10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

________________________________________________________________________________________________________________

FORM 10-Q

_________________________________________________________________________________________________________________

(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number 001-31456

_________________________________________________________________________________________________________________

GENESEE & WYOMING INC.

(Exact name of registrant as specified in its charter)

_________________________________________________________________________________________________________________

Delaware		06-0984624
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

20 West Avenue, Darien, Connecticut 06820

(Address of principal executive offices)(Zip Code)

(203) 202-8900

(Registrant's telephone number, including area code)

_____________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Class A Common Stock	GWR	New York Stock Exchange	(NYSE)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    ☒  Yes    ☐  No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    ☒  Yes    ☐  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    

☐  Yes    ☒  No

Shares of common stock outstanding as of the close of business on October 31, 2019:

Class	Number of Shares Outstanding
Class A Common Stock	57,037,678
Class B Common Stock	2,072

INDEX
		Page
	Forward-Looking Statements	3
Part I	Financial Information	4
Item 1.	Financial Statements:
	Consolidated Balance Sheets (Unaudited) - As of September 30, 2019 and December 31, 2018	4
	Consolidated Statements of Operations (Unaudited) - For the Three and Nine Months Ended September 30, 2019 and 2018	5
	Consolidated Statements of Comprehensive Income (Unaudited) - For the Three and Nine Months Ended September 30, 2019 and 2018	6
	Consolidated Statements of Changes in Equity (Unaudited) - For the Three and Nine Months Ended September 30, 2019 and 2018	7
	Consolidated Statements of Cash Flows (Unaudited) - For the Nine Months Ended September 30, 2019 and 2018	9
	Notes to Consolidated Financial Statements (Unaudited)	10
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	66
Item 4.	Controls and Procedures	66
Part II	Other Information	67
Item 1.	Legal Proceedings	67
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	69
Item 3.	Defaults Upon Senior Securities	69
Item 4.	Mine Safety Disclosures	69
Item 5.	Other Information	69
Item 6.	Exhibits	69
Index to Exhibits		70
Signatures		71

2

Unless the context otherwise requires, when used in this Quarterly Report on Form 10-Q, the terms "Genesee & Wyoming," "G&W," the "Company," "we," "our" and "us" refer to Genesee & Wyoming Inc. and its subsidiaries. All references to currency amounts included in this Quarterly Report on Form 10-Q, including the financial statements, are in United States dollars unless specifically noted otherwise. The term carload represents physical railcars and the estimated railcar equivalents of commodities transported by metric ton or other measure, as well as intermodal units.

From time to time, we may use our website as a channel of distribution of material company information. Financial and other material information regarding the Company is routinely posted on and accessible at www.gwrr.com/investors. In addition, you may automatically receive email alerts and other information about us by enrolling your email address in the "Email Alerts" section of www.gwrr.com/investors. The information contained on or connected to our Internet website is not deemed to be incorporated by reference in this Quarterly Report or filed with the Securities and Exchange Commission.    

Forward-Looking Statements

This report and other documents referred to in this report contain forward-looking statements regarding future events and the future performance of Genesee & Wyoming Inc. that are based on current expectations, estimates and projections about our industry, our business and our performance, management's beliefs and assumptions made by management. Words such as "anticipates," "intends," "plans," "believes," "could," "should," "seeks," "expects," "will," "estimates," "trends," "outlook," variations of these words and similar expressions are intended to identify these forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to forecast, including the following: the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement with affiliates of Brookfield Infrastructure and GIC; the inability to complete the proposed merger due to the failure to satisfy other conditions to completion of the proposed merger, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the transaction; risks related to disruption of management’s attention from G&W's ongoing business operations due to the transaction; the effect of the proposed merger on G&W's ability to retain and hire key personnel or maintain relationships with its customers, operating results and business generally; the risk that the proposed merger will not be consummated in a timely manner; exceeding the expected costs of the merger; risks related to the operation of our railroads; severe weather conditions and other natural occurrences, which could result in shutdowns, derailments, railroad network and port congestion or other substantial disruption of operations; customer demand and changes in our operations or loss of important customers; exposure to the credit risk of customers and counterparties; changes in commodity prices; consummation and integration of acquisitions; implementation of restructuring plans; economic, political and industry conditions, including employee strikes or work stoppages; retention and contract continuation; our ability to attract and retain skilled workers; legislative and regulatory developments, including changes in environmental and other laws and regulations to which we or our customers are subject; increased competition in relevant markets; funding needs and financing sources, including our ability to obtain government funding for capital projects; international complexities of operations, currency fluctuations, finance, tax and decentralized management; challenges of managing rapid growth, including retention and development of senior leadership; unpredictability of fuel costs; susceptibility to and outcome of various legal claims, lawsuits and arbitrations; increase in, or volatility associated with, expenses related to estimated claims, self-insured retention amounts and insurance coverage, collectability and limits; consummation of new business opportunities; decrease in revenues and/or increase in costs and expenses; susceptibility to the risks of doing business in foreign countries; uncertainties arising from a referendum in which voters in the United Kingdom (U.K.) approved an exit from the European Union (E.U.), commonly referred to as Brexit; our ability to integrate acquired businesses successfully or to realize the expected synergies associated with acquisitions; risks associated with our substantial indebtedness; failure to maintain satisfactory working relationships with partners in Australia; failure to maintain an effective system of internal control over financial reporting as well as disclosure controls and procedures and other risks including, but not limited to, those set forth in Part II Item 1A of this Quarterly Report on Form 10-Q, if any, and those noted in our 2018 Annual Report on Form 10-K under "Risk Factors." Therefore, actual results may differ materially from those expressed or forecasted in any such forward-looking statements. Forward-looking statements speak only as of the date of this report or as of the date they were made. We do not undertake, and expressly disclaim, any duty to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

3

PART I - FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS.

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2019 and DECEMBER 31, 2018 (Unaudited)

(dollars in thousands, except per share and share amounts)

	September 30, 2019			December 31, 2018
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	86,912		$	90,387
Accounts receivable, net	437,062			426,305
Materials and supplies	58,476			56,716
Prepaid expenses and other	36,275			54,185
Total current assets	618,725			627,593
PROPERTY AND EQUIPMENT, net	4,664,837			4,613,014
GOODWILL	1,096,095			1,115,849
INTANGIBLE ASSETS, net	1,362,963			1,430,197
DEFERRED INCOME TAX ASSETS, net	5,102			4,616
OTHER ASSETS	536,657			77,192
Total assets	$	8,284,379		$	7,868,461
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt	$	38,951		$	28,303
Accounts payable	278,418			288,070
Accrued expenses	245,874			165,280
Total current liabilities	563,243			481,653
LONG-TERM DEBT, less current portion	2,176,563			2,425,235
DEFERRED INCOME TAX LIABILITIES, net	884,402			877,721
DEFERRED ITEMS - grants from outside parties	344,813			326,520
OTHER LONG-TERM LIABILITIES	608,101			127,280
COMMITMENTS AND CONTINGENCIES
EQUITY:
Class A Common Stock, $0.01 par value, one vote per share; 180,000,000 shares authorized at September 30, 2019 and December 31, 2018; 75,696,850 and 75,240,513 shares issued and 56,663,012 and 56,349,327 shares outstanding (net of 19,033,838 and 18,891,186 shares in treasury) on September 30, 2019 and December 31, 2018, respectively	757			752
Class B Common Stock, $0.01 par value, ten votes per share; 30,000,000 shares authorized at September 30, 2019 and December 31, 2018; 376,392 and 517,138 shares issued and outstanding on September 30, 2019 and December 31, 2018, respectively	4			5
Additional paid-in capital	1,812,085			1,785,005
Retained earnings	2,638,043			2,482,252
Accumulated other comprehensive loss	(230,108		)	(146,456		)
Treasury stock, at cost	(711,922		)	(699,852		)
Total Genesee & Wyoming Inc. stockholders' equity	3,508,859			3,421,706
Noncontrolling interest	198,398			208,346
Total equity	3,707,257			3,630,052
Total liabilities and equity	$	8,284,379		$	7,868,461

The accompanying notes are an integral part of these consolidated financial statements.

4

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 and 2018 (Unaudited)

(in thousands, except per share amounts)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
OPERATING REVENUES	$	583,694		$	603,304		$	1,713,263		$	1,772,955
OPERATING EXPENSES:
Labor and benefits	175,500			175,853			539,751			539,407
Equipment rents	30,926			35,325			95,169			104,214
Purchased services	51,055			53,717			156,337			178,864
Depreciation and amortization	63,026			65,392			188,169			197,127
Diesel fuel used in train operations	41,533			45,713			127,674			137,487
Electricity used in train operations	1,794			2,742			6,344			7,020
Casualties and insurance	11,658			9,912			34,869			32,862
Materials	32,435			32,744			94,949			97,589
Trackage rights	21,266			22,838			64,633			67,119
Net gain on sale and impairment of assets	(641		)	(642		)	(1,151		)	(2,501		)
Restructuring and related costs	3,561			3,286			18,756			12,931
Other expenses, net	38,825			28,604			101,097			82,978
Total operating expenses	470,938			475,484			1,426,597			1,455,097
OPERATING INCOME	112,756			127,820			286,666			317,858
Interest income	1,244			417			2,615			1,499
Interest expense	(25,386		)	(26,429		)	(80,395		)	(80,605		)
Other income/(loss), net	1,132			1,515			4,165			(237		)
Income before income taxes	89,746			103,323			213,051			238,515
Provision for income taxes	(19,975		)	(31,013		)	(53,101		)	(41,569		)
Net income	$	69,771		$	72,310		$	159,950		$	196,946
Less: Net income attributable to noncontrolling interest	2,979			2,720			3,011			8,090
Net income attributable to Genesee & Wyoming Inc.	$	66,792		$	69,590		$	156,939		$	188,856
Basic earnings per common share attributable to Genesee & Wyoming Inc. common stockholders:	$	1.18		$	1.18		$	2.78		$	3.13
Weighted average shares – Basic	56,638			59,168			56,497			60,343
Diluted earnings per common share attributable to Genesee & Wyoming Inc. common stockholders:	$	1.16		$	1.16		$	2.74		$	3.08
Weighted average shares – Diluted	57,532			60,131			57,297			61,255

The accompanying notes are an integral part of these consolidated financial statements.

5

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 and 2018 (Unaudited)

(dollars in thousands)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
NET INCOME	$	69,771		$	72,310		$	159,950		$	196,946
OTHER COMPREHENSIVE INCOME/(LOSS):
Foreign currency translation adjustment, net of tax provision of ($2,068), $0, ($1,885) and $0, respectively	(36,647		)	(9,501		)	(32,641		)	(59,042		)
Net unrealized (loss)/gain on qualifying hedges, net of tax benefit/(provision) of $8,720, ($1,583), $19,430 and ($4,612), respectively	(27,462		)	5,153			(61,139		)	14,756
Changes in pension and other postretirement benefits, net of tax (provision)/benefit of ($8), ($14), $74 and ($42), respectively	60			43			(94		)	129
Other comprehensive loss	(64,049		)	(4,305		)	(93,874		)	(44,157		)
COMPREHENSIVE INCOME	$	5,722		$	68,005		$	66,076		$	152,789
Less: Comprehensive loss attributable to noncontrolling interest	(4,759		)	(2,179		)	(7,211		)	(9,495		)
COMPREHENSIVE INCOME ATTRIBUTABLE TO GENESEE & WYOMING INC.	$	10,481		$	70,184		$	73,287		$	162,284

The accompanying notes are an integral part of these consolidated financial statements.

6

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 and 2018 (Unaudited)

(dollars in thousands)

	G&W Stockholders
	Class A Common Stock		Class B Common Stock			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive (Loss)/Income			Treasury Stock			Non-controlling Interest			Total Equity
BALANCE, December 31, 2018	$	752	$	5		$	1,785,005		$	2,482,252		$	(146,456	)	$	(699,852	)	$	208,346		3,630,052
Net income	—		—			—			38,706			—			—			100			38,806
Other comprehensive (loss)/income	—		—			—			—			(6,989		)	—			818			(6,171		)
Conversion of 100,000 shares Class B Common Stock to Class A Common Stock	1		(1		)	—			—			—			—			—			—
Value of stock issued for stock-based compensation - 164,732 shares Class A Common Stock	2		—			2,069			—			—			—			—			2,071
Compensation cost related to stock-based compensation	—		—			3,884			—			—			—			—			3,884
Value of treasury stock repurchased - 111,289 shares	—		—			—			—			—			(8,630		)	—			(8,630		)
Other	—		—			(832		)	(1,104		)	—			—			(796		)	(2,732		)
BALANCE, March 31, 2019	$	755	$	4		$	1,790,126		$	2,519,854		$	(153,445	)	$	(708,482	)	$	208,468		$	3,657,280
Net income/(loss)	—		—			—			51,441			—			—			(68		)	51,373
Other comprehensive loss	—		—			—			—			(20,352		)	—			(3,302		)	(23,654		)
Conversion of 40,746 shares Class B Common Stock to Class A Common Stock	—		—			—			—			—			—			—			—
Value of stock issued for stock-based compensation - 38,512 shares Class A Common Stock	1		—			2,095			—			—			—			—			2,096
Compensation cost related to stock-based compensation	—		—			4,227			—			—			—			—			4,227
Other (including treasury stock repurchased - 107 shares)	—		—			1,346			(44		)	—			—			(1,722		)	(420		)
BALANCE, June 30, 2019	$	756	$	4		$	1,797,794		$	2,571,251		$	(173,797	)	$	(708,482	)	$	203,376		$	3,690,902
Net income	—		—			—			66,792			—			—			2,979			69,771
Other comprehensive loss	—		—			—			—			(56,311		)	—			(7,738		)	(64,049		)
Value of stock issued for stock-based compensation - 112,347 shares Class A Common Stock	1		—			10,227			—			—			—			—			10,228
Compensation cost related to stock-based compensation	—		—			4,277			—			—			—			—			4,277
Value of treasury stock acquisitions from equity awards - 31,256 shares	—		—			—			—			—			(3,440		)	—			(3,440		)
Other	—		—			(213		)	—			—			—			(219		)	(432		)
BALANCE, September 30, 2019	$	757	$	4		$	1,812,085		$	2,638,043		$	(230,108	)	$	(711,922	)	$	198,398		$	3,707,257

The accompanying notes are an integral part of these consolidated financial statements.

7

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 and 2018 (Unaudited)

(dollars in thousands) (continued)

	G&W Stockholders															Non-controlling Interest			Total Equity
	Class A Common Stock		Class B Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss)/Income			Treasury Stock
BALANCE, December 31, 2017	$	748	$	7		$	1,757,332	$	2,234,864	$	(105,534	)	$	(236,951	)	$	245,626		$	3,896,092
Net income	—		—			—		75,098		—			—			927			76,025
Other comprehensive income/(loss)	—		—			—		—		10,345			—			(4,018		)	6,327
Value of stock issued for stock-based compensation - 115,897 shares Class A Common Stock	1		—			1,049		—		—			—			—			1,050
Compensation cost related to stock-based compensation	—		—			4,056		—		—			—			—			4,056
Value of treasury stock repurchased - 832,232 shares	—		—			—		—		—			(60,175		)	—			(60,175		)
Amounts reclassified from accumulated other comprehensive loss to retained earnings related to the United States Tax Cuts and Jobs Act	—		—			—		2,970		(2,970		)	—			—			—
Other	—		—			—		—		—			—			1			1
BALANCE, March 31, 2018	$	749	$	7		$	1,762,437	$	2,312,932	$	(98,159	)	$	(297,126	)	$	242,536		$	3,923,376
Net income	—		—			—		44,168		—			—			4,443			48,611
Other comprehensive loss	—		—			—		—		(37,511		)	—			(8,668		)	(46,179		)
Conversion of 30,000 shares Class B Common Stock to Class A Common Stock	—		—			—		—		—			—			—			—
Value of stock issued for stock-based compensation - 42,102 shares Class A Common Stock	1		—			1,856		—		—			—			—			1,857
Compensation cost related to stock-based compensation	—		—			4,515		—		—			—			—			4,515
Value of treasury stock repurchased - 1,873,170 shares	—		—			—		—		—			(134,952		)	—			(134,952		)
Distribution to noncontrolling interest	—		—			—		—		—			—			(14,898		)	(14,898		)
Other	—		—			—		—		—			—			48			48
BALANCE, June 30, 2018	$	750	$	7		$	1,768,808	$	2,357,100	$	(135,670	)	$	(432,078	)	$	223,461		$	3,782,378
Net income	—		—			—		69,590		—			—			2,720			72,310
Other comprehensive income/(loss)	—		—			—		—		594			—			(4,899		)	(4,305		)
Conversion of 130,000 shares Class B Common Stock to Class A Common Stock	2		(2		)	—		—		—			—			—			—
Value of stock issued for stock-based compensation - 72,925 shares Class A Common Stock	—		—			5,902		—		—			—			—			5,902
Compensation cost related to stock-based compensation	—		—			4,458		—		—			—			—			4,458
Value of treasury stock acquisitions from equity awards - 893,705 shares	—		—			—		—		—			(78,167		)	—			(78,167		)
Other	—		—			—		—		—			—			(6		)	(6		)
BALANCE, September 30, 2018	$	752	$	5		$	1,779,168	$	2,426,690	$	(135,076	)	$	(510,245	)	$	221,276		$	3,782,570

The accompanying notes are an integral part of these consolidated financial statements.

8

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019 and 2018 (Unaudited)

(dollars in thousands)

	Nine Months Ended
	September 30,
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	159,950		$	196,946
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	188,169			197,127
Stock-based compensation	12,371			13,029
Deferred income taxes	34,468			7,978
Gain on insurance recoveries	(2,500		)	—
Net gain on sale and impairment of assets	(1,151		)	(2,501		)
Changes in assets and liabilities which provided/(used) cash:
Accounts receivable, net	2,594			(50,143		)
Materials and supplies	(3,550		)	3,133
Prepaid expenses and other	(4,519		)	(11,663		)
Accounts payable and accrued expenses	(7,065		)	33,818
Other assets and liabilities, net	5,434			9,750
Net cash provided by operating activities	384,201			397,474
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(227,266		)	(194,132		)
Grant proceeds from outside parties	22,987			16,696
Proceeds from settlement of derivative transactions	45,360			—
Proceeds from sale of business	—			7,927
Insurance proceeds for replacement of assets	4,297			2,780
Proceeds from disposition of property and equipment	5,200			3,710
Contributions to joint ventures	(2,965		)	(2,921		)
Net cash used in investing activities	(152,387		)	(165,940		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on revolving line-of-credit, long-term debt and finance lease obligations	(426,276		)	(799,726		)
Proceeds from revolving line-of-credit and long-term debt	195,335			854,679
Debt amendment/issuance costs	—			(5,318		)
Purchase of additional shares in Freightliner Australia	(4,696		)	—
Common share repurchases	(4,796		)	(270,488		)
Distribution to noncontrolling interest	—			(14,898		)
Installment payments on Freightliner deferred consideration	(2,522		)	(6,255		)
Other financing related activities, net	6,534			5,006
Net cash used in financing activities	(236,421		)	(237,000		)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	1,132			(939		)
DECREASE IN CASH AND CASH EQUIVALENTS	(3,475		)	(6,405		)
CASH AND CASH EQUIVALENTS, beginning of period	90,387			80,472
CASH AND CASH EQUIVALENTS, end of period	$	86,912		$	74,067

The accompanying notes are an integral part of these consolidated financial statements.

9

Table of Contents             GENESEE & WYOMING INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1. PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION:

The interim consolidated financial statements presented herein include the accounts of Genesee & Wyoming Inc. and its subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. These interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and are unaudited. They do not contain all disclosures which would be required in a full set of financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). In the opinion of management, the unaudited financial statements for the three and nine months ended September 30, 2019 and 2018 are presented on a basis consistent with the audited financial statements and contain all adjustments, consisting only of normal recurring adjustments, necessary to provide a fair statement of the results for the interim periods presented. The results of operations for interim periods are not necessarily indicative of results of operations for the full year. The consolidated balance sheet data for 2018 was derived from the audited financial statements in the Company's 2018 Annual Report on Form 10-K, but does not include all disclosures required by U.S. GAAP.

The results of operations of the foreign entities are maintained in the local currency of the respective subsidiary and translated into United States dollars at the applicable exchange rates for inclusion in the consolidated financial statements. As a result, any appreciation or depreciation of these currencies against the United States dollar will impact the Company's results of operations.

The interim consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2018 included in the Company's 2018 Annual Report on Form 10-K.

During the process of preparing the Form 10-K for the year ended December 31, 2018, the Company determined that there was an error in and revised its statement of cash flows for the nine months ended September 30, 2018, which resulted in the following offsetting adjustments: an increase of $33.0 million in principal payments on revolving line-of-credit, long-term debt and capital lease obligations, representing cash outflows from financing activities, and an increase of $33.0 million in proceeds from revolving line-of-credit and long-term debt, representing cash inflows from financing activities. There was no effect on any other section of the Company's statement of cash flows, and this revision had no impact on the Company's consolidated balance sheet as of December 31, 2018 or the Company's consolidated statements of operations or comprehensive income for the three and nine months ended September 30, 2018. The Company does not consider this revision material to any previously issued consolidated financial statements.

When comparing the Company's results of operations from one reporting period to another, it is important to consider that the Company has historically experienced fluctuations in revenues and expenses due to acquisitions and divestitures, changing economic conditions, fluctuations in commodity prices, competitive forces, changes in foreign currency exchange rates, rail network issues and congestion, the ability to attract and retain skilled workers, one-time freight moves, fuel price fluctuations, customer plant expansions and shutdowns, sales of property and equipment, derailments and weather-related conditions, such as hurricanes, cyclones, tornadoes, high winds, droughts, heavy snowfall, unseasonably hot or cold weather, freezing and flooding, among other factors. In periods when these events occur, the Company's results of operations are not easily comparable from one period to another. Finally, certain of the Company's railroads have commodity shipments that are sensitive to general economic conditions, global commodity prices and foreign exchange rates, such as steel products, iron ore, paper products, lumber and forest products and agricultural products, as well as product specific market conditions, such as the availability of lower priced alternative sources of power generation (coal) and energy commodity price differentials (crude oil and natural gas liquids) or congestion at ports (intermodal). Other shipments are relatively less affected by economic conditions and are more closely affected by other factors, such as winter weather (salt) and seasonal rainfall (agricultural products). As a result of these and other factors, the Company's results of operations in any reporting period may not be directly comparable to the Company's results of operations in other reporting periods.

2. CHANGES IN OPERATIONS:

Proposed Merger

On July 1, 2019, the Company, together with Brookfield Infrastructure, GIC and Brookfield Infrastructure's institutional partners, announced an agreement pursuant to which affiliates of Brookfield Infrastructure and GIC will acquire G&W for a transaction price of $112.00 per share of common stock valued at approximately $8.4 billion including debt (the Merger). The proposed Merger was approved by the Company stockholders on October 3, 2019 by an affirmative vote of the holders of approximately 82.9% of the voting power of the outstanding shares of G&W's common stock on the record date. Subject to the satisfaction of the other closing conditions, the Merger is expected to close by year end 2019 or early 2020.

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The Merger will be effected pursuant to the Agreement and Plan of Merger (the Merger Agreement), by and among the Company, DJP XX, LLC, a Delaware limited liability company (Parent), and MKM XXII Corp., a Delaware corporation and a wholly owned subsidiary of Parent (Merger Sub). Merger Sub will be merged with and into G&W with G&W surviving the Merger as a wholly-owned subsidiary of Parent. The proposed Merger will result in G&W becoming a privately held company.

Completion of the proposed Merger is subject to various closing conditions, including, among others, (i) the absence of any law, injunction or other order that prohibits the consummation of the Merger, (ii) the approval or authorization of, or exemption by, the Surface Transportation Board (or approval of the use of a voting trust structure), which exemption was granted on October 29, 2019, (iii) receipt of other antitrust and regulatory approvals, including approval of the Committee on Foreign Investment in the United States, and (iv) other customary closing conditions, including the accuracy of each party’s representations and warranties and each party’s compliance with its covenants and agreements contained in the Merger Agreement (subject in the case of this clause (iv) to certain materiality qualifiers).

Australian Operations

Divestiture of 51.1% Interest in G&W Australia Holdings LP (GWAHLP): Under the Merger Agreement (as described in more detail above), the Company agreed to use reasonable best efforts to assist and cooperate with Parent in Parent’s efforts to consummate any planned divestiture by Parent of G&W's interests in GWAHLP, the holding company for all of the Company's Australian businesses, to a third party (the GWA Divestiture), provided that (i) such cooperation would not unreasonably interfere with the Company's business or operations and (ii) the Company would not be required to take any action that would subject it to actual or potential liability, to bear any cost or expense or to pay any fee or make any other payment or agree to provide any indemnity in connection with the GWA Divestiture prior to the effective time of the Merger. Following the execution of the Merger Agreement, Parent requested that G&W cause certain of its subsidiaries to enter into a Definitive Interest Sale Agreement for the GWA Divestiture (the GWA Divestiture Agreement), and on August 4, 2019, G&W's board of directors and the governing bodies of such subsidiaries approved the GWA Divestiture Agreement and such subsidiaries entered into the GWA Divestiture Agreement.

Under the GWA Divestiture Agreement, certain entities affiliated with MIRA that currently own 48.9% of GWAHLP will acquire, directly or indirectly, the remaining interests in GWAHLP from certain subsidiaries of G&W in exchange for A$627.4 million, subject to adjustment. The GWA Divestiture is subject to customary closing conditions, including the satisfaction of the closing conditions set forth in the Merger Agreement. Neither the Company nor any of its subsidiaries will have any liability under the GWA Divestiture Agreement prior to the consummation of the Merger. The GWA Divestiture Agreement may be terminated under certain circumstances, including by any party thereto if the transactions contemplated by the GWA Divestiture Agreement have not been consummated on or before July 1, 2020.

The consideration to be received by the subsidiaries of the Company that are parties to the GWA Divestiture Agreement will not be distributed to any of the Company’s stockholders prior to consummation of the Merger, and the sole consideration that the Company's stockholders will receive in the Merger is $112.00 in cash per share of G&W common stock on the terms and conditions set forth in the Merger Agreement.

The consummation of the GWA Divestiture is not a condition to the closing of the Merger or any of Parent’s other obligations under the Merger Agreement.

North American Operations

Canada Lease Expirations: Two of the Company's short line railroad leases in Canada (Goderich-Exeter Railway (GEXR) and Southern Ontario Railway (SORR)) expired at the end of 2018. The Company's results for the three and nine months ended September 30, 2018 included $5.1 million and $16.1 million, respectively, of revenues and operating losses of $0.9 million and $1.3 million, respectively, from these leased railroads.

U.K./European Operations

U.K. Operations Optimization: In May 2018, the Company began a program to restructure and further optimize its operations in the U.K., which it intends to complete by 2020. The program includes the rationalization of the locomotive and railcar fleet, management restructuring (following the U.K. consultative process) and technology investments to upgrade systems to enhance productivity and service quality.

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Restructuring and related costs associated with the optimization are expected to be approximately $43 million (at an exchange rate of $1.28 for one British pound) and are comprised of the following (dollars in thousands):

	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019		Total Costs Incurred Through September 30, 2019		Estimated Total Restructuring and Related Costs
Rationalization of locomotive and railcar fleet	$	—	$	—	$	6,301	$	11,000
Management restructuring(a)	1,240		10,381		15,021		17,000
Productivity and automation investments	1,998		5,136		9,179		15,000
Total	$	3,238	$	15,517	$	30,501	$	43,000

(a) Subject to requisite U.K. consultative process.

Changes in restructuring and related liabilities for the U.K. Operations Optimization program for the nine months ended September 30, 2019 was as follows (dollars in thousands):

	Rationalization of Locomotive and Railcar Fleet			Management Restructuring			Productivity and Automation Investments			Total
Restructuring and related liabilities as of December 31, 2018	$	4,094		$	982		$	—		$	5,076
Restructuring and related costs incurred	—			10,381			5,136			15,517
Cash payments	(1,394		)	(8,079		)	(5,136		)	(14,609		)
Non-cash settlements	—			—			—			—
Restructuring and related liabilities as of September 30, 2019	$	2,700		$	3,284		$	—		$	5,984

Continental Europe Intermodal Business: On June 5, 2018, the Company sold its Continental Europe intermodal business, ERS Railways B.V. (ERS), for gross cash proceeds of €11.2 million (or $13.1 million at the exchange rate on June 5, 2018) or €6.8 million (or $7.9 million at the exchange rate on June 5, 2018) net of €4.4 million (or $5.2 million at the exchange rate on June 5, 2018) of cash on hand that transferred to the buyer. The Company's results for the nine months ended September 30, 2018 included $24.1 million of revenues and $1.6 million of operating income from ERS.

3. EARNINGS PER COMMON SHARE:

The following table sets forth the computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Numerators:
Net income attributable to Genesee & Wyoming Inc.	$	66,792	$	69,590	$	156,939	$	188,856
Denominators:
Weighted average Class A common shares outstanding – Basic	56,638		59,168		56,497		60,343
Weighted average Class B common shares outstanding	376		664		426		679
Dilutive effect of employee stock-based awards	518		299		374		233
Weighted average shares – Diluted	57,532		60,131		57,297		61,255
Earnings per common share attributable to Genesee & Wyoming Inc. common stockholders:
Basic earnings per common share	$	1.18	$	1.18	$	2.78	$	3.13
Diluted earnings per common share	$	1.16	$	1.16	$	2.74	$	3.08

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The following total number of shares of Class A Common Stock issuable under the assumed exercise of stock-based awards computed based on the treasury stock method were excluded from the calculation of diluted earnings per common share, as the effect of including these shares would have been antidilutive (in thousands):

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2019	2018	2019	2018
Antidilutive shares	—	704	249	1,045

Share Repurchase

In October 2018, the Company completed its $300 million share repurchase program that had been approved in 2015, and the Company's Board of Directors authorized a new $500 million share repurchase program of Class A Common Stock, subject to certain limitations under the Company's credit facility. The table below presents information regarding shares repurchased by the Company under the share repurchase programs during the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Class A Common Stock repurchased	—		894		65		3,560
Average price paid per share of Class A Common Stock repurchased	$	—	$	87.46	$	73.94	$	75.99

Repurchased shares are recorded in treasury stock, at cost, which includes any applicable commissions and fees. As of September 30, 2019, the remaining amount authorized for repurchase under the $500 million share repurchase program was $335.0 million. In light of the Company's entry into the Merger Agreement with affiliates of Brookfield Infrastructure and GIC, future share repurchases under the repurchase program have been suspended. See Note 2, Changes in Operations, for additional information regarding the Merger Agreement.

