(Source: Genesee & Wyoming press release, July 27, 2018)
DARIEN, Conn. — Genesee & Wyoming (G&W) reported its second quarter 2018 financial results on July 27, 2018.
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)
Please see link above for full press release.