Global Railway Industries has reported total revenue of C$16.9 million (US$16.1 million) for this year's third quarter, compared to C$15.1 million in the third quarter of 2008. Terry McManaman, chairman, president, and CEO of London, Ontario-based Global, said the lift came from passenger rail sources.
"Global's rail product and service offering to passenger rail and transit operators was the catalyst to our overall revenue growth in Q3, rising 12%," said McManaman. "Global subsidiary Bach-Simpson, whose customers are mostly commuter- and passenger-rail related, has generated a year-to-date sales increase of 59% and continues to forecast strong growth throughout the remainder of the year. Approximately 40% of Global's total revenues are generated from passenger rail and transit operators."
Continued weakness in the freight segment kept Global from posting an operating profit, though McManaman did say: "On a positive note, some of the freight railroads are starting to see some signs that several market groups are stabilizing, and if that is the case we expect a pent-up demand for our products for 2010 as rail work and maintenance programs resume to more normalized levels."
The company reported a third-quarter net loss of C$532,000 (US$507,000) compared to C$542,000 of net income in the third quarter of 2008. For the first nine months of 2009, a net loss of C$3 million (US$2.86 million) compared to C$1.3 million of net income for the same period in 2008.
"Due to the economic recession in 2008 and 2009 year-to-date, railroads continue to store about 20% of their locomotive and railcar fleets and maintain tight control over operating and capital expenditures to address reduced freight revenues and operating income," said McManaman. "The railroads' reduced spending has materially impacted Global's financial results in 2009 due to reduced locomotive and railcar maintenance and component sales being substantially lower than in prior years."
He said he expects the company will return to profitability in 2010.
"Despite lower demand for track & signal and railgear products, Global subsidiary G&B Specialties' sales and gross margins met management's expectations in the third quarter of 2009," said McManaman. "In 2009, G&B has been able to maintain the same level of sales compared to 2008, aided by new international sales, new customer penetration in local markets, and a higher average U.S. dollar."
McManaman continued, "Diminishing sales volumes in the locomotive and component markets, combined with the learning curve impact on the VIA Rail Canada ("VIA") project's margins, continue to negatively impact Global's largest subsidiary, CAD Railway Industries ("CADRI"), operating results and Global's overall financial results during the third quarter of 2009."
Fausto Levy, president of CADRI, said that "to date CADRI has delivered five remanufactured locomotives to VIA. CADRI's gross profit margins for the units in production under the C$101.5 million [US$97 million] VIA project have improved during Q3 versus Q2 and are expected to continue to improve as production line improvements are implemented. During the third quarter, we successfully negotiated a revised delivery schedule for the VIA locomotives which took into consideration prototyping and learning curve delays. Under the revised delivery schedule CADRI will deliver 8 locomotives to VIA in 2009."
Levy said CADRI "continues to experience decreased sales for locomotive maintenance and component parts. Management expects this trend to extend into early 2010 as railroads continue to store substantial numbers of locomotives and railcars."
Olin Corp. has purchased hundreds of Lat-Lon's solar tracking units, with built-in camera capability, to bolster security for its tank car fleet. Designed to provide "much more information than can be collected with traditional sensors," Lat-Lon says the pictures can show “the position of valves, hatches, brakes, condition of asset, weather, intruders, or damage," providing "increased security and safety by allowing the customer to act on a visual picture."
Clayton, Mo.-based Olin Corp. produces chlorine and caustic soda, sodium hydrosulfite, hydrochloric acid, hydrogen, potassium hydroxide, and bleach products, which are shipped by rail.
The camera captures pictures based on an event such as an impact or hatch opening, which matters to Olin executives such as Principal Software Engineer Don Loftis. “When an alarm is generated, the first thing I would like to do is go see the car. Now with the camera on Lat-Lon’s STU, that’s exactly what I can do,” Loftis says.
Images can be taken during the day as well as night. The camera has infrared capability and can capture a photo in complete darkness without intruders knowing that a picture was taken. The unit is powered by the sun and has a backup battery that provides the required power through the night. A patented Lat-Lon power system extends the life of batteries so that they do not need to be replaced as often.