4. ACCOUNTS RECEIVABLE:

Accounts receivable consisted of the following as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019			December 31, 2018
Accounts receivable – trade	$	395,512		$	397,255
Accounts receivable – grants from outside parties	24,677			19,376
Accounts receivable – insurance and other third-party claims	29,386			19,729
Total accounts receivable	449,575			436,360
Less: Allowance for doubtful accounts	(12,513		)	(10,055		)
Accounts receivable, net	$	437,062		$	426,305

The timing of revenue recognition, billings and cash collections result in trade accounts receivable, contract assets and contract liabilities. The Company’s contract assets and liabilities are typically short-term in nature, with terms settled within a 12-month period. The Company had no material contract assets or contract liabilities recorded on the consolidated balance sheet as of September 30, 2019 or December 31, 2018.

Grants from Outside Parties

The Company periodically receives grants for the upgrade and construction of rail lines and the upgrade of locomotives from federal, provincial, state and local agencies in the United States and provinces in Canada in which the Company operates.

These grants typically reimburse the Company for 50% to 100% of the actual cost of specific projects. In total, the Company received grant proceeds of $23.0 million and $16.7 million for the nine months ended September 30, 2019 and 2018, respectively, from such grant programs. The proceeds were presented as cash inflows from investing activities within the statement of cash flows for each of the applicable periods. The Company records additions to property and equipment for its grant-funded projects and defers the amount of the grants. The amortization of deferred grants is a non-cash offset to depreciation expense over the useful lives of the related assets.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The following table sets forth the offset to depreciation expense from the amortization of deferred grants recorded by the Company during the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Amortization of deferred grants	$	3,442	$	3,173	$	10,265	$	8,776

Insurance and Third-Party Claims

The increase in the balance of the accounts receivable from insurance and other third-party claims for the nine months ended September 30, 2019 was primarily related to the anticipated insurance recovery associated with a personal injury that occurred in the U.K. in 2019. The receivable and the associated claim liability were recorded on the balance sheet as of September 30, 2019.

The Company completed its annual property insurance renewal during the third quarter of 2019, which became effective on August 1, 2019. Effective with this renewal, the Company's property policies have various self-insured retentions, which vary based on the type and location of the incident, up to $10.0 million. The Company recently completed its annual liability insurance renewal, which became effective on November 1, 2019. Effective with this renewal, the Company's liability policies have various self-insured retentions up to $5.0 million.

5. LEASES:

On January 1, 2019, the Company adopted Accounting Standards Update (ASU) 2016-02, Leases (the New Standard), and all related amendments, which supersedes the previous lease guidance, using the transition method with the election not to adjust comparative periods. The New Standard requires lessees to recognize leases on their balance sheet as a right-of-use (ROU) asset with a corresponding lease liability. The adoption resulted in the recognition of ROU assets included in other assets and lease liabilities included in accrued expenses and other long-term liabilities of approximately $495 million in the Company's consolidated balance sheet, each as a result of the new requirement to recognize operating leases. No material cumulative-effect adjustment was recognized in retained earnings, and the adoption did not materially impact operating results, liquidity or the Company's debt-covenant compliance under these agreements. The Company continues to recognize its capital leases on the balance sheet but these leases are now referred to as "finance" leases, as required by the New Standard.

The Company enters into leases for railcars, locomotives and other equipment as well as real property. These leases may contain variable payments that vary with rate or index changes or include payment of a per car fee or per mile fee to use the track under variable lease contracts. The Company may receive rent holidays and other incentives provided by the lessor on lease agreements. On occasion, the Company subleases assets to other parties.

As of January 1, 2019, the Company adopted a number of practical expedients and exemptions included in the New Standard, which were intended to reduce the cost and complexity of complying with the transition requirements. The Company chose the following practical expedients and exemptions in setting its accounting policy elections for transition to:

1. Not recognize an asset and liability for leases of all asset classes with a term of 12 months or less;

2. Carry forward the historical lease classification and not reassess its existing contracts to determine whether the arrangements contained a lease or whether initial direct costs qualified for capitalization;

3. Not separate lease and non-lease components; and

4. Carry forward its current accounting treatment for land easements on existing agreements.

Lease contracts may include one or more renewal options, with renewal terms from one to fifty years or more. Leases may also include options to terminate the arrangement or options to purchase the underlying leased property. The exercise of lease options are generally at the discretion of the Company's management team. The Company determines the expected term of a lease and includes options that are reasonably certain to be exercised in the calculation of its ROU assets and lease liabilities.

The determination of whether a contract contains a lease, as well as the analysis regarding the allocation of consideration in a contract between lease and non-lease components, is performed on a case by case basis and considers the nature and interdependency of the individual assets in the arrangement. The Company generally accounts for lease assets as a single component as the assets in most agreements are highly interrelated and dependent upon each other to fulfill the arrangement.

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As the implicit rate is not readily determinable in most of the Company's lease agreements, the Company uses its estimated secured incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The following table summarizes the Company's leased assets and lease liabilities recorded in the consolidated balance sheet as of September 30, 2019 (dollars in thousands):

	Balance Sheet Location	September 30, 2019
Leased right-of-use assets:
Operating leased assets	Other assets	$	471,929
Finance leased assets, net	Property and equipment, net(a)	85,230
Total leased assets		$	557,159
Lease liabilities:
Current
Operating lease liabilities	Accrued expenses	$	60,624
Finance lease liabilities	Current portion of long-term debt	14,402
Non-current
Operating lease liabilities	Other long-term liabilities	411,153
Finance lease liabilities	Long-term debt, less current portion	64,309
Total lease liabilities		$	550,488

(a) Net of $30.1 million of accumulated amortization as of September 30, 2019, which was recognized in depreciation and amortization expense within the Company's consolidated statement of operations.

The following table summarizes the components of lease expense for the three and nine months ended September 30, 2019 (dollars in thousands):

	Location of Amount Recognized in Earnings	Three Months Ended			Nine Months Ended
		September 30, 2019			September 30, 2019
Finance leases:
Amortization of right-of-use assets	Depreciation and amortization	$	2,069		$	5,830
Interest on lease liability	Interest expense	881			2,554
Total finance lease cost		$	2,950		$	8,384
Operating leases:
Operating lease cost	Equipment rents/Trackage rights	$	22,292		$	66,976
Short-term lease cost	Equipment rents/Trackage rights	2,071			7,064
Variable lease cost	Equipment rents/Trackage rights	1,964			6,871
Sublease income (gross basis)	Operating revenues	(1,291		)	(3,541		)
Total operating lease cost		$	25,036		$	77,370
Total lease cost		$	27,986		$	85,754

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The maturities of lease liabilities under the New Standard based on the Company's reasonably certain holding period for each lease were as follows as of September 30, 2019 (dollars in thousands):

	Finance Leases		Operating Leases
Maturity of lease liabilities:
2019 (remainder)	$	3,299	$	23,076
2020	19,373		72,851
2021	10,495		63,445
2022	14,650		52,080
2023	10,551		43,398
Thereafter	34,778		553,484
Total lease payments	93,146		808,334
Less: Imputed interest	14,435		336,557
Total lease liabilities	$	78,711	$	471,777

The following is a summary of future minimum lease payments based on the minimum non-cancelable lease term as required under previous guidance for capital and operating leases as of December 31, 2018 (dollars in thousands):

	Capital		Operating
2019	$	11,405	$	82,191
2020	17,261		63,062
2021	8,668		54,305
2022	9,625		44,739
2023	10,780		35,919
Thereafter	13,988		383,739
Total minimum payments	$	71,727	$	663,955

The following table presents supplemental cash flow and other information for the Company's leases as of and for the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended
	September 30, 2019
Cash flow information:
Cash paid for operating leases included in operating activities	$	69,533
Cash paid for finance leases included in operating activities	$	2,608
Cash paid for finance leases included in financing activities	$	9,694
Weighted average remaining lease term (in years):
Operating leases	26.8
Finance leases	8.1
Weighted average discount rate:
Operating leases	3.8		%
Finance leases	4.5		%
New leases:
Right-of-use assets obtained in exchange for operating lease liabilities	$	36,333
Right-of-use assets obtained in exchange for finance lease liabilities	$	27,592

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6. DERIVATIVE FINANCIAL INSTRUMENTS:

The Company actively monitors its exposure to interest rate and foreign currency exchange rate risks and uses derivative financial instruments to manage the impact of risks associated with underlying interest rate and foreign exchange rate exposures. The Company's use of these derivative financial instruments may result in short-term gains or losses and increased earnings volatility. The instruments held by the Company are recorded in the consolidated balance sheets at fair value in prepaid expenses and other, other assets, accrued expenses or other long-term liabilities.

The Company may designate derivatives as a hedge of a forecasted transaction or a hedge of the variability of the cash flows to be received or paid in the future related to a recognized asset or liability (cash flow hedge). The portion of the changes in the fair value of the derivative used as a cash flow hedge that is offset by changes in the expected cash flows related to a recognized asset or liability is recorded in other comprehensive income/(loss) (OCI). Amounts recorded in OCI may be realized and reported in the consolidated statements of operations on the same line item as the hedged item in the event the hedged item is settled, did not or is no longer expected to occur or if the hedging relationship is no longer effective.

The Company may designate fair value hedges to mitigate foreign currency exchange rates on non-functional currency assets or liabilities. The Company uses the mark-to-market approach to remeasure the hedged item and the hedging instrument. The changes in the fair value of the hedged item is included in other income/(loss), net and are offset by changes in the fair value of the hedging instrument which are reported in the same income statement line item.

In addition, the Company may designate net investment hedges to reduce the impact of the variability of foreign currency exchange rates on its net investments in certain non-U.S. operations using cross-currency swaps. The Company measures the effectiveness of the hedge by offsetting the changes in the fair value of the cross-currency swap and the hedged asset or liability. Gains and losses on the after-tax effective portion of the net investment hedge are reported in currency translation adjustments where they remain until the investment is liquidated. The Company records the portion of the gain or loss on the hedging instrument that exceeds the gain or loss of the hedged item as an offset to the tax impact recognized during the period.

The Company matches the hedge instrument to the underlying hedged item (assets, liabilities, firm commitments or forecasted transactions). At inception of the hedge and at least quarterly thereafter, the Company assesses whether the derivatives used to hedge transactions are highly effective in offsetting changes in either the fair value or cash flows of the hedged item. When it is determined that a derivative instrument ceases to be a highly effective hedge of the underlying transaction, the Company discontinues hedge accounting, and any gains or losses on the derivative instrument thereafter are recognized in earnings during the period in which it no longer qualifies for hedge accounting. Gains and losses on any excluded components of derivatives designated as hedges are recorded in OCI and amortized to other income/(loss), net over the life of the hedge.

From time to time, the Company may enter into certain derivative instruments that may not be designated as hedges for accounting purposes. The Company believes such instruments are closely correlated with the underlying exposure, thus reducing the associated risk. The gains or losses from the changes in the fair value of derivative instruments not accounted for using hedge accounting are recognized in current period earnings within other income/(loss), net.

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The following table summarizes the fair value of the Company's derivative instruments recorded in the consolidated balance sheets as of September 30, 2019 and December 31, 2018 (dollars in thousands):

		Fair Value
	Balance Sheet Location	September 30, 2019		December 31, 2018
Asset Derivatives:
Derivatives designated as cash flow hedges:
British pound forward contracts	Prepaid expenses and other	$	4,535	$	—
British pound forward contracts	Other assets	—		26,011
Derivative designated as a net investment hedge:
Cross-currency swap contract	Other assets	8,039		—
Total derivatives designated as hedges		$	12,574	$	26,011
Derivatives not designated as hedges:
Cross-currency swap contract	Prepaid expenses and other	$	—	$	19,684
Total derivatives not designated as hedges		$	—	$	19,684
Liability Derivatives:
Derivatives designated as cash flow hedges:
Interest rate swap agreements	Accrued expenses	$	8,545	$	1,954
Interest rate swap agreements	Other long-term liabilities	86,483		12,441
British pound forward contracts	Other long-term liabilities	—		59
Derivative designated as a fair value hedge:
Cross-currency swap contract	Other long-term liabilities	4,047		—
Total derivatives designated as hedges		$	99,075	$	14,454

The following table shows the effective portion of net changes in the fair value of the Company's derivative instruments designated as hedges recognized in OCI, net of tax for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Total Derivatives Designated as Hedges OCI Activity, Net of Tax
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Derivatives Designated as Hedges:
Cash Flow Hedges:
Interest rate swap agreements	$	(26,746	)	$	4,816		$	(61,451	)	$	14,396
Foreign currency forward contracts	—			(13		)	—			275
British pound forward contracts, net (a)	(12		)	350			1,446			85
	$	(26,758	)	$	5,153		$	(60,005	)	$	14,756
Net Investment Hedge:
Cross-currency swap contract	$	6,821		$	—		$	6,048		$	—
Fair Value Hedge:
Cross-currency swap contract	$	(704	)	$	—		$	(1,134	)	$	—
Total derivatives designated as hedges	$	(20,641	)	$	5,153		$	(55,091	)	$	14,756

(a) The three months ended September 30, 2019 represented a net loss of $1.0 million for the mark-to-market of the U.K. intercompany loan, partially offset by a net gain of $1.0 million for the mark-to-market of the British pound forward contracts. The nine months ended September 30, 2019 represented a net gain of $18.5 million for the mark-to-market of the U.K. intercompany loan, partially offset by a net loss of $17.0 million for the mark-to-market of the British pound forward contracts.

The three and nine months ended September 30, 2018 represented a net loss of $1.7 million and $5.4 million, respectively, for the mark-to-market of the U.K. intercompany loan, partially offset by a net gain of $2.0 million and $5.5 million, respectively, for the mark-to-market of the British pound forward contracts.

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The following table shows the effect of the Company's derivative instruments not designated as hedges for the three and nine months ended September 30, 2019 and 2018 in the consolidated statements of operations (dollars in thousands):

		Amount Recognized in Earnings
	Location of Amount Recognized in Earnings	Three Months Ended					Nine Months Ended
		September 30,					September 30,
		2019		2018			2019			2018
Derivatives Not Designated as Hedges:
Cross-currency swap agreements, net (a)	Other income/(loss), net	$	—	$	(2,410	)	$	(1,770	)	$	(4,900	)

(a) The nine months ended September 30, 2019 represented a net loss of $1.4 million for the mark-to-market of the GRail Intercompany Loan and a net loss of $0.3 million for the mark-to-market of the swaps. This derivative was settled in June 2019, and the Company received cash proceeds of €17.0 million (or $19.3 million at the exchange rate on June 30, 2019).

The three months ended September 30, 2018 represented a net loss of $3.0 million for the mark-to-market of the GRail Intercompany Loan, partially offset by a net gain of $0.6 million for the mark-to-market of the swaps. The nine months ended September 30, 2018 represented a net loss of $8.1 million for the mark-to-market of the GRail Intercompany Loan, partially offset by a net gain of $3.2 million for the mark-to-market of the swaps.

The following table shows the cash flow impacts from the Company's derivatives that settled during the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended
	September 30, 2019
Derivatives designated as hedges:
British pound forward contracts	$	26,088
Derivatives not designated as hedges:
Cross-currency swap contract	19,272
Total cash received from settlement of derivative transactions, investing activities	$	45,360

Interest Rate Risk Management

The Company uses interest rate swap agreements to manage its exposure to the changes in interest rates on the Company's variable rate debt. Interest payments accrued each reporting period for these interest rate swaps are recognized in interest expense.

The following table summarizes the terms of the Company's outstanding interest rate swap agreements entered into to manage the Company's exposure to changes in interest rates on its variable rate debt (amounts in thousands):

Effective Date	Expiration Date	Notional Amount		Pay Fixed Rate	Receive Variable Rate
12/1/2016	12/1/2021	A$	517,500	2.44%	AUD-BBR
8/31/2018	8/31/2021 - 8/31/2048	$	500,000	2.70% - 2.87%	1-month LIBOR

During the three and nine months ended September 30, 2019, $1.7 million and $3.2 million, respectively, of net losses associated with the Company's interest rate swaps were realized and recorded as interest expense in the consolidated statements of operations. During the three and nine months ended September 30, 2018, $0.5 million and $1.2 million, respectively, of net losses associated with the Company's interest rate swaps were realized and recorded as interest expense in the consolidated statements of operations. Based on the Company's fair value assumptions as of September 30, 2019, it expects to realize $8.9 million of net losses that are reported in accumulated other comprehensive loss (AOCL) into earnings within the next 12 months. See Note 11, Accumulated Other Comprehensive Loss, for additional information regarding the Company's derivatives designated as hedges.

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Foreign Currency Exchange Rate Risk

As of September 30, 2019, the Company's foreign subsidiaries had $948.4 million of third-party debt, including finance leases, denominated in the local currencies in which the Company's foreign subsidiaries operate, including the Australian dollar, the British pound, the Canadian dollar and the Euro. The debt service obligations associated with this foreign currency debt are generally funded directly from those foreign operations. As a result, foreign currency risk related to this portion of the Company's debt service payments is limited. However, in the event the foreign currency debt service is not paid by the Company's foreign subsidiaries and is paid by its United States subsidiaries, the Company may face exchange rate risk if the Australian dollar, the British pound, the Canadian dollar or the Euro were to appreciate relative to the United States dollar and require higher United States dollar equivalent cash.

The Company is also exposed to foreign currency exchange rate risk, including non-functional currency intercompany debt, typically associated with acquisitions and any timing difference between announcement and closing of an acquisition of a foreign business. To mitigate currency exposures related to non-functional currency denominated intercompany debt, foreign currency forward contracts or cross-currency swaps may be entered into for periods consistent with the underlying debt. In cases where foreign currency forward contracts or cross-currency swaps do not qualify for hedge accounting, the gains or losses from changes in the fair value are recognized in current period earnings within other income/(loss), net.

In 2015, the Company, in conjunction with the acquisition of Freightliner Group Limited (Freightliner) in the U.K., transferred cash from the United States to the U.K. through an intercompany loan with a notional amount of £120.0 million (or $181.0 million at the exchange rate on the effective date of the loan). To mitigate the foreign currency exchange rate risk related to the outstanding balance of this loan, the Company entered into British pound forward contracts, which were accounted for as cash flow hedges. During the nine months ended September 30, 2019, the Company settled certain of its British pound forward contracts, which had notional amounts totaling £120.0 million with a settlement date of March 31, 2020 and exchange rates ranging from 1.50 to 1.51 GBP to USD. Upon settlement, the Company received cash proceeds of $26.1 million.

As of September 30, 2019, the Company's outstanding British pound forward contracts had a notional amount of £32.6 million with a settlement date of March 31, 2020 and exchange rates ranging from 1.28 to 1.57 GBP to USD. During the three and nine months ended September 30, 2019, $0.1 million and $0.8 million, respectively, of net gains were recorded as interest income in the consolidated statements of operations. During the three and nine months ended September 30, 2018, $0.2 million and $0.5 million, respectively, of net gains were recorded as interest income in the consolidated statements of operations. Based on the Company's fair value assumptions as of September 30, 2019, it expects to realize $0.2 million of net gains that are reported in AOCL into earnings within the next 12 months. See Note 11, Accumulated Other Comprehensive Loss, for additional information regarding the Company's derivatives designated as hedges.

In 2016, in conjunction with an acquisition in Australia, the Company's subsidiaries, G&W Australia Holdings LP (GWAHLP) and GWI Holding B.V. (GWBV), entered into an A$248.9 million non-recourse subordinated partner loan agreement (GRail Intercompany Loan), which is eliminated in consolidation. To mitigate the foreign currency exchange rate risk related to the non-functional currency intercompany loan, the Company entered into two Euro/Australian dollar floating-to-floating cross-currency swap agreements (the Swaps) on December 22, 2016. These agreements did not qualify as hedges for accounting purposes, and, accordingly, mark-to-market changes in the fair value of the Swaps relative to the underlying GRail Intercompany Loan were recorded over the life of the agreements, which expired on June 30, 2019. Upon settlement of the agreements, the Company received cash proceeds of €17.0 million (or $19.3 million at the exchange rate on June 30, 2019).

In June 2019, the Company entered into two new cross-currency swap agreements designated as fair value hedges of the non-functional currency GRail intercompany loan. In addition, the Company entered into a cross-currency swap in June 2019 that was designated as a net investment hedge of the GWBV investment. During the three and nine months ended September 30, 2019, the Company recognized a gain of $0.1 million within other income/(loss), net in the consolidated statement of operations related to amortization of excluded components of its net investment hedge. Based on the Company's assumptions as of September 30, 2019, its net investment hedge and fair value hedge, which each terminate on June 30, 2021, are expected to realize $0.6 million of net gains and $0.9 million of net losses, respectively, that are currently reported in AOCL into earnings within the next 12 months. See Note 11, Accumulated Other Comprehensive Loss, for additional information regarding the Company's derivatives designated as hedges.

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7. FAIR VALUE OF FINANCIAL INSTRUMENTS:

The following table presents the Company's financial instruments carried at fair value using Level 2 inputs as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019		December 31, 2018
Financial instruments carried at fair value using Level 2 inputs:
Financial assets carried at fair value:
British pound forward contracts	$	4,535	$	26,011
Cross-currency swap contract - net investment hedge	8,039		—
Cross-currency swap contracts	—		19,684
Total financial assets carried at fair value	$	12,574	$	45,695
Financial liabilities carried at fair value:
Interest rate swap agreements	$	95,028	$	14,395
British pound forward contracts	—		59
Cross-currency swap contract - fair value hedge	4,047		—
Total financial liabilities carried at fair value	$	99,075	$	14,454

Financial Instruments Carried at Fair Value: Derivative instruments are recorded on the consolidated balance sheets as either assets or liabilities measured at fair value. As more fully described in Note 6, Derivative Financial Instruments, during the reporting period, the Company's derivative financial instruments consisted of interest rate swap agreements, foreign currency forward contracts and cross-currency swap agreements. The Company estimated the fair value of its derivative financial instruments based on Level 2 valuation inputs, including fixed interest rates, LIBOR, British pound LIBOR, BBR and EURIBOR implied forward interest rates and the remaining time to maturity.

The following table presents the carrying value, net of debt issuance costs and fair value using Level 2 inputs of the Company's financial instruments carried at historical cost as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019				December 31, 2018
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial liabilities carried at historical cost:
United States term loan	$	1,261,983	$	1,258,527	$	1,295,672	$	1,296,079
U.K. term loan	289,357		290,883		315,524		319,556
Australian credit agreement	422,120		427,617		450,252		457,978
Australia subordinated shareholder loan from Macquarie Infrastructure and Real Assets	160,675		157,652		167,796		166,974
Revolving credit facility	319		3,687		160,033		163,662
Other debt	2,392		2,379		2,356		2,352
Total	$	2,136,846	$	2,140,745	$	2,391,633	$	2,406,601

Financial Instruments Carried at Historical Cost: Since the Company's long-term debt is not actively traded, fair value was estimated using a discounted cash flow analysis based on Level 2 valuation inputs, including borrowing rates the Company believes are currently available to it for loans with similar terms and maturities.

8. U.K. PENSION PLAN:

Through its Freightliner subsidiary, the Company has a defined benefit pension plan for Freightliner's eligible U.K. employees through a standalone shared cost arrangement within the Railways Pension Scheme (Pension Program). The Pension Program is managed and administered by a professional pension administration company and is overseen by trustees with professional advice from independent actuaries and other advisers. The Pension Program is a shared cost arrangement with required contributions shared between Freightliner and its participating members, with Freightliner contributing 60% and the remaining 40% contributed by active employees. The Company engages independent actuaries to compute the amounts of liabilities and expenses relating to the Pension Program subject to the assumptions that the Company selects.

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The following tables summarize the components of the Pension Program related to the net benefit costs recognized in labor and benefits and other income/(loss), net in the Company's consolidated statements of operations for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
		2019			2018			2019			2018
Operating expense:
	Service cost(a)	$	3,257		$	3,610		$	10,094		$	11,235
Nonoperating income, net:
	Interest cost	2,240			2,383			6,942			7,416
	Expected return on plan assets	(4,158		)	(4,572		)	(12,885		)	(14,231		)
	Amortization of prior year service cost	42			—			130			—
	Total nonoperating income, net(b)	(1,876		)	(2,189		)	(5,813		)	(6,815		)
Net periodic benefit cost		$	1,381		$	1,421		$	4,281		$	4,420

(a) Included in labor and benefits within the Company’s consolidated statements of operations.

(b) Included in other income/(loss), net within the Company’s consolidated statements of operations.

During the nine months ended September 30, 2019, the Company contributed £4.7 million (or $6.0 million at the exchange rate when the payments were made) to fund the Pension Program. The Company expects to contribute £2.3 million (or $2.8 million at the September 30, 2019 exchange rate) to the Pension Program for the remainder of 2019. The Pension Program's assets may undergo significant changes over time as a result of market conditions, and its assets and liabilities are formally valued on an independent actuarial basis every three years to assess the adequacy of funding levels. A key element of the valuation process is an assessment of the creditworthiness of the participating employer. In the event that the Pension Program's projected assets and liabilities reveal additional funding requirements, the shared cost arrangement generally means that the Company will be required to pay 60% of any additional contributions, with active members contributing the remaining 40%, in each case over an agreed recovery period. If the Pension Program was to be terminated and wound up, any deficit would fall entirely on the Company and could not be shared with active members. Currently, the Company has no intention of terminating the Pension Program.

9. INCOME TAXES:

The Company's provision for income taxes for the three months ended September 30, 2019 was $20.0 million, compared with $31.0 million for the three months ended September 30, 2018. The Company's provision for income taxes for the three months ended September 30, 2019 included a $4.2 million benefit from the release of a reserve for an uncertain tax position as a result of a lapse of the statute of limitations. The Company's provision for income taxes for the three months ended September 30, 2018 included a $1.6 million measurement period adjustment to increase the one-time transition (toll) tax on earnings of certain foreign subsidiaries as a result of the Tax Cuts and Jobs Act (TCJA).

The Company's provision for income taxes for the nine months ended September 30, 2019 was $53.1 million compared with $41.6 million for the nine months ended September 30, 2018. Based on developments during the nine months ended September 30, 2018, the Company recorded a reserve for uncertain tax positions of $5.5 million related to tax deductions on intercompany financing arrangements in the U.K., of which $3.7 million related to the period from March 25, 2015, the date of the Freightliner acquisition when the arrangements were established, through December 31, 2017. The provision for income taxes for the nine months ended September 30, 2018 also included an income tax benefit of $31.6 million associated with the retroactive extension of the United States Short Line Tax Credit for fiscal year 2017, which was enacted in February 2018.

The Company's effective income tax rate for the three and nine months ended September 30, 2019 was 22.3% and 24.9%, respectively. The Company's effective income tax rate for the three and nine months ended September 30, 2018 was 30.0% and 17.4%, respectively. Excluding the benefit from the retroactive extension of the United States Short Line Tax Credit and the prior period portion of the reserve for uncertain tax positions, the Company's effective income tax rate for the nine months ended September 30, 2018 was 29.1%. The decrease in the Company's effective income tax rate from 2018, excluding the benefit from the retroactive extension and the prior period portion of the reserve for uncertain tax positions, to 2019 was primarily due to the $4.2 million benefit from the release of a reserve for an uncertain tax position recognized during the three months ended September 30, 2019.

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The United States Short Line Tax Credit is an income tax track maintenance credit for Class II and Class III railroads to reduce their federal income tax based on qualified railroad track maintenance expenditures. Qualified expenditures include amounts incurred for maintaining track, including roadbed, bridges and related track structures owned or leased by a Class II or Class III railroad. The credit is equal to 50% of the qualified expenditures, subject to an annual limitation of $3,500 multiplied by the number of miles of railroad track owned or leased by the Class II or Class III railroad as of the end of its tax year. The United States Short Line Tax Credit was initially enacted for a three-year period, 2005 through 2007, and was subsequently extended a series of times with the last extension enacted in February 2018. The February 2018 extension provided a retroactive credit, solely for fiscal year 2017. Legislation is currently pending that seeks to make the United States Short Line Tax Credit permanent for fiscal year 2018 and beyond.

10. COMMITMENTS AND CONTINGENCIES:

From time to time, the Company is a defendant in certain lawsuits and a party to certain arbitrations resulting from the Company's operations in the ordinary course as the nature of the Company's business exposes it to the potential for various claims and litigation, including those related to property damage, personal injury, freight loss, labor and employment, environmental and other matters. The Company maintains insurance policies to mitigate the financial risk associated with such claims. However, any material changes to pending litigation or a catastrophic rail accident or series of accidents involving material freight loss or property damage, personal injuries or environmental liability or other claims or disputes that are not covered by insurance could have a material adverse effect on the Company's results of operations, financial condition and liquidity.

In November 2014, the Company received a notice from the United States Environmental Protection Agency (EPA) requesting information under the Clean Water Act related to the discharge of crude oil as a result of a derailment of an Alabama & Gulf Coast Railway LLC (AGR) freight train in November 2013 in the vicinity of Aliceville, Alabama. In May 2018, the EPA notified the AGR of a maximum civil payment of up to $14.1 million, based on the amount of oil allegedly discharged and other relevant factors considered under the applicable regulation. The Company's evaluation of its defenses, settlement options and insurance coverage is ongoing. Although the cleanup associated with this derailment is substantially complete, the civil penalty associated with the contamination is subject to further discussion and potential litigation.

Following the filing of the Company’s definitive proxy statement (the Proxy Statement) associated with the Merger with the Securities and Exchange Commission (the SEC) on August 20, 2019, three lawsuits were filed in connection with the Merger, including two purported class action lawsuits that were filed on August 21, 2019 and September 4, 2019 in the United States District Court for the District of Delaware, and one lawsuit filed on behalf of a purported individual shareholder on September 12, 2019 in the United States District Court for the District of Connecticut. These lawsuits, Gordon vs. Genesee & Wyoming Inc. et al., Case No. 1:19-cv-01558-MN, Thompson vs. Genesee & Wyoming Inc. et al., Case No. 1;19-cv-01650-MN and Geery vs. Genesee & Wyoming Inc. et al., Case No. 3:19-cv-01438-VLB (collectively, the Disclosure Actions), named the Company and individual officers and members of the Company’s board of directors as defendants. The actions alleged, among other things, that the defendants failed to disclose certain information relating to the Company’s financial projections set forth in the Proxy Statement.

On September 25, 2019, solely to eliminate the burden, expense, and uncertainty inherent in such litigation, and without admitting any liability or wrongdoing, the Company filed a Form 8-K containing certain supplemental disclosures with the SEC. In consideration for such supplemental disclosures by the Company, plaintiffs in the Disclosure Actions had agreed to voluntarily dismiss the Disclosure Actions. On October 4, 2019, pursuant to those agreements, plaintiffs filed voluntary dismissals of the Disclosure Actions.

