries |
- |
- |
% |
(574 | ) | (0.7 | )% | (574 | ) | (0.3 | )% | |||||||||||||||||||||||||
| Other expenses | 7,678 | 5.2 | % | 2,578 | 3.2 | % | 10,256 | 4.5 | % | |||||||||||||||||||||||||||
|
RailAmerica acquisition-related costs |
12,591 | 8.6 | % |
- |
- |
% |
12,591 | 5.5 | % | |||||||||||||||||||||||||||
| RailAmerica integration costs | 11,359 | 7.8 | % |
- |
- |
% |
11,359 | 5.0 | % | |||||||||||||||||||||||||||
| Total operating expenses | 135,837 | 92.8 | % | 57,819 | 71.5 | % | 193,656 | 85.2 | % | |||||||||||||||||||||||||||
| Income from operations | $ | 10,605 | $ | 23,055 | $ | 33,660 | ||||||||||||||||||||||||||||||
| Carloads | 180,427 | 49,391 | 229,818 | |||||||||||||||||||||||||||||||||
| Net expenditures for additions to property & equipment | $ | 18,875 | $ | 27,587 | $ | 46,462 | ||||||||||||||||||||||||||||||
| GENESEE & WYOMING INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||||||||||
| RAILROAD FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD | |||||||||||||||||||||||||||||||||||||||||||||||||
| COMPARISON BY COMMODITY GROUP | |||||||||||||||||||||||||||||||||||||||||||||||||
|
(dollars in thousands, except average revenues per carload) |
|||||||||||||||||||||||||||||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended December 31, 2013 |
North American & European Operations |
Australian Operations |
Total Operations |
||||||||||||||||||||||||||||||||||||||||||||||
| Average | Average | Average | |||||||||||||||||||||||||||||||||||||||||||||||
|
Freight |
Revenues | Freight | Revenues | Freight | Revenues | ||||||||||||||||||||||||||||||||||||||||||||
|
Commodity Group |
Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | ||||||||||||||||||||||||||||||||||||||||
| Agricultural Products | $ | 24,075 | 48,361 | $ | 498 | $ | 8,652 | 13,466 | $ | 643 | $ | 32,727 | 61,827 | $ | 529 | ||||||||||||||||||||||||||||||||||
| Metallic Ores | 4,669 | 5,333 | 875 | 29,817 | 15,430 | 1,932 | 34,486 | 20,763 | 1,661 | ||||||||||||||||||||||||||||||||||||||||
| Chemicals & Plastics | 30,668 | 39,088 | 785 |
- |
- |
- |
30,668 | 39,088 | 785 | ||||||||||||||||||||||||||||||||||||||||
| Metals | 31,517 | 42,636 | 739 |
- |
- |
- |
31,517 | 42,636 | 739 | ||||||||||||||||||||||||||||||||||||||||
| Pulp & Paper | 29,066 | 42,928 | 677 |
- |
- |
- |
29,066 | 42,928 | 677 | ||||||||||||||||||||||||||||||||||||||||
| Coal & Coke | 28,880 | 82,960 | 348 |
- |
- |
- |
28,880 | 82,960 | 348 | ||||||||||||||||||||||||||||||||||||||||
| Minerals & Stone | 21,122 | 39,463 | 535 | 1,819 | 10,624 | 171 | 22,941 | 50,087 | 458 | ||||||||||||||||||||||||||||||||||||||||
| Intermodal | 218 | 2,404 | 91 | 25,980 | 17,243 | 1,507 | 26,198 | 19,647 | 1,333 | ||||||||||||||||||||||||||||||||||||||||
| Lumber & Forest Products | 19,200 | 32,375 | 593 |
- |
- |
- |
19,200 | 32,375 | 593 | ||||||||||||||||||||||||||||||||||||||||
| Petroleum Products | 16,069 | 27,677 | 581 | 388 | 76 | 5,105 | 16,457 | 27,753 | 593 | ||||||||||||||||||||||||||||||||||||||||
| Food or Kindred Products | 8,607 | 14,916 | 577 |
- |
- |
- |
8,607 | 14,916 | 577 | ||||||||||||||||||||||||||||||||||||||||
| Waste | 5,546 | 10,999 | 504 |
- |
- |
- |
5,546 | 10,999 | 504 | ||||||||||||||||||||||||||||||||||||||||
| Autos & Auto Parts | 6,748 | 9,512 | 709 |
- |
- |
- |
6,748 | 9,512 | 709 | ||||||||||||||||||||||||||||||||||||||||
| Other | 4,459 | 16,415 | 272 |
- |
- |
- |
4,459 | 16,415 | 272 | ||||||||||||||||||||||||||||||||||||||||
|
Totals |
$ |
230,844 |
415,067 |
$ |
556 |
$ |
66,656 |
56,839 |
$ |
1,173 |
$ |
297,500 |
471,906 |
$ |
630 |
||||||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended December 31, 2012 |
North American & European Operations |
Australian Operations |
Total Operations |
||||||||||||||||||||||||||||||||||||||||||||||
| Average | Average | Average | |||||||||||||||||||||||||||||||||||||||||||||||
|
Freight |
Revenues |
Freight | Revenues | Freight | Revenues | ||||||||||||||||||||||||||||||||||||||||||||
|
Commodity Group |
Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | ||||||||||||||||||||||||||||||||||||||||
| Agricultural Products | $ | 4,434 | 11,420 | $ | 388 | $ | 6,863 | 7,246 | $ | 947 | $ | 11,297 | 18,666 | $ | 605 | ||||||||||||||||||||||||||||||||||
| Metallic Ores | 2,473 | 2,653 | 932 | 26,292 | 9,323 | 2,820 | 28,765 | 11,976 | 2,402 | ||||||||||||||||||||||||||||||||||||||||
| Chemicals & Plastics | 13,360 | 16,929 | 789 |
- |
- |
- |
13,360 | 16,929 | 789 | ||||||||||||||||||||||||||||||||||||||||
| Metals | 15,411 | 22,017 | 700 |
- |
- |
- |