The Charleston, Blue Creek & Sanderson Railway Co. (CB&SR) has asked the Surface Transportation Board for authority to lease and operate two Norfolk Southern lines totaling 30.6 miles in West Virginia. The lines run approximately from Charleston to Morris Fork and from Falling Rock to Blue Creek.
NS will retain operating rights for access to a potential future interchange with the Elk River Railroad.
CB&SR said its projected revenue would qualify it as a Class III carrier. The earliest the transaction may be consummated is Nov. 27, according to the STB.
RailAmerica, Inc. has reported third-quarter 2009 earnings from continuing operations of $3.5 million compared to $2.0 million for the third quarter of 2008. Third-quarter 2009 net income, which includes discontinued operations, was $3.5 million, compared to $2.9 million for the third quarter of 2008.
The company reported a third-quarter 2009 operating ratio of 76.7% vs. 81.5% last year.
John Giles, RailAmerica’s President and Chief Executive Officer, commented: "In the third quarter, we posted solid financia lresults generating adjusted EBITDA of $37.6 million, down 4% compared to the record third quarter of 2008 and up 7% compared to the second quarter of 2009. With the completion of the initial public offering in October, we have a strong balance sheet with approximately $130 million of cash and are well positioned to make strategic investments that will complement the opportunities we have to grow organically through freight and non-freight revenue growth and further productivity gains."
RailAmerica, Inc. operates of 40 railroads with approximately 7,500 miles of track in 27 U.S. states and three Canadian provinces.
The Association of American Railroads reported that freight rail carloadings were down 15.3% in October compared with the same month last year. But "while U.S. rail intermodal traffic remained down 11.2% in October compared with the same month last year, there continued to be incremental month-to-month gains--up 4% from September 2009," said the AAR.
The association said coal traffic was down by 92,764 carloads, a factor in October's drop that "likely was the result of a cooler-than-normal summer that has led to larger-than-normal utility coal stockpiles." However, grain was up 1% as a weaker U.S. dollar lifted grain exports. (The U.S. Department of Agriculture reported that grain deliveries by rail to ports surged in October.)
"October's intermodal numbers, along with the recently-announced increase in GDP for the third quarter, indicate that we are seeing some hope for improvement in the nation's economic situation," said AAR Senior Vice President of Policy and Economics John Gray. "While it is still too early to say we are on the road to recovery, railroads continue to take freight cars out of storage with over 11,000 cars back in service in October."
New Providence, N.J.-based Axion International Holdings, Inc. has announced that it has won a $957,000 contract from the U. S. Army for construction of two railroad bridges from nearly 100% recycled plastics.
The bridges will be built at Fort Eustis, Va., home of the Army Transportation Corps, with main structural components made entirely from recycled consumer and industrial plastics.
Axion said the new bridges will have rating capacities of 130 tons, "a new milestone in thermoplastic load bearing capacity, surpassing the current record held by Axion’s bridges at Fort Bragg, N. C., which are able to support loads over 73 tons for tracked vehicles and 88 tons for wheeled vehicles."
Austin, Tex.’s Capital Metropolitan Transportation Authority says it will begin testing its Stadler diesel multiple-unit (DMU) cars (previously categorized by the agency as diesel light rail transit, or DLRT) as early as next week. CapMetro has tested the equipment over its 32-mile rail route throughout 2009 primarily during morning hours, even as its opening date has been repeatedly delayed, but this marks the first testing during afternoons.
Trains will be running on simulated schedules comparable to what CapMetro will use when service begins sometime in 2010, with a March target the current plan.
"MetroRail will be traveling at full operating speeds, nearly twice as fast as freight trains," CapMetro said in a news release. "Additionally, train activity will increase significantly. For these reasons, motorists, cyclists, and pedestrians are encouraged to always expect a train, and to stay off the tracks."
MetroRail's route crosses about 70 streets, highways, and private drives. CapMetro has installed crossing gates at almost all crossings, including quad gates in some locations, but has had difficulties with operational timing throughout the year, contributing to the delay in commencing service.