On September 17, 2019, in New South Wales, Australia, a complaint was filed by Australia Eastern Railroad Pty Ltd ACN against the Company, GWI Holdings Pty Ltd and Genesee & Wyoming Australia Pty Ltd in connection with the Merger. The complaint seeks an award of damages in connection with a right of first refusal provision in a commercial contract involving the Company’s majority-owned Australian subsidiary. The Company disputes the allegations made in the complaint and intends to defend itself appropriately.

In addition to the EPA matter and the lawsuits set forth above, from time to time, the Company is a defendant in certain lawsuits resulting from its operations in the ordinary course. Management believes there are adequate provisions in the financial statements for any probable liabilities that may result from disposition of the pending lawsuits and the aforementioned EPA matter. Based upon currently available information, management does not believe it is reasonably possible that any such lawsuit, related lawsuit or matter would be material to the Company's results of operations or have a material adverse effect on its financial position or liquidity.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

11. ACCUMULATED OTHER COMPREHENSIVE LOSS:

The following tables set forth the components of AOCL attributable to Genesee & Wyoming Inc. included in the consolidated balance sheets and consolidated statements of comprehensive income (dollars in thousands):

	Foreign Currency Translation Adjustment				Defined Benefit Plans				Net Unrealized Gain/(Loss) on Hedges				Accumulated Other Comprehensive Loss
Balance, December 31, 2018	$	(144,503	)		$	11,120			$	(13,073	)		$	(146,456	)
Other comprehensive loss before reclassifications	(24,026		)		—				(57,612		)		(81,638		)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit of ($26), $74 and $593, respectively	82			(a)	(94		)	(b)	(2,002		)	(c)	(2,014		)
Current period change	(23,944		)		(94		)		(59,614		)		(83,652		)
Balance, September 30, 2019	$	(168,447	)		$	11,026			$	(72,687	)		$	(230,108	)

	Foreign Currency Translation Adjustment			Defined Benefit Plans				Net Unrealized Gain/(Loss) on Hedges				Accumulated Other Comprehensive Loss
Balance, December 31, 2017	$	(74,617	)	$	(19,601	)		$	(11,316	)		$	(105,534	)
Other comprehensive income before reclassifications	(41,395		)	—				14,926				(26,469		)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit of ($42) and $76, respectively	—			129			(b)	(232		)	(c)	(103		)
Current period change	(41,395		)	129				14,694				(26,572		)
Amounts reclassified from accumulated other comprehensive loss to retained earnings related to the United States Tax Cuts and Jobs Act	—			(132		)		(2,838		)		(2,970		)
Balance, September 30, 2018	$	(116,012	)	$	(19,604	)		$	540			$	(135,076	)

(a) Net gains realized were recorded in other income/(loss), net within the consolidated statements of operations.

(b) Net (losses)/gains realized were recorded in labor and benefits on the consolidated statements of operations.

(c) For the nine months ended September 30, 2019, $1.7 million and $0.3 million of net losses were recorded in interest expense and other income/(loss), net, respectively, within the consolidated statements of operations. For the nine months ended September 30, 2018, net losses realized were recorded in interest expense on the consolidated statements of operations. See Note 6, Derivative Financial Instruments.

Comprehensive Loss Attributable to Noncontrolling Interest

The following table sets forth comprehensive loss attributable to noncontrolling interest for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Net income attributable to noncontrolling interest	$	2,979		$	2,720		$	3,011		$	8,090
Other comprehensive income/(loss):
Foreign currency translation adjustment	(7,690		)	(4,804		)	(8,697		)	(17,647		)
Net unrealized (loss)/gain on qualifying cash flow hedges, net of tax benefit/(provision) of $21, $41, $654 and ($26), respectively	(48		)	(95		)	(1,525		)	62
Comprehensive loss attributable to noncontrolling interest	$	(4,759	)	$	(2,179	)	$	(7,211	)	$	(9,495	)

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12. SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES:

As of September 30, 2019 and 2018, the Company had outstanding accounts receivable from outside parties for the funding of capital expenditures of $24.7 million and $14.6 million, respectively. As of September 30, 2019 and 2018, the Company also had $24.5 million and $16.1 million, respectively, of purchases of property and equipment that were not paid and, accordingly, were accrued in accounts payable in the normal course of business. See Note 5, Leases, for ROU assets obtained during the reporting period in exchange for lease liabilities.

13. SEGMENT INFORMATION:

The Company presents the financial results of its eight operating regions as three reportable segments: North American Operations, Australian Operations and U.K./European Operations. During the three months ended March 31, 2019, the Company's Central Region railroads were consolidated into the Company's Midwest and Southern regions. The Company's remaining six North American regions are aggregated into one segment as a result of having similar economic and operating characteristics. Each of the Company's segments generates the following three categories of revenues from external customers: freight revenues, freight-related revenues and all other revenues.

The Company's Australian business underwent a transformational change on December 1, 2016, with the acquisition of

Glencore Rail (NSW) Pty Limited (GRail) and the formation of a partnership with Macquarie Infrastructure and Real Assets (MIRA) (the Australia Partnership), which the Company controls through its 51.1% interest. The GRail acquisition significantly expanded the Company's operations in New South Wales. In conjunction with the GRail acquisition, the Company issued a 48.9% equity stake in its Australian subsidiary, GWAHLP, to MIRA. The Company retained a 51.1% controlling interest in GWAHLP and continues to consolidate 100% of its Australian Operations in the Company's financial statements and reports a noncontrolling interest for MIRA's 48.9% equity ownership. As a result, (1) 100% of the assets and liabilities of the Company's Australian Operations, after the elimination of intercompany balances, were included in the Company's consolidated balance sheets as of September 30, 2019 and December 31, 2018, with MIRA's 48.9% noncontrolling interest reflected in the equity section, (2) the Company's operating revenues and operating income for the three and nine months ended September 30, 2019 and 2018 included 100% of the Australian Operations, while net income attributable to G&W reflected the Company's 51.1% ownership position in the Australian Operations and (3) 100% of the cash flows of the Australian Operations, after the elimination of intercompany items, were included in the Company's consolidated statements of cash flows for the nine months ended September 30, 2019 and 2018. Accordingly, any payments between the Company's Australian Operations and its other businesses are eliminated in consolidation, while the Company's cash flows reflect 100% of any cash flows between the Australian Operations and MIRA.

In accordance with the Company's Australian Partnership agreement with MIRA, the cash and cash equivalents of the Company's Australian Operations can be used to make payments in the ordinary course of business, to pay down debt of the Australia Partnership and to make distributions to the partners in proportion to their investments. No such distributions were made during the nine months ended September 30, 2019. During the nine months ended September 30, 2018, the Australia Partnership made an A$40.0 million distribution, of which A$20.4 million (or $15.6 million at the exchange rate on June 5, 2018) and A$19.6 million (or $14.9 million at the exchange rate on June 5, 2018) were distributed to the Company and MIRA, respectively.

The results of operations of the Company's foreign entities are maintained in the respective local currency (the Australian dollar, the British pound, the Canadian dollar and the Euro) and then translated into United States dollars at the exchange rate at the end of the period for balance sheet items and, for the statement of operations, at the average rate for the period. Currency translation adjustments are reflected within the equity section of the balance sheet and are included in OCI. Upon complete or substantially complete liquidation of the underlying investment in the foreign subsidiary, cumulative translation adjustments are recognized in the consolidated statements of operations. As a result, any appreciation or depreciation of these currencies against the United States dollar will impact the Company's results of operations.

The following table reflects the balance sheet exchange rates used to translate each foreign entity's respective local currency balance sheet into United States dollars as of September 30, 2019 and December 31, 2018:

	September 30, 2019		December 31, 2018
United States dollar per Australian dollar	$	0.67	$	0.70
United States dollar per British pound	$	1.23	$	1.28
United States dollar per Canadian dollar	$	0.76	$	0.73
United States dollar per Euro	$	1.09	$	1.15

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The following table reflects the average exchange rates used to translate each foreign entity's respective local currency results of operations into United States dollars for the three and nine months ended September 30, 2019 and 2018:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
United States dollar per Australian dollar	$	0.69	$	0.73	$	0.70	$	0.76
United States dollar per British pound	$	1.23	$	1.30	$	1.27	$	1.35
United States dollar per Canadian dollar	$	0.76	$	0.77	$	0.75	$	0.78
United States dollar per Euro	$	1.11	$	1.16	$	1.12	$	1.19

The following tables set forth select financial data for the Company's reportable segments, including operating revenues by commodity group, for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	34,574	$	2,631	$	763		$	37,968
Autos & Auto Parts	6,339		—		—			6,339
Chemicals & Plastics	39,518		—		—			39,518
Coal & Coke	18,336		33,187		606			52,129
Food & Kindred Products	8,355		—		—			8,355
Intermodal	461		16,446		56,998			73,905
Lumber & Forest Products	22,862		—		—			22,862
Metallic Ores	4,225		7,036		—			11,261
Metals	28,115		—		—			28,115
Minerals & Stone	41,399		1,979		21,672			65,050
Petroleum Products	19,027		178		628			19,833
Pulp & Paper	30,648		—		—			30,648
Waste	8,278		—		—			8,278
Other	5,888		—		—			5,888
Total freight revenues	268,025		61,457		80,667			410,149
Freight-related revenues	68,129		8,011		65,229			141,369
All other revenues	16,288		2,132		13,756			32,176
Total operating revenues	$	352,442	$	71,600	$	159,652		$	583,694
Operating income/(loss)	$	95,633	$	19,484	$	(2,361	)	$	112,756
Depreciation and amortization	$	39,164	$	13,779	$	10,083		$	63,026
Interest expense, net	$	12,599	$	10,694	$	849		$	24,142
Provision for income taxes	$	16,876	$	2,641	$	458		$	19,975
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	53,239	$	14,845	$	6,336		$	74,420

26

Table of Contents             GENESEE & WYOMING INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Three Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	30,565	$	4,150	$	1,053	$	35,768
Autos & Auto Parts	5,513		—		—		5,513
Chemicals & Plastics	38,436		—		—		38,436
Coal & Coke	23,006		32,357		2,588		57,951
Food & Kindred Products	8,761		—		—		8,761
Intermodal	514		17,538		58,609		76,661
Lumber & Forest Products	24,113		—		—		24,113
Metallic Ores	3,573		8,914		—		12,487
Metals	34,904		—		—		34,904
Minerals & Stone	38,570		2,066		22,344		62,980
Petroleum Products	18,236		224		99		18,559
Pulp & Paper	31,961		—		—		31,961
Waste	8,089		—		—		8,089
Other	7,191		—		—		7,191
Total freight revenues	273,432		65,249		84,693		423,374
Freight-related revenues	66,045		10,136		69,269		145,450
All other revenues	16,232		1,318		16,930		34,480
Total operating revenues	$	355,709	$	76,703	$	170,892	$	603,304
Operating income	$	102,484	$	20,713	$	4,623	$	127,820
Depreciation and amortization	$	41,388	$	14,937	$	9,067	$	65,392
Interest expense, net	$	10,339	$	12,780	$	2,893	$	26,012
Provision for income taxes	$	26,323	$	2,398	$	2,292	$	31,013
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	42,120	$	8,185	$	6,704	$	57,009

27

Table of Contents             GENESEE & WYOMING INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Nine Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	99,383	$	8,684	$	2,011		$	110,078
Autos & Auto Parts	17,905		—		—			17,905
Chemicals & Plastics	116,504		—		—			116,504
Coal & Coke	56,089		91,323		6,195			153,607
Food & Kindred Products	25,559		—		—			25,559
Intermodal	1,439		45,705		174,500			221,644
Lumber & Forest Products	68,238		—		—			68,238
Metallic Ores	9,883		22,177		—			32,060
Metals	87,032		—		—			87,032
Minerals & Stone	111,806		5,834		58,709			176,349
Petroleum Products	56,779		476		2,036			59,291
Pulp & Paper	88,940		—		—			88,940
Waste	23,104		—		—			23,104
Other	16,308		—		—			16,308
Total freight revenues	778,969		174,199		243,451			1,196,619
Freight-related revenues	198,740		23,902		197,385			420,027
All other revenues	49,026		5,137		42,454			96,617
Total operating revenues	$	1,026,735	$	203,238	$	483,290		$	1,713,263
Operating income/(loss)	$	249,209	$	43,642	$	(6,185	)	$	286,666
Depreciation and amortization	$	116,333	$	42,382	$	29,454		$	188,169
Interest expense, net	$	36,871	$	34,618	$	6,291		$	77,780
Provision for income taxes	$	49,103	$	2,711	$	1,287		$	53,101
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	153,959	$	26,797	$	23,523		$	204,279

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Table of Contents             GENESEE & WYOMING INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Nine Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	91,630	$	15,639	$	3,073		$	110,342
Autos & Auto Parts	16,686		—		—			16,686
Chemicals & Plastics	113,625		—		—			113,625
Coal & Coke	62,038		96,506		8,751			167,295
Food & Kindred Products	25,587		—		—			25,587
Intermodal	1,203		50,613		192,413			244,229
Lumber & Forest Products	70,362		—		—			70,362
Metallic Ores	10,816		24,770		—			35,586
Metals	95,791		—		—			95,791
Minerals & Stone	107,122		6,247		63,849			177,218
Petroleum Products	52,870		560		107			53,537
Pulp & Paper	90,346		—		—			90,346
Waste	21,316		—		—			21,316
Other	19,325		—		—			19,325
Total freight revenues	778,717		194,335		268,193			1,241,245
Freight-related revenues	193,344		32,214		203,491			429,049
All other revenues	48,835		4,017		49,809			102,661
Total operating revenues	$	1,020,896	$	230,566	$	521,493		$	1,772,955
Operating income/(loss)	$	255,918	$	62,585	$	(645	)	$	317,858
Depreciation and amortization	$	123,266	$	46,232	$	27,629		$	197,127
Interest expense, net	$	30,572	$	38,914	$	9,620		$	79,106
Provision for income taxes	$	26,930	$	7,120	$	7,519		$	41,569
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	129,607	$	27,936	$	19,893		$	177,436

The following tables set forth select balance sheet data for the Company's reportable segments as of September 30, 2019 and December 31, 2018 (dollars in thousands): 

	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Cash and cash equivalents	$	37,261	$	31,142	$	18,509	$	86,912
Property and equipment, net	$	3,747,047	$	587,793	$	329,997	$	4,664,837

	December 31, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Cash and cash equivalents	$	33,996	$	26,902	$	29,489	$	90,387
Property and equipment, net	$	3,679,279	$	609,450	$	324,285	$	4,613,014

29

Table of Contents             GENESEE & WYOMING INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

14. RECENTLY ISSUED ACCOUNTING STANDARDS:

Accounting Standards Not Yet Effective

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Measurement of Credit Losses on Financial Instruments, which requires assessment of credit losses on an expected model rather than an incurred loss model. The guidance requires the consideration of all available relevant information when estimating expected credit losses, including past events, current conditions and forecasts. The amendment will become effective for the Company beginning January 1, 2020. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles–Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The amendments will become effective for the Company beginning January 1, 2020. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework–Changes to the Disclosure for Fair Value Measurement. The amendments modify the disclosure requirements for fair value measurements in FASB Accounting Standards Codification (ASC) 820 based on revisions to the FASB Concepts Statement, Conceptual Framework for Financial Reporting (Concepts Statement), and cost/benefit considerations. The amendments will become effective for the Company beginning January 1, 2020. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its disclosure requirements.

In August 2018, the FASB issued ASU 2018-14, Compensation–Retirement Benefits–Defined Benefit Plans–General (Subtopic 715-20): Changes to the Disclosure Requirements for Defined Benefit Plans. The amendments modify the disclosure requirements for employers that sponsor defined benefit pension plans or other postretirement benefit plans to make disclosure requirements more consistent with the revisions to the Concepts Statement. The amendments will become effective for the Company beginning January 1, 2021. Early adoption is permitted on a retrospective basis to all periods presented. The Company is still evaluating the potential impact of this guidance on its disclosure requirements.

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ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion should be read in conjunction with our consolidated financial statements and related notes set forth in this Quarterly Report on Form 10-Q and our 2018 Annual Report on Form 10-K. Our consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP).

When comparing our results of operations from one reporting period to another, it is important to consider that we have historically experienced fluctuations in revenues and expenses due to acquisitions and divestitures, changing economic conditions, commodity prices, competitive forces, changes in foreign currency exchange rates, rail network issues and congestion, the ability to attract and retain skilled workers, one-time freight moves, fuel price fluctuations, customer plant expansions and shutdowns, sales of property and equipment, derailments and weather-related conditions, such as hurricanes, cyclones, tornadoes, high winds, droughts, heavy snowfall, unseasonably hot or cold weather, freezing and flooding, among other factors. In periods when these events occur, our results of operations are not easily comparable from one period to another. Finally, certain of our railroads have commodity shipments that are sensitive to general economic conditions, global commodity prices and foreign exchange rates, such as steel products, iron ore, paper products, lumber and forest products and agricultural products, as well as product specific market conditions, such as the availability of lower priced alternative sources of power generation (coal) and energy commodity price differentials (crude oil and natural gas liquids) or congestion at ports (intermodal). Other shipments are relatively less affected by economic conditions and are more closely affected by other factors, such as winter weather (salt) and seasonal rainfall (agricultural products). As a result of these and other factors, our results of operations in any reporting period may not be directly comparable to our results of operations in other reporting periods.

When we discuss foreign exchange impact, we are referring to the change in our results due to the change in foreign currency exchange rates. We calculate foreign exchange impact by comparing the prior period results translated from local currency to United States dollars using current period exchange rates to the prior period results in United States dollars as reported. Constant currency, which is a non-GAAP measure, reflects the prior period results translated at the current period exchange rates. When we discuss results from existing operations or same railroad operations, we are referring to the change in our results, period-over-period, associated with operations that we managed in both periods (i.e., excluding the impact of acquisitions and divestitures).

Overview

We own or lease 119 freight railroads worldwide that are organized in eight operating regions with approximately 8,000 employees and 3,000 customers. The financial results of our eight operating regions are reported in the following three distinct segments:

• Our North American Operations segment includes six regions (Coastal, Midwest, Northeast, Southern, Western and Canada) that serve 42 U.S. states and four Canadian provinces and include 113 short line and regional freight railroads with more than 13,000 track-miles.

• Our Australian Operations segment serves New South Wales, the Northern Territory and South Australia and operates the 1,400-mile Tarcoola-to-Darwin rail line. Since December 1, 2016, the Australia Region has been 51.1% owned by us and 48.9% owned by a consortium of funds and clients managed by Macquarie Infrastructure and Real Assets (MIRA).

• Our U.K./European Operations segment is led by Freightliner Group Limited (Freightliner), the United Kingdom's (U.K.) largest rail maritime intermodal operator and second-largest freight rail provider, as well as regional rail services in Continental Europe.

Our subsidiaries and joint ventures also provide rail service at more than 40 major ports, rail-ferry service between the U.S. Southeast and Mexico, transload services, contract coal loading, and industrial railcar switching and repair. As more fully described in Note 13, Segment Information, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report, the results of operations of the foreign entities are maintained in the respective local currency and then translated into United States dollars at the applicable exchange rates for inclusion in the consolidated financial statements. As a result, any appreciation or depreciation of these currencies against the United States dollar will impact our results of operations.

31

Overview of Three-Month Results

Consolidated Results

Our operating revenues decreased $19.6 million, or 3.3%, to $583.7 million for the three months ended September 30, 2019, compared with $603.3 million for the three months ended September 30, 2018. Operating income for the three months ended September 30, 2019 was $112.8 million, compared with $127.8 million for the three months ended September 30, 2018, a decrease of $15.1 million, or 11.8%. Our operating ratio, defined as operating expenses divided by operating revenues, was 80.7% for the three months ended September 30, 2019, compared with 78.8% for the three months ended September 30, 2018.

Net income attributable to G&W for the three months ended September 30, 2019 was $66.8 million, compared with $69.6 million for the three months ended September 30, 2018. Our diluted earnings per common share (EPS) were $1.16 with 57.5 million weighted average shares outstanding for the three months ended September 30, 2019 and $1.16 with 60.1 million weighted average shares outstanding for the three months ended September 30, 2018.

Our provision for income taxes for the three months ended September 30, 2019 was $20.0 million compared with $31.0 million for the three months ended September 30, 2018. Our effective income tax rate for the three months ended September 30, 2019 was 22.3% and included a $4.2 million income tax benefit due to the release of a reserve for an uncertain tax position due to the expiration of the statute of limitations. Excluding the release of the reserve, our effective tax rate for the three months ended September 30, 2019 was 27.0%. Our effective income tax rate for the three months ended September 30, 2018 was 30.0% and included a $1.6 million measurement period adjustment to increase the one-time transition (toll) tax on earnings of certain foreign subsidiaries as a result of the Tax Cuts and Jobs Act (TCJA).

Items Affecting Comparability

Our results for the three months ended September 30, 2019 and 2018 included certain items affecting comparability between the periods that are set forth below (dollars in millions, except per share amounts):

	Income/(Loss) Before Taxes Impact			After-Tax Net Income/(Loss) Attributable to G&W Impact			Diluted Earnings/(Loss) Per Common Share Impact
Three Months Ended September 30, 2019
Corporate development and related costs	$	(8.2	)	$	(5.9	)	$	(0.10	)
Restructuring and related costs	$	(3.6	)	$	(2.9	)	$	(0.05	)
Release of a reserve for an uncertain tax position	$	—		$	4.2		$	0.07
Three Months Ended September 30, 2018
Corporate development and related costs	$	(0.3	)	$	(0.3	)	$	—
Restructuring and related costs	$	(3.3	)	$	(2.7	)	$	(0.04	)
Gain on settlement	$	0.9		$	0.3		$	0.01
TCJA measurement period adjustment	$	—		$	(1.6	)	$	(0.03	)

For the three months ended September 30, 2019, our results included corporate development and related costs of $8.2 million, primarily related to fees associated with the proposed acquisition of G&W by affiliates of Brookfield Infrastructure and GIC, restructuring and related costs of $3.6 million, primarily associated with our optimization activities in the U.K., and a $4.2 million income tax benefit from the release of a reserve for an uncertain tax position due to the expiration of the statute of limitations.

For the three months ended September 30, 2018, our results included restructuring and related costs of $3.3 million, primarily driven by our optimization activities in the U.K., and a gain on a settlement of $0.9 million from the recovery of pre-petition claims associated with an Australia customer's voluntary administration (bankruptcy) in the second quarter of 2016. As a result of the TCJA, the results for the three months ended September 30, 2018 also included a $1.6 million measurement period adjustment to the one-time transition (toll) tax on earnings of certain foreign subsidiaries.

32

Results by Segment

North America

Operating revenues from our North American Operations decreased $3.3 million, or 0.9%, to $352.4 million for the three months ended September 30, 2019, compared with $355.7 million for the three months ended September 30, 2018. Excluding $5.1 million of revenues in 2018 from two leased railroads in Canada that expired at the end of 2018, and a $0.2 million decrease due to foreign currency depreciation, North American existing operations revenues increased $2.0 million, or 0.6%, primarily due to an increase in freight-related revenues, partially offset by a decrease in freight revenues.

Total traffic from our North American Operations decreased 30,880 carloads, or 6.9%, to 415,339 carloads for the three months ended September 30, 2019, compared with the three months ended September 30, 2018. Excluding traffic from the two railroad leases in Canada that expired at the end of 2018, existing operations traffic decreased 23,236 carloads, or 5.3%. The decrease in traffic from existing operations included decreases of 17,532 carloads of coal and coke traffic, 8,428 carloads of metals traffic, 3,698 carloads of pulp and paper traffic, 2,292 carloads of lumber and forest products traffic and 1,597 carloads of other commodity traffic, partially offset by increases of 6,080 carloads of agricultural products traffic, 2,553 carloads of minerals and stone traffic and 1,376 carloads of autos and auto parts traffic. All remaining traffic increased by a net 302 carloads.

Operating income from our North American Operations was $95.6 million for the three months ended September 30, 2019, compared with $102.5 million for the three months ended September 30, 2018. Operating income for the three months ended September 30, 2019 included corporate development and related costs of $7.8 million and restructuring and related costs of $0.3 million. Operating income for the three months ended September 30, 2018 included corporate development and related costs of $0.1 million. The operating ratio was 72.9% for the three months ended September 30, 2019, compared with 71.2% for the three months ended September 30, 2018.

Australia

Operating revenues from our Australian Operations decreased $5.1 million, or 6.7%, to $71.6 million for the three months ended September 30, 2019, compared with $76.7 million for the three months ended September 30, 2018. Excluding a $4.8 million decrease due to foreign currency depreciation, Australian Operations operating revenues decreased $0.3 million, or 0.4%.

Total traffic from our Australian Operations decreased 3,840 carloads, or 2.5%, to 147,478 carloads for the three months ended September 30, 2019, compared with the three months ended September 30, 2018. The traffic decrease was primarily due to decreases of 5,004 carloads of agricultural products traffic and 1,480 carloads of metallic ores traffic, partially offset by an increase of 2,401 carloads of coal and coke traffic. All remaining traffic increased by a net 243 carloads.

Operating income from our Australian Operations was $19.5 million for the three months ended September 30, 2019, compared with $20.7 million for the three months ended September 30, 2018. The operating ratio for our Australian Operations was 72.8% for the three months ended September 30, 2019, compared with an operating ratio of 73.0% for the three months ended September 30, 2018.

U.K./Europe

Operating revenues from our U.K./European Operations decreased $11.2 million, or 6.6%, to $159.7 million for the three months ended September 30, 2019, compared with $170.9 million for the three months ended September 30, 2018. Excluding a $9.1 million decrease due to foreign currency depreciation, U.K./European operating revenues decreased $2.2 million, or 1.3%, primarily due to a decrease in all other revenue.

Total traffic from our U.K./European Operations decreased 5,880 carloads, or 2.4%, to 235,502 carloads for the three months ended September 30, 2019, compared with 241,382 carloads for the three months ended September 30, 2018. The decrease in traffic was primarily due to decreases of 8,855 carloads of intermodal traffic and 2,803 carloads of coal and coke traffic, partially offset by increases of 3,319 carloads of minerals and stone traffic and 2,675 carloads of petroleum products traffic. All remaining traffic decreased by 216 carloads.

33

Operating loss from our U.K./European Operations was $2.4 million for the three months ended September 30, 2019, compared with operating income of $4.6 million for the three months ended September 30, 2018. The operating loss for the three months ended September 30, 2019 and operating income for the three months ended September 30, 2018 included $3.2 million and $3.3 million, respectively, of restructuring and related costs, primarily driven by our optimization activities in the U.K. The operating loss for the three months ended September 30, 2019 also included $1.9 million of unrealized foreign currency costs related to the revaluation of non-functional currency denominated operating lease liabilities in Poland, which are now included on the balance sheet with the adoption of the new lease standard. See Note 5, Leases, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report for additional information regarding this standard.

The operating ratio was 101.5% for the three months ended September 30, 2019, compared with 97.3% for the three months ended September 30, 2018.

Overview of Nine-Month Results

Our operating revenues decreased $59.7 million, or 3.4%, to $1,713.3 million for the nine months ended September 30, 2019, compared with $1,773.0 million for the nine months ended September 30, 2018. Operating income for the nine months ended September 30, 2019 was $286.7 million, compared with $317.9 million for the nine months ended September 30, 2018, a decrease of $31.2 million, or 9.8%. Our operating ratio was 83.3% for the nine months ended September 30, 2019, compared with 82.1% for the nine months ended September 30, 2018.

Net income for the nine months ended September 30, 2019 was $160.0 million, compared with net income of $196.9 million for the nine months ended September 30, 2018. Our diluted EPS for the nine months ended September 30, 2019 was $2.74 with 57.3 million weighted average shares outstanding, compared with diluted EPS of $3.08 with 61.3 million weighted average shares outstanding for the nine months ended September 30, 2018.

Our provision for income taxes for the nine months ended September 30, 2019 was $53.1 million compared with $41.6 million for the nine months ended September 30, 2018. Our effective income tax rate for the nine months ended September 30, 2019 was 24.9% and included a $4.2 million income tax benefit due to the release of a reserve for an uncertain tax position due to the expiration of the statute of limitations. Excluding the release of the reserve, our effective tax rate for the nine months ended September 30, 2019 was 26.9%. Our results for the nine months ended September 30, 2018 included an income tax benefit of $31.6 million associated with the retroactive extension of the United States Short Line Tax Credit for fiscal year 2017, which was enacted in February 2018. Based on developments during 2018, we recorded a reserve for uncertain tax positions of $5.5 million related to tax deductions on intercompany financing arrangements in the U.K., of which $3.7 million related to the period from March 25, 2015, the date of the Freightliner acquisition when the arrangements were established, through December 31, 2017. The reserve for uncertain tax positions was included in our provision for income taxes for the nine months ended September 30, 2018. Excluding the benefit from the retroactive extension and the prior period portion of the reserve for uncertain tax positions, our effective income tax rate for the nine months ended September 30, 2018 was 29.1%.

During the nine months ended September 30, 2019, we generated $384.2 million in cash flows from operating activities. During the same period, we purchased $227.3 million of property and equipment, including $18.9 million for new business investments, partially offset by $23.0 million in cash received from government grants and other outside parties for capital spending. We also paid $230.9 million in cash from the net decrease in outstanding debt and received cash of $45.4 million from the settlement of derivative transactions.

During the nine months ended September 30, 2018, we generated $397.5 million in cash flows from operating activities. During the same period, we purchased $194.1 million of property and equipment, including $33.9 million for new business investments, partially offset by $16.7 million in cash received from government grants and other outside parties for capital spending. We also repurchased 3.6 million shares of our Class A common stock for $270.5 million and received $55.0 million in cash from the net increase in outstanding debt. In addition, Genesee & Wyoming Australia (GWA) made a distribution of $14.9 million to its noncontrolling interest holders.