15,411 | 22,017 | 700 | ||||||||||||||||||||||||||||||||||||||||
| Pulp & Paper | 16,642 | 25,978 | 641 |
- |
- |
- |
16,642 | 25,978 | 641 | ||||||||||||||||||||||||||||||||||||||||
| Coal & Coke | 16,694 | 41,541 | 402 |
- |
- |
- |
16,694 | 41,541 | 402 | ||||||||||||||||||||||||||||||||||||||||
| Minerals & Stone | 8,027 | 16,792 | 478 | 3,134 | 15,197 | 206 | 11,161 | 31,989 | 349 | ||||||||||||||||||||||||||||||||||||||||
| Intermodal | 121 | 1,244 | 97 | 27,319 | 17,542 | 1,557 | 27,440 | 18,786 | 1,461 | ||||||||||||||||||||||||||||||||||||||||
| Lumber & Forest Products | 9,142 | 18,774 | 487 |
- |
- |
- |
9,142 | 18,774 | 487 | ||||||||||||||||||||||||||||||||||||||||
| Petroleum Products | 6,210 | 7,566 | 821 | 574 | 83 | 6,916 | 6,784 | 7,649 | 887 | ||||||||||||||||||||||||||||||||||||||||
| Food or Kindred Products | 1,428 | 3,027 | 472 |
- |
- |
- |
1,428 | 3,027 | 472 | ||||||||||||||||||||||||||||||||||||||||
| Waste | 3,829 | 5,979 | 640 |
- |
- |
- |
3,829 | 5,979 | 640 | ||||||||||||||||||||||||||||||||||||||||
| Autos & Auto Parts | 2,007 | 2,622 | 765 |
- |
- |
- |
2,007 | 2,622 | 765 | ||||||||||||||||||||||||||||||||||||||||
| Other | 1,450 | 3,885 | 373 |
- |
- |
- |
1,450 | 3,885 | 373 | ||||||||||||||||||||||||||||||||||||||||
|
Totals |
$ |
101,228 |
180,427 |
$ |
561 |
$ |
64,182 |
49,391 |
$ |
1,299 |
$ |
165,410 |
229,818 |
$ |
720 |
||||||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||
|
GENESEE & WYOMING INC. AND SUBSIDIARIES |
||||||||||||||||||||||||
|
SELECTED CONSOLIDATED FINANCIAL INFORMATION |
||||||||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||
|
Twelve Months Ended December 31, |
||||||||||||||||||||||||
|
2013 |
2012 |
|||||||||||||||||||||||
|
Amount |
% of Revenue |
Amount |
% of Revenue |
|||||||||||||||||||||
|
Revenues: |
||||||||||||||||||||||||
|
Freight |
$ |
1,177,364 |
75.0 |
% |
$ |
624,809 |
71.4 |
% |
||||||||||||||||
|
Non-freight |
391,647 |
25.0 |
% |
250,107 |
28.6 |
% |
||||||||||||||||||
|
Total revenues |
$ |
1,569,011 |
100.0 |
% |
$ |
874,916 |
100.0 |
% |
||||||||||||||||
|
Operating Expense Comparison: |
||||||||||||||||||||||||
|
Natural Classification |
||||||||||||||||||||||||
| Labor and benefits | $ | 441,318 | 28.1 | % | $ | 257,618 | 29.5 | % | ||||||||||||||||
| Equipment rents | 77,825 | 5.0 | % | 37,322 | 4.3 | % | ||||||||||||||||||
| Purchased services | 120,871 | 7.7 | % | 80,572 | 9.2 | % | ||||||||||||||||||
| Depreciation and amortization | 141,644 | 9.0 | % | 73,405 | 8.4 | % | ||||||||||||||||||
| Diesel fuel used in operations | 147,172 | 9.4 | % | 88,399 | 10.1 | % | ||||||||||||||||||
| Diesel fuel sold to third parties | 368 |
- |
% |
11,322 | 1.3 | % | ||||||||||||||||||
| Casualties and insurance | 40,781 | 2.6 | % | 24,858 | 2.8 | % | ||||||||||||||||||
| Materials | 78,243 | 5.0 | % | 25,240 | 2.9 | % | ||||||||||||||||||
| Trackage rights | 50,911 | 3.2 | % | 28,250 | 3.2 | % | ||||||||||||||||||
| Net gain on sale of assets | (4,677 | ) | (0.3 | )% | (11,225 | ) | (1.3 | )% | ||||||||||||||||
| Gain on insurance recoveries | (1,465 | ) | (0.1 | )% | (5,760 | ) | (0.7 | )% | ||||||||||||||||
| Other expenses | 78,797 | 5.1 | % | 44,549 | 5.1 | % | ||||||||||||||||||
| RailAmerica acquisition-related costs | 360 |
- |
% |
18,592 | 2.1 | % | ||||||||||||||||||
| RailAmerica integration costs | 16,675 | 1.1 | % | 11,452 | 1.3 | % | ||||||||||||||||||
| Total operating expenses | $ | 1,188,823 | 75.8 | % | $ | 684,594 | 78.2 | % | ||||||||||||||||
|
Functional Classification |
||||||||||||||||||||||||
| Transportation | $ | 449,018 | 28.6 | % | $ | 276,316 | 31.6 | % | ||||||||||||||||
| Maintenance of ways and structures | 164,641 | 10.5 | % | 87,751 | 10.0 | % | ||||||||||||||||||
| Maintenance of equipment | 164,349 | 10.5 | % | 92,531 | 10.6 | % | ||||||||||||||||||
| Diesel fuel sold to third parties | 368 |
- |
% |
11,322 | 1.3 | % | ||||||||||||||||||
| General and administrative | 218,891 | 14.0 | % | 130,210 | 14.9 | % | ||||||||||||||||||
| Construction costs | 39,019 | 2.5 | % |
- |
- |
% |
||||||||||||||||||
| RailAmerica acquisition-related costs | 360 |
- |
% |
18,592 | 2.1 | % | ||||||||||||||||||
| RailAmerica integration costs | 16,675 | 1.1 | % | 11,452 | 1.3 | % | ||||||||||||||||||
| Net gain on sale of assets | (4,677 | ) | (0.3 | )% | (11,225 | ) | (1.3 | )% | ||||||||||||||||
| Gain on insurance recoveries | (1,465 | ) | (0.1 | )% | (5,760 | ) | (0.7 | )% | ||||||||||||||||
| Depreciation and amortization | 141,644 | 9.0 | % | 73,405 | 8.4 | % | ||||||||||||||||||