Munich, Germany-based Knorr-Bremse Thursday said it has signed an agreement with the Chinese Ministry of Railways to equip 2,720 new cars for the Chinese CRH3 high speed train with braking and door systems. Of these, 1,280 cars will also be fitted with air-conditioning systems from Knorr-Bremse. The company valued the agreement at approximately $744 million, making it “the largest order that Knorr-Bremse has ever won,” the company said.
Knorr-Bremse’s local subsidiaries will work with Chinese joint-venture partners on the order, targeted for completion by 2012.
"This order represents an exceptional success story and provides further confirmation that Knorr-Bremse's strategic approach in China is on track," said Dr. Dieter Wilhelm, chairman of the Rail Vehicle Systems division.
The company credits its long-term presence in China, beginning in the 1970s, as one reason for its success. Knorr-Bremse has its own production facility in Suzhou, thereby meeting Chinese local-content requirements. The company also maintains a development center staffed by about 45 engineers, and has concluded a technology transfer agreement with the Locomotive and Car Research Institute at the Chinese Academy of Railway Sciences. Knorr-Bremse Rail Vehicle Systems has a workforce of roughly 1,400 employees in China.
Lake Oswego, Ore.-based Greenbrier Cos. Inc. Thursday reported that its fiscal fourth-quarter net profit fell 9.3% to $6.7 million, or 37 cents a share, from $7.4 million, or 45 cents a share, a year earlier. Earnings for the quarter included a tax benefit of 37 cents a share as well as severance costs, write-offs, and other charges of 14 cents a share.
Revenue for the quarter fell 36% to $230.4 million, but earnings per share beat analyst estimates predicting a loss of one cent a share for the quarter, based on projected revenue of $246.3 million.
The company said new railcar deliveries of 900 units were one-half of the year-ago amount, and noted it still is in negotiations with Fairfield, Conn.-based General Electric Co., which seeks to scale back or cancel deliveries under a long-term contract. Roughly 85% of the Greenbrier’s order backlog is subject to the GE order.
For the full fiscal year, the company reported a net loss of $54.1 million, or $3.21 per diluted share, vs. prior year’s net earnings of $19.5 million, or $1.19 per diluted share. Revenue of $1.0 billion was down 21% from the previous year, “reflecting the impact of the economic recession on all business segments,” the company said.
Greenbrier President and CEO William A. Furman hailed the improvement logged during the fourth quarter, saying, “Stronger performance in our Manufacturing and Leasing & Services segments and a favorable tax rate led to a sequential improvement in our quarterly operating results. Our diversification efforts continue to pay off and reduce the effects of the economic downturn.
“Yet the markets in which we operate remain challenging,” Furman said. “For example, year-to-date rail loadings in North America are down about 18%, and a significant portion of the entire North American railcar fleet remains idle. In this environment, we continue to scale our operations and control costs, manage the company for cash flow and liquidity, and prudently deploy capital. During the quarter, we paid down net debt by an additional $35 million.”
Just after noon Thursday, shares of Greenbrier were up almost 3.6% in trading on the New York Stock Exchange.
G.I. Jobs magazine has named four Class I freight railroads among the 10 “most military friendly” employers, selecting Union Pacific as No. 1 among the top employers of military personnel, followed by CSX, BNSF, and Norfolk Southern.
“The nation’s freight railroads maintain a strong commitment to the men and women who serve our country,” said Edward R. Hamberger, president and CEO of the Association of American Railroads, in a Veterans Day message. “We’re proud tha twe can provide steady, good-paying jobs to America’s veterans. It’s a win-win. Veterans are highly skilled and possess maturity, discipline, and a strong work ethic.”
Hamberger said G.I. Jobs took note of the fact that while Union Pacific slowed its overall hiring over the past year due to the weak economy, the company still developed a new military task team to spearhead its military recruiting efforts.
Onein five CSX employees has served in the military. Currently, more than 100 BNSF employees are serving on active duty and more than 1,000 have been called to active duty since Sept. 11, 2001. Norfolk Southern actively recruits potential hires with military backgrounds and in 2009, military veterans comprised 10.1% of new hires.