34

Items Affecting Comparability

Our results for the nine months ended September 30, 2019 and 2018 included certain items affecting comparability between the periods that are set forth below (dollars in millions, except per share amounts):

	Income/(Loss) Before Taxes Impact			After-Tax Net Income/(Loss) Attributable to G&W Impact			Diluted Earnings/(Loss) Per Common Share Impact
Nine Months Ended September 30, 2019
Restructuring and related costs	$	(18.8	)	$	(14.3	)	$	(0.25	)
Corporate development and related costs	$	(11.1	)	$	(8.0	)	$	(0.14	)
Net loss on sale and impairment of certain assets in North America	$	(1.0	)	$	(0.8	)	$	(0.01	)
Australia enterprise bargaining agreement amendment	$	(2.6	)	$	(0.9	)	$	(0.02	)
Release of a reserve for an uncertain tax position	$	—		$	4.2		$	0.07
Nine Months Ended September 30, 2018
Corporate development and related costs	$	(0.9	)	$	(0.6	)	$	(0.01	)
Restructuring costs	$	(12.9	)	$	(10.5	)	$	(0.17	)
Loss on sale of ERS Railways B.V.	$	(1.4	)	$	(1.4	)	$	(0.02	)
Gain on settlement	$	7.3		$	2.6		$	0.04
Credit facility refinancing-related costs	$	(2.7	)	$	(2.0	)	$	(0.03	)
2017 Short Line Tax Credit	$	—		$	31.6		$	0.52
Prior period portion of tax adjustment	$	—		$	(3.7	)	$	(0.06	)
TCJA measurement period adjustment	$	—		$	(1.6	)	$	(0.03	)

Changes in Operations

Proposed Merger

On July 1, 2019, G&W, together with Brookfield Infrastructure, GIC and Brookfield Infrastructure's institutional partners, announced an agreement pursuant to which affiliates of Brookfield Infrastructure and GIC will acquire G&W for a transaction price of $112 per share of common stock valued at approximately $8.4 billion including debt (the Merger). The proposed Merger was approved by our stockholders on October 3, 2019 by an affirmative vote of the holders of approximately 82.9% of the voting power of the outstanding shares of G&W's common stock on the record date. Subject to the satisfaction of the other closing conditions, the Merger is expected to close by year end 2019 or early 2020.

The Merger will be effected pursuant to the Agreement and Plan of Merger (the Merger Agreement), by and among the Company, DJP XX, LLC, a Delaware limited liability company (Parent), and MKM XXII Corp., a Delaware corporation and a wholly owned subsidiary of Parent (Merger Sub). Merger Sub will be merged with and into G&W with G&W surviving the Merger as a wholly-owned subsidiary of Parent. The proposed Merger will result in G&W becoming a privately held company.

Completion of the proposed Merger is subject to various closing conditions, including, among others, (i) the absence of any law, injunction or other order that prohibits the consummation of the Merger, (ii) the approval or authorization of, or exemption by, the Surface Transportation Board (or approval of the use of a voting trust structure), which exemption was granted on October 29, 2019, (iii) receipt of other antitrust and regulatory approvals, including approval of the Committee on Foreign Investment in the United States, and (iv) other customary closing conditions, including the accuracy of each party’s representations and warranties and each party’s compliance with its covenants and agreements contained in the Merger Agreement (subject in the case of this clause (iv) to certain materiality qualifiers).

35

Divestiture of 51.1% Interest in G&W Australia Holdings LP (GWAHLP)

Under the Merger Agreement (as described in more detail above), we agreed to use reasonable best efforts to assist and cooperate with Parent in Parent’s efforts to consummate any planned divestiture by Parent of our interests in GWAHLP, the holding company for all of our Australian businesses, to a third party (the GWA Divestiture), provided that (i) such cooperation would not unreasonably interfere with our business or operations and (ii) we would not be required to take any action that would subject us to actual or potential liability, to bear any cost or expense or to pay any fee or make any other payment or agree to provide any indemnity in connection with the GWA Divestiture prior to the effective time of the Merger. Following the execution of the Merger Agreement, Parent requested that we cause certain of our subsidiaries to enter into a Definitive Interest Sale Agreement for the GWA Divestiture (the GWA Divestiture Agreement), and on August 4, 2019, our board of directors and the governing bodies of such subsidiaries approved the GWA Divestiture Agreement and such subsidiaries entered into the GWA Divestiture Agreement.

Under the GWA Divestiture Agreement, certain entities affiliated with MIRA that currently own 48.9% of GWAHLP will acquire, directly or indirectly, the remaining interests in GWAHLP from certain subsidiaries of G&W in exchange for A$627.4 million, subject to adjustment. The GWA Divestiture is subject to customary closing conditions, including the satisfaction of the closing conditions set forth in the Merger Agreement. Neither G&W nor any of its subsidiaries will have any liability under the GWA Divestiture Agreement prior to the consummation of the Merger. The GWA Divestiture Agreement may be terminated under certain circumstances, including by any party thereto if the transactions contemplated by the GWA Divestiture Agreement have not been consummated on or before July 1, 2020.

The consideration to be received by our subsidiaries that are parties to the GWA Divestiture Agreement will not be distributed to any of our stockholders prior to consummation of the Merger, and the sole consideration that our stockholders will receive in the Merger is $112.00 in cash per share of G&W common stock on the terms and conditions set forth in the Merger Agreement.

The consummation of the GWA Divestiture is not a condition to the closing of the Merger or any of Parent's other obligations under the Merger Agreement.

North American Operations

Canada Lease Expirations: Two of our short line railroad leases in Canada (Goderich-Exeter Railway (GEXR) and Southern Ontario Railway (SORR)) expired at the end of 2018. Our results for the three and nine months ended September 30, 2018 included $5.1 million and $16.1 million, respectively, of revenues and operating losses of $0.9 million and $1.3 million, respectively, from these leased railroads.

U.K./European Operations

U.K. Operations Optimization: In May 2018, we began a program to restructure and further optimize our operations in the U.K., which we intend to complete by 2020. The program includes the rationalization of the locomotive and railcar fleet, management restructuring (following the U.K. consultative process) and technology investments to upgrade systems to enhance productivity and service quality.

We recorded restructuring and related costs associated with the optimization of $3.2 million and $15.5 million for the three and nine months ended September 30, 2019, respectively. Restructuring and related costs of $3.3 million and $12.9 million were recorded associated with the optimization for the three and nine months ended September 30, 2018, respectively. For additional information regarding the optimization of our U.K. operations, see Note 2, Changes in Operations, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report.

Continental Europe Intermodal Business: On June 5, 2018, we sold our Continental Europe intermodal business, ERS Railways B.V. (ERS), for gross cash proceeds of €11.2 million (or $13.1 million at the exchange rate on June 5, 2018) or €6.8 million (or $7.9 million at the exchange rate on June 5, 2018) net of €4.4 million (or $5.2 million at the exchange rate on June 5, 2018) of cash on hand that transferred to the buyer. Our results for the nine months ended September 30, 2018 included $24.1 million of revenues and $1.6 million of operating income from ERS.

36

Three Months Ended September 30, 2019 Compared with Three Months Ended September 30, 2018

Consolidated Operating Results

Operating Revenues

The following table sets forth our total operating revenues and carloads for the three months ended September 30, 2019 and 2018. The table below also reflects the calculation of our existing operations by subtracting the 2018 revenues and carloads of the operations of the leased railroads in Canada that expired at the end of 2018 from our total operations for the three months ended September 30, 2018 (dollars in thousands):

	Three Months Ended September 30,								Increase/(Decrease) in Total Operations					Increase/(Decrease) in Existing Operations					Currency Impact on 2018 Total Operations*			Currency Impact on 2018 Existing Operations*
	2019		2018
			Total Operations		Divested Operations		Existing Operations		Amount			%		Amount			%
Freight revenues	$	410,149	$	423,374	$	3,216	$	420,158	$	(13,225	)	(3.1	)%	$	(10,009	)	(2.4	)%	$	(8,720	)	$	(8,687	)
Freight-related revenues	141,369		145,450		1,434		144,016		(4,081		)	(2.8	)%	(2,647		)	(1.8	)%	(4,405		)	(4,391		)
All other revenues	32,176		34,480		415		34,065		(2,304		)	(6.7	)%	(1,889		)	(5.5	)%	(1,026		)	(1,022		)
Total operating revenues	$	583,694	$	603,304	$	5,065	$	598,239	$	(19,610	)	(3.3	)%	$	(14,545	)	(2.4	)%	$	(14,151	)	$	(14,100	)
Carloads	798,319		838,919		7,644		831,275		(40,600		)	(4.8	)%	(32,956		)	(4.0	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

Operating Expenses

Total operating expenses for the three months ended September 30, 2019 decreased $4.5 million, or 1.0%, to $470.9 million, compared with $475.5 million for the three months ended September 30, 2018. The decrease consisted of $5.9 million from the leased railroads in Canada that expired at the end of 2018, partially offset by an increase of $1.4 million from existing operations. Excluding a $12.5 million benefit from the depreciation of foreign currencies relative to the United States dollar, operating expenses from existing operations increased $13.9 million, or 3.0%. The increase from existing operations included increases of $10.9 million in other expense, net, primarily due to corporate development and related costs associated with the proposed Merger, $4.2 million in labor and benefits expense, $2.6 million in depreciation and amortization expense and $2.1 million in casualty and insurance expense, partially offset by decreases of $3.2 million in equipment rents expense and $2.4 million in the cost of diesel fuel used in train operations.

The following table sets forth our total operating expenses for the three months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease)Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	175,500		30.1	%	$	175,853		29.1	%	$	(353	)	$	(3,879	)	$	171,974		$	3,526
Equipment rents	30,926			5.3	%	35,325			6.0	%	(4,399		)	(1,067		)	34,258			(3,332		)
Purchased services	51,055			8.7	%	53,717			8.9	%	(2,662		)	(2,132		)	51,585			(530		)
Depreciation and amortization	63,026			10.8	%	65,392			10.8	%	(2,366		)	(1,475		)	63,917			(891		)
Diesel fuel used in train operations	41,533			7.1	%	45,713			7.6	%	(4,180		)	(1,284		)	44,429			(2,896		)
Electricity used in train operations	1,794			0.3	%	2,742			0.5	%	(948		)	(142		)	2,600			(806		)
Casualties and insurance	11,658			2.0	%	9,912			1.6	%	1,746			(191		)	9,721			1,937
Materials	32,435			5.6	%	32,744			5.4	%	(309		)	(1,112		)	31,632			803
Trackage rights	21,266			3.6	%	22,838			3.8	%	(1,572		)	(658		)	22,180			(914		)
Net gain on sale and impairment of assets	(641		)	(0.1	)%	(642		)	(0.1	)%	1			11			(631		)	(10		)
Restructuring and related costs	3,561			0.6	%	3,286			0.5	%	275			(176		)	3,110			451
Other expenses, net	38,825			6.7	%	28,604			4.7	%	10,221			(454		)	28,150			10,675
Total operating expenses	$	470,938		80.7	%	$	475,484		78.8	%	$	(4,546	)	$	(12,559	)	$	462,925		$	8,013

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

37

Operating Income/Operating Ratio

Operating income was $112.8 million for the three months ended September 30, 2019, compared with $127.8 million for the three months ended September 30, 2018. Operating income for the three months ended September 30, 2019 included corporate development and related costs of $8.2 million, primarily related to the proposed Merger, and restructuring and related costs of $3.6 million, primarily driven by our optimization activities in the U.K. Operating income for the three months ended September 30, 2018 included restructuring and related costs of $3.3 million, primarily driven by our optimization activities in the U.K., corporate development and related costs of $0.3 million and a gain on settlement of $0.9 million from the recovery of pre-petition claims associated with an Australia customer's voluntary administration (bankruptcy) in the second quarter of 2016. Our operating ratio was 80.7% for the three months ended September 30, 2019, compared with 78.8% for the three months ended September 30, 2018.

Interest Expense

Interest expense was $25.4 million for the three months ended September 30, 2019, compared with $26.4 million for the three months ended September 30, 2018. The decrease in interest expense for the three months ended September 30, 2019 was primarily driven by a decrease in outstanding borrowings due to normal scheduled payments and a decrease in interest rates.

Provision for Income Taxes

Our provision for income taxes for the three months ended September 30, 2019 was $20.0 million compared with $31.0 million for the three months ended September 30, 2018. Our effective income tax rate for the three months ended September 30, 2019 was 22.3% and included a $4.2 million income tax benefit due to the release of a reserve for an uncertain tax position due to the expiration of the statute of limitations. Excluding the release of the reserve, our effective income tax rate for the three months ended September 30, 2019 was 27.0%. Our effective income tax rate for the three months ended September 30, 2018 was 30.0% and included a $1.6 million measurement period adjustment to increase the one-time transition (toll) tax on earnings of certain foreign subsidiaries as a result of the TCJA. For additional information regarding income taxes, see Note 9, Income Taxes, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report.

Net Income Attributable to G&W and Earnings Per Common Share

Net income attributable to G&W for the three months ended September 30, 2019 was $66.8 million, compared with $69.6 million for the three months ended September 30, 2018. Our basic EPS were $1.18 with 56.6 million weighted average shares outstanding for the three months ended September 30, 2019, compared with basic EPS of $1.18 with 59.2 million weighted average shares outstanding for the three months ended September 30, 2018. Our diluted EPS for the three months ended September 30, 2019 were $1.16 with 57.5 million weighted average shares outstanding, compared with diluted EPS of $1.16 with 60.1 million weighted average shares outstanding for the three months ended September 30, 2018. Our results for the three months ended September 30, 2019 and 2018 included certain items affecting comparability between the periods as previously presented in the "Overview—Overview of Three-Month Results—Items Affecting Comparability."

Net Income Attributable to Noncontrolling Interest

We own a 51.1% controlling interest in our Australian Operations. As such, we include 100% of the revenues and expenses from our Australian Operations within our consolidated financial statements and report a noncontrolling interest for MIRA’s 48.9% equity ownership. Net income attributable to noncontrolling interest for the three months ended September 30, 2019 was $3.0 million, compared with $2.7 million for three months ended September 30, 2018.

Operating Results by Segment

Our various rail operations are organized into eight operating regions. We present our financial information as three reportable segments: North American Operations, Australian Operations and U.K./European Operations. Our six North American regions are aggregated into one segment as a result of having similar economic and operating characteristics. Each of our segments generates the following three categories of revenues from external customers: freight revenues, freight-related revenues and all other revenues.

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North American Operations

Operating Revenues

The following table sets forth our North American Operations total operating revenues and carloads for the three months ended September 30, 2019 and 2018. The table also reflects the calculation of our existing operations by subtracting the 2018 revenues and carloads from the leased railroads in Canada that expired at the end of 2018 from our total operations for the three months ended September 30, 2018 (dollars in thousands):

	Three Months Ended September 30,								Increase/(Decrease) in Total Operations					Increase/(Decrease) in Existing Operations					Currency Impact on 2018 Total Operations*			Currency Impact on 2018 Existing Operations*
	2019		2018
			Total Operations		Divested Operations		Existing Operations		Amount			%		Amount			%
Freight revenues	$	268,025	$	273,432	$	3,216	$	270,216	$	(5,407	)	(2.0	)%	$	(2,191	)	(0.8	)%	$	(183	)	$	(150	)
Freight-related revenues	68,129		66,045		1,434		64,611		2,084			3.2	%	3,518			5.4	%	(83		)	(69		)
All other revenues	16,288		16,232		415		15,817		56			0.3	%	471			3.0	%	(28		)	(24		)
Total operating revenues	$	352,442	$	355,709	$	5,065	$	350,644	$	(3,267	)	(0.9	)%	$	1,798		0.5	%	$	(294	)	$	(243	)
Carloads	415,339		446,219		7,644		438,575		(30,880		)	(6.9	)%	(23,236		)	(5.3	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

Freight Revenues

The following table sets forth our North American Operations total freight revenues for the three months ended September 30, 2019 and 2018. The table below also reflects the calculation of our existing operations by subtracting the 2018 revenues and carloads from the leased railroads in Canada that expired at the end of 2018 from our total operations for the three months ended September 30, 2018 (dollars in thousands):

	Three Months Ended September 30,									Increase/(Decrease) in Existing Operations			Currency Impact on Existing Operations			2018 Constant Currency Existing Operations*		Increase/(Decrease) in Existing Operations Constant Currency*
	2019		2018
Commodity Group			Total Operations		Divested Operations			Existing Operations
Agricultural Products	$	34,574	$	30,565	$	467		$	30,098	$	4,476		$	(8	)	$	30,090	$	4,484
Autos & Auto Parts	6,339		5,513		264			5,249		1,090			(6		)	5,243		1,096
Chemicals & Plastics	39,518		38,436		586			37,850		1,668			(23		)	37,827		1,691
Coal & Coke	18,336		23,006		—			23,006		(4,670		)	(10		)	22,996		(4,660		)
Food & Kindred Products	8,355		8,761		225			8,536		(181		)	(1		)	8,535		(180		)
Intermodal	461		514		—			514		(53		)	—			514		(53		)
Lumber & Forest Products	22,862		24,113		77			24,036		(1,174		)	(10		)	24,026		(1,164		)
Metallic Ores	4,225		3,573		(1		)	3,574		651			(10		)	3,564		661
Metals	28,115		34,904		502			34,402		(6,287		)	(20		)	34,382		(6,267		)
Minerals & Stone	41,399		38,570		193			38,377		3,022			(12		)	38,365		3,034
Petroleum Products	19,027		18,236		658			17,578		1,449			(11		)	17,567		1,460
Pulp & Paper	30,648		31,961		34			31,927		(1,279		)	(33		)	31,894		(1,246		)
Waste	8,278		8,089		63			8,026		252			(2		)	8,024		254
Other	5,888		7,191		148			7,043		(1,155		)	(4		)	7,039		(1,151		)
Total	$	268,025	$	273,432	$	3,216		$	270,216	$	(2,191	)	$	(150	)	$	270,066	$	(2,041	)

*     Constant currency amounts reflect the prior period existing operations translated at the current period exchange rates.

39

The following table sets forth our North American Operations freight revenues, carloads and average freight revenues per carload for the three months ended September 30, 2019 and 2018 (dollars in thousands, except average freight revenues per carload):

	Freight Revenues								Carloads		Average Freight Revenues Per Carload
	Three Months Ended September 30,								Three Months Ended September 30,		Three Months Ended
	2019				2018 Constant Currency*						September 30,
Commodity Group	Amount		% of Total		Amount		% of Total		2019	2018	2019		2018		2018 Constant Currency*
Agricultural Products	$	34,574	12.9	%	$	30,552	11.2	%	56,026	50,989	$	617	$	599	$	599
Autos & Auto Parts	6,339		2.4	%	5,506		2.0	%	9,575	8,724	662		632		631
Chemicals & Plastics	39,518		14.7	%	38,407		14.0	%	43,293	43,903	913		875		875
Coal & Coke	18,336		6.8	%	22,996		8.4	%	52,782	70,314	347		327		327
Food & Kindred Products	8,355		3.1	%	8,757		3.2	%	13,971	15,312	598		572		572
Intermodal	461		0.2	%	514		0.2	%	3,983	4,922	116		104		104
Lumber & Forest Products	22,862		8.5	%	24,103		8.8	%	34,840	37,328	656		646		646
Metallic Ores	4,225		1.6	%	3,565		1.3	%	4,872	4,655	867		768		766
Metals	28,115		10.5	%	34,878		12.8	%	33,862	43,752	830		798		797
Minerals & Stone	41,399		15.5	%	38,555		14.1	%	62,357	60,496	664		638		637
Petroleum Products	19,027		7.1	%	18,219		6.7	%	26,081	26,231	730		695		695
Pulp & Paper	30,648		11.4	%	31,926		11.7	%	40,638	44,403	754		720		719
Waste	8,278		3.1	%	8,087		3.0	%	15,764	15,859	525		510		510
Other	5,888		2.2	%	7,184		2.6	%	17,295	19,331	340		372		372
Total	$	268,025	100.0	%	$	273,249	100.0	%	415,339	446,219	$	645	$	613	$	612

*     Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Total traffic from our North American Operations decreased 30,880 carloads, or 6.9%, to 415,339 carloads for the three months ended September 30, 2019, compared with the three months ended September 30, 2018. Excluding traffic from the railroad leases in Canada that expired at the end of 2018, existing operations traffic decreased 23,236 carloads, or 5.3%, which included decreases of 17,532 carloads of coal and coke traffic, 8,428 carloads of metals traffic, 3,698 carloads of pulp and paper traffic, 2,292 carloads of lumber and forest products traffic and 1,597 carloads of other commodity traffic, partially offset by increases of 6,080 carloads of agricultural products traffic, 2,553 carloads of minerals and stone traffic and 1,376 carloads of autos and auto parts traffic. All remaining traffic increased by a net 302 carloads.

Changes in average freight revenues per carload in a commodity group may be impacted by changes in customer rates, fuel surcharges, commodity mix and the mix of customer traffic within a commodity group. Excluding a 0.2% impact of foreign currency, average freight revenues per carload from our North American Operations increased 5.4% to $645 for the three months ended September 30, 2019, compared with the same period in 2018. Average freight revenues per carload from existing operations, excluding the impact of foreign currency, increased 4.7% for the three months ended September 30, 2019, compared with the same period in 2018. The increase in average freight revenues per carload was impacted by a change in the mix of commodities, which increased average freight revenues per carload by 1.7%, while higher fuel surcharges decreased average freight revenues per carload by 0.6%. Excluding these factors, average freight revenues per carload increased 3.6%.

The following information discusses the significant changes in our North American Operations freight revenues by commodity group excluding the impact of foreign currency and freight revenues from the leased railroads in Canada that expired at the end of 2018.

Agricultural products revenues increased $4.5 million, or 14.9%. Agricultural products traffic increased 6,080 carloads, or 12.2%, which increased revenues by $3.8 million, and average freight revenues per carload increased 2.5%, which increased revenues by $0.7 million. The increase in carloads was primarily due to increased grain shipments in the midwestern United States and farm products shipments in the western United States.

Autos and auto parts revenues increased $1.1 million, or 20.9%. Autos and auto parts traffic increased 1,376 carloads, or 16.8%, which increased revenues by $0.9 million, and average freight revenues per carload increased 3.6%, which increased revenues by $0.2 million. The increase in carloads was primarily due to higher export demand in the western United States.

40

Chemicals and plastics revenues increased $1.7 million, or 4.5%. Chemicals and plastics traffic increased 937 carloads, or 2.2%, which increased revenues by $0.9 million, and average freight revenues per carload increased 2.2%, which increased revenues by $0.8 million. The increase in carloads was primarily due to an increase in ethanol shipments in the midwestern United States associated with a new customer.

Coal and coke revenues decreased $4.7 million, or 20.3%. Coal and coke traffic decreased 17,532 carloads, or 24.9%, which decreased revenues by $6.1 million, while average freight revenues per carload increased 6.2%, which increased revenues by $1.4 million. The decrease in carloads was primarily due to reduced demand in the midwestern, southern and northeastern United States primarily associated with unplanned outages, pending plant closures, natural gas competition and high inventories. The increase in average freight revenues per carload was primarily due to a change in the mix of business.

Lumber and forest products revenues decreased $1.2 million, or 4.8%. Lumber and forest products traffic decreased 2,292 carloads, or 6.2%, which decreased revenues by $1.5 million, while average freight revenues per carload increased 1.4%, which increased revenues by $0.3 million. The decrease in carloads was primarily due to less demand for lumber across North America and decreased export log shipments in the western United States.

Metals revenues decreased $6.3 million, or 18.2%. Metals traffic decreased 8,428 carloads, or 19.9%, which decreased revenues by $7.0 million, while average freight revenues per carload increased 2.1%, which increased revenues by $0.7 million. The decrease in carloads was primarily due to decreased finished steel shipments in the southern and northeastern United States and decreased scrap steel shipments in the northeastern and midwestern United States.

Minerals and stone revenues increased $3.0 million, or 7.9%. Minerals and stone traffic increased 2,553 carloads, or 4.3%, which increased revenues $1.7 million, and average freight revenues per carload increased 3.4%, which increased revenues by $1.3 million. The increase in carloads was primarily due to increased aggregates shipments across North America.

Petroleum products revenues increased $1.5 million, or 8.3%. Petroleum products average freight revenues per carload increased 5.2%, which increased revenues by $0.9 million, and traffic increased 766 carloads, or 3.0%, which increased revenues by $0.6 million. The increase in average freight revenues per carload was primarily due to stronger pricing and a change in the mix of business.

Pulp and paper revenues decreased $1.2 million, or 3.9%. Pulp and paper traffic decreased 3,698 carloads, or 8.3%, which decreased revenues by $2.8 million, while average freight revenues per carload increased 4.8%, which increased revenues by $1.6 million. The decrease in carloads was primarily due to fewer shipments of containerboard across the United States.

Other commodity revenues decreased $1.2 million, or 16.4%. Other commodity average freight revenues per carload decreased 8.8%, which decreased revenues by $0.6 million, and traffic decreased 1,597 carloads, or 8.5%, which decreased revenues by $0.6 million. The decrease in carloads was primarily due to decreased empty car traffic in the midwestern United Sates and the decrease in average freight revenues per carload was primarily due to a change in mix of the business, led by fewer shipments of wind tower components in the midwestern United States.

Freight revenues from all remaining commodities combined increased by a net $0.7 million.

Freight-Related Revenues

Freight-related revenues from our North American Operations, which includes revenues from railcar switching, track access fees, storage and other ancillary revenues related to the movement of freight, were $68.1 million for the three months ended September 30, 2019, compared with $66.0 million for the three months ended September 30, 2018, an increase of $2.1 million, or 3.2%. Excluding $1.4 million of revenues from the leased railroads in Canada that expired at the end of 2018, and a $0.1 million decrease due to foreign currency depreciation, freight-related revenues from our North American Operations existing operations increased $3.6 million, or 5.6%, for the three months ended September 30, 2019, compared with $64.5 million for the three months ended September 30, 2018. The increase in freight-related revenues from our existing operations was primarily due to increases in switching and storage revenues in the southeastern United States, demurrage revenues in the midwestern United States and revenue from volume commitment shortfall contracts in the southern United States.

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All Other Revenues

All other revenues from our North American Operations, which includes revenues from third-party railcar and locomotive repairs, property rentals and other ancillary revenues not directly related to the movement of freight, were $16.3 million for the three months ended September 30, 2019, compared with $16.2 million for the three months ended September 30, 2018, an increase of $0.1 million, or 0.3%. Excluding $0.4 million in revenues from the leased railroads in Canada that expired at the end of 2018 and a decrease of less than $0.1 million due to foreign currency depreciation, all other revenues from our North American Operations increased $0.5 million, or 3.1%, for the three months ended September 30, 2019, compared with $15.8 million for the three months ended September 30, 2018.

Operating Expenses

Total operating expenses from our North American Operations increased $3.6 million, or 1.4%, to $256.8 million for the three months ended September 30, 2019, compared with $253.2 million for the three months ended September 30, 2018. The increase included a $9.7 million increase from existing operations, partially offset by a $5.9 million decrease in expenses from the leased railroads in Canada that expired at the end of 2018 and a $0.2 million decrease due to foreign currency depreciation. The increase from existing operations included increases of $6.6 million in other expenses, net, primarily due to corporate development and related costs associated with the proposed Merger, $2.4 million in purchased services expense, $2.1 million in casualties and insurance expense and $1.3 million in depreciation and amortization expense, partially offset by decreases of $3.3 million in equipment rent expense and $2.0 million in the cost of diesel fuel used in train operations.

The following table sets forth operating expenses from our North American Operations for the three months ended September 30, 2019 and 2018 (dollars in thousands): 

	Three Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	108,161		30.7	%	$	107,940		30.3	%	$	221		$	(88	)	$	107,852		$	309
Equipment rents	12,075			3.4	%	15,441			4.4	%	(3,366		)	(11		)	15,430			(3,355		)
Purchased services	16,648			4.7	%	14,968			4.2	%	1,680			(14		)	14,954			1,694
Depreciation and amortization	39,164			11.1	%	41,388			11.6	%	(2,224		)	(63		)	41,325			(2,161		)
Diesel fuel used in train operations	20,673			5.9	%	23,230			6.5	%	(2,557		)	(25		)	23,205			(2,532		)
Casualties and insurance	8,605			2.4	%	6,636			1.9	%	1,969			(2		)	6,634			1,971
Materials	13,577			3.9	%	12,836			3.6	%	741			(11		)	12,825			752
Trackage rights	11,028			3.1	%	10,586			3.0	%	442			(1		)	10,585			443
Net gain on sale and impairment of assets	(509		)	(0.1	)%	(506		)	(0.1	)%	(3		)	4			(502		)	(7		)
Restructuring and related costs	323			0.1	%	1			—	%	322			—			1			322
Other expenses, net	27,064			7.7	%	20,705			5.8	%	6,359			(13		)	20,692			6,372
Total operating expenses	$	256,809		72.9	%	$	253,225		71.2	%	$	3,584		$	(224	)	$	253,001		$	3,808

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

The following information discusses the significant changes in operating expenses of our North American Operations excluding a decrease of $0.2 million due to the impact from foreign currency depreciation.

Equipment rents expense was $12.1 million for the three months ended September 30, 2019, compared with $15.4 million for the three months ended September 30, 2018, a decrease of $3.4 million, or 21.7%. The decrease was primarily due to reduced car hire expense from existing operations as a result of more fluid car movements in 2019.

Purchased services expense was $16.6 million for the three months ended September 30, 2019, compared with $15.0 million for the three months ended September 30, 2018, an increase of $1.7 million, or 11.3%. The increase consisted of $2.4 million from existing operations, partially offset by a decrease of $0.7 million from the expired Canadian leases. The increase in existing operations was primarily due to increases in track maintenance expense in 2019.

42

Depreciation and amortization expense was $39.2 million for the three months ended September 30, 2019, compared with $41.3 million for the three months ended September 30, 2018, a decrease of $2.2 million, or 5.2%. The decrease consisted of $3.5 million from the expired Canadian leases, partially offset by an increase of $1.3 million from existing operations. The increase from existing operations was primarily attributable to capital spending in 2018.

The cost of diesel fuel used in train operations was $20.7 million for the three months ended September 30, 2019, compared with $23.2 million for the three months ended September 30, 2018, a decrease of $2.5 million, or 10.9%. The decrease consisted of $2.0 million from existing operations and $0.5 million from the expired Canadian leases. The decrease from existing operations consisted of $2.6 million due to an 11.4% decrease in average fuel cost per gallon, partially offset by an increase of $0.6 million due to higher diesel fuel consumption.

Casualties and insurance expense was $8.6 million for the three months ended September 30, 2019, compared with $6.6 million for the three months ended September 30, 2018, an increase of $2.0 million, or 29.7%. The increase in existing operations was primarily attributable to higher derailment expense in 2019 associated with the washouts on the Rapid City, Pierre & Eastern Railroad.

Other expenses, net were $27.1 million for the three months ended September 30, 2019, compared with $20.7 million for the three months ended September 30, 2018, an increase of $6.4 million, or 30.8%. The increase consisted of $6.6 million from existing operations, partially offset by a decrease of $0.2 million from the expired Canadian leases. The increase from existing operations was primarily due to corporate development and related costs in 2019 associated with the proposed Merger.

Operating Income/Operating Ratio

Operating income from our North American Operations was $95.6 million for the three months ended September 30, 2019, compared with $102.5 million for the three months ended September 30, 2018. Operating income for the three months ended September 30, 2019 included corporate development and related costs of $7.8 million and restructuring and related costs of $0.3 million. Operating income for the three months ended September 30, 2018 included corporate development and related costs of $0.1 million. The operating ratio was 72.9% for the three months ended September 30, 2019, compared with 71.2% for the three months ended September 30, 2018.