| Total operating expenses | $ | 1,188,823 | 75.8 | % | $ | 684,594 | 78.2 | % | ||||||||||||||||
| GENESEE & WYOMING INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||
| SELECTED CONSOLIDATED FINANCIAL INFORMATION | |||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||||||||
| North American & | |||||||||||||||||||||||||||
| Twelve Months Ended December 31, 2013 | European Operations | Australian Operations | Total Operations | ||||||||||||||||||||||||
| % of | % of | % of | |||||||||||||||||||||||||
| Amount | Revenue | Amount | Revenue | Amount | Revenue | ||||||||||||||||||||||
|
Revenues: |
|
||||||||||||||||||||||||||
| Freight | $ | 917,971 | 73.8 | % | $ | 259,393 | 79.8 | % | $ | 1,177,364 | 75.0 | % | |||||||||||||||
| Non-freight | 325,876 | 26.2 | % | 65,385 | 20.1 | % | 391,261 | 24.9 | % | ||||||||||||||||||
| Fuel sales to third parties |
- |
- |
% |
386 | 0.1 | % | 386 | 0.1 | % | ||||||||||||||||||
| Total revenues | 1,243,847 |
100.0 |
% | 325,164 | 100.0 | % | 1,569,011 | 100.0 | % | ||||||||||||||||||
|
Operating expenses |
|||||||||||||||||||||||||||
| Labor and benefits | 374,935 | 30.2 | % | 66,383 | 20.4 | % | 441,318 | 28.1 | % | ||||||||||||||||||
| Equipment rents | 67,297 | 5.4 | % | 10,528 | 3.2 | % | 77,825 | 5.0 | % | ||||||||||||||||||
| Purchased services | 68,632 | 5.5 | % | 52,239 | 16.1 | % | 120,871 | 7.7 | % | ||||||||||||||||||
| Depreciation and amortization | 114,542 | 9.2 | % | 27,102 | 8.4 | % | 141,644 | 9.0 | % | ||||||||||||||||||
| Diesel fuel used in operations | 116,204 | 9.4 | % | 30,968 | 9.5 | % | 147,172 | 9.4 | % | ||||||||||||||||||
| Diesel fuel sold to third parties |
- |
- |
% |
368 | 0.1 | % | 368 |
- |
% |
||||||||||||||||||
| Casualties and insurance | 28,937 | 2.3 | % | 11,844 | 3.7 | % | 40,781 | 2.6 | % | ||||||||||||||||||
| Materials | 75,742 | 6.1 | % | 2,501 | 0.8 | % | 78,243 | 5.0 | % | ||||||||||||||||||
| Trackage rights | 29,595 | 2.4 | % | 21,316 | 6.6 | % | 50,911 | 3.2 | % | ||||||||||||||||||
| Net gain on sale of assets | (4,491 | ) | (0.4 | )% | (186 | ) | (0.1 | )% | (4,677 | ) | (0.3 | )% | |||||||||||||||
| Gain on insurance recoveries |
- |
- |
% |
(1,465 | ) | (0.5 | )% | (1,465 | ) | (0.1 | )% | ||||||||||||||||
| Other expenses | 71,297 | 5.8 | % | 7,500 | 2.3 | % | 78,797 | 5.1 | % | ||||||||||||||||||
| RailAmerica acquisition-related costs | 360 |
- |
% |
- |
- |
% |
360 |
- |
% |
||||||||||||||||||
| RailAmerica integration costs | 16,675 | 1.3 | % |
- |
- |
% |
16,675 | 1.1 | % | ||||||||||||||||||
| Total operating expenses | 959,725 | 77.2 | % | 229,098 | 70.5 | % | 1,188,823 | 75.8 | % | ||||||||||||||||||
| Income from operations | $ | 284,122 | $ | 96,066 | $ | 380,188 | |||||||||||||||||||||
| Carloads | 1,649,914 | 236,098 | 1,886,012 | ||||||||||||||||||||||||
| Net expenditures for additions to property & equipment | $ | 163,545 | $ | 51,860 | $ | 215,405 | |||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||
|
|
North American & |
||||||||||||||||||||||||||||||||||
|
Twelve Months Ended December 31, 2012 |
European Operations |
Australian Operations |
Total Operations |
||||||||||||||||||||||||||||||||
|
|
% of |
% of |
% of |
||||||||||||||||||||||||||||||||
|
|
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
|||||||||||||||||||||||||||||
|
Revenues: |
|||||||||||||||||||||||||||||||||||
| Freight | $ | 412,839 | 70.5 | % | $ | 211,970 | 73.3 | % | $ | 624,809 | 71.4 | % | |||||||||||||||||||||||
| Non-freight | 173,054 | 29.5 | % | 65,185 | 22.6 | % | 238,239 | 27.2 | % | ||||||||||||||||||||||||||
| Fuel sales to third parties |
- |
- |
% |
11,868 | 4.1 | % |
11,868 |
1.4 |
% |
||||||||||||||||||||||||||
| Total revenues | 585,893 | 100.0 | % | 289,023 | 100.0 | % | 874,916 | 100.0 | % | ||||||||||||||||||||||||||
|
Operating expenses |
|||||||||||||||||||||||||||||||||||
| Labor and benefits | 197,407 | 33.7 | % | 60,211 | 20.8 | % | 257,618 | 29.5 | % | ||||||||||||||||||||||||||
| Equipment rents | 26,298 | 4.5 | % | 11,024 | 3.8 | % | 37,322 | 4.3 | % | ||||||||||||||||||||||||||
| Purchased services | 26,330 | 4.5 | % | 54,242 | 18.8 | % | 80,572 | 9.2 | % | ||||||||||||||||||||||||||
| Depreciation and amortization | 50,156 | 8.5 | % | 23,249 | 8.0 | % | 73,405 | 8.4 | % | ||||||||||||||||||||||||||
| Diesel fuel used in operations | 56,298 | 9.6 | % | 32,101 | 11.1 | % | 88,399 | 10.1 | % | ||||||||||||||||||||||||||
| Diesel fuel sold to third parties |
- |
- |
% |
11,322 | 3.9 | % | 11,322 | 1.3 | % | ||||||||||||||||||||||||||
| Casualties and insurance | 16,244 | 2.8 | % | 8,614 | 3.0 | % | 24,858 | 2.8 | % | ||||||||||||||||||||||||||
