Type. Fourth Quarter 2008 Earnings Call. February 11, 2009

Transcription

1 Type Fourth Quarter 2008 Earnings Call February 11, 2009

2 Forward-looking Statements This presentation contains forward-looking statements regarding future events and the future performance of Genesee & Wyoming Inc. that involve risks and uncertainties that could cause actual results to differ materially, including, but not limited to, economic conditions, customer demand, increased competition in the relevant market and others. The Company refers you to the documents that it files from time to time with the Securities and Exchange Commission, such as the Company s Forms 10-Q and 10-K, which contain additional important factors that could cause its actual results to differ from its current expectations and from the forward-looking statements discussed during this presentation. Genesee & Wyoming Inc. disclaims any obligation to update the forwardlooking statements contained in this presentation. 1 1

3 2008 Injury Frequency Rate 0 Injuries Genesee & 1.3* Wyoming Inc. Class I (e.g., Burlington Northern, CSX, Norfolk Southern, Union Pacific) 1.5 FRA Group 2 (Medium railroads, e.g., DM&E, Florida East Coast, Montana Rail Link, NJ Transit) 2.8 FRA Group 3 (U.S. short line railroads) * GWI results through December; all others through November Rate per 200,000 man hours worked 2

4 Revenues $600 $ % CAGR $450.7 $516.2 $602.0 $400 $350.4 $300 $270.5 $200 $100 ($ in Millions) 3 3 $

5 Operating Income $100 $ % CAGR $96.8 $115.9 $107.8* Gains on Asset Sales $75 $69.4 $90.1* $50 $46.1 $66.2* $76.6* $25 ($ in Millions) $ Operating Ratio 83.0% 80.2% 81.9% 81.2% 80.7% Operating Ratio Ex.Gains 83.0% 81.1% 83.0% 82.5% 82.1% * Operating income for each period has been adjusted for net gains on the sale of assets. Operating income for has also been adjusted for a $1.9 million gain on insurance recovery. 4

6 Fourth Quarter Income and EPS ($ in millions) 4Q Q 2007 Income from Cont Ops $25.3 $14.5 Diluted EPS from Cont Ops $0.70 $0.40 Significant Items $10.7 $ Significant Items After-Tax Impact Retroactive impact of extension of short-line tax credit Other net tax benefits Gain on sale of assets Acquisition related expenses $6.5 $2.8 $2.7 ($1.3) Total After-Tax Impact $10.7 Diluted Shares Significant Items Acquisition Expenses Gains on sale of assets Tax benefit from change in Canadian tax law Total After-Tax Impact After-Tax Impact ($0.4) $0.5 $0.6 $

7 Fourth Quarter Revenues ($ in millions) 4Q Q 2007 Change Revenues $149.2 $134.5 $14.6 New Operations $26.3 FX (Depreciation of A$ and C$) ($7.2) Third party Fuel Sales ($3.5) Core Same Railroad ($1.0) 6 6

8 Fourth Quarter Freight Revenues ($ in millions) 4Q Q 2007 Change Same Railroad Drivers Freight Revenues $95.2 $82.1 $13.1 New Operations $19.8 Carloads - Paper - Lumber - Coal - Metals (8.8%) FX (Depreciation of A$ and C$) ($3.9) Average Revenue +5.9% per Carload (ex-fx) Core Same Railroad ($2.8) 7 7

9 Fourth Quarter Operating Income ($ in millions) 4Q Q 2007 Change Operating Income $30.4 $ % Operating Ratio 79.6% 83.3% 2008 Significant Items Pre-Tax Impact Gains on sale of assets $3.9 Acquisition-related expenses ($2.0) Significant Items $1.9 $ Significant Items Pre-Tax Impact Adj. Operating Income* $28.5 $ % Gains on sale of assets Acquisition-related expenses $0.8 ($0.7) Adj. Operating Ratio* 80.9% 83.4% *Adjusted Operating Income and Adjusted Operating Ratio are Non-GAAP measures. A Non-GAAP financial measure reconciliation is included at the end of this presentation. 8 8

10 2008 Guidance 2009 Guidance Revenue: $620 million Operating Ratio: ~80% Tax Rate: ~30% EPS: $ $2.00 Free Cash Flow: $80 million -$90 million 9 9

11 2009 Guidance - Revenues ($ in millions) E Revenues $602 $620 New Operations ~$75 FX (Depreciation of A$ and C$) ~($20) Third party Fuel Sales ~($10) Core Same Railroad ~($25) 10 10

12 2009 Capital Expenditures $ millions 2009 Track and Equipment Improvement $ New Business Development (RRF Locomotives) 7.0 Total Capital Expenditures $

13 2009 Free Cash Flow Guidance ($ in millions) 2009 Net Income $65 - $73 Plus: Depreciation & Amortization Deferred Taxes Option and Restricted Stock Amortization Operating Cash Flow $ Total Free Cash Flow Operating Cash Flow $140 - $148 Less: 2009 Capital Expenditures Plus: Delayed 2008 grants Less: Delayed 2009 grants (estimate) Working Capital (58) 8 (8) TBD 2009 Total Free Cash Flow $80 - $

14 Balance Sheet $ in millions December 31, 2008 Cash & Equivalents $ 31.7 Debt: 4.85% Senior Notes, due November % Senior Notes, due August 2015 Floating Rate Senior Notes, due August 2012 Other Long Term Debt, due October 2013 TOTAL LONG TERM DEBT Stockholders Equity TOTAL CAPITALIZATION Total Debt/Total Capitalization Net Debt/Total Capitalization $ $ $ $1, % 51.0% 13 13

15 Non-GAAP Financial Measure Reconciliation Operating Ratio Description and Discussion Management views the Operating Ratio, calculated as total Operating Expenses divided by total Revenues, as an important measure of GWI s operating performance. Because management believes this is useful for investors in assessing GWI's financial results compared to the same period in the prior year, Adjusted Operating Ratios and Adjusted Operating Income for the three months ended December 31, 2008 and 2007, are presented excluding the impact of Net Gain from the Sale of Assets and Acquisition Expenses. The Adjusted Operating Ratios and Adjusted Operating Incomes presented excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, the Operating Ratios calculated using amounts determined in accordance with GAAP.

16 Non-GAAP Financial Measure Reconciliation The following table sets forth a reconciliation of GWI's Operating Ratio and Operating Income calculated using amounts determined in accordance with GAAP to the Adjusted Operating Ratios and Adjusted Operating Incomes described above for the three months ended December 31, 2008 ($ in millions): For the Three Months Ended December 31, 2008 Total Revenues Total Operating Expenses Operating Income Operating Ratio As reported $149.2 $118.8 $ % Gain on sale of assets Acquisition-related expenses - (2.0) (2.0) Excluding above items $149.2 $120.7 $ % 15 15

17 Non-GAAP Financial Measure Reconciliation The following table sets forth a reconciliation of GWI's Operating Ratio and Operating Income calculated using amounts determined in accordance with GAAP to the Adjusted Operating Ratios described above for the three months ended December 31, 2007 ($ in millions): For the Three Months Ended December 31, 2007 Total Revenues Total Operating Expenses Operating Income Operating Ratio As reported $134.5 $112.1 $ % Gain on sale of assets Acquisition-related expenses - (0.7) (0.7) Excluding above Items $134.5 $112.2 $ % 16 16

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