Australian Operations

Operating Revenues

As previously disclosed, we own a controlling 51.1% interest in our Australian Operations, and therefore, we include 100% of our Australian Operations within our consolidated financial statements with a 48.9% noncontrolling interest recorded to reflect MIRA's ownership. The following table sets forth our Australian Operations operating revenues and carloads for the three months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,				Increase/(Decrease) in Total Operations					Currency Impact on 2018 Total Operations*
	2019		2018		Amount			%
Freight revenues	$	61,457	$	65,249	$	(3,792	)	(5.8	)%	$	(4,066	)
Freight-related revenues	8,011		10,136		(2,125		)	(21.0	)%	(633		)
All other revenues	2,132		1,318		814			61.8	%	(84		)
Total operating revenues	$	71,600	$	76,703	$	(5,103	)	(6.7	)%	$	(4,783	)
Carloads	147,478		151,318		(3,840		)	(2.5	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

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Freight Revenues

The following table sets forth the changes in our Australian Operations freight revenues by commodity group for the three months ended September 30, 2019 and 2018 (dollars in thousands): 

	Three Months Ended September 30,				Increase/(Decrease) in Total Operations			Currency Impact			2018 Constant Currency*		Increase/(Decrease) in Total Operations Constant Currency*
Commodity Group	2019		2018
Agricultural Products	$	2,631	$	4,150	$	(1,519	)	$	(259	)	$	3,891	$	(1,260	)
Coal & Coke	33,187		32,357		830			(2,025		)	30,332		2,855
Intermodal	16,446		17,538		(1,092		)	(1,088		)	16,450		(4		)
Metallic Ores	7,036		8,914		(1,878		)	(552		)	8,362		(1,326		)
Minerals & Stone	1,979		2,066		(87		)	(127		)	1,939		40
Petroleum Products	178		224		(46		)	(15		)	209		(31		)
Total	$	61,457	$	65,249	$	(3,792	)	$	(4,066	)	$	61,183	$	274

*     Constant currency amounts reflect the prior period results translated at the current period exchange rates.

The following table sets forth our Australian Operations freight revenues, carloads and average freight revenues per carload for the three months ended September 30, 2019 and 2018 (dollars in thousands, except average freight revenues per carload):

	Freight Revenues								Carloads		Average Freight Revenues Per Carload
	Three Months Ended September 30,								Three Months Ended September 30,		Three Months Ended
	2019				2018 Constant Currency*						September 30,
Commodity Group	Amount		% of Total		Amount		% of Total		2019	2018	2019		2018		2018 Constant Currency*
Agricultural Products	$	2,631	4.3	%	$	3,891	6.4	%	1,525	6,529	$	1,725	$	636	$	596
Coal & Coke	33,187		54.0	%	30,332		49.6	%	109,210	106,809	304		303		284
Intermodal	16,446		26.8	%	16,450		26.9	%	14,564	14,610	1,129		1,200		1,126
Metallic Ores	7,036		11.4	%	8,362		13.7	%	4,984	6,464	1,412		1,379		1,294
Minerals & Stone	1,979		3.2	%	1,939		3.1	%	17,121	16,813	116		123		115
Petroleum Products	178		0.3	%	209		0.3	%	74	93	2,405		2,409		2,247
Total	$	61,457	100.0	%	$	61,183	100.0	%	147,478	151,318	$	417	$	431	$	404

*     Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Total traffic from our Australian Operations decreased 3,840 carloads, or 2.5%, to 147,478 carloads for the three months ended September 30, 2019, compared with the three months ended September 30, 2018, primarily due to decreases of 5,004 carloads of agricultural products traffic and 1,480 carloads of metallic ores traffic, partially offset by an increase of 2,401 carloads of coal and coke traffic. All remaining traffic increased by a net 243 carloads.

Changes in average freight revenues per carload in a commodity group may be impacted by changes in customer rates, fuel surcharges, commodity mix and the mix of customer traffic within a commodity group. Excluding a 6.4% impact of foreign currency, average freight revenues per carload from our Australian Operations increased 3.2% to $417 for the three months ended September 30, 2019, compared with the same period in 2018. A change in the mix of commodities decreased average freight revenues per carload by 13.8%, and lower fuel surcharges decreased average freight revenues per carload by 0.2%. Excluding these factors, average freight revenues per carload increased 17.2% primarily due to an increase in agricultural products freight revenues per carload.

The following information discusses the significant changes in our Australian Operations freight revenues by commodity group excluding the impact of foreign currency.

44

Agricultural products revenues decreased $1.3 million, or 32.4%. Agricultural products traffic decreased 5,004 carloads, or 76.6%, which decreased revenues by $8.6 million, while average freight revenues per carload increased 189.4%, which increased revenues by $7.4 million. The decrease in carloads was primarily due to a drought-related smaller grain harvest in 2019. The increase in average freight revenue per carload was primarily due to a change in mix and the conclusion of services on the Eyre Peninsula. The decrease in grain traffic resulted in higher average freight revenues per carload, primarily due to the rate structure for Australian grain traffic, which has both a fixed and variable component.

Coal and coke revenues increased $2.9 million, or 9.4%. Coal and coke average freight revenues per carload increased 7.0%, which increased revenues by $2.1 million, and traffic increased 2,401 carloads, or 2.2%, which increased revenues by $0.7 million. The increase in average freight revenues per carload was primarily due to a change in the mix of business.

Metallic ores revenues decreased $1.3 million, or 15.9%. Metallic ores traffic decreased 1,480 carloads, or 22.9%, which decreased revenues by $2.1 million, primarily due to a temporary mine closure in 2019.

Freight revenues from all remaining commodities were relatively flat.

Freight-Related Revenues

Excluding a $0.6 million decrease due to foreign currency depreciation, freight-related revenues from our Australian Operations, which includes revenues from railcar switching, track access rights, crewing services, storage and other ancillary revenues related to the movement of freight, decreased $1.5 million, or 15.7%, to $8.0 million for the three months ended September 30, 2019, compared with $9.5 million for the three months ended September 30, 2018. The decrease in freight-related revenues was primarily due to switching competition and prolonged drought conditions in 2019.

All Other Revenues

Excluding a $0.1 million decrease due to foreign currency depreciation, all other revenues from our Australian Operations, which includes revenues from third-party railcar and locomotive repairs, property rentals and other ancillary revenues not directly related to the movement of freight, increased $0.9 million, or 72.8%, to $2.1 million for the three months ended September 30, 2019, compared with $1.2 million for the three months ended September 30, 2018.

Operating Expenses

Total operating expenses from our Australian Operations for the three months ended September 30, 2019 decreased $3.9 million, or 6.9%, to $52.1 million, compared with $56.0 million for the three months ended September 30, 2018, primarily due to a $3.5 million decrease from foreign currency depreciation for the three months ended September 30, 2019 compared with the three months ended September 30, 2018.

The following table sets forth operating expenses from our Australian Operations for the three months ended September 30, 2019 and 2018 (dollars in thousands): 

	Three Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	15,865		22.2	%	$	17,400		22.7	%	$	(1,535	)	$	(1,085	)	$	16,315		$	(450	)
Equipment rents	1,047			1.5	%	1,452			1.9	%	(405		)	(91		)	1,361			(314		)
Purchased services	5,444			7.6	%	6,319			8.2	%	(875		)	(393		)	5,926			(482		)
Depreciation and amortization	13,779			19.2	%	14,937			19.5	%	(1,158		)	(929		)	14,008			(229		)
Diesel fuel used in train operations	7,069			9.9	%	8,074			10.5	%	(1,005		)	(504		)	7,570			(501		)
Casualties and insurance	2,117			3.0	%	1,651			2.2	%	466			(102		)	1,549			568
Materials	2,740			3.8	%	3,003			3.9	%	(263		)	(188		)	2,815			(75		)
Trackage rights	1,555			2.2	%	1,932			2.5	%	(377		)	(123		)	1,809			(254		)
Net gain on sale and impairment of assets	(111		)	(0.2	)%	(20		)	—	%	(91		)	1			(19		)	(92		)
Other expenses, net	2,611			3.6	%	1,242			1.6	%	1,369			(85		)	1,157			1,454
Total operating expenses	$	52,116		72.8	%	$	55,990		73.0	%	$	(3,874	)	$	(3,499	)	$	52,491		$	(375	)

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

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The following information discusses the significant change in operating expenses of our Australian Operations excluding a $3.5 million decrease from foreign currency depreciation.

Other expenses, net were $2.6 million for the three months ended September 30, 2019, compared with $1.2 million for the three months ended September 30, 2018, an increase of $1.5 million. Other expense, net for the three months ended September 30, 2018 included a $0.9 million gain on settlement related to a customer's voluntary administration (bankruptcy).

Operating Income/Operating Ratio

Total operating income from our Australian Operations decreased $1.2 million, or 5.9%, to $19.5 million for the three months ended September 30, 2019, compared with $20.7 million for the three months ended September 30, 2018. The operating ratio was 72.8% for the three months ended September 30, 2019, compared with 73.0% for the three months ended September 30, 2018. Operating income from our Australian Operations was negatively impacted by $1.3 million from foreign currency depreciation.

U.K./European Operations

Operating Revenues

The following table sets forth our U.K./European Operations operating revenues and carloads for the three months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,				Increase/(Decrease) in Total Operations					Currency Impact on 2018 Total Operations*
	2019		2018		Amount			%
Freight revenues	$	80,667	$	84,693	$	(4,026	)	(4.8	)%	$	(4,471	)
Freight-related revenues	65,229		69,269		(4,040		)	(5.8	)%	(3,689		)
All other revenues	13,756		16,930		(3,174		)	(18.7	)%	(914		)
Total operating revenues	$	159,652	$	170,892	$	(11,240	)	(6.6	)%	$	(9,074	)
Carloads	235,502		241,382		(5,880		)	(2.4	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

Freight Revenues

The following table sets forth the changes in our U.K./European Operations freight revenues by commodity group for the three months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,				Increase/(Decrease) in Total Operations			Currency Impact			2018 Constant Currency*		Increase/(Decrease) in Total Operations Constant Currency*
Commodity Group	2019		2018
Agricultural Products	$	763	$	1,053	$	(290	)	$	(55	)	$	998	$	(235	)
Coal & Coke	606		2,588		(1,982		)	(137		)	2,451		(1,845		)
Intermodal	56,998		58,609		(1,611		)	(3,177		)	55,432		1,566
Minerals & Stone	21,672		22,344		(672		)	(1,097		)	21,247		425
Petroleum Products	628		99		529			(5		)	94		534
Total	$	80,667	$	84,693	$	(4,026	)	$	(4,471	)	$	80,222	$	445

*     Constant currency amounts reflect the prior period existing operations translated at the current period exchange rates.

46

The following table sets forth our U.K./European Operations freight revenues, carloads and average freight revenues per carload for the three months ended September 30, 2019 and 2018 (dollars in thousands, except average freight revenues per carload):

	Freight Revenues								Carloads		Average Freight Revenues Per Carload
	Three Months Ended September 30,								Three Months Ended September 30,		Three Months Ended
	2019				2018 Constant Currency*						September 30,
Commodity Group	Amount		% of Total		Amount		% of Total		2019	2018	2019		2018		2018 Constant Currency*
Agricultural Products	$	763	0.9	%	$	998	1.2	%	560	776	$	1,363	$	1,357	$	1,286
Coal & Coke	606		0.7	%	2,451		3.1	%	1,468	4,271	413		606		574
Intermodal	56,998		70.7	%	55,432		69.1	%	179,147	188,002	318		312		295
Minerals & Stone	21,672		26.9	%	21,247		26.5	%	51,430	48,111	421		464		442
Petroleum Products	628		0.8	%	94		0.1	%	2,897	222	217		446		423
Total	$	80,667	100.0	%	$	80,222	100.0	%	235,502	241,382	$	343	$	351	$	332

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Total traffic from our U.K./European Operations decreased 5,880 carloads, or 2.4%, to 235,502 carloads for the three months ended September 30, 2019, compared with the same period in 2018, primarily due to decreases of 8,855 carloads of intermodal traffic and 2,803 carloads of coal and coke traffic, partially offset by increases of 3,319 carloads of minerals and stone traffic and 2,675 carloads of petroleum products traffic. All remaining traffic decreased by 216 carloads.

Changes in average freight revenues per carload in a commodity group may be impacted by changes in customer rates, fuel surcharges, commodity mix and the mix of customer traffic within a commodity group. Excluding a 5.6% impact of foreign currency, average freight revenues per carload from our U.K./European Operations increased 3.3% to $343 for the three months ended September 30, 2019, compared with the same period in 2018.

The following information discusses the significant changes in our U.K./European Operations freight revenues by commodity group excluding the impact of foreign currency.

Coal and coke revenues decreased $1.8 million, or 75.3%. Coal and coke traffic decreased 2,803 carloads, or 65.6%, which decreased revenues by $1.2 million, and average freight revenues per carload decreased 28.0%, which decreased revenues by $0.7 million. The carload decrease was primarily due to the conclusion of certain customer contracts in the U.K.

Intermodal revenues increased $1.6 million, or 2.8%. Intermodal average freight revenues per carload increased 7.8%, which increased revenues by $4.4 million, while traffic decreased 8,855 carloads, or 4.7%, which decreased revenues by $2.8 million. The increase in average freight revenues per carload was primarily due to stronger pricing in the U.K. The decrease in carloads was primarily due to service cancellations and lower demand.

Freight revenues from all remaining commodities combined increased by a net $0.7 million.

Freight-Related Revenues

Freight-related revenues from our U.K./European Operations includes trucking haulage services, container storage and switching services, as well as infrastructure services where we operate work trains for the track infrastructure owner. Freight-related revenues from our U.K./European Operations also include traction services (or hook and pull), which requires us to provide locomotives and drivers to move a customer's train between specified origin and destination points and other ancillary revenues related to the movement of freight.

Excluding a $3.7 million decrease due to foreign currency depreciation, freight-related revenues from our U.K./European Operations decreased $0.4 million, or 0.5%, to $65.2 million for the three months ended September 30, 2019, compared with $65.6 million for the three months ended September 30, 2018.

47

All Other Revenues

Excluding a $0.9 million decrease due to foreign currency depreciation, all other revenues from our U.K./European Operations, which includes revenues from container sales and conversions, third-party car and locomotive repairs, property rentals and other ancillary revenues not directly related to the movement of freight, decreased $2.3 million, or 14.1%, to $13.8 million for the three months ended September 30, 2019, compared with $16.0 million for the three months ended September 30, 2018. The decrease in all other revenues was primarily due to reduced management and technical support revenues in Saudi Arabia in 2019.

Operating Expenses

Excluding an $8.8 million decrease due to foreign currency depreciation, total operating expenses from our U.K./European Operations increased $4.6 million, or 2.9%, to $162.0 million for the three months ended September 30, 2019, compared with $157.4 million for the three months ended September 30, 2018. The increase included $3.7 million in labor and benefits expense, $2.8 million in other expenses, net and $1.5 million in depreciation and amortization expense, partially offset by decreases of $1.7 million in purchased services expense and $1.1 million in trackage rights expense.

The following table sets forth operating expenses from our U.K./European Operations for the three months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	51,474		32.3	%	$	50,513		29.6	%	$	961		$	(2,706	)	$	47,807		$	3,667
Equipment rents	17,804			11.2	%	18,432			10.8	%	(628		)	(965		)	17,467			337
Purchased services	28,963			18.1	%	32,430			19.0	%	(3,467		)	(1,725		)	30,705			(1,742		)
Depreciation and amortization	10,083			6.3	%	9,067			5.3	%	1,016			(483		)	8,584			1,499
Diesel fuel used in train operations	13,791			8.7	%	14,409			8.4	%	(618		)	(755		)	13,654			137
Electricity used in train operations	1,794			1.1	%	2,742			1.6	%	(948		)	(142		)	2,600			(806		)
Casualties and insurance	936			0.6	%	1,625			1.0	%	(689		)	(87		)	1,538			(602		)
Materials	16,118			10.1	%	16,905			9.9	%	(787		)	(913		)	15,992			126
Trackage rights	8,683			5.4	%	10,320			6.0	%	(1,637		)	(534		)	9,786			(1,103		)
Net gain on sale and impairment of assets	(21		)	—	%	(116		)	(0.1	)%	95			6			(110		)	89
Restructuring and related costs	3,238			2.0	%	3,285			1.9	%	(47		)	(176		)	3,109			129
Other expenses, net	9,150			5.7	%	6,657			3.9	%	2,493			(356		)	6,301			2,849
Total operating expenses	$	162,013		101.5	%	$	166,269		97.3	%	$	(4,256	)	$	(8,836	)	$	157,433		$	4,580

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

The following information discusses the significant changes in operating expenses from our U.K./European Operations excluding a decrease of $8.8 million due to foreign currency depreciation.

Labor and benefits expense was $51.5 million for the three months ended September 30, 2019, compared with $47.8 million for the three months ended September 30, 2018, an increase of $3.7 million, or 7.7%. The increase was primarily due to annual wage increases and an increase in headcount to support new business, partially offset by savings resulting from the U.K. Operations optimization program.

Purchased services expense was $29.0 million for the three months ended September 30, 2019, compared with $30.7 million for the three months ended September 30, 2018, a decrease of $1.7 million, or 5.7%. The decrease was primarily due to reduced subcontractor costs in 2019.

Depreciation and amortization expense was $10.1 million for the three months ended September 30, 2019, compared with $8.6 million for the three months ended September 30, 2018, an increase of $1.5 million, or 17.5%. The increase was primarily due to capital spending in 2018.

Trackage rights expense was $8.7 million for the three months ended September 30, 2019, compared with $9.8 million for the three months ended September 30, 2018, a decrease of $1.1 million, or 11.3%. The decrease was primarily due to a refund of prior year track access costs.

48

Other expenses, net were $9.2 million for the three months ended September 30, 2019, compared with $6.3 million for the three months ended September 30, 2018, an increase of $2.8 million, or 45.2%. The increase was primarily attributable to unrealized foreign currency costs related to the revaluation of non-functional currency denominated operating lease liabilities in Poland, which are now included on the balance sheet with the adoption of the new lease standard. See Note 5, Leases, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report for additional information regarding this standard.

Operating Loss/Operating Ratio

Operating loss from our U.K./European Operations was $2.4 million for the three months ended September 30, 2019, compared with operating income of $4.6 million for the three months ended September 30, 2018. The operating loss for the three months ended September 30, 2019 included $3.2 million of restructuring and related costs primarily driven by our optimization activities in the U.K. The operating income for the three months ended September 30, 2018 included $3.3 million of restructuring and related costs. The operating ratio was 101.5% for the three months ended September 30, 2019, compared with 97.3% for the three months ended September 30, 2018.

Nine Months Ended September 30, 2019 Compared with Nine Months Ended September 30, 2018

Consolidated Operating Results

Operating Revenues

The following table sets forth our total operating revenues and carloads for the nine months ended September 30, 2019 and 2018. The table below also reflects the calculation of our existing operations by subtracting the 2018 revenues and carloads of the divested operations of ERS and the leased railroads in Canada that expired at the end of 2018 from our total operations for the nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Nine Months Ended September 30,								Increase/(Decrease) in Total Operations					Increase/(Decrease) in Existing Operations					Currency Impact on 2018 Total Operations*			Currency Impact on 2018 Existing Operations*
			2018
	2019		Total Operations		Divested Operations		Existing Operations		Amount			%		Amount			%
Freight revenues	$	1,196,619	$	1,241,245	$	27,121	$	1,214,124	$	(44,626	)	(3.6	)%	$	(17,505	)	(1.4	)%	$	(32,978	)	$	(31,407	)
Freight-related revenues	420,027		429,049		11,759		417,290		(9,022		)	(2.1	)%	2,737			0.7	%	(14,968		)	(14,339		)
All other revenues	96,617		102,661		1,373		101,288		(6,044		)	(5.9	)%	(4,671		)	(4.6	)%	(3,500		)	(3,454		)
Total operating revenues	$	1,713,263	$	1,772,955	$	40,253	$	1,732,702	$	(59,692	)	(3.4	)%	$	(19,439	)	(1.1	)%	$	(51,446	)	$	(49,200	)
Carloads	2,326,187		2,484,595		74,738		2,409,857		(158,408		)	(6.4	)%	(83,670		)	(3.5	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

Operating Expenses

Total operating expenses for the nine months ended September 30, 2019 decreased $28.5 million, or 2.0%, to $1,426.6 million, compared with $1,455.1 million for the nine months ended September 30, 2018. The decrease consisted of $40.0 million from the divested operations and the leased railroads in Canada that expired at the end of 2018, partially offset by an increase of $11.5 million from existing operations. Excluding a $44.4 million benefit from the depreciation of foreign currencies relative to the United States dollar, operating expenses from existing operations increased $55.9 million, or 4.1%. The increase from existing operations included increases of $19.3 million in other expenses, net, $17.6 million in labor and benefits expense, $7.4 million in purchased services expense, $7.1 million in depreciation and amortization expense, $6.5 million in restructuring and related costs and $3.0 million in casualties and insurance expense, partially offset by decreases of $3.9 million in equipment rents expense and $3.2 million in the cost of diesel fuel used in train operations.

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The following table sets forth our total operating expenses for the nine months ended September 30, 2019 and 2018 (dollars in thousands): 

	Nine Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	539,751		31.5	%	$	539,407		30.4	%	$	344		$	(14,272	)	$	525,135		$	14,616
Equipment rents	95,169			5.6	%	104,214			5.9	%	(9,045		)	(4,011		)	100,203			(5,034		)
Purchased services	156,337			9.1	%	178,864			10.1	%	(22,527		)	(8,693		)	170,171			(13,834		)
Depreciation and amortization	188,169			11.0	%	197,127			11.1	%	(8,958		)	(5,811		)	191,316			(3,147		)
Diesel fuel used in train operations	127,674			7.5	%	137,487			7.8	%	(9,813		)	(4,628		)	132,859			(5,185		)
Electricity used in train operations	6,344			0.4	%	7,020			0.4	%	(676		)	(425		)	6,595			(251		)
Casualties and insurance	34,869			2.0	%	32,862			1.8	%	2,007			(719		)	32,143			2,726
Materials	94,949			5.5	%	97,589			5.5	%	(2,640		)	(3,701		)	93,888			1,061
Trackage rights	64,633			3.8	%	67,119			3.8	%	(2,486		)	(2,382		)	64,737			(104		)
Net gain on sale and impairment of assets	(1,151		)	(0.1	)%	(2,501		)	(0.1	)%	1,350			9			(2,492		)	1,341
Restructuring costs	18,756			1.1	%	12,931			0.7	%	5,825			(673		)	12,258			6,498
Other expenses, net	101,097			5.9	%	82,978			4.7	%	18,119			(1,272		)	81,706			19,391
Total operating expenses	$	1,426,597		83.3	%	$	1,455,097		82.1	%	$	(28,500	)	$	(46,578	)	$	1,408,519		$	18,078

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Operating Income/Operating Ratio

Operating income was $286.7 million for the nine months ended September 30, 2019, compared with $317.9 million for the nine months ended September 30, 2018. Operating income for the nine months ended September 30, 2019 included restructuring and related costs of $18.8 million, primarily driven by our optimization activities in the U.K., $11.1 million of corporate development and related costs primarily related to the proposed Merger, $2.6 million of expense associated with amending an enterprise bargaining agreement in Australia and a $1.0 million net loss on the sale and impairment of certain assets in North America. Operating income for the nine months ended September 30, 2018 included restructuring and related costs of $12.9 million, primarily related to the restructuring of ERS, and corporate development and related costs of $0.9 million, partially offset by a $7.3 million gain on settlement related to an Australia customer's voluntary administration (bankruptcy). Our operating ratio was 83.3% for the nine months ended September 30, 2019, compared with 82.1% for the nine months ended September 30, 2018.

Interest Expense

Interest expense was $80.4 million for the nine months ended September 30, 2019, compared with $80.6 million for the nine months ended September 30, 2018. The decrease in interest expense for the nine months ended September 30, 2019 was primarily due to the write-off of deferred financing fees associated with our credit facility refinancing in June 2018, partially offset by changes in outstanding borrowings and fluctuations in interest rates.

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Provision for Income Taxes

Our provision for income taxes for the nine months ended September 30, 2019 was $53.1 million compared with $41.6 million for the nine months ended September 30, 2018. Our effective income tax rate for the nine months ended September 30, 2019 was 24.9% and included a $4.2 million income tax benefit due to the release of a reserve for an uncertain tax position due to the expiration of the statute of limitations. Excluding the release of the reserve, our effective income tax rate for the nine months ended September 30, 2019 was 26.9%. Our effective income tax rate for the nine months ended September 30, 2018 was 17.4%. Our results for the nine months ended September 30, 2018 included an income tax benefit of $31.6 million associated with the retroactive extension of the United States Short Line Tax Credit for fiscal year 2017, which was enacted in February 2018. Based on developments during 2018, we recorded a reserve for uncertain tax positions of $5.5 million related to tax deductions on intercompany financing arrangements in the U.K., of which $3.7 million related to the period from March 25, 2015, the date of the Freightliner acquisition when the arrangements were established, through December 31, 2017. The reserve for uncertain tax positions was included in our provision for income taxes for the nine months ended September 30, 2018. Excluding the benefit from the retroactive extension and the prior period portion of the reserve for uncertain tax positions, our effective income tax rate for the nine months ended September 30, 2018 was 29.1%. For additional information regarding our provision for income taxes, see Note 9, Income Taxes, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report.

Net Income Attributable to G&W and Earnings Per Common Share

Net income attributable to G&W for the nine months ended September 30, 2019 was $156.9 million, compared with $188.9 million for the nine months ended September 30, 2018. Our basic EPS were $2.78 with 56.5 million weighted average shares outstanding for the nine months ended September 30, 2019, compared with basic EPS of $3.13 with 60.3 million weighted average shares outstanding for the nine months ended September 30, 2018. Our diluted EPS for the nine months ended September 30, 2019 were $2.74 with 57.3 million weighted average shares outstanding, compared with diluted EPS of $3.08 with 61.3 million weighted average shares outstanding for the nine months ended September 30, 2018. Our results for the nine months ended September 30, 2019 and 2018 included certain items affecting comparability between the periods as previously presented in the "Overview—Overview of Nine-Month Results—Items Affecting Comparability."

Net Income Attributable to Noncontrolling Interest

We own a 51.1% controlling interest in our Australian Operations. As such, we include 100% of the revenues and expenses from our Australian Operations within our consolidated financial statements and report a noncontrolling interest for MIRA’s 48.9% equity ownership. Net income attributable to noncontrolling interest for the nine months ended September 30, 2019 was $3.0 million, compared with $8.1 million for nine months ended September 30, 2018.

North American Operations

Operating Revenues

The following table sets forth our North American Operations total operating revenues and carloads for the nine months ended September 30, 2019 and 2018. The table also reflects the calculation of our existing operations by subtracting the 2018 revenues and carloads from the Canadian leases that expired at the end of 2018 from our total operations for the nine months ended September 30, 2018 (dollars in thousands):

	Nine Months Ended September 30,								Increase/(Decrease) in Total Operations					Increase/(Decrease) in Existing Operations					Currency Impact on 2018 Total Operations*			Currency Impact on 2018 Existing Operations*
			2018
	2019		Total Operations		Divested Operations		Existing Operations		Amount			%		Amount			%
Freight revenues	$	778,969	$	778,717	$	10,035	$	768,682	$	252		—	%	$	10,287		1.3	%	$	(1,716	)	$	(1,408	)
Freight-related revenues	198,740		193,344		4,753		188,591		5,396			2.8	%	10,149			5.4	%	(576		)	(421		)
All other revenues	49,026		48,835		1,352		47,483		191			0.4	%	1,543			3.2	%	(284		)	(240		)
Total operating revenues	$	1,026,735	$	1,020,896	$	16,140	$	1,004,756	$	5,839		0.6	%	$	21,979		2.2	%	$	(2,576	)	$	(2,069	)
Carloads	1,216,091		1,282,585		23,789		1,258,796		(66,494		)	(5.2	)%	(42,705		)	(3.4	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

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Freight Revenues

The following table sets forth our North American Operations total freight revenues for the nine months ended September 30, 2019 and 2018. The table below also reflects the calculation of our existing operations by subtracting the revenues and carloads from the Canadian leases that expired at the end of 2018 from our total operations for the nine months ended September 30, 2018 (dollars in thousands):

	Nine Months Ended September 30,								Increase/(Decrease) in Existing Operations			Currency Impact on Existing Operations			2018 Constant Currency Existing Operations*		Increase/(Decrease) in Existing Operations Constant Currency*
			2018
Commodity Group	2019		Total Operations		Divested Operations		Existing Operations
Agricultural Products	$	99,383	$	91,630	$	1,474	$	90,156	$	9,227		$	(131	)	$	90,025	$	9,358
Autos & Auto Parts	17,905		16,686		745		15,941		1,964			(59		)	15,882		2,023
Chemicals & Plastics	116,504		113,625		1,954		111,671		4,833			(229		)	111,442		5,062
Coal & Coke	56,089		62,038		—		62,038		(5,949		)	(72		)	61,966		(5,877		)
Food & Kindred Products	25,559		25,587		551		25,036		523			(6		)	25,030		529
Intermodal	1,439		1,203		—		1,203		236			(1		)	1,202		237
Lumber & Forest Products	68,238		70,362		264		70,098		(1,860		)	(98		)	70,000		(1,762		)
Metallic Ores	9,883		10,816		2		10,814		(931		)	(82		)	10,732		(849		)
Metals	87,032		95,791		1,485		94,306		(7,274		)	(167		)	94,139		(7,107		)
Minerals & Stone	111,806		107,122		720		106,402		5,404			(75		)	106,327		5,479
Petroleum Products	56,779		52,870		2,015		50,855		5,924			(112		)	50,743		6,036
Pulp & Paper	88,940		90,346		117		90,229		(1,289		)	(330		)	89,899		(959		)
Waste	23,104		21,316		180		21,136		1,968			(6		)	21,130		1,974
Other	16,308		19,325		528		18,797		(2,489		)	(40		)	18,757		(2,449		)
Total	$	778,969	$	778,717	$	10,035	$	768,682	$	10,287		$	(1,408	)	$	767,274	$	11,695

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

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The following table sets forth our North American Operations freight revenues, carloads and average freight revenues per carload for the nine months ended September 30, 2019 and 2018 (dollars in thousands, except average freight revenues per carload):

	Freight Revenues								Carloads		Average Freight Revenues Per Carload
	Nine Months Ended September 30,								Nine Months Ended September 30,		Nine Months Ended
	2019				2018 Constant Currency*						September 30,
Commodity Group	Amount		% of Total		Amount		% of Total		2019	2018	2019		2018		2018 Constant Currency*
Agricultural Products	$	99,383	12.7	%	$	91,452	11.8	%	166,415	156,515	$	597	$	585	$	584
Autos & Auto Parts	17,905		2.2	%	16,607		2.1	%	27,035	26,546	662		629		626
Chemicals & Plastics	116,504		15.0	%	113,335		14.6	%	128,597	132,530	906		857		855
Coal & Coke	56,089		7.2	%	61,966		8.0	%	154,992	191,626	362		324		323
Food & Kindred Products	25,559		3.3	%	25,565		3.3	%	43,035	45,402	594		564		563
Intermodal	1,439		0.2	%	1,202		0.1	%	11,776	11,822	122		102		102
Lumber & Forest Products	68,238		8.8	%	70,256		9.0	%	102,925	111,311	663		632		631
Metallic Ores	9,883		1.3	%	10,735		1.4	%	12,287	13,499	804		801		795
Metals	87,032		11.2	%	95,580		12.3	%	105,972	119,796	821		800		798
Minerals & Stone	111,806		14.3	%	107,023		13.8	%	171,867	170,348	651		629		628
Petroleum Products	56,779		7.3	%	52,695		6.8	%	76,960	76,231	738		694		691
Pulp & Paper	88,940		11.4	%	90,011		11.6	%	119,894	127,522	742		708		706
Waste	23,104		3.0	%	21,305		2.7	%	44,069	42,677	524		499		499
Other	16,308		2.1	%	19,269		2.5	%	50,267	56,760	324		340		339
Total	$	778,969	100.0	%	$	777,001	100.0	%	1,216,091	1,282,585	$	641	$	607	$	606

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Total traffic from our North American Operations decreased 66,494 carloads, or 5.2%, for the nine months ended September 30, 2019, compared with the same period in 2018. Excluding traffic from the Canadian leases that expired at the end of 2018, existing operations traffic decreased 42,705 carloads, or 3.4%, primarily due to decreases of 36,634 carloads of coal and coke traffic, 9,481 carloads of metals traffic, 7,696 carloads of lumber and forest products traffic, 7,393 carloads of pulp and paper traffic, 4,740 carloads of other commodity traffic and 1,202 carloads of metallic ores traffic, partially offset by increases of 13,271 carloads of agricultural products traffic, 3,931 carloads of minerals and stone traffic, 3,275 carloads of petroleum products traffic, 1,925 carloads of autos and auto parts traffic, 1,676 carloads of waste traffic and 1,108 carloads of chemicals and plastics traffic. All remaining traffic decreased by 745 carloads.