| Materials | 23,569 | 4.0 | % | 1,671 | 0.6 | % | 25,240 | 2.9 | % | ||||||||||||||||||||||||||
| Trackage rights | 17,643 | 3.0 | % | 10,607 | 3.7 | % | 28,250 | 3.2 | % | ||||||||||||||||||||||||||
| Net gain on sale of assets | (9,178 | ) | (1.6 | )% | (2,047 | ) | (0.7 | )% | (11,225 | ) | (1.3 | )% | |||||||||||||||||||||||
| Gain on insurance recoveries |
- |
- |
% |
(5,760 | ) | (2.0 | )% | (5,760 | ) |
|
(0.7 |
)% |
|||||||||||||||||||||||
| Other expenses | 35,695 | 6.1 | % | 8,854 | 3.1 | % | 44,549 | 5.1 | % | ||||||||||||||||||||||||||
| RailAmerica acquisition-related costs | 18,592 | 3.2 | % |
- |
- |
% |
18,592 | 2.1 | % | ||||||||||||||||||||||||||
| RailAmerica integration costs | 11,452 | 2.0 | % |
- |
- |
% |
11,452 | 1.3 | % | ||||||||||||||||||||||||||
| Total operating expenses | 470,506 | 80.3 | % | 214,088 | 74.1 | % | 684,594 | 78.2 | % | ||||||||||||||||||||||||||
| Income from operations | $ | 115,387 | $ | 74,935 | $ | 190,322 | |||||||||||||||||||||||||||||
| Carloads | 723,448 | 203,646 | 927,094 | ||||||||||||||||||||||||||||||||
|
Net expenditures for additions to property & equipment |
$ | 69,636 | $ | 122,426 | $ | 192,062 | |||||||||||||||||||||||||||||
| GENESEE & WYOMING INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||||||||||
| RAILROAD FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD | ||||||||||||||||||||||||||||||||||||||||||||||
| COMPARISON BY COMMODITY GROUP | ||||||||||||||||||||||||||||||||||||||||||||||
|
(dollars in thousands, except average revenues per carload) |
||||||||||||||||||||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
|
Twelve Months Ended December 31, 2013 |
North American & European Operations |
Australian Operations |
Total Operations |
|||||||||||||||||||||||||||||||||||||||||||
| Commodity Group | Average | Average | Average | |||||||||||||||||||||||||||||||||||||||||||
| Freight | Revenues | Freight | Revenues |
Freight |
Revenues | |||||||||||||||||||||||||||||||||||||||||
| Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | ||||||||||||||||||||||||||||||||||||||
| Agricultural Products | $ | 90,272 | 179,083 | $ | 504 | $ | 40,305 | 61,757 | $ | 653 | $ | 130,577 | 240,840 | $ | 542 | |||||||||||||||||||||||||||||||
| Metallic Ores | 16,602 | 20,231 | 821 | 109,326 | 52,135 | 2,097 | 125,928 | 72,366 | 1,740 | |||||||||||||||||||||||||||||||||||||
| Chemicals & Plastics | 128,935 | 163,123 | 790 |
- |
- |
- |
128,935 | 163,123 | 790 | |||||||||||||||||||||||||||||||||||||
| Metals | 127,769 | 175,636 | 727 |
- |
- |
- |
127,769 | 175,636 | 727 | |||||||||||||||||||||||||||||||||||||
| Pulp & Paper | 112,663 | 169,708 | 664 |
- |
- |
- |
112,663 | 169,708 | 664 | |||||||||||||||||||||||||||||||||||||
| Coal & Coke | 110,836 | 323,500 | 343 |
- |
- |
- |
110,836 | 323,500 | 343 | |||||||||||||||||||||||||||||||||||||
| Minerals & Stone | 86,627 | 162,401 | 533 | 10,144 | 56,762 | 179 | 96,771 | 219,163 | 442 | |||||||||||||||||||||||||||||||||||||
| Intermodal | 871 | 8,518 | 102 | 97,888 | 65,148 | 1,503 | 98,759 | 73,666 | 1,341 | |||||||||||||||||||||||||||||||||||||
| Lumber & Forest Products | 79,035 | 133,649 | 591 |
- |
- |
- |
79,035 | 133,649 | 591 | |||||||||||||||||||||||||||||||||||||
| Petroleum Products | 63,493 | 108,605 | 585 | 1,730 | 296 | 5,845 | 65,223 | 108,901 | 599 | |||||||||||||||||||||||||||||||||||||
| Food or Kindred Products | 31,982 | 55,084 | 581 |
- |
- |
- |
31,982 | 55,084 | 581 | |||||||||||||||||||||||||||||||||||||
| Waste | 22,750 | 43,166 | 527 |
- |
- |
- |
22,750 | 43,166 | 527 | |||||||||||||||||||||||||||||||||||||
| Autos & Auto Parts | 26,415 | 36,510 | 724 |
- |
- |
- |
26,415 | 36,510 | 724 | |||||||||||||||||||||||||||||||||||||
| Other | 19,721 | 70,700 | 279 |
- |
- |
- |
19,721 | 70,700 | 279 | |||||||||||||||||||||||||||||||||||||
|
Totals |
$ |
917,971 |
1,649,914 |
$ |
556 |
$ |
259,393 |
236,098 |
$ |
1,099 |
$ |
1,177,364 |
1,886,012 |
$ |
624 |
|||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||
|
Twelve Months Ended December 31, 2012 |
North American & European Operations |
Australian Operations |
Total Operations |
||||||||||||||||||||||||||||||||||||||||||||||
| Average | Average | Average | |||||||||||||||||||||||||||||||||||||||||||||||
| Freight | Revenues | Freight | Revenues | Freight | Revenues | ||||||||||||||||||||||||||||||||||||||||||||
| Commodity Group | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | Revenues | Carloads | Per Carload | ||||||||||||||||||||||||||||||||||||||||
