Tuesday, May 01, 2012

GWI 1Q net income rises modestly

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Genesee & Wyoming Inc. early Tuesday reported net income in the first quarter of 2012 of $22.2 million, up from $22.1 million in the first quarter of 2011. GWI's diluted earnings per share of 52 cents held steady in the quarter measured against the same period a year ago, though the company sported roughly 600,000 more weighted average shares outstanding in the latest report.

The company's operating ratio for North American and European operations improved 1.3 percentage points to 78.3% during the quarter, GWI noted, despite a falloff in coal traffic.

GWI CEO and President Jack Hellmann commented, "Our financial results for the first quarter of 2012 were consistent with our expectations. While revenues increased 8% to $207 million, our net income was unchanged for three main reasons: the expiration of the U.S. short line tax credit; weak coal shipments in the United States; and a 60-day outage on a portion of our main line in Australia due to the washout of our Edith River Bridge. For our North American & European Operations, despite a 20% drop in coal revenues, our first quarter revenues still increased 9% and our operating income increased 16%."

"As we look ahead to the remainder of 2012, we expect improving business trends," Hellman said. "In North America, our non-coal traffic continues to grow and our newly acquired Arizona Eastern Railway and Hilton & Albany Railroad are performing well. Although our U.S. coal traffic is weak, primarily due to warm winter weather and low natural gas prices, we expect some improvement in the second quarter as shipments resume at two power plants."