Changes in average freight revenues per carload in a commodity group may be impacted by changes in customer rates, fuel surcharges, commodity mix and the mix of customer traffic within a commodity group. Excluding a 0.2% impact of foreign currency, average freight revenues per carload from our North American Operations increased 5.8% to $641 for the nine months ended September 30, 2019, compared with the same period in 2018. Average freight revenues per carload from existing operations, excluding the impact of foreign currency, increased 5.1% to $641 for the nine months ended September 30, 2019, compared with the same period in 2018. The increase in average freight revenues per carload from existing operations was impacted by a change in the mix of commodities, which increased average freight revenues per carload by 1.2%, and higher fuel surcharges, which increased average freight revenues per carload by 0.4%. Excluding these factors, average freight revenues per carload increased 3.5%.

The following information discusses the significant changes in our North American Operations freight revenues by commodity group excluding the impact of foreign currency and freight revenues from the leased railroads in Canada that expired at the end of 2018.

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Agricultural products revenues increased $9.4 million, or 10.4%. Agricultural products traffic increased 13,271 carloads, or 8.7%, which increased revenues by $7.9 million, and average freight revenues per carload increased 1.5%, which increased revenues by $1.5 million. The increase in carloads was primarily due to higher farm products and soybean shipments in the western United States and increased grain and dried distillers' grains shipments in the midwestern United States, partially offset by decreased grain shipments in Canada.

Autos and auto parts revenues increased $2.0 million, or 12.7%. Autos and auto parts traffic increased 1,925 carloads, or 7.7%, which increased revenues by $1.3 million, and average freight revenues per carload increased 4.7%, which increased revenues by $0.7 million. The increase in carloads was primarily due to higher export demand in the western United States.

Chemicals and plastics revenues increased $5.1 million, or 4.5%. Chemicals and plastics average freight revenues per carload increased by 3.7%, which increased revenues by $4.1 million, and traffic increased 1,108 carloads, or 0.9%, which increased revenues by $1.0 million. The increase in average revenue per carload was primarily related to a change in the mix of business. The increase in carloads was primarily related to increased sulphuric acid shipments in the western United States, partially offset by fewer plastic shipments across the United States.

Coal and coke revenues decreased $5.9 million, or 9.5%. Coal and coke traffic decreased 36,634 carloads, or 19.1%, which decreased revenues by $13.3 million, while average freight revenues per carload increased 12.1%, which increased revenues by $7.4 million. The decrease in carloads was primarily due to reduced demand in the midwestern and southern United States due to natural gas competition and high inventories. The increase in average freight revenues per carload was primarily due to a change in the mix of business.

Lumber and forest products revenues decreased $1.8 million, or 2.5%. Lumber and forest products traffic decreased 7,696 carloads, or 7.0%, which decreased revenues by $5.1 million, while average freight revenues per carload increased 4.7%, which increased revenues by $3.3 million. The decrease in carloads was primarily due to fewer lumber shipments in the southern and western United States, lower wood chip shipments in the southeastern United States and decreased export log shipments in the western United States. The increase in average freight revenues per carload was primarily due to a change in the mix of business.

Metals revenues decreased $7.1 million, or 7.5%. Metals traffic decreased 9,481 carloads, or 8.2%, which decreased revenues by $7.8 million, while average freight revenues per carload increased 0.7%, which increased revenues by $0.7 million. The decrease in carloads was primarily due to reduced finished steel shipments in the northeastern and southern United States, lower scrap steel shipments in the midwestern, northeastern and southern United States, reduced slab shipments in the midwestern United States and lower pipe shipments in the northeastern United States.

Minerals and stone revenues increased $5.5 million, or 5.2%. Minerals and stone average freight revenues per carload increased 2.8%, which increased revenues by $2.9 million, and traffic increased 3,931 carloads, or 2.3%, which increased revenues by $2.6 million. The increase in average freight revenue per carload was primarily due to stronger pricing and increased fuel surcharge revenues. The increase in carloads was primarily due to higher rock salt and sand shipments in the northeastern United States, partially offset by decreased aggregates shipments in the western United States and decreased sand shipments in the southern United States.

Petroleum products revenues increased $6.0 million, or 11.9%. Petroleum products average freight revenues per carload increased 7.1%, which increased revenues by $3.6 million, and traffic increased 3,275 carloads, or 4.4%, which increased revenues by $2.4 million. The increase in average freight revenues per carload was primarily due to stronger pricing and increased fuel surcharge revenues. The increase in carloads was primarily due to increased liquid petroleum gas shipments in the western and southern United States and increased other petroleum products shipments in the northeastern United States, partially offset by decreased liquid petroleum gas and other petroleum products shipments in Canada.

Pulp and paper revenues decreased $1.0 million, or 1.1%. Pulp and paper traffic decreased 7,393 carloads, or 5.8%, which decreased revenues by $5.5 million, while average freight revenues per carload increased 5.1%, which increased revenues by $4.5 million. The decrease in carloads was primarily due to fewer containerboard shipments in the southern and western United States, partially offset by increased pulp products shipments in the southern United States. The increase in average freight revenues per carload was primarily due to stronger pricing and increased fuel surcharge revenues.

Waste revenues increased $2.0 million, or 9.3%. Waste average freight revenues per carload increased 5.2%, which increased revenues by $1.1 million, and traffic increased 1,676 carloads, or 4.0%, which increased revenues by $0.9 million. The increase in average freight revenues per carload was primarily due to a change in the mix of business.

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Other commodity revenues decreased $2.4 million, or 13.1%. Other traffic decreased 4,740 carloads, or 8.6%, which decreased revenues by $1.5 million, and average freight revenues per carload decreased 5.0%, which decreased revenues by $0.9 million. The decrease in carloads was primarily due to decreased empty car traffic across North America led by the southern United States. The decrease in average freight revenues per carload was primarily due to decreased shipments of wind tower components in the midwestern United States.

Freight revenues from all remaining commodities combined decreased by a net $0.1 million.

Freight-Related Revenues

Freight-related revenues from our North American Operations, which includes revenues from railcar switching, track access fees, storage and other ancillary revenues related to the movement of freight, were $198.7 million for the nine months ended September 30, 2019, compared with $193.3 million for the nine months ended September 30, 2018, an increase of $5.4 million, or 2.8%. Excluding a decrease of $4.8 million in revenues from the leased railroads in Canada that expired at the end of 2018, and a $0.4 million decrease due to foreign currency depreciation, freight-related revenues from our North American Operations increased $10.6 million, or 5.6%, for the nine months ended September 30, 2019, compared with $188.2 million for the nine months ended September 30, 2018. The increase in freight-related revenues from our existing operations was primarily due to increases in demurrage revenues primarily in the midwestern United States, switching revenues in the southeastern United States and Canada and storage revenues in the southeastern United States.

All Other Revenues

All other revenues from our North American Operations, which includes revenues from third-party railcar and locomotive repairs, property rentals and other ancillary revenues not directly related to the movement of freight, were $49.0 million for the nine months ended September 30, 2019, compared with $48.8 million for the nine months ended September 30, 2018, an increase of $0.2 million, or 0.4%. Excluding a decrease of $1.4 million in revenues from the Canadian leases that expired at the end of 2018 and a $0.2 million decrease due to foreign currency depreciation, all other revenues from our North American Operations increased $1.8 million, or 3.8%, for the nine months ended September 30, 2019, compared with $47.2 million for the nine months ended September 30, 2018. The increase in all other revenues from our existing operations was primarily due to increased other rental revenues in the western, southern and midwestern United States.

Operating Expenses

Total operating expenses from our North American Operations increased $12.5 million, or 1.6%, to $777.5 million for the nine months ended September 30, 2019, compared with $765.0 million for the nine months ended September 30, 2018. The increase consisted of $31.9 million from existing operations, partially offset by a $16.9 million decrease in expenses from the leased railroads in Canada that expired at the end of 2018 and a $2.4 million decrease due to foreign currency depreciation. The increase from existing operations was primarily due to increases of $7.8 million in labor and benefits expense, $7.7 million in purchased services expense, $6.7 million in other expenses, net, $3.9 million in depreciation and amortization expense, $3.5 million in casualties and insurance expense, $2.9 million in trackage rights expense, $2.5 million in materials expense and $1.5 million in restructuring and related costs, partially offset by decreases of $4.6 million in equipment rents expense and $1.9 million in the cost of diesel fuel used in operations. The nine months ended September 30, 2019 also included a $0.2 million net gain on the sale and impairment of assets compared with $2.1 million for the nine months ended September 30, 2018.

55

The following table sets forth operating expenses from our North American Operations for the nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Nine Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	333,971		32.5	%	$	329,146		32.2	%	$	4,825		$	(888	)	$	328,258		$	5,713
Equipment rents	36,609			3.6	%	41,574			4.1	%	(4,965		)	(110		)	41,464			(4,855		)
Purchased services	49,764			4.8	%	43,550			4.3	%	6,214			(125		)	43,425			6,339
Depreciation and amortization	116,333			11.3	%	123,266			12.1	%	(6,933		)	(605		)	122,661			(6,328		)
Diesel fuel used in train operations	67,813			6.6	%	71,963			7.0	%	(4,150		)	(310		)	71,653			(3,840		)
Casualties and insurance	26,434			2.6	%	23,249			2.3	%	3,185			(56		)	23,193			3,241
Materials	41,293			4.0	%	39,189			3.8	%	2,104			(122		)	39,067			2,226
Trackage rights	33,123			3.2	%	30,225			2.9	%	2,898			(17		)	30,208			2,915
Net gain on sale and impairment of assets	(151		)	—	%	(2,124		)	(0.2	)%	1,973			7			(2,117		)	1,966
Restructuring and related costs	1,553			0.2	%	42			—	%	1,511			—			42			1,511
Other expenses, net	70,784			6.9	%	64,898			6.4	%	5,886			(160		)	64,738			6,046
Total operating expenses	$	777,526		75.7	%	$	764,978		74.9	%	$	12,548		$	(2,386	)	$	762,592		$	14,934

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

The following information discusses the significant changes in operating expenses of our North American Operations excluding a decrease of $2.4 million due to foreign currency depreciation.

Labor and benefits expense was $334.0 million for the nine months ended September 30, 2019, compared with $328.3 million for the nine months ended September 30, 2018, an increase of $5.7 million, or 1.7%. The increase consisted of $7.8 million, or 2.4%, from existing operations, partially offset by a decrease of $2.1 million from the expired Canadian leases. The increase from existing operations was primarily due to annual wage increases and $1.6 million of expense representing the mark-to-market impact on our deferred compensation plan liabilities. This expense was offset by $1.6 million of mark-to-market earnings on investment assets associated with the deferred compensation plan recognized in other non-operating income.

Equipment rents expense was $36.6 million for the nine months ended September 30, 2019, compared with $41.5 million for the nine months ended September 30, 2018, a decrease of $4.9 million, or 11.7%. The decrease consisted of $4.6 million, or 11.1%, from existing operations and $0.3 million from the expired Canadian leases. The decrease from existing operations was primarily due to reduced car hire expense as a result of more fluent car movements in 2019.

Purchased services expense was $49.8 million for the nine months ended September 30, 2019, compared with $43.4 million for the nine months ended September 30, 2018, an increase of $6.3 million, or 14.6%. The increase consisted of $7.7 million, or 18.3%, from existing operations, partially offset by a decrease of $1.3 million from the expired Canadian leases. The increase from existing operations was primarily due to increases in track maintenance expense in 2019.

Depreciation and amortization expense was $116.3 million for the nine months ended September 30, 2019, compared with $122.7 million for the nine months ended September 30, 2018, a decrease of $6.3 million, or 5.2%. The decrease consisted of $10.2 million from the expired Canadian leases, partially offset by an increase of $3.9 million, or 3.5%, from existing operations. The increase was primarily due to capital spending in 2018.

The cost of diesel fuel used in train operations was $67.8 million for the nine months ended September 30, 2019, compared with $71.7 million for the nine months ended September 30, 2018, a decrease of $3.8 million, or 5.4%. The decrease consisted of $2.0 million from the expired Canadian leases and $1.9 million, or 2.7%, from existing operations. The decrease in existing operations consisted of $5.0 million due to a 7.3% decrease in average fuel cost per gallon, partially offset by an increase of $3.1 million due to higher diesel fuel consumption.

Casualties and insurance expense was $26.4 million for the nine months ended September 30, 2019, compared with $23.2 million for the nine months ended September 30, 2018, an increase of $3.2 million, or 14.0%, primarily due to higher derailment expense in 2019, partially offset by a gain on an insurance recovery recognized in 2019 resulting from a business interruption claim related to Hurricane Michael in the southern United States in October 2018.

56

Materials expense was $41.3 million for the nine months ended September 30, 2019, compared with $39.1 million for the nine months ended September 30, 2018, an increase of $2.2 million, or 5.7%. The increase consisted of $2.5 million, or 6.4%, from existing operations, partially offset by a decrease of $0.2 million from the expired Canadian leases. The increase in existing operations was primarily due to increases in track maintenance expense in 2019.

Trackage rights expense was $33.1 million for the nine months ended September 30, 2019, compared with $30.2 million for the nine months ended September 30, 2018, an increase of $2.9 million, or 9.6%. The increase was primarily attributable to increased traffic at port switching locations and increased rail traffic.

Net gain on the sale and impairment of assets was $0.2 million for the nine months ended September 30, 2019, compared with $2.1 million for the nine months ended September 30, 2018, a change of $2.0 million. The net gain for the nine months ended September 30, 2019 was primarily attributable to a gain on the sale of land in the northeastern United States, partially offset by an impairment of assets related to the expiration of a lease of a rail line in the southeastern United States.

Restructuring costs for the nine months ended September 30, 2019 of $1.6 million were primarily related to the consolidation of our Central Region in 2019.

Other expenses, net were $70.8 million for the nine months ended September 30, 2019, compared with $64.7 million for the nine months ended September 30, 2018, an increase of $6.0 million, or 9.3%. The increase consisted of $6.7 million, or 10.4%, from existing operations, partially offset by a decrease of $0.6 million from the expired Canadian leases. The increase was primarily due to corporate development and related costs in 2019 associated with the proposed Merger.

Operating Income/Operating Ratio

Operating income from our North American Operations was $249.2 million for the nine months ended September 30, 2019, compared with $255.9 million for the nine months ended September 30, 2018. Operating income for the nine months ended September 30, 2019 and 2018 included corporate development and related costs of $10.5 million and $0.7 million, respectively. The operating ratio was 75.7% for the nine months ended September 30, 2019, compared with 74.9% for the nine months ended September 30, 2018.

Australian Operations

Operating Revenues

As previously disclosed, we own a controlling 51.1% interest in our Australian Operations, and therefore, we include 100% of our Australian Operations within our consolidated financial statements with a 48.9% noncontrolling interest recorded to reflect MIRA's ownership. The following table sets forth our Australian Operations operating revenues and carloads for the nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Nine Months Ended September 30,				Increase/(Decrease) in Total Operations					Currency Impact on 2018 Total Operations*
	2019		2018		Amount			%
Freight revenues	$	174,199	$	194,335	$	(20,136	)	(10.4	)%	$	(14,929	)
Freight-related revenues	23,902		32,214		(8,312		)	(25.8	)%	(2,485		)
All other revenues	5,137		4,017		1,120			27.9	%	(310		)
Total operating revenues	$	203,238	$	230,566	$	(27,328	)	(11.9	)%	$	(17,724	)
Carloads	419,251		442,798		(23,547		)	(5.3	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

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Freight Revenues

The following table sets forth the changes in our Australian Operations freight revenues by commodity group for the nine months ended September 30, 2019 and 2018 (dollars in thousands): 

					Increase/(Decrease) in Total Operations			Currency Impact			2018 Constant Currency*		Increase/(Decrease) Total Operations Constant Currency*
	Nine Months Ended September 30,
Commodity Group	2019		2018
Agricultural Products	$	8,684	$	15,639	$	(6,955	)	$	(1,222	)	$	14,417	$	(5,733	)
Coal and Coke	91,323		96,506		(5,183		)	(7,431		)	89,075		2,248
Intermodal	45,705		50,613		(4,908		)	(3,868		)	46,745		(1,040		)
Metallic Ores	22,177		24,770		(2,593		)	(1,885		)	22,885		(708		)
Minerals & Stone	5,834		6,247		(413		)	(481		)	5,766		68
Petroleum Products	476		560		(84		)	(42		)	518		(42		)
Total	$	174,199	$	194,335	$	(20,136	)	$	(14,929	)	179,406		$	(5,207	)

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

The following table sets forth our Australian Operations freight revenues, carloads and average freight revenues per carload for the nine months ended September 30, 2019 and 2018 (dollars in thousands, except average freight revenues per carload):

	Freight Revenues								Carloads		Average Freight Revenues Per Carload
	Nine Months Ended September 30,								Nine Months Ended September 30,		Nine Months Ended
	2019				2018 Constant Currency*						September 30,
Commodity Group	Amount		% of Total		Amount		% of Total		2019	2018	2019		2018		2018 Constant Currency*
Agricultural Products	$	8,684	5.0	%	$	14,417	8.0	%	10,009	33,816	$	868	$	462	$	426
Coal & Coke	91,323		52.4	%	89,075		49.6	%	305,461	300,947	299		321		296
Intermodal	45,705		26.2	%	46,745		26.1	%	39,559	41,321	1,155		1,225		1,131
Metallic Ores	22,177		12.7	%	22,885		12.8	%	15,613	16,921	1,420		1,464		1,352
Minerals & Stone	5,834		3.4	%	5,766		3.2	%	48,411	49,567	121		126		116
Petroleum Products	476		0.3	%	518		0.3	%	198	226	2,404		2,478		2,292
Total	$	174,199	100.0	%	$	179,406	100.0	%	419,251	442,798	$	416	$	439	$	405

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Total traffic from our Australian Operations decreased 23,547 carloads, or 5.3%, to 419,251 carloads for the nine months ended September 30, 2019, compared with the same period in 2018, primarily due to decreases of 23,807 carloads of agricultural products traffic, 1,762 carloads of intermodal traffic, 1,308 carloads of metallic ores traffic and 1,156 carloads of minerals and stone traffic, partially offset by an increase of 4,514 carloads of coal and coke traffic. All remaining traffic decreased by 28 carloads.

Changes in average freight revenues per carload in a commodity group may be impacted by changes in customer rates, fuel surcharges, commodity mix and the mix of customer traffic within a commodity group. Excluding a 7.9% impact of foreign currency, average freight revenues per carload from our Australian Operations increased 2.7% to $416 for the nine months ended September 30, 2019, compared with the same period in 2018.

The following information discusses the significant changes in our Australian Operations freight revenues by commodity group excluding the impact of foreign currency.

Agricultural products revenues decreased $5.7 million, or 39.8%. Agricultural products traffic decreased 23,807 carloads, or 70.4%, which decreased revenues by $20.7 million, while average freight revenues per carload increased 103.8%, which increased revenues by $14.9 million. The carload decrease was primarily due to a drought-related smaller grain harvest in 2019 and conclusion of services on the Eyre Peninsula. The decrease in grain traffic resulted in higher average freight revenues per carload, primarily due to the rate structure for Australian grain traffic, which has both a fixed and variable component, and a change in the mix of business.

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Coal and coke revenues increased $2.2 million, or 2.5%. Coal and coke traffic increased 4,514 carloads, or 1.5%, which increased revenues by $1.4 million, and average freight revenues per carload increased 1.0%, which increased revenues by $0.9 million. The carload increase was primarily due to higher shipping activity and longer hauls.

Intermodal revenues decreased $1.0 million, or 2.2%. Intermodal traffic decreased 1,762 carloads, or 4.3%, which decreased revenues by $2.0 million, while average freight revenues per carload increased 2.1%, which increased revenues by $1.0 million. The carload decrease was primarily due to service cancellations and decreased automotive movements.

Freight revenues from all remaining commodities combined decreased by a net $0.7 million.

Freight-Related Revenues

Excluding a $2.5 million decrease due to foreign currency depreciation, freight-related revenues from our Australian Operations, which includes revenues from railcar switching, track access rights, crewing services, storage and other ancillary revenues related to the movement of freight, decreased $5.8 million, or 19.6%, to $23.9 million for the nine months ended September 30, 2019, compared with $29.7 million for the nine months ended September 30, 2018. The decrease in freight-related revenues was primarily due to prolonged drought conditions in 2019, switching competition and a customer termination payment received in 2018.

All Other Revenues

Excluding a $0.3 million decrease due to foreign currency depreciation, all other revenues from our Australian Operations, which includes revenues from third-party railcar and locomotive repairs, property rentals and other ancillary revenues not directly related to the movement of freight, increased $1.4 million, or 38.6%, to $5.1 million for the nine months ended September 30, 2019, compared with $3.7 million for the nine months ended September 30, 2018.

Operating Expenses

Excluding a $13.0 million decrease due to foreign currency depreciation, total operating expenses from our Australian Operations for the nine months ended September 30, 2019 increased $4.6 million, or 3.0%, to $159.6 million, compared with $155.0 million for the nine months ended September 30, 2018. The increase in operating expenses included increases of $7.6 million in other expenses, net and $1.7 million in restructuring and related costs, partially offset by decreases of $1.6 million in purchased services expense, $1.5 million in the cost of diesel fuel used in operations and $1.5 million in trackage rights expense.

The following table sets forth operating expenses from our Australian Operations for the nine months ended September 30, 2019 and 2018 (dollars in thousands): 

	Nine Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	51,605		25.4	%	$	55,318		24.0	%	$	(3,713	)	$	(4,286	)	$	51,032		$	573
Equipment rents	2,931			1.4	%	3,950			1.7	%	(1,019		)	(304		)	3,646			(715		)
Purchased services	16,467			8.1	%	19,603			8.5	%	(3,136		)	(1,507		)	18,096			(1,629		)
Depreciation and amortization	42,382			20.9	%	46,232			20.1	%	(3,850		)	(3,577		)	42,655			(273		)
Diesel fuel used in train operations	20,234			10.0	%	23,557			10.2	%	(3,323		)	(1,804		)	21,753			(1,519		)
Casualties and insurance	5,072			2.5	%	5,198			2.3	%	(126		)	(400		)	4,798			274
Materials	8,231			4.0	%	8,725			3.8	%	(494		)	(670		)	8,055			176
Trackage rights	4,497			2.2	%	6,510			2.8	%	(2,013		)	(508		)	6,002			(1,505		)
Net gain on sale and impairment of assets	(170		)	(0.1	)%	(133		)	(0.1	)%	(37		)	10			(123		)	(47		)
Restructuring and related costs	1,686			0.8	%	—			—	%	1,686			—			—			1,686
Other expenses, net	6,661			3.3	%	(979		)	(0.4	)%	7,640			36			(943		)	7,604
Total operating expenses	$	159,596		78.5	%	$	167,981		72.9	%	$	(8,385	)	$	(13,010	)	$	154,971		$	4,625

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

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The following information discusses the significant changes in operating expenses of our Australian Operations excluding a decrease of $13.0 million due to foreign currency depreciation.

Labor and benefits expense of $51.6 million for the nine months ended September 30, 2019, compared with $51.0 million for the nine months ended September 30, 2018, an increase of $0.6 million, or 1.1%. The increase was primarily due to $2.6 million associated with the amending of an enterprise bargaining agreement, partially offset by a decrease in labor expense attributable to a smaller grain harvest in 2019.

Purchased services expense was $16.5 million for the nine months ended September 30, 2019, compared with $18.1 million for the nine months ended September 30, 2018, a decrease of $1.6 million, or 9.0%. The decrease was primarily due to the timing of equipment maintenance and decreased infrastructure services.

The cost of diesel fuel used in train operations was $20.2 million for the nine months ended September 30, 2019, compared with $21.8 million for the nine months ended September 30, 2018, a decrease of $1.5 million, or 7.0%. The decrease consisted of $1.8 million due to a 7.9% decrease in diesel fuel consumption, partially offset by an increase of $0.3 million due to a 1.0% higher average fuel cost per gallon.

Trackage rights expense was $4.5 million for the nine months ended September 30, 2019, compared with $6.0 million for the nine months ended September 30, 2018, a decrease of $1.5 million, or 25.1%. The decrease was primarily due to lower volumes related to drought affected harvests and reduced intermodal activity in 2019.

Restructuring and related costs of $1.7 million for the nine months ended September 30, 2019 were primarily related to a severance provision associated with the termination of grain service on the Eyre Peninsula.

Other expenses, net for the nine months ended September 30, 2018 included a $7.3 million gain on settlement related to a customer's voluntary administration.

Operating Income/Operating Ratio

Operating income from our Australian Operations was $43.6 million for the nine months ended September 30, 2019, compared with $62.6 million for the nine months ended September 30, 2018. Operating income for the nine months ended September 30, 2019 included $2.6 million of expense associated with amending an enterprise bargaining agreement and $1.7 million of expense primarily related to a severance provision associated with the termination of grain service on the Eyre Peninsula. Operating income for the nine months ended September 30, 2018 included a $7.3 million gain on a settlement related to Arrium's voluntary administration (bankruptcy). The operating ratio was 78.5% for the nine months ended September 30, 2019, compared with 72.9% for the nine months ended September 30, 2018.

U.K./European Operations

Operating Revenues

The following table sets forth our U.K./European Operations total operating revenues for the nine months ended September 30, 2019 and 2018. The table below also reflects the calculation of our U.K./European Operations existing operations by subtracting the revenues and carloads from the divested ERS operations from our U.K./European total operations for the nine months ended September 30, 2018 (dollars in thousands):

	Nine Months Ended September 30,								Increase/(Decrease) in Total Operations					Increase/(Decrease) in Existing Operations					Currency Impact on 2018 Total Operations*			Currency Impact on 2018 Existing Operations*
			2018
	2019		Total Operations		Divested Operations		Existing Operations		Amount			%		Amount			%
Freight revenues	$	243,451	$	268,193	$	17,086	$	251,107	$	(24,742	)	(9.2	)%	$	(7,656	)	(3.0	)%	$	(16,333	)	$	(15,070	)
Freight-related revenues	197,385		203,491		7,006		196,485		(6,106		)	(3.0	)%	900			0.5	%	(11,907		)	(11,433		)
All other revenues	42,454		49,809		21		49,788		(7,355		)	(14.8	)%	(7,334		)	(14.7	)%	(2,906		)	(2,904		)
Total operating revenues	$	483,290	$	521,493	$	24,113	$	497,380	$	(38,203	)	(7.3	)%	$	(14,090	)	(2.8	)%	$	(31,146	)	$	(29,407	)
Carloads	690,845		759,212		50,949		708,263		(68,367		)	(9.0	)%	(17,418		)	(2.5	)%

* Currency impact was calculated by comparing the 2018 results translated from local currency to United States dollars using 2019 exchange rates to the 2018 results in United States dollars as reported.

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Freight Revenues

The following table sets forth our U.K./European Operations total freight revenues for the nine months ended September 30, 2019 and 2018. The table below also reflects the calculation of our U.K./European Operations existing operations by subtracting the revenues from the divested ERS operations from our U.K./European Operations total operations for the nine months ended September 30, 2018 (dollars in thousands): 

	Nine Months Ended September 30,								Increase/(Decrease) in Existing Operations			Currency Impact on Existing Operations			2018 Constant Currency Existing Operations*		Increase/(Decrease) in Existing Operations Constant Currency*
			2018
Commodity Group	2019		Total Operations		Divested Operations		Existing Operations
Agricultural Products	$	2,011	$	3,073	$	—	$	3,073	$	(1,062	)	$	(226	)	$	2,847	$	(836	)
Coal & Coke	6,195		8,751		—		8,751		(2,556		)	(563		)	8,188		(1,993		)
Intermodal	174,500		192,413		17,086		175,327		(827		)	(10,132		)	165,195		9,305
Minerals & Stone	58,709		63,849		—		63,849		(5,140		)	(4,144		)	59,705		(996		)
Petroleum Products	2,036		107		—		107		1,929			(5		)	102		1,934
Total	$	243,451	$	268,193	$	17,086	$	251,107	$	(7,656	)	$	(15,070	)	$	236,037	$	7,414

*Constant currency amounts reflect the prior period Total Ongoing Operations translated at the current period exchange rates.

