Net profit for shortline operator Genesee & Wyoming (G&W) slipped in the third quarter amid lower revenues and rail volumes.
Third-quarter net income attributable to G&W totaled $66.8 million, or $1.16/diluted share, compared with $69.6 million, or $1.16/diluted share, in the third quarter of 2018, according to the company’s 10-Q filing to the U.S. Securities and Exchange Commission (SEC). The shortline operator no longer hosts earnings calls for investors or issues releases because Brookfield Infrastructure and other partners sought in July to acquire G&W at a transaction price of $112/share per common stock. That acquisition is expected to become final by the end of 2019 or in early 2020.
Operating revenues fell 3% to $583.7 million in the third quarter of 2019, while operating expenses slipped 1% to $470.9 million. Operating income totaled nearly $112.8 million, down 11.7% from the third quarter of 2018.
G&W North America
Third-quarter operating revenue for G&W’s North American operations was relatively flat, falling 0.9% to $352.4 million. But North American traffic fell 6.9% to 415,339 carloads in the third quarter amid volume declines for coal and coke, metals, pulp and paper, and lumber and forest products.
Operating income for G&W’s North American operations was $95.6 million, down 6.7% from the third quarter of 2018.
Operating ratio for G&W’s North American operations was 72.9% in the third quarter of 2019, compared with 71.2% for the same period in 2018.
G&W owns or leases 119 freight railroads worldwide, and it has approximately 8,000 employees and 3,000 customers. Its North American operations consists of 113 short line and regional railroads with more than 13,000 track miles across 42 states and four Canadian provinces.
The company also currently operates the 1,400-mile Tarcoola to Darwin rail line in Australia. Its U.K./European operations are led by Freightliner Group Limited, which is the U.K.’s largest rail maritime intermodal operator and its second-largest freight rail provider, according to G&W. The company also has regional rail services in continental Europe.