| Agricultural Products | $ | 20,845 | 46,062 | $ | 453 | $ | 38,533 | 50,672 | $ | 760 | $ | 59,378 | 96,734 | $ | 614 | ||||||||||||||||||||||||||||||||||
| Metallic Ores | 10,549 | 11,184 | 943 | 64,639 | 30,734 | 2,103 | 75,188 | 41,918 | 1,794 | ||||||||||||||||||||||||||||||||||||||||
| Chemicals & Plastics | 55,146 | 68,999 | 799 |
- |
- |
- |
55,146 | 68,999 | 799 | ||||||||||||||||||||||||||||||||||||||||
| Metals | 62,129 | 94,621 | 657 |
- |
- |
- |
62,129 | 94,621 | 657 | ||||||||||||||||||||||||||||||||||||||||
| Pulp & Paper | 65,696 | 101,588 | 647 |
- |
- |
- |
65,696 | 101,588 | 647 | ||||||||||||||||||||||||||||||||||||||||
| Coal & Coke | 70,052 | 168,574 | 416 |
- |
- |
- |
70,052 | 168,574 | 416 | ||||||||||||||||||||||||||||||||||||||||
| Minerals & Stone | 36,005 | 70,830 | 508 | 12,018 | 59,772 | 201 | 48,023 | 130,602 | 368 | ||||||||||||||||||||||||||||||||||||||||
| Intermodal | 503 | 4,644 | 108 | 94,232 | 62,062 | 1,518 | 94,735 | 66,706 | 1,420 | ||||||||||||||||||||||||||||||||||||||||
| Lumber & Forest Products | 34,839 | 70,896 | 491 |
- |
- |
- |
34,839 | 70,896 | 491 | ||||||||||||||||||||||||||||||||||||||||
| Petroleum Products | 22,745 | 26,501 | 858 | 2,548 | 406 | 6,276 | 25,293 | 26,907 | 940 | ||||||||||||||||||||||||||||||||||||||||
| Food or Kindred Products | 5,230 | 11,011 | 475 |
- |
- |
- |
5,230 | 11,011 | 475 | ||||||||||||||||||||||||||||||||||||||||
| Waste | 13,622 | 21,676 | 628 |
- |
- |
- |
13,622 | 21,676 | 628 | ||||||||||||||||||||||||||||||||||||||||
| Autos & Auto Parts | 8,313 | 10,148 | 819 |
- |
- |
- |
8,313 | 10,148 | 819 | ||||||||||||||||||||||||||||||||||||||||
| Other | 7,165 | 16,714 | 429 |
- |
- |
- |
7,165 | 16,714 | 429 | ||||||||||||||||||||||||||||||||||||||||
|
Totals |
$ |
412,839 |
723,448 |
$ |
571 |
$ |
211,970 |
203,646 |
$ |
1,041 |
$ |
624,809 |
927,094 |
$ |
674 |
||||||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of non-GAAP Financial Measures
This earnings release contains references to adjusted income before income taxes and income from equity investment, adjusted pre-tax income, adjusted net income, adjusted effective income tax rate, adjusted diluted earnings per common share, Combined Company adjusted operating revenues, adjusted income from operations, adjusted operating ratios and free cash flow, which are "non-GAAP financial measures" as this term is defined in Regulation G. In accordance with Item 10(e) and Regulation G, G&W has reconciled these non-GAAP financial measures to their most directly comparable U.S. GAAP measures.
Adjusted Income Before Income Taxes and Income From Equity Investment, Adjusted Net Income, Adjusted Effective Income Tax Rate and Adjusted Diluted Earnings Per Common Share
Management views income before income taxes and income from equity investment, net income and diluted earnings per common share (EPS) as important measures of G&W's operating performance. Because management believes this information is useful for investors in assessing G&W's financial results, the income before income taxes and income from equity investment, net income and diluted EPS for the three months ended December 31, 2013 used to calculate adjusted income before income taxes and income from equity investment, adjusted net income, adjusted effective income tax rate and adjusted diluted EPS are presented excluding RailAmerica integration and acquisition-related costs, business development and financing costs, net gain on sale of assets and valuation allowance on foreign tax credits (FTC) generated in prior years and are further adjusted to exclude the fourth quarter of 2013 short line tax credit. The net income and diluted EPS for the three months ended December 31, 2012 used to calculate adjusted net income and adjusted diluted EPS are presented excluding the RailAmerica integration and acquisition-related costs, business development and financing costs, acquisition costs incurred by RailAmerica, gain on insurance recoveries, net gain on sale of assets and contract termination expense in Australia. The adjusted income before income taxes and income from equity investment, adjusted net income, adjusted effective income tax rate and adjusted diluted EPS excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, the net income, effective income tax rate and diluted EPS calculated using amounts in accordance with GAAP. Adjusted income before income taxes and income from equity investment, adjusted net income, adjusted effective income tax rate and adjusted diluted EPS amounts may be different from similarly-titled non-GAAP financial measures used by other companies.
The following tables set forth reconciliations of income before income taxes and income from equity investment, net income and diluted EPS calculated using amounts determined in accordance with GAAP to the adjusted income before income taxes and income from equity investment, adjusted net income, adjusted effective income tax rate and adjusted diluted EPS described above (in millions, except per share amounts):
|
Income Before |
Diluted | |||||||||||||||||||||||
|
Income Taxes & |
Earnings/ | |||||||||||||||||||||||
|
Income From |
|
(Loss) Per | ||||||||||||||||||||||
|
Equity Investment |
|
Diluted |
Common | |||||||||||||||||||||
| Three Months Ended December 31, 2013 |
(Pre-Tax Income) |
Net Income |
Shares |
Share Impact | ||||||||||||||||||||
| As reported |
$ |
81.9 |
$ | 58.1 | 56.8 | $ | 1.03 | |||||||||||||||||
| Add back certain items, net of tax: | ||||||||||||||||||||||||
| RailAmerica integration/acquisition costs | 1.0 | 0.6 | 0.01 | |||||||||||||||||||||
| Business development and financing costs | 1.2 | 0.7 | 0.01 | |||||||||||||||||||||
| Net gain on sale of assets | (1.3 | ) | (0.8 | ) | (0.01 | ) | ||||||||||||||||||
| Valuation allowance on FTC | — | 2.0 | 0.03 | |||||||||||||||||||||
| As adjusted | $ | 82.8 | $ | 60.6 | 56.8 | $ | 1.07 | |||||||||||||||||
| Q4 impact of 2013 short line tax credit | — | (7.7 | ) | (0.13 | ) | |||||||||||||||||||
| As adjusted (excluding Q4 short line tax credit) |
$ |
82.8 |
$ |
53.0 |
56.8 |
$ |
0.94 |
|||||||||||||||||
|
Calculation of adjusted effective income tax rate: |
||||||||||||||||||||||||
|
Adjusted income (pre-tax) |
$ | 82.8 | ||||||||||||||||||||||
| Adjusted provision for income taxes | $ | 22.2 | ||||||||||||||||||||||
| Adjusted effective income tax rate | 26.8 | % | ||||||||||||||||||||||
| Diluted | |||||||||||||||||
| Earnings/ | |||||||||||||||||
| (Loss) Per | |||||||||||||||||
| Diluted | Common | ||||||||||||||||
| Three Months Ended December 31, 2012 | Net Income | Shares | Share Impact | ||||||||||||||
| As reported |
$ |
13.4 |
50.6 | $ | 0.18 | ||||||||||||
| Add back certain items, net of tax: | |||||||||||||||||
| RailAmerica integration/acquisition costs | 17.4 | 6.0 | (a) | 0.36 | |||||||||||||
| Business development and financing costs | 10.1 | 0.20 | |||||||||||||||
| Acquisition/integration costs incurred by RailAmerica | 3.5 | 0.06 | |||||||||||||||
| Gain on insurance recoveries | (0.4 | ) | (0.01 | ) | |||||||||||||
| Net gain on sale of assets | (0.6 | ) | (0.01 | ) | |||||||||||||
| Contract termination expense in Australia | 0.8 | 0.01 | |||||||||||||||
| As adjusted | $ | 44.2 | 56.6 | $ | 0.79 | ||||||||||||
(a) There is no effect of Class B shares outstanding or unvested equity awards in the calculation of diluted earnings per common share. Amount represents effect of Class B shares outstanding and unvested equity awards in the calculation of diluted earnings per common share.
Combined Company Adjusted Operating Revenues
Management views operating revenues as an important financial measure of G&W's operating performance. Because management believes this information is useful for investors in assessing G&W's financial results, compared with the same period in the prior year, the Combined Company operating revenues are presented excluding revenues from fuel sales to third parties and the impact from the net depreciation of the Australia and Canadian dollars and the Euro relative to the United States dollar. The Combined Company adjusted operating revenues excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, operating revenues calculated using amounts in accordance with GAAP. Combined Company adjusted operating revenues may be different from similarly-titled non-GAAP financial measures used by other companies.
The following tables set forth a reconciliation of operating revenues to the Combined Company adjusted operating revenues described above ($ in millions):
|
Eliminations/ |
|||||||||||||||||||||||
| G&W As | RailAmerica |
Adjustments |
Combined | ||||||||||||||||||||
|
Three Months Ended December 31, 2012 |
Reported | As Reported | (a) | Company | |||||||||||||||||||
| Freight revenues |
$ |
165.4 |
$ | 113.1 | $ | (2.4 | ) | $ | 276.1 | ||||||||||||||
| Non-freight revenues | 61.9 | 38.0 | (2.9 | ) | 97.0 | ||||||||||||||||||
| Total operating revenues | $ | 227.3 | $ | 151.1 | $ | (5.2 | ) | $ | 373.1 | ||||||||||||||
(a) Includes the elimination of non-freight revenues earned during the three months ended December 31, 2012 by a subsidiary of RailAmerica for work performed for subsidiaries of G&W and reclassifications of certain revenues of RailAmerica to align with G&W's accounting policies.