The following table sets forth our U.K./European Operations freight revenues, carloads and average freight revenues per carload for the nine months ended September 30, 2019 and 2018 (dollars in thousands, except average freight revenues per carload):

	Freight Revenues								Carloads		Average Freight Revenues Per Carload
	Nine Months Ended September 30,								Nine Months Ended September 30,		Nine Months Ended
	2019				2018 Constant Currency*						September 30,
Commodity Group	Amount		% of Total		Amount		% of Total		2019	2018	2019		2018		2018 Constant Currency*
Agricultural Products	$	2,011	0.9	%	$	2,847	1.1	%	1,486	2,349	$	1,353	$	1,308	$	1,212
Coal & Coke	6,195		2.5	%	8,188		3.3	%	11,407	14,204	543		616		576
Intermodal	174,500		71.7	%	181,018		71.9	%	533,115	599,840	327		321		302
Minerals & Stone	58,709		24.0	%	59,705		23.7	%	135,420	142,577	434		448		419
Petroleum Products	2,036		0.9	%	102		—	%	9,417	242	216		442		421
Total	$	243,451	100.0	%	$	251,860	100.0	%	690,845	759,212	$	352	$	353	$	332

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

Total traffic from our U.K./European Operations decreased 68,367 carloads, or 9.0%, to 690,845 carloads for the nine months ended September 30, 2019, compared with the same period in 2018. Excluding traffic from our divested ERS operations, existing operations traffic decreased 17,418 carloads, or 2.5%, primarily due to decreases of 15,776 carloads of intermodal traffic, 7,157 carloads of minerals and stone traffic and 2,797 carloads of coal and coke traffic, partially offset by an increase of 9,175 carloads of petroleum products traffic. All remaining traffic decreased by 863 carloads.

Changes in average freight revenues per carload in a commodity group may be impacted by changes in customer rates, fuel surcharges, commodity mix and the mix of customer traffic within a commodity group. Excluding a 6.3% impact of foreign currency, average freight revenues per carload from our U.K./European Operations increased 6.0% to $352 for the nine months ended September 30, 2019, compared with the same period in 2018. Average freight revenues per carload from existing operations, excluding the impact of foreign currency, increased 5.7% to $352 for the nine months ended September 30, 2019, compared with the same period in 2018.

The following information discusses the significant changes in our U.K./European Operations freight revenues by commodity group excluding the impact of foreign currency and the divested ERS operations.

Coal and coke revenues decreased $2.0 million, or 24.3%. Coal and coke traffic decreased 2,797 carloads, or 19.7%, which decreased revenues by $1.5 million, and average freight revenues per carload decreased 5.7%, which decreased revenues by $0.5 million. The carload decrease was primarily due to the conclusion of certain customer contracts in the U.K.

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Intermodal revenues increased $9.3 million, or 5.6%. Intermodal average freight revenues per carload increased 8.6%, which increased revenues by $14.5 million, while traffic decreased 15,776 carloads, or 2.9%, which decreased revenues by $5.2 million. The increase in average freight revenues per carload was primarily due to stronger pricing in the U.K. The decrease in carloads was primarily due to temporary rail network outages, service cancellations and lower demand.

Minerals and stone revenues decreased $1.0 million, or 1.7%. Minerals and stone traffic decreased 7,157 carloads, or 5.0%, which decreased revenues by $3.1 million, while average freight revenues per carload increased 3.6%, which increased revenues by $2.1 million. The carload decrease was primarily due to lower construction aggregates shipments in Poland primarily as a result of unfavorable weather conditions, partially offset by new customer contracts in the U.K.

Petroleum products revenues increased $1.9 million, primarily due to an increase in traffic of 9,175 carloads. The carload increase was primarily due to a new customer contract in the U.K.

Freight revenues from all remaining commodities decreased by $0.8 million.

Freight-Related Revenues

Freight-related revenues from our U.K./European Operations includes trucking haulage services, container storage and switching services, as well as infrastructure services, where we operate work trains for the track infrastructure owner. Freight-related revenues from our U.K./European Operations also include traction service (or hook and pull), which requires us to provide locomotives and drivers to move a customer's train between specified origin and destination points and other ancillary revenues related to the movement of freight.

Freight-related revenues from our U.K./European Operations were $197.4 million for the nine months ended September 30, 2019, compared with $203.5 million for the nine months ended September 30, 2018, a decrease of $6.1 million, or 3.0%. Excluding a decrease of $11.9 million due to foreign currency depreciation and $6.5 million from our divested ERS operations, freight-related revenues from our existing operations increased $12.3 million, or 6.7%, for the nine months ended September 30, 2019, compared with $185.1 million for the nine months ended September 30, 2018. The increase in freight-related revenues from our existing operations was primarily due to increased rates on trucking, switching and storage services in the U.K. and increased crewing services in Poland, partially offset by a decrease in infrastructure services in the U.K.

All Other Revenues

All other revenues from our U.K./European Operations includes revenues from container sales, third-party car and locomotive repairs, property rentals and other ancillary revenues not directly related to the movement of freight. All other revenues from our U.K./European Operations were $42.5 million for the nine months ended September 30, 2019, compared with $49.8 million for the nine months ended September 30, 2018, a decrease of $7.4 million, or 14.8%. Excluding a $2.9 million decrease due to foreign currency depreciation, all other revenues from our existing operations decreased $4.4 million, or 9.4%, for the nine months ended September 30, 2019, compared with $46.9 million for the nine months ended September 30, 2018. The decrease in all other revenues from our existing operations was primarily due to reduced management and technical support revenues in Saudi Arabia and lower container sales in 2019.

Operating Expenses

Total operating expenses from our U.K./European Operations were $489.5 million for the nine months ended September 30, 2019, compared with $522.1 million for the nine months ended September 30, 2018, a decrease of $32.7 million, or 6.3%. The decrease consisted of $31.2 million due to foreign currency depreciation and $20.9 million from divested operations, partially offset by a $19.4 million increase from existing operations. The increase from existing operations included increases of $9.2 million in labor and benefits expense, $5.1 million in other expenses, net, $3.5 million in depreciation and amortization expense, $3.3 million in restructuring and related costs, $1.4 million in equipment rents expense and $1.4 million in purchased services expense, partially offset by decreases of $1.5 million in trackage rights expense and $1.3 million in materials expense.

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The following table sets forth operating expenses from our U.K./European Operations for the nine months ended September 30, 2019 and 2018 (dollars in thousands): 

	Nine Months Ended September 30,										Increase/(Decrease)			Currency Impact			2018 Constant Currency*			Increase/(Decrease) Constant Currency*
	2019					2018
	Amount			% of Operating Revenues		Amount			% of Operating Revenues
Labor and benefits	$	154,175		31.9	%	$	154,943		29.7	%	$	(768	)	$	(9,098	)	$	145,845		$	8,330
Equipment rents	55,629			11.5	%	58,690			11.3	%	(3,061		)	(3,597		)	55,093			536
Purchased services	90,106			18.7	%	115,711			22.2	%	(25,605		)	(7,061		)	108,650			(18,544		)
Depreciation and amortization	29,454			6.1	%	27,629			5.3	%	1,825			(1,629		)	26,000			3,454
Diesel fuel used in train operations	39,627			8.2	%	41,967			8.0	%	(2,340		)	(2,514		)	39,453			174
Electricity used in train operations	6,344			1.3	%	7,020			1.3	%	(676		)	(425		)	6,595			(251		)
Casualties and insurance	3,363			0.7	%	4,415			0.8	%	(1,052		)	(263		)	4,152			(789		)
Materials	45,425			9.4	%	49,675			9.5	%	(4,250		)	(2,909		)	46,766			(1,341		)
Trackage rights	27,013			5.6	%	30,384			5.8	%	(3,371		)	(1,857		)	28,527			(1,514		)
Net gain on sale and impairment of assets	(830		)	(0.2	)%	(244		)	—	%	(586		)	(8		)	(252		)	(578		)
Restructuring and related costs	15,517			3.2	%	12,889			2.5	%	2,628			(673		)	12,216			3,301
Other expenses, net	23,652			4.9	%	19,059			3.7	%	4,593			(1,148		)	17,911			5,741
Total operating expenses	$	489,475		101.3	%	$	522,138		100.1	%	$	(32,663	)	$	(31,182	)	$	490,956		$	(1,481	)

* Constant currency amounts reflect the prior period results translated at the current period exchange rates.

The following information discusses the significant changes in operating expenses of our U.K./European Operations excluding a decrease of $31.2 million due to foreign currency depreciation.

Labor and benefits expense was $154.2 million for the nine months ended September 30, 2019, compared with $145.8 million for the nine months ended September 30, 2018, an increase of $8.3 million, or 5.7%. The increase consisted of $9.2 million from existing operations, partially offset by a decrease of $0.8 million from divested operations. The increase from existing operations was primarily due to annual wage increases and an increase in headcount to support new aggregate business, partially offset by savings resulting from the U.K. Operations optimization program.

Purchased services expense was $90.1 million for the nine months ended September 30, 2019, compared with $108.7 million for the nine months ended September 30, 2018, a decrease of $18.5 million, or 17.1%. The decrease consisted of $19.9 million from divested operations, partially offset by an increase of $1.4 million from existing operations. The increase from existing operations was primarily due to an increase in trucking activity and the timing of maintenance.

Depreciation and amortization expense was $29.5 million for the nine months ended September 30, 2019, compared with $26.0 million for the nine months ended September 30, 2018, an increase of $3.5 million, or 13.3%. The increase was primarily due to capital spending in 2018.

Materials expense, which primarily consists of the cost of containers sold to third parties, materials purchased for use in repairing and maintaining our locomotives, railcars and other equipment, as well as costs for general tools and supplies used in our business, was $45.4 million for the nine months ended September 30, 2019, compared with $46.8 million for the nine months ended September 30, 2018, a decrease of $1.3 million, or 2.9%. The decrease was primarily due to reduced container sales in 2019 and timing of roadway maintenance.

Trackage rights expense was $27.0 million for the nine months ended September 30, 2019, compared with $28.5 million for the nine months ended September 30, 2018, a decrease of $1.5 million, or 5.3%. The decrease was primarily due to a refund of prior year track access costs.

Restructuring and related costs for the nine months ended September 30, 2019 and 2018 of $15.5 million and $12.2 million, respectively, were primarily related to our optimization activities in the U.K.

Other expenses, net were $23.7 million for the nine months ended September 30, 2019, compared with $17.9 million for the nine months ended September 30, 2018, an increase of $5.7 million, or 32.1%. The increase consisted of $5.1 million from existing operations and $0.7 million from divested operations. The increase from existing operations was primarily attributable to implementation costs associated with information technology initiatives.

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Operating Loss and Operating Ratio

Our U.K./European Operations had an operating loss of $6.2 million for the nine months ended September 30, 2019, compared with an operating loss of $0.6 million for the nine months ended September 30, 2018. The operating loss for the nine months ended September 30, 2019 included $15.5 million of restructuring and related costs primarily driven by our optimization activities in the U.K. The operating loss for the nine months ended September 30, 2018 included $12.9 million, or $12.2 million excluding foreign currency, of restructuring and related costs primarily driven by our optimization activities in the U.K. The operating ratio was 101.3% for the nine months ended September 30, 2019, compared with 100.1% for the nine months ended September 30, 2018.

Liquidity and Capital Resources

We had cash and cash equivalents of $86.9 million as of September 30, 2019, of which $31.1 million was from our Australian Operations, which we control through a 51.1% ownership interest. In accordance with our Australia partnership agreement with MIRA, the cash and cash equivalents of our Australian Operations can be used to make payments in the ordinary course of business, pay down debt of the Australia Partnership and make distributions to the partners in proportion to their investments. No such distributions were made during the nine months ended September 30, 2019. During the nine months ended September 30, 2018, the Australia Partnership made an A$40.0 million distribution, of which A$20.4 million (or $15.6 million at the exchange rate on June 5, 2018) and A$19.6 million (or $14.9 million at the exchange rate on June 5, 2018) were distributed to us and MIRA, respectively.

Based on current expectations, we believe our cash, together with our other liquid assets, anticipated future cash flows from operations, availability under our credit agreement and access to debt and equity capital markets and other sources of available financing will be sufficient to fund expected operating, capital and debt service requirements and other financial commitments for the foreseeable future. As of September 30, 2019, we had $618.8 million of unused borrowing capacity under our credit agreement.

As of September 30, 2019, we had long-term debt, including current portion, of $2,215.5 million, which comprised 37.4% of our total capitalization. As of December 31, 2018, we had long-term debt, including current portion, of $2,453.5 million, which comprised 40.3% of our total capitalization. Our long-term debt, including current portion, consisted of the following as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019			December 31, 2018
Senior secured credit facility	$	1,561,648		$	1,783,423
Australian senior secured credit facility(a)	427,718			458,166
Australian subordinated shareholder loan from MIRA(b)	160,675			167,796
Other debt	81,060			64,261
Less: deferred financing fees	(15,587		)	(20,108		)
Total debt	$	2,215,514		$	2,453,538

(a) Standalone credit agreement is non-recourse to us and MIRA.

(b) Shareholder loan is non-recourse to us.

During the nine months ended September 30, 2019 and 2018, we generated $384.2 million and $397.5 million, respectively, of cash from operating activities. Changes in working capital decreased net cash flows by $7.1 million and $15.1 million for the nine months ended September 30, 2019 and 2018, respectively.

During the nine months ended September 30, 2019 and 2018, our net cash used in investing activities was $152.4 million and $165.9 million, respectively. For the nine months ended September 30, 2019, the primary drivers of cash used in investing activities were $227.3 million of cash used for capital expenditures, including $26.8 million related to capital expenditures accrued in 2018, partially offset by $23.0 million of cash received from grants from outside parties for capital spending and $45.4 million of cash received from the settlement of certain derivative investments. For the nine months ended September 30, 2018, primary drivers of cash used in investing activities were $194.1 million of cash used for capital expenditures, including $20.1 million related to capital expenditures accrued in 2017, partially offset by $16.7 million in cash received from grants from outside parties for capital spending and $7.9 million of net proceeds received from the sale of ERS.

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During the nine months ended September 30, 2019 and 2018, our net cash used in financing activities was $236.4 million and $237.0 million, respectively. For the nine months ended September 30, 2019, the primary drivers of cash used in financing activities were net payments on outstanding debt of $230.9 million, $4.8 million for common share repurchases and $4.7 million for the purchase of additional shares in Freightliner Australia from its noncontrolling interest holders, partially offset by $6.5 million of cash provided by other financing activities. For the nine months ended September 30, 2018, the primary drivers of cash used in financing activities were $270.5 million for common share repurchases and $14.9 million of cash distributed to MIRA, $6.3 million for installment payments on deferred consideration related to the Freightliner acquisition and $5.3 million in debt amendment and issuance costs, partially offset by a net increase in outstanding debt of $55.0 million. For additional information regarding our common share repurchases, see Note 3, Earnings Per Common Share, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report.

Property Insurance

We completed our annual property insurance renewal during the third quarter of 2019, which became effective on August 1, 2019. Effective with this renewal, our property policies have various self-insured retentions, which vary based on the type and location of the incident, up to $10.0 million. We recently completed our annual liability insurance renewal, which became effective on November 1, 2019. Effective with this renewal, our liability policies have various self-insured retentions up to $5.0 million.

2019 Capital Expenditures

During the nine months ended September 30, 2019, we incurred $225.1 million in aggregate capital expenditures related to current year projects of which we paid $200.5 million in cash and accrued $24.5 million in accounts payable as of September 30, 2019. We expect to receive $19.2 million of grants from outside parties related to these current year projects, which was included in outstanding grant receivables from outside parties as of September 30, 2019.

The following table sets forth our capital expenditures related to current year projects incurred by segment for the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended September 30, 2019
	North American Operations			Australian Operations		U.K./European Operations		Total
Capital Expenditures:
Track and equipment, self-funded	$	130,679		$	11,500	$	23,523	$	165,702
Track and equipment, subject to third-party funding	40,409			—		—		40,409
New business investments	2,635			16,305		—		18,940
Gross capital expenditures	173,723			27,805		23,523		225,051
Grants from outside parties	(27,553		)	—		—		(27,553		)
Net capital expenditures	$	146,170		$	27,805	$	23,523	$	197,498

Cash paid for purchases of property and equipment during the nine months ended September 30, 2019 of $227.3 million consisted of $200.5 million for 2019 capital projects and $26.8 million related to capital expenditures accrued in 2018. Grant proceeds from outside parties received during the nine months ended September 30, 2019 of $23.0 million were primarily related to our capital expenditures from prior years.

During the three months ended September 30, 2019, our Australian Operations entered into a commitment of approximately $26 million to procure locomotives and wagons to serve new business.

Recently Adopted and Recently Issued Accounting Standards

See Note 5, Leases, and Note 14, Recently Issued Accounting Standards, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report for additional information regarding recently adopted and recently issued accounting standards.

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Off-Balance Sheet Arrangements

An off-balance sheet arrangement includes any contractual obligation, agreement or transaction involving an unconsolidated entity under which we (1) have made guarantees, (2) have a retained or contingent interest in transferred assets, or a similar arrangement, that serves as credit, liquidity or market risk support to that entity for such assets, (3) have an obligation under certain derivative instruments or (4) have any obligation arising out of a material variable interest in such an entity that provides financing, liquidity, market risk or credit risk support to us, or that engages in leasing or hedging services with us.

Our off-balance sheet arrangements as of December 31, 2018 consisted of operating lease obligations. Effective January 1, 2019, we adopted Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2016-02, Leases (Topic 842), which required lessees to now recognize operating leases on their balance sheet as a right-of-use asset with a corresponding liability. See Note 5, Leases, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report for additional information regarding this standard. As of September 30, 2019, we had no off-balance sheet arrangements.

Impact of Foreign Currencies on Consolidated Results

As more fully described in Note 13, Segment Information, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report, the results of operations of our foreign entities are maintained in the respective local currency and then translated into United States dollars at the applicable exchange rates for inclusion in the consolidated financial statements. When comparing the effects of average foreign currency exchange rates on operating revenues and operating expenses during the three and nine months ended September 30, 2019 and 2018, foreign currency translation had a negative impact on our consolidated operating revenues and a positive impact on our consolidated operating expenses. Currency effects related to operating revenues and operating expenses are presented within the discussion of these respective items included within this Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

During the nine months ended September 30, 2019, we settled certain of our British pound forward contracts, which had notional amounts totaling £120.0 million and received cash proceeds of $26.1 million. In addition, we settled our cross-currency swap agreements, which had notional amounts totaling A$248.9 million, and received cash proceeds of €17.0 million (or $19.3 million at the exchange rate on June 30, 2019, the date of settlement).

In June 2019, we entered into two new cross-currency swap agreements designated as fair value hedges and a cross-currency swap designated as a net investment hedge. See Note 6, Derivative Financial Instruments, to our Consolidated Financial Statements set forth in "Part I Item 1. Financial Statements" of this quarterly report for additional information regarding our swap agreements.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures — We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (Exchange Act)) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2019. Based upon that evaluation and subject to the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2019, the disclosure controls and procedures were effective to accomplish their objectives at the reasonable assurance level.

Internal Control Over Financial Reporting — There were no changes in our internal control over financial reporting (as the term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended September 30, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, we are a defendant in certain lawsuits and a party to certain arbitrations resulting from our operations in the ordinary course, as the nature of our business exposes us to the potential for various claims and litigation, including those related to property damage, personal injury, freight loss, labor and employment, environmental and other matters. We maintain insurance policies to mitigate the financial risk associated with such claims. However, any material changes to pending litigation or a catastrophic rail accident or series of accidents involving material freight loss or property damage, personal injuries or environmental liability or other claims or disputes that are not covered by insurance could have a material adverse effect on our results of operations, financial condition and liquidity.

In November 2014, we received a notice from the United States Environmental Protection Agency (EPA) requesting information under the Clean Water Act related to the discharge of crude oil as a result of a derailment of an Alabama & Gulf Coast Railway LLC (AGR) freight train in November 2013 in the vicinity of Aliceville, Alabama. In May 2018, the EPA notified the AGR of a maximum civil payment penalty of $14.1 million, based on the amount of oil allegedly discharged and other relevant factors considered under the applicable regulation. Although the cleanup associated with this derailment is substantially complete, the civil penalty associated with the contamination is subject to further discussion and potential litigation.

Following the filing of our definitive proxy statement (the Proxy Statement) associated with the Merger with the Securities and Exchange Commission (the “SEC”) on August 20, 2019, three lawsuits were filed in connection with the Merger, including two purported class action lawsuits that were filed on August 21, 2019 and September 4, 2019 in the United States District Court for the District of Delaware, and one lawsuit filed on behalf of a purported individual shareholder on September 12, 2019 in the United States District Court for the District of Connecticut. These lawsuits, Gordon vs. Genesee & Wyoming Inc. et al., Case No. 1:19-cv-01558-MN, Thompson vs. Genesee & Wyoming Inc. et al., Case No. 1;19-cv-01650-MN and Geery vs. Genesee & Wyoming Inc. et al., Case No. 3:19-cv-01438-VLB (collectively, the “Disclosure Actions”), named us and individual officers and members of our board of directors as defendants. The actions alleged, among other things, that the defendants failed to disclose certain information relating to our financial projections set forth in the Proxy Statement.

On September 25, 2019, solely to eliminate the burden, expense, and uncertainty inherent in such litigation, and without admitting any liability or wrongdoing, we filed a Form 8-K containing certain supplemental disclosures with the SEC. In consideration for such supplemental disclosures by us, plaintiffs in the Disclosure Actions had agreed to voluntarily dismiss the Disclosure Actions. On October 4, 2019, pursuant to those agreements, plaintiffs filed voluntary dismissals of the Disclosure Actions.

On September 17, 2019, in New South Wales, Australia, a complaint was filed by Australia Eastern Railroad Pty Ltd ACN against the Company, GWI Holdings Pty Ltd and Genesee & Wyoming Australia Pty Ltd in connection with the Merger. The complaint seeks an award of damages in connection with a right of first refusal provision in a commercial contract involving our majority-owned Australian subsidiary. We dispute the allegations made in the complaint and intend to defend us appropriately.

In addition to the EPA matter and the lawsuits set forth above, from time to time, we are a defendant in certain lawsuits resulting from our operations in the ordinary course. Management believes there are adequate provisions in the financial statements for any probable liabilities that may result from disposition of the pending lawsuits and the aforementioned EPA matter. Based upon currently available information, we do not believe it is reasonably possible that any such lawsuit, related lawsuits or matter would be material to our results of operations or have a material adverse effect on our financial position or liquidity.

ITEM 1A. RISK FACTORS.

For a discussion of our potential risks or uncertainties, please see Risk Factors in Part I Item 1A of the Company's 2018 Annual Report on Form 10-K filed with the Securities and Exchange Commission. Except for the risks described below, there have been no material changes to the risk factors disclosed in the 2018 Annual Report.

There are risks and uncertainties associated with the proposed merger.

On July 1, 2019, G&W entered into an Agreement and Plan of Merger (the Merger Agreement), by and among G&W, DJP XX, LLC, a Delaware limited liability company (Parent), and MKM XXII Corp., a Delaware corporation and a wholly owned subsidiary of Parent (Merger Sub), pursuant to which Merger Sub will be merged with and into G&W (the Merger) with G&W surviving the Merger as a wholly-owned subsidiary of Parent. The proposed Merger will result in G&W becoming a privately-held company.

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Completion of the proposed Merger is subject to various conditions, including, among others, (i) the absence of any law, injunction or other order that prohibits the consummation of the Merger, (ii) the approval or authorization of, or exemption by, the Surface Transportation Board (or approval of the use of a voting trust structure), which exemption was granted on October 29, 2019, (iii) receipt of other antitrust and regulatory approvals, including approval of the Committee on Foreign Investment in the United States, and (iv) other customary closing conditions, including the accuracy of each party’s representations and warranties and each party’s compliance with its covenants and agreements contained in the Merger Agreement (subject in the case of this clause (iv) to certain materiality qualifiers). We cannot provide any assurance that these conditions will be met or waived, or that we will be able to successfully consummate the proposed Merger as provided for under the Merger Agreement, or at all.

In this regard, we face risks and uncertainties due both to the pendency of the proposed Merger as well as the potential failure to consummate the proposed Merger, including:

• the occurrence of any event, change or other circumstances that could give us or Parent the right to terminate the Merger Agreement;

• the outcome of any legal proceedings that may be instituted against us with respect to the proposed Merger;

• the ability to obtain regulatory approvals and satisfy other closing conditions to the proposed Merger in a timely manner or at all, including the risk that regulatory approvals required for the proposed Merger are not obtained or are obtained subject to conditions that are not anticipated;

• delay in closing the proposed Merger;

• business disruptions from the proposed Merger that may harm our business, including our current plans and operations;

• adverse effects on our ability to retain and hire key personnel or maintain relationships with customers or on our operating results and business generally;

• the risk that developments with respect to the proposed Merger could have adverse effects on the market price of our common stock;

• restrictions during the pendency of the proposed Merger that may impact our ability to pursue certain business opportunities or strategic transactions; and

• the risk that G&W will be required to pay Parent a termination fee of $194 million in the event the Merger Agreement is terminated by G&W or Parent under certain circumstances specified in the Merger Agreement, including upon a termination by G&W in connection with G&W’s entry into a superior proposal (which termination fee would be payable even if such superior proposal is not consummated).

In addition, we have incurred, and will continue to incur, significant costs, expenses and fees for professional services and other transaction costs in connection with the proposed Merger, and these fees and costs are payable by us regardless of whether the proposed Merger is consummated.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

There were no unregistered sales of equity securities for the period covered by this Quarterly Report on Form 10-Q.

Issuer Purchases of Equity Securities

Period in 2019	(a) Total Number of Shares (or Units) Purchased (1)	(b) Average Price Paid per Share (or Unit)(1)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs (2)	(d) Maximum Number of Shares (or Units) (or Approximate Dollar Value) that May Yet Be Purchased Under the Plans or Programs (2)
July 1 to July 31	—	$	—	—	$	335,000,045
August 1 to August 31	31,256	$	110.05	—	$	335,000,045
September 1 to September 30	—	$	—	—	$	335,000,045
Total	31,256	$	110.05	—

(1) The 31,256 shares acquired in the three months ended September 30, 2019 represent common stock acquired by us from our employees who surrendered shares in lieu of cash either to fund their exercise of stock options or to pay taxes on equity awards granted under our Fourth Amended and Restated 2004 Omnibus Plan.

(2) In November 2018, the Board of Directors authorized the repurchase of $500 million of our Class A Common Stock. During the three months ended September 30, 2019, we did not purchase any shares of our Class A Common Stock under the repurchase program. In connection with entering into the Merger Agreement, we suspended future share repurchases under the repurchase program.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

For a list of exhibits, see Index to Exhibits in this Quarterly Report on Form 10-Q, which is incorporated herein by reference.

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INDEX TO EXHIBITS

Number	Description
2.1	Agreement and Plan of Merger, dated as of July 1, 2019, by and among Genesee & Wyoming Inc., DJP XX, LLC and MKM XXII Corp., is incorporated herein by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on July 1, 2019.
2.2	Partnership Interest Sale Agreement, dated August 4, 2019, by and among GWI Holding B.V., GWI International Pty Ltd, GWI International B.V., Macquarie Australian Infrastructure Management 1 Limited as trustee for the PGGM Ibis LP Trust, as the Buyer, Brookfield Infrastructure Group LLC and trustees, guarantors and partners thereto, is incorporated herein by reference to the Registrant’s Quarterly Report on Form 10-Q filed on August 7, 2019.
*31.1	Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer
*31.2	Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer
*32.1	Section 1350 Certification
*101	The following financial information from Genesee & Wyoming Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, formatted in Inline Extensible Business Reporting Language (iXBRL) includes: (i) Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018, (ii) Consolidated Statements of Operations for the three and nine months ended September 30, 2019 and 2018, (iii) Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2019 and 2018, (iv) Consolidated Statements of Changes in Equity for the three and nine months ended September 30, 2019 and 2018, (v) Consolidated Statements of Cash Flows for the nine months ended September 30, 2019 and 2018, and (vi) the Notes to Consolidated Financial Statements.
*104	Cover Page Interactive Date File (formatted as Inline XBRL and contained in Exhibit 101)

*Exhibit filed or furnished with this Report.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure, other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

70

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		GENESEE & WYOMING INC.
Date:	November 6, 2019	By:	/s/    TIMOTHY J. GALLAGHER
		Name:	Timothy J. Gallagher
		Title:	Chief Financial Officer (Principal Financial Officer)
Date:	November 6, 2019	By:	/s/ CHRISTOPHER F. LIUCCI
		Name:	Christopher F. Liucci
		Title:	Chief Accounting Officer (Principal Accounting Officer)

71

EX-31.1

Exhibit 31.1

Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer

I, John C. Hellmann, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2019, of Genesee & Wyoming Inc. (the "registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	November 6, 2019	/s/ JOHN C. HELLMANN
		John C. Hellmann,
		Chairman and Chief Executive Officer

EX-31.2

Exhibit 31.2

Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer

I, Timothy J. Gallagher, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2019, of Genesee & Wyoming Inc. (the "registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	November 6, 2019	/s/ TIMOTHY J. GALLAGHER
		Timothy J. Gallagher,
		Chief Financial Officer

EX-32.1

Exhibit 32.1

Section 1350 Certification

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, John C. Hellmann and Timothy J. Gallagher, President and Chief Executive Officer and Chief Financial Officer, respectively, of Genesee & Wyoming Inc., certify that (i) the Quarterly Report on Form 10-Q for the three months ended September 30, 2019 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of Genesee & Wyoming Inc.

/s/ JOHN C. HELLMANN
John C. Hellmann
Chairman and Chief Executive Officer
Date:	November 6, 2019
/s/ TIMOTHY J. GALLAGHER
Timothy J. Gallagher
Chief Financial Officer
Date:	November 6, 2019

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Principles of Consolidation and Basis of Presentation

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Principles of Consolidation and Basis of Presentation

PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION:

The interim consolidated financial statements presented herein include the accounts of Genesee & Wyoming Inc. and its subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. These interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and are unaudited. They do not contain all disclosures which would be required in a full set of financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). In the opinion of management, the unaudited financial statements for the three and nine months ended September 30, 2019 and 2018 are presented on a basis consistent with the audited financial statements and contain all adjustments, consisting only of normal recurring adjustments, necessary to provide a fair statement of the results for the interim periods presented. The results of operations for interim periods are not necessarily indicative of results of operations for the full year. The consolidated balance sheet data for 2018 was derived from the audited financial statements in the Company's 2018 Annual Report on Form 10-K, but does not include all disclosures required by U.S. GAAP.

The results of operations of the foreign entities are maintained in the local currency of the respective subsidiary and translated into United States dollars at the applicable exchange rates for inclusion in the consolidated financial statements. As a result, any appreciation or depreciation of these currencies against the United States dollar will impact the Company's results of operations.

The interim consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2018 included in the Company's 2018 Annual Report on Form 10-K.

