G&W 2nd Quarter Revenue up 10%

Genesee & Wyoming reported that second quarter operating revenue rose 10 percent to $595 million from $540.4 million and operating income increased 3.4 percent to $103.1 million compared with the same quarter a year ago.

Diluted earnings per share fell 1.4 percent to 0.73 cents per share for the quarter compared with last year’s EPS in the same period.

Adjusted diluted EPS in the second quarter of this year rose 17.5 percent to 94 cents compared with a year ago.

G&W repurchased 1.9 million shares of its stock for $134.9 million during this year’s second quarter.

The diluted EPS of 73 cents was “generally consistent” with the second quarter of 2017, primarily because of previously announced restructuring charges related to the company’s U.K. operations, said Chairman, President and Chief Executive Officer Jack Hellmann.

He said the diluted EPS of 94 cents in the quarter 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 percent in North America with particular strength in coal, steel and minerals and stone traffic,” Hellmann said. “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.”

G&W expects growth in customer demand for rail shipments across most commodity groups — particularly in North America — to continue for the rest of the year.

“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,” Hellmann said.

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