| Three Months Ended | |||||||||||||||||||||||
| December 31, | Change | ||||||||||||||||||||||
|
2013 |
2012 |
$ |
% |
||||||||||||||||||||
| Combined Company operating revenues | $ | 391.7 | $ | 373.1 | $ | 18.5 | 5.0 | % | |||||||||||||||
| Fuel sales to third parties |
- |
(0.9 | ) | 0.9 | |||||||||||||||||||
| Foreign exchange |
- |
(10.3 | ) | 10.3 | |||||||||||||||||||
| Combined Company adjusted operating revenues |
$ |
391.7 |
$ |
361.9 |
$ |
29.8 |
8.2 |
% |
|||||||||||||||
The following table sets forth a reconciliation of operating revenues to the Combined Company adjusted operating freight revenues described above ($ in millions):
| Three Months Ended | ||||||||||||||||||||||
| December 31, | Change | |||||||||||||||||||||
|
2013 |
2012 |
$ |
% |
|||||||||||||||||||
| Combined Company freight revenues |
$ |
297.5 |
$ | 276.1 |
$ |
21.4 |
7.7 | % | ||||||||||||||
| Foreign exchange |
- |
(8.2 | ) | 8.2 | ||||||||||||||||||
| Combined Company adjusted freight revenues |
$ |
297.5 |
$ |
267.9 |
$ |
29.6 |
11.0 |
% |
||||||||||||||
The following table sets forth a reconciliation of operating revenues to the Combined Company adjusted operating non-freight revenues described above ($ in millions):
| Three Months Ended | ||||||||||||||||||||||||
| December 31, | Change | |||||||||||||||||||||||
|
2013 |
2012 |
$ |
% |
|||||||||||||||||||||
| Combined Company non-freight revenues | $ | 94.2 | $ | 97.0 | $ | (2.8 | ) | (2.9 | )% | |||||||||||||||
| Fuel sales to third parties |
- |
(0.9 | ) | 0.9 | ||||||||||||||||||||
| Foreign exchange |
- |
(2.1 | ) | 2.1 | ||||||||||||||||||||
|
Combined Company adjusted non-freight revenues |
$ |
94.2 |
$ |
94.0 |
$ |
0.2 |
0.2 |
% |
||||||||||||||||
Adjusted Income from Operations and Adjusted Operating Ratios
Management views income from operations, calculated as operating revenues less operating expenses, and operating ratios, calculated as operating expenses divided by operating revenues, as important measures of G&W's operating performance. Because management believes this information is useful for investors in assessing G&W's financial results compared with the same period in the prior year, the income from operations and operating ratios for the three months ended December 31, 2013, used to calculate adjusted income from operations and adjusted operating ratios, are presented excluding RailAmerica integration and acquisition-related costs, business development and financing costs and net gain on sale of assets. The income from operations and operating ratios for the three months ended December 31, 2012, used to calculate adjusted income from operations and adjusted operating ratios, are presented excluding RailAmerica integration and acquisition-related costs, business development and financing costs, gain on insurance recoveries, net gain on sale of assets and contract termination expense Australia. The adjusted income from operations and adjusted operating ratios presented excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, the income from operations and operating ratios calculated using amounts in accordance with GAAP. Adjusted income from operations and operating ratios may be different from similarly-titled non-GAAP financial measures used by other companies.
The following table sets forth a reconciliation of income from operations and operating ratios by segment calculated using amounts determined in accordance with GAAP to the adjusted income from operations and adjusted operating ratios by segment described above ($ in millions):
| North | |||||||||||||||||||
| American & | |||||||||||||||||||
| European | Australian | Total | |||||||||||||||||
| Three Months Ended December 31, 2013 | Operations | Operations | Operations | ||||||||||||||||
|
Operating revenues |
$ |
308.5 |
$ |
83.2 |
$ |
391.7 |
|||||||||||||
|
Operating expenses |
238.3 |
58.6 |
296.8 |
||||||||||||||||
|
Operating income |
$ |
70.2 |
$ |
24.6 |
$ |
94.8 |
|||||||||||||
|
Operating ratio |
77.2 |
% |
70.4 |
% |
75.8 |
% |
|||||||||||||
| Operating expenses |
$ |
238.3 |
$ | 58.6 | $ | 296.8 | |||||||||||||
| RailAmerica integration/acquisition costs | (1.0 | ) |
- |
(1.0 | ) | ||||||||||||||
| Business development and financing costs | (1.2 | ) |
- |
(1.2 | ) | ||||||||||||||
| Net gain on sale of assets | 1.5 | (0.2 | ) | 1.3 | |||||||||||||||
|
Adjusted operating expenses |
$ |
237.6 |
$ |
58.4 |
$ |
295.9 |
|||||||||||||
| Adjusted income from operations | $ | 70.9 | $ | 24.9 | $ | 95.7 | |||||||||||||
| Adjusted operating ratio | 77.0 | % | 70.1 | % | 75.6 | % | |||||||||||||
| North | |||||||||||||||||||
| American & | |||||||||||||||||||
| European | Australian | Total | |||||||||||||||||
| Three Months Ended December 31, 2012 |
Operations |
Operations | Operations | ||||||||||||||||
|
Operating revenues |
$ |
146.4 |
$ |
80.9 |
$ |
227.3 |
|||||||||||||
|
Operating expenses |
135.8 |
57.8 |
193.7 |
||||||||||||||||
|
Operating income |
$ |
10.6 |
$ |
23.1 |
$ |
33.7 |
|||||||||||||
|
Operating ratio |
92.8 |
% |
71.5 |
% |
85.2 |
% |
|||||||||||||
|
Operating expenses |
$ |
135.8 |
$ | 57.8 | $ | 193.7 | |||||||||||||
|
RailAmerica integration/acquisition costs |
(23.5 | ) |
- |
(23.5 | ) | ||||||||||||||
| Business development and financing costs | (0.3 | ) | (0.6 | ) | (1.0 | ) | |||||||||||||
| Gain on insurance recoveries |
- |
0.6 | 0.6 | ||||||||||||||||
| Net gain on sale of assets | 0.8 |
- |
0.8 | ||||||||||||||||
| Contract termination expense in Australia |
- |
(1.1 | ) | (1.1 | ) | ||||||||||||||
| Adjusted operating expenses | $ | 112.8 | $ | 56.6 |
$ |
169.5 | |||||||||||||
|
Adjusted income from operations
|
$ |
33.6 |
$ |
24.2 |
$ |
57.8 |
|||||||||||||
|
Adjusted operating ratio |
77.1 |
% |
70.0 |
% |
74.6 |
% |
|||||||||||||
Adjusted Income Before Income Taxes and Income From Equity Investment, Adjusted Net Income and Adjusted Diluted Earnings Per Common Share
Management views income before income taxes and income from equity investment, net income and diluted EPS as important measures of G&W's operating performance. Because management believes this information is useful for investors in assessing G&W's financial results, the income before income taxes and income from equity investment, net income and diluted EPS for the year ended December 31, 2013 used to calculate adjusted income before income taxes and income from equity investment, adjusted net income and adjusted diluted EPS are presented excluding RailAmerica integration and acquisition-related costs, business development and financing costs, net gain on sale of assets, the retroactive fiscal year 2012 short line tax credit and valuation allowance on foreign tax credits and are further adjusted to exclude the 2013 short line tax credit. The income before income taxes and income from equity investment, net income and diluted EPS for the year ended December 31, 2012 used to calculate adjusted income before income taxes and income from equity investment, adjusted net income and adjusted diluted EPS are presented excluding the RailAmerica integration/acquisition costs, business development and financing costs, acquisition costs incurred by RailAmerica, gain on insurance recoveries, net gain on sale of assets, contract termination expense in Australia and the contingent forward sale contract mark-to-market expense. The adjusted income before income taxes and income from equity investment, adjusted net income and adjusted diluted EPS excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, the net income and diluted EPS calculated using amounts in accordance with GAAP. Adjusted income before income taxes and income from equity investment, adjusted net income and adjusted diluted EPS amounts may be different from similarly-titled non-GAAP financial measures used by other companies.
The following tables set forth reconciliations of income before income taxes and income from equity investment, net income and diluted EPS calculated using amounts determined in accordance with GAAP to the adjusted income before income taxes and income from equity investment, adjusted net income and adjusted diluted EPS described above (in millions, except per share amounts):
| Income | ||||||||||||||||||||||||
| Before | ||||||||||||||||||||||||
| Income | ||||||||||||||||||||||||
| Taxes & |
Diluted |
|||||||||||||||||||||||
| Income | Earnings/ | |||||||||||||||||||||||
| from | (Loss) Per | |||||||||||||||||||||||
| Equity | Common | |||||||||||||||||||||||
| Investment |
Diluted |
Share | ||||||||||||||||||||||
| Twelve Months Ended December 31, 2013 |
(Pre-Tax Income) |
Net Income | Shares | Impact | ||||||||||||||||||||
| As reported |
$ |
318.4 |
$ | 272.1 | 56.7 | $ | 4.79 | |||||||||||||||||
| Add back certain items, net of tax: | ||||||||||||||||||||||||
| RailAmerica integration/acquisition costs | 17.0 | 10.7 | 0.19 | |||||||||||||||||||||
| Business development and financing costs | 2.2 | 1.4 | 0.03 | |||||||||||||||||||||
| Net gain on sale of assets | (4.7 | ) | (3.2 | ) | (0.06 | ) | ||||||||||||||||||
| Retroactive Short Line Tax Credit for 2012 |
- |
(41.0 | ) | (0.72 | ) | |||||||||||||||||||
| Valuation allowance on FTC |
- |
2.0 | 0.03 | |||||||||||||||||||||
| As adjusted | $ | 332.9 | $ | 242.0 | 56.7 | $ | 4.26 | |||||||||||||||||
| Impact of 2013 short line tax credit |
- |
(25.9 | ) | (0.46 | ) | |||||||||||||||||||
|
As adjusted (excluding short line tax credit) |
$ |
332.9 |
$ |
216.1 |
56.7 |
$ |
3.80 |
|||||||||||||||||
|
|
|
|
||||||||||||||||||||||
| Income | ||||||||||||||||||||||||
| Before | ||||||||||||||||||||||||
| Income | ||||||||||||||||||||||||
| Taxes & | Diluted | |||||||||||||||||||||||
| Income | Earnings/ | |||||||||||||||||||||||
| from | (Loss) Per | |||||||||||||||||||||||
| Equity | Common | |||||||||||||||||||||||
| Investment | Diluted | Share | ||||||||||||||||||||||
| Twelve Months Ended December 31, 2012 |
(Pre-Tax Income) |
Net Income | Shares | Impact | ||||||||||||||||||||
| As reported | $ | 83.3 | $ | 52.4 | 51.3 | $ | 1.02 | |||||||||||||||||
| Add back certain items, net of tax: | ||||||||||||||||||||||||
| RailAmerica integration/acquisition costs | 29.5 | 21.0 | 0.41 | |||||||||||||||||||||
| Business development and financing costs | 18.1 | 11.0 | 0.21 | |||||||||||||||||||||
|
Acquisition/integration costs incurred by RailAmerica |
- |
3.5 |
0.07 |
|||||||||||||||||||||
| Gain on insurance recoveries | (0.8 | ) | (0.5 | ) | (0.01 | ) | ||||||||||||||||||
| Net gain on sale of assets | (11.2 | ) | (8.6 | ) | (0.17 | ) | ||||||||||||||||||
| Contract termination expense in Australia | 1.1 | 0.8 | 0.02 | |||||||||||||||||||||
| Contingent forward sale contract mark-to-market expense |
50.1 |
50.1 |
0.98 |
|||||||||||||||||||||
| As adjusted | $ | 170.0 | $ | 129.7 | 51.3 | $ | 2.53 | |||||||||||||||||
Free Cash Flow
Management views free cash flow as an important financial measure of how well G&W is managing its assets. Subject to the limitations discussed below, free cash flow is a useful indicator of cash flow that may be available for discretionary use by G&W. Free cash flow is defined as net cash provided by operating activities less net cash used in investing activities, excluding net cash used for acquisitions. 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. Free cash flow is not intended to represent, and should not be considered more meaningful than, or as an alternative to, net cash provided by operating activities or other measures of cash flow determined in accordance with GAAP. Free cash flow may be different from similarly-titled non-GAAP financial measures used by other companies.
The following table sets forth a reconciliation of net cash provided by operating activities to free cash flow ($ in millions):
| Twelve Months Ended | ||||||||||||
| December 31, | ||||||||||||
| 2013 | 2012 | |||||||||||
| Net cash provided by operating activities | $ | 411.9 | $ | 170.7 | ||||||||
| Net cash used in investing activities | (208.7 | ) | (2,101.7 | ) | ||||||||
| Net cash used for acquisitions | 12.9 | 1,964.2 | ||||||||||
|
Free cash flow |
$ |
216.1 |
|
$ |
33.2 |
|
||||||