During the process of preparing the Form 10-K for the year ended December 31, 2018, the Company determined that there was an error in and revised its statement of cash flows for the nine months ended September 30, 2018, which resulted in the following offsetting adjustments: an increase of $33.0 million in principal payments on revolving line-of-credit, long-term debt and capital lease obligations, representing cash outflows from financing activities, and an increase of $33.0 million in proceeds from revolving line-of-credit and long-term debt, representing cash inflows from financing activities. There was no effect on any other section of the Company's statement of cash flows, and this revision had no impact on the Company's consolidated balance sheet as of December 31, 2018 or the Company's consolidated statements of operations or comprehensive income for the three and nine months ended September 30, 2018. The Company does not consider this revision material to any previously issued consolidated financial statements.

When comparing the Company's results of operations from one reporting period to another, it is important to consider that the Company has historically experienced fluctuations in revenues and expenses due to acquisitions and divestitures, changing economic conditions, fluctuations in commodity prices, competitive forces, changes in foreign currency exchange rates, rail network issues and congestion, the ability to attract and retain skilled workers, one-time freight moves, fuel price fluctuations, customer plant expansions and shutdowns, sales of property and equipment, derailments and weather-related conditions, such as hurricanes, cyclones, tornadoes, high winds, droughts, heavy snowfall, unseasonably hot or cold weather, freezing and flooding, among other factors. In periods when these events occur, the Company's results of operations are not easily comparable from one period to another. Finally, certain of the Company's railroads have commodity shipments that are sensitive to general economic conditions, global commodity prices and foreign exchange rates, such as steel products, iron ore, paper products, lumber and forest products and agricultural products, as well as product specific market conditions, such as the availability of lower priced alternative sources of power generation (coal) and energy commodity price differentials (crude oil and natural gas liquids) or congestion at ports (intermodal). Other shipments are relatively less affected by economic conditions and are more closely affected by other factors, such as winter weather (salt) and seasonal rainfall (agricultural products). As a result of these and other factors, the Company's results of operations in any reporting period may not be directly comparable to the Company's results of operations in other reporting periods.

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Leases (Notes)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Lessee, Operating and Financing Leases [Text Block]

LEASES:

On January 1, 2019, the Company adopted Accounting Standards Update (ASU) 2016-02, Leases (the New Standard), and all related amendments, which supersedes the previous lease guidance, using the transition method with the election not to adjust comparative periods. The New Standard requires lessees to recognize leases on their balance sheet as a right-of-use (ROU) asset with a corresponding lease liability. The adoption resulted in the recognition of ROU assets included in other assets and lease liabilities included in accrued expenses and other long-term liabilities of approximately $495 million in the Company's consolidated balance sheet, each as a result of the new requirement to recognize operating leases. No material cumulative-effect adjustment was recognized in retained earnings, and the adoption did not materially impact operating results, liquidity or the Company's debt-covenant compliance under these agreements. The Company continues to recognize its capital leases on the balance sheet but these leases are now referred to as "finance" leases, as required by the New Standard.

The Company enters into leases for railcars, locomotives and other equipment as well as real property. These leases may contain variable payments that vary with rate or index changes or include payment of a per car fee or per mile fee to use the track under variable lease contracts. The Company may receive rent holidays and other incentives provided by the lessor on lease agreements. On occasion, the Company subleases assets to other parties.

As of January 1, 2019, the Company adopted a number of practical expedients and exemptions included in the New Standard, which were intended to reduce the cost and complexity of complying with the transition requirements. The Company chose the following practical expedients and exemptions in setting its accounting policy elections for transition to:

1. Not recognize an asset and liability for leases of all asset classes with a term of 12 months or less;

2. Carry forward the historical lease classification and not reassess its existing contracts to determine whether the arrangements contained a lease or whether initial direct costs qualified for capitalization;

3. Not separate lease and non-lease components; and

4. Carry forward its current accounting treatment for land easements on existing agreements.

Lease contracts may include one or more renewal options, with renewal terms from one to fifty years or more. Leases may also include options to terminate the arrangement or options to purchase the underlying leased property. The exercise of lease options are generally at the discretion of the Company's management team. The Company determines the expected term of a lease and includes options that are reasonably certain to be exercised in the calculation of its ROU assets and lease liabilities.

The determination of whether a contract contains a lease, as well as the analysis regarding the allocation of consideration in a contract between lease and non-lease components, is performed on a case by case basis and considers the nature and interdependency of the individual assets in the arrangement. The Company generally accounts for lease assets as a single component as the assets in most agreements are highly interrelated and dependent upon each other to fulfill the arrangement.

As the implicit rate is not readily determinable in most of the Company's lease agreements, the Company uses its estimated secured incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The following table summarizes the Company's leased assets and lease liabilities recorded in the consolidated balance sheet as of September 30, 2019 (dollars in thousands):

	Balance Sheet Location	September 30, 2019
Leased right-of-use assets:
Operating leased assets	Other assets	$	471,929
Finance leased assets, net	Property and equipment, net(a)	85,230
Total leased assets		$	557,159
Lease liabilities:
Current
Operating lease liabilities	Accrued expenses	$	60,624
Finance lease liabilities	Current portion of long-term debt	14,402
Non-current
Operating lease liabilities	Other long-term liabilities	411,153
Finance lease liabilities	Long-term debt, less current portion	64,309
Total lease liabilities		$	550,488

(a) Net of $30.1 million of accumulated amortization as of September 30, 2019, which was recognized in depreciation and amortization expense within the Company's consolidated statement of operations.

The following table summarizes the components of lease expense for the three and nine months ended September 30, 2019 (dollars in thousands):

	Location of Amount Recognized in Earnings	Three Months Ended			Nine Months Ended
		September 30, 2019			September 30, 2019
Finance leases:
Amortization of right-of-use assets	Depreciation and amortization	$	2,069		$	5,830
Interest on lease liability	Interest expense	881			2,554
Total finance lease cost		$	2,950		$	8,384
Operating leases:
Operating lease cost	Equipment rents/Trackage rights	$	22,292		$	66,976
Short-term lease cost	Equipment rents/Trackage rights	2,071			7,064
Variable lease cost	Equipment rents/Trackage rights	1,964			6,871
Sublease income (gross basis)	Operating revenues	(1,291		)	(3,541		)
Total operating lease cost		$	25,036		$	77,370
Total lease cost		$	27,986		$	85,754

The maturities of lease liabilities under the New Standard based on the Company's reasonably certain holding period for each lease were as follows as of September 30, 2019 (dollars in thousands):

	Finance Leases		Operating Leases
Maturity of lease liabilities:
2019 (remainder)	$	3,299	$	23,076
2020	19,373		72,851
2021	10,495		63,445
2022	14,650		52,080
2023	10,551		43,398
Thereafter	34,778		553,484
Total lease payments	93,146		808,334
Less: Imputed interest	14,435		336,557
Total lease liabilities	$	78,711	$	471,777

The following is a summary of future minimum lease payments based on the minimum non-cancelable lease term as required under previous guidance for capital and operating leases as of December 31, 2018 (dollars in thousands):

	Capital		Operating
2019	$	11,405	$	82,191
2020	17,261		63,062
2021	8,668		54,305
2022	9,625		44,739
2023	10,780		35,919
Thereafter	13,988		383,739
Total minimum payments	$	71,727	$	663,955

The following table presents supplemental cash flow and other information for the Company's leases as of and for the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended
	September 30, 2019
Cash flow information:
Cash paid for operating leases included in operating activities	$	69,533
Cash paid for finance leases included in operating activities	$	2,608
Cash paid for finance leases included in financing activities	$	9,694
Weighted average remaining lease term (in years):
Operating leases	26.8
Finance leases	8.1
Weighted average discount rate:
Operating leases	3.8		%
Finance leases	4.5		%
New leases:
Right-of-use assets obtained in exchange for operating lease liabilities	$	36,333
Right-of-use assets obtained in exchange for finance lease liabilities	$	27,592

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Changes in Operations Proposed Acquisition by Brookfield Infrastructure and GIC (Details) - Proposed G&W [Member] - USD ($) $ / shares in Units, $ in Billions	Oct. 03, 2019	Jul. 01, 2019
Business Acquisition, Share Price		$ 112.00
Business Acquisition, Total Value including total debt		$ 8.4
Shareholder Vote, Percentage	82.90%

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Accumulated Other Comprehensive Income/(Loss) (Tables)

9 Months Ended

Sep. 30, 2019

Schedule of Accumulated Other Comprehensive Income/(Loss) [Table Text Block]

The following tables set forth the components of AOCL attributable to Genesee & Wyoming Inc. included in the consolidated balance sheets and consolidated statements of comprehensive income (dollars in thousands):

	Foreign Currency Translation Adjustment				Defined Benefit Plans				Net Unrealized Gain/(Loss) on Hedges				Accumulated Other Comprehensive Loss
Balance, December 31, 2018	$	(144,503	)		$	11,120			$	(13,073	)		$	(146,456	)
Other comprehensive loss before reclassifications	(24,026		)		—				(57,612		)		(81,638		)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit of ($26), $74 and $593, respectively	82			(a)	(94		)	(b)	(2,002		)	(c)	(2,014		)
Current period change	(23,944		)		(94		)		(59,614		)		(83,652		)
Balance, September 30, 2019	$	(168,447	)		$	11,026			$	(72,687	)		$	(230,108	)

	Foreign Currency Translation Adjustment			Defined Benefit Plans				Net Unrealized Gain/(Loss) on Hedges				Accumulated Other Comprehensive Loss
Balance, December 31, 2017	$	(74,617	)	$	(19,601	)		$	(11,316	)		$	(105,534	)
Other comprehensive income before reclassifications	(41,395		)	—				14,926				(26,469		)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit of ($42) and $76, respectively	—			129			(b)	(232		)	(c)	(103		)
Current period change	(41,395		)	129				14,694				(26,572		)
Amounts reclassified from accumulated other comprehensive loss to retained earnings related to the United States Tax Cuts and Jobs Act	—			(132		)		(2,838		)		(2,970		)
Balance, September 30, 2018	$	(116,012	)	$	(19,604	)		$	540			$	(135,076	)

(a) Net gains realized were recorded in other income/(loss), net within the consolidated statements of operations.

(b) Net (losses)/gains realized were recorded in labor and benefits on the consolidated statements of operations.

(c)

For the nine months ended September 30, 2019, $1.7 million and $0.3 million of net losses were recorded in interest expense and other income/(loss), net, respectively, within the consolidated statements of operations. For the nine months ended September 30, 2018, net losses realized were recorded in interest expense on the consolidated statements of operations. See Note 6, Derivative Financial Instruments.

Noncontrolling Interest [Member]

Comprehensive Income (Loss) [Table Text Block]

The following table sets forth comprehensive loss attributable to noncontrolling interest for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Net income attributable to noncontrolling interest	$	2,979		$	2,720		$	3,011		$	8,090
Other comprehensive income/(loss):
Foreign currency translation adjustment	(7,690		)	(4,804		)	(8,697		)	(17,647		)
Net unrealized (loss)/gain on qualifying cash flow hedges, net of tax benefit/(provision) of $21, $41, $654 and ($26), respectively	(48		)	(95		)	(1,525		)	62
Comprehensive loss attributable to noncontrolling interest	$	(4,759	)	$	(2,179	)	$	(7,211	)	$	(9,495	)

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Leases Supplemental Cash Flow Information Related to Leases (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2019 USD ($)
Leases [Abstract]
Cash paid for operating leases included in operating activities	$ 69,533
Cash paid for finance leases included in operating activities	2,608
Cash paid for finance leases included in financing activities	$ 9,694
Operating Lease, Weighted Average Remaining Lease Term	26 years 9 months 18 days
Finance Lease, Weighted Average Remaining Lease Term	8 years 1 month 6 days
Operating Lease, Weighted Average Discount Rate, Percent	3.80%
Finance Lease, Weighted Average Discount Rate, Percent	4.50%
Right-of-use assets obtained in exchange for operating lease liabilities	$ 36,333
Right-of-use assets obtained in exchange for finance lease liabilities	$ 27,592

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Derivative Financial Instruments Cash Flow Impact of Settled Derivative Transactions (Details) $ in Thousands, € in Millions	9 Months Ended
	Sep. 30, 2019 EUR (€)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Derivative [Line Items]
Proceeds from settlement of derivative transactions		$ 45,360	$ 0
Designated as Hedging Instrument [Member] | British Pound Foreign currency forward contracts [Member]
Derivative [Line Items]
Proceeds from settlement of derivative transactions		26,088
Not Designated as Hedging Instrument [Member] | Currency Swap [Member]
Derivative [Line Items]
Proceeds from settlement of derivative transactions	€ 17.0	$ 19,300

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Segment Information Balance Sheet Data (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018	Dec. 31, 2017
Segment Reporting, Asset Reconciling Item [Line Items]
Cash and cash equivalents	$ 86,912	$ 90,387	$ 74,067	$ 80,472
Property and equipment, net	4,664,837	4,613,014
North American Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Cash and cash equivalents	37,261	33,996
Property and equipment, net	3,747,047	3,679,279
Australia Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Cash and cash equivalents	31,142	26,902
Property and equipment, net	587,793	609,450
U.K./European Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Cash and cash equivalents	18,509	29,489
Property and equipment, net	$ 329,997	$ 324,285

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Consolidated Statement of Changes in Equity (Parenthetical) - shares	3 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018
Class A Common Stock repurchased	31,256	107	111,289	893,705	1,873,170	832,232
Class A Common Shares [Member]
Stock Issued During Period, Shares, Share-based Compensation, Gross	112,347	38,512	164,732	72,925	42,102	115,897
Conversion of Class B Common Stock to Class A Common Stock [Member] | Common Stock [Member] | Class A Common Shares [Member]
Stock Issued During Period, Shares, Conversion of Convertible Securities	0	40,746	100,000	130,000	30,000	0

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Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
OPERATING REVENUES	$ 583,694	$ 603,304	$ 1,713,263	$ 1,772,955
OPERATING EXPENSES:
Labor and benefits	175,500	175,853	539,751	539,407
Equipment rents	30,926	35,325	95,169	104,214
Purchased services	51,055	53,717	156,337	178,864
Depreciation and amortization	63,026	65,392	188,169	197,127
Diesel fuel used in train operations	41,533	45,713	127,674	137,487
Electricity used in train operations	1,794	2,742	6,344	7,020
Casualties and insurance	11,658	9,912	34,869	32,862
Materials	32,435	32,744	94,949	97,589
Trackage rights	21,266	22,838	64,633	67,119
Net gain on sale and impairment of assets	(641)	(642)	(1,151)	(2,501)
Restructuring and related costs	3,561	3,286	18,756	12,931
Other expenses, net	38,825	28,604	101,097	82,978
Total operating expenses	470,938	475,484	1,426,597	1,455,097
OPERATING INCOME	112,756	127,820	286,666	317,858
Interest income	1,244	417	2,615	1,499
Interest expense	(25,386)	(26,429)	(80,395)	(80,605)
Other income/(loss), net	1,132	1,515	4,165	(237)
Income before income taxes	89,746	103,323	213,051	238,515
Provision for income taxes	(19,975)	(31,013)	(53,101)	(41,569)
Net income	69,771	72,310	159,950	196,946
Net income attributable to noncontrolling interest	2,979	2,720	3,011	8,090
Net income attributable to Genesee & Wyoming Inc.	$ 66,792	$ 69,590	$ 156,939	$ 188,856
Basic earnings per common share attributable to Genesee & Wyoming Inc. common stockholders:	$ 1.18	$ 1.18	$ 2.78	$ 3.13
Weighted average shares - Basic	56,638	59,168	56,497	60,343
Diluted earnings per common share attributable to Genesee & Wyoming Inc. common stockholders	$ 1.16	$ 1.16	$ 2.74	$ 3.08
Weighted average shares - Diluted	57,532	60,131	57,297	61,255

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Accounts Receivable Insurance and Third Party Claims (Details) - USD ($) $ in Millions	Nov. 01, 2019	Aug. 01, 2019
Property Polices [Member]
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Line Items]
Self-Insured Retention, Maximum Per Incident		$ 10.0
Scenario, Forecast [Member] | Liability Policies [Member]
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Line Items]
Self-Insured Retention, Maximum Per Incident	$ 5.0

XML

Earnings per Share Share Repurchase (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018	Oct. 25, 2018	Sep. 30, 2015
Equity, Class of Treasury Stock [Line Items]
Class A Common Stock repurchased	31,256	107	111,289	893,705	1,873,170	832,232
Share Repurchase Program 1 [Member]
Equity, Class of Treasury Stock [Line Items]
Stock Repurchase Program, Authorized Amount										$ 300,000
Average stock price paid per share of Class A Common Stock repurchased				$ 87.46				$ 75.99
Stock Repurchase Program, Remaining Authorized Repurchase Amount									$ 0
Share Repurchase Program 2 [Member]
Equity, Class of Treasury Stock [Line Items]
Stock Repurchase Program, Authorized Amount									$ 500,000
Average stock price paid per share of Class A Common Stock repurchased	$ 0						$ 73.94
Stock Repurchase Program, Remaining Authorized Repurchase Amount	$ 335,000						$ 335,000
Class A Common Shares [Member] | Share Repurchase Program 1 [Member]
Equity, Class of Treasury Stock [Line Items]
Class A Common Stock repurchased				894,000				3,560,000
Class A Common Shares [Member] | Share Repurchase Program 2 [Member]
Equity, Class of Treasury Stock [Line Items]
Class A Common Stock repurchased	0						65,000

XML

Segment Information Foreign Currency Exchange Rates (Details)	Sep. 30, 2019 $ / £	Sep. 30, 2019 $ / $	Sep. 30, 2019 $ / $	Sep. 30, 2019 $ / €	Dec. 31, 2018 $ / £	Dec. 31, 2018 $ / $	Dec. 31, 2018 $ / $	Dec. 31, 2018 $ / €	Sep. 30, 2018 $ / £	Sep. 30, 2018 $ / $	Sep. 30, 2018 $ / $	Sep. 30, 2018 $ / €
Last day rate [Member]
Foreign Currency Exchange Rate, Translation	1.23	0.67	0.76	1.09	1.28	0.70	0.73	1.15
Quarter to Date Average [Member]
Foreign Currency Exchange Rate, Translation	1.23	0.69	0.76	1.11					1.30	0.73	0.77	1.16
Year to Date Average [Member]
Foreign Currency Exchange Rate, Translation	1.27	0.70	0.75	1.12					1.35	0.76	0.78	1.19

XML

Fair Value of Financial Instruments Financial Instruments Carried at Fair Value-Level 2 (Details) - Fair Value, Inputs, Level 2 [Member] - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial assets carried at fair value	$ 12,574	$ 45,695
Financial liabilities carried at fair value	99,075	14,454
Interest rate swap agreements [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability	95,028	14,395
British pound forward contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Asset	4,535	26,011
Derivative Liability	0	59
Cross-currency swap contract [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Asset	0	19,684
Cross-currency swap contract [Member] | Net Investment Hedging [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Asset	8,039	0
Cross-currency swap contract [Member] | Fair Value Hedging [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability	$ 4,047	$ 0

XML

Commitments and Contingencies (Details) $ in Millions	Sep. 30, 2019 USD ($)
Damage from Fire, Explosion or Other Hazard [Member]
Loss Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	$ 14.1

XML

Segment Information

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Segment and Geographic Area Information

SEGMENT INFORMATION:

The Company presents the financial results of its eight operating regions as three reportable segments: North American Operations, Australian Operations and U.K./European Operations. During the three months ended March 31, 2019, the Company's Central Region railroads were consolidated into the Company's Midwest and Southern regions. The Company's remaining six North American regions are aggregated into one segment as a result of having similar economic and operating characteristics. Each of the Company's segments generates the following three categories of revenues from external customers: freight revenues, freight-related revenues and all other revenues.

The Company's Australian business underwent a transformational change on December 1, 2016, with the acquisition of

Glencore Rail (NSW) Pty Limited (GRail) and the formation of a partnership with Macquarie Infrastructure and Real Assets (MIRA) (the Australia Partnership), which the Company controls through its 51.1% interest. The GRail acquisition significantly expanded the Company's operations in New South Wales. In conjunction with the GRail acquisition, the Company issued a 48.9% equity stake in its Australian subsidiary, GWAHLP, to MIRA. The Company retained a 51.1% controlling interest in GWAHLP and continues to consolidate 100% of its Australian Operations in the Company's financial statements and reports a noncontrolling interest for MIRA's 48.9% equity ownership. As a result, (1) 100% of the assets and liabilities of the Company's Australian Operations, after the elimination of intercompany balances, were included in the Company's consolidated balance sheets as of September 30, 2019 and December 31, 2018, with MIRA's 48.9% noncontrolling interest reflected in the equity section, (2) the Company's operating revenues and operating income for the three and nine months ended September 30, 2019 and 2018 included 100% of the Australian Operations, while net income attributable to G&W reflected the Company's 51.1% ownership position in the Australian Operations and (3) 100% of the cash flows of the Australian Operations, after the elimination of intercompany items, were included in the Company's consolidated statements of cash flows for the nine months ended September 30, 2019 and 2018. Accordingly, any payments between the Company's Australian Operations and its other businesses are eliminated in consolidation, while the Company's cash flows reflect 100% of any cash flows between the Australian Operations and MIRA.

In accordance with the Company's Australian Partnership agreement with MIRA, the cash and cash equivalents of the Company's Australian Operations can be used to make payments in the ordinary course of business, to pay down debt of the Australia Partnership and to make distributions to the partners in proportion to their investments. No such distributions were made during the nine months ended September 30, 2019. During the nine months ended September 30, 2018, the Australia Partnership made an A$40.0 million distribution, of which A$20.4 million (or $15.6 million at the exchange rate on June 5, 2018) and A$19.6 million (or $14.9 million at the exchange rate on June 5, 2018) were distributed to the Company and MIRA, respectively.

The results of operations of the Company's foreign entities are maintained in the respective local currency (the Australian dollar, the British pound, the Canadian dollar and the Euro) and then translated into United States dollars at the exchange rate at the end of the period for balance sheet items and, for the statement of operations, at the average rate for the period. Currency translation adjustments are reflected within the equity section of the balance sheet and are included in OCI. Upon complete or substantially complete liquidation of the underlying investment in the foreign subsidiary, cumulative translation adjustments are recognized in the consolidated statements of operations. As a result, any appreciation or depreciation of these currencies against the United States dollar will impact the Company's results of operations.

The following table reflects the balance sheet exchange rates used to translate each foreign entity's respective local currency balance sheet into United States dollars as of September 30, 2019 and December 31, 2018:

	September 30, 2019		December 31, 2018
United States dollar per Australian dollar	$	0.67	$	0.70
United States dollar per British pound	$	1.23	$	1.28
United States dollar per Canadian dollar	$	0.76	$	0.73
United States dollar per Euro	$	1.09	$	1.15

The following table reflects the average exchange rates used to translate each foreign entity's respective local currency results of operations into United States dollars for the three and nine months ended September 30, 2019 and 2018:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
United States dollar per Australian dollar	$	0.69	$	0.73	$	0.70	$	0.76
United States dollar per British pound	$	1.23	$	1.30	$	1.27	$	1.35
United States dollar per Canadian dollar	$	0.76	$	0.77	$	0.75	$	0.78
United States dollar per Euro	$	1.11	$	1.16	$	1.12	$	1.19

The following tables set forth select financial data for the Company's reportable segments, including operating revenues by commodity group, for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	34,574	$	2,631	$	763		$	37,968
Autos & Auto Parts	6,339		—		—			6,339
Chemicals & Plastics	39,518		—		—			39,518
Coal & Coke	18,336		33,187		606			52,129
Food & Kindred Products	8,355		—		—			8,355
Intermodal	461		16,446		56,998			73,905
Lumber & Forest Products	22,862		—		—			22,862
Metallic Ores	4,225		7,036		—			11,261
Metals	28,115		—		—			28,115
Minerals & Stone	41,399		1,979		21,672			65,050
Petroleum Products	19,027		178		628			19,833
Pulp & Paper	30,648		—		—			30,648
Waste	8,278		—		—			8,278
Other	5,888		—		—			5,888
Total freight revenues	268,025		61,457		80,667			410,149
Freight-related revenues	68,129		8,011		65,229			141,369
All other revenues	16,288		2,132		13,756			32,176
Total operating revenues	$	352,442	$	71,600	$	159,652		$	583,694
Operating income/(loss)	$	95,633	$	19,484	$	(2,361	)	$	112,756
Depreciation and amortization	$	39,164	$	13,779	$	10,083		$	63,026
Interest expense, net	$	12,599	$	10,694	$	849		$	24,142
Provision for income taxes	$	16,876	$	2,641	$	458		$	19,975
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	53,239	$	14,845	$	6,336		$	74,420

	Three Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	30,565	$	4,150	$	1,053	$	35,768
Autos & Auto Parts	5,513		—		—		5,513
Chemicals & Plastics	38,436		—		—		38,436
Coal & Coke	23,006		32,357		2,588		57,951
Food & Kindred Products	8,761		—		—		8,761
Intermodal	514		17,538		58,609		76,661
Lumber & Forest Products	24,113		—		—		24,113
Metallic Ores	3,573		8,914		—		12,487
Metals	34,904		—		—		34,904
Minerals & Stone	38,570		2,066		22,344		62,980
Petroleum Products	18,236		224		99		18,559
Pulp & Paper	31,961		—		—		31,961
Waste	8,089		—		—		8,089
Other	7,191		—		—		7,191
Total freight revenues	273,432		65,249		84,693		423,374
Freight-related revenues	66,045		10,136		69,269		145,450
All other revenues	16,232		1,318		16,930		34,480
Total operating revenues	$	355,709	$	76,703	$	170,892	$	603,304
Operating income	$	102,484	$	20,713	$	4,623	$	127,820
Depreciation and amortization	$	41,388	$	14,937	$	9,067	$	65,392
Interest expense, net	$	10,339	$	12,780	$	2,893	$	26,012
Provision for income taxes	$	26,323	$	2,398	$	2,292	$	31,013
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	42,120	$	8,185	$	6,704	$	57,009

	Nine Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	99,383	$	8,684	$	2,011		$	110,078
Autos & Auto Parts	17,905		—		—			17,905
Chemicals & Plastics	116,504		—		—			116,504
Coal & Coke	56,089		91,323		6,195			153,607
Food & Kindred Products	25,559		—		—			25,559
Intermodal	1,439		45,705		174,500			221,644
Lumber & Forest Products	68,238		—		—			68,238
Metallic Ores	9,883		22,177		—			32,060
Metals	87,032		—		—			87,032
Minerals & Stone	111,806		5,834		58,709			176,349
Petroleum Products	56,779		476		2,036			59,291
Pulp & Paper	88,940		—		—			88,940
Waste	23,104		—		—			23,104
Other	16,308		—		—			16,308
Total freight revenues	778,969		174,199		243,451			1,196,619
Freight-related revenues	198,740		23,902		197,385			420,027
All other revenues	49,026		5,137		42,454			96,617
Total operating revenues	$	1,026,735	$	203,238	$	483,290		$	1,713,263
Operating income/(loss)	$	249,209	$	43,642	$	(6,185	)	$	286,666
Depreciation and amortization	$	116,333	$	42,382	$	29,454		$	188,169
Interest expense, net	$	36,871	$	34,618	$	6,291		$	77,780
Provision for income taxes	$	49,103	$	2,711	$	1,287		$	53,101
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	153,959	$	26,797	$	23,523		$	204,279

	Nine Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	91,630	$	15,639	$	3,073		$	110,342
Autos & Auto Parts	16,686		—		—			16,686
Chemicals & Plastics	113,625		—		—			113,625
Coal & Coke	62,038		96,506		8,751			167,295
Food & Kindred Products	25,587		—		—			25,587
Intermodal	1,203		50,613		192,413			244,229
Lumber & Forest Products	70,362		—		—			70,362
Metallic Ores	10,816		24,770		—			35,586
Metals	95,791		—		—			95,791
Minerals & Stone	107,122		6,247		63,849			177,218
Petroleum Products	52,870		560		107			53,537
Pulp & Paper	90,346		—		—			90,346
Waste	21,316		—		—			21,316
Other	19,325		—		—			19,325
Total freight revenues	778,717		194,335		268,193			1,241,245
Freight-related revenues	193,344		32,214		203,491			429,049
All other revenues	48,835		4,017		49,809			102,661
Total operating revenues	$	1,020,896	$	230,566	$	521,493		$	1,772,955
Operating income/(loss)	$	255,918	$	62,585	$	(645	)	$	317,858
Depreciation and amortization	$	123,266	$	46,232	$	27,629		$	197,127
Interest expense, net	$	30,572	$	38,914	$	9,620		$	79,106
Provision for income taxes	$	26,930	$	7,120	$	7,519		$	41,569
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	129,607	$	27,936	$	19,893		$	177,436

The following tables set forth select balance sheet data for the Company's reportable segments as of September 30, 2019 and December 31, 2018 (dollars in thousands): 

	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Cash and cash equivalents	$	37,261	$	31,142	$	18,509	$	86,912
Property and equipment, net	$	3,747,047	$	587,793	$	329,997	$	4,664,837

	December 31, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Cash and cash equivalents	$	33,996	$	26,902	$	29,489	$	90,387
Property and equipment, net	$	3,679,279	$	609,450	$	324,285	$	4,613,014

XML

Changes in Operations (Tables)

9 Months Ended

Sep. 30, 2019

Significant Changes in Operations [Abstract]

Restructuring and Related Costs [Table Text Block]

Restructuring and related costs associated with the optimization are expected to be approximately $43 million (at an exchange rate of $1.28 for one British pound) and are comprised of the following (dollars in thousands):

	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019		Total Costs Incurred Through September 30, 2019		Estimated Total Restructuring and Related Costs
Rationalization of locomotive and railcar fleet	$	—	$	—	$	6,301	$	11,000
Management restructuring(a)	1,240		10,381		15,021		17,000
Productivity and automation investments	1,998		5,136		9,179		15,000
Total	$	3,238	$	15,517	$	30,501	$	43,000

(a)

Subject to requisite U.K. consultative process.

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]

Changes in restructuring and related liabilities for the U.K. Operations Optimization program for the nine months ended September 30, 2019 was as follows (dollars in thousands):

	Rationalization of Locomotive and Railcar Fleet			Management Restructuring			Productivity and Automation Investments			Total
Restructuring and related liabilities as of December 31, 2018	$	4,094		$	982		$	—		$	5,076
Restructuring and related costs incurred	—			10,381			5,136			15,517
Cash payments	(1,394		)	(8,079		)	(5,136		)	(14,609		)
Non-cash settlements	—			—			—			—
Restructuring and related liabilities as of September 30, 2019	$	2,700		$	3,284		$	—		$	5,984

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Net income	$ 69,771	$ 72,310	$ 159,950	$ 196,946
OTHER COMPREHENSