G&W profits drop despite higher revenues in 2015

The short line and regional freight railroad owner and operator Genesee & Wyoming saw net income fall 13.7 percent year-over-year in 2015 to $225 million.    Genesee & Wyoming (G&W), a short line and regional freight railroad owner and operator, posted a net income of $225 million in 2015, a 13.7 percent decline from 2014, according to the company’s most recent unaudited financial statements.
   Operating income fell 8.9 percent year-over-year in 2015 to $384.3 million, while operating revenues surged 22 percent to $2 billion.
   In the fourth quarter, G&W’s net income totaled $84.9 million, a 2.8 percent decline from the fourth quarter of 2014.
   Operating income for the quarter tumbled 16.6 percent year-over-year to $94.6 million. However, operating revenues jumped 23.9 percent from the fourth quarter of 2014 to $514.9 million.
   All three operating segments – North America, Australia and the United Kingdom/Europe – continued to face weak shipments in the majority of commodity groups, G&W President and CEO Jack Hellmann said. Hellmann attributed this to the drop in prices of global commodities, including iron ore, copper, manganese and crude oil; the rapid shift of U.S. and U.K. power generation from coal to natural gas; and the strong U.S. dollar.
   In the first quarter of 2015, G&W acquired approximately 94 percent of rail freight provider Freightliner Group for around 492 million euros (U.S. $558.1 million), plus the assumption of approximately 19 million euros of net debt and capitalized leases. Freightliner lead’s G&W’s U.K./European region.
   Looking ahead into January 2016, G&W’s carloads for its North American operations totaled 124,416 carloads, a 16.6 percent decline from January 2015, which the company primarily attributed to reduced shipments of coal and coke, minerals and stone, metals and agricultural goods.
   G&W’s Australian operation’s carloads tumbled 16.8 percent year-over-year in January to 15,095 carloads, primarily due to reduced metallic ore shipments.
   Carloads for the U.K./European operations reached 78,920 carloads in January, led by intermodal traffic in the U.K. and continental Europe; and minerals and stone traffic in Poland and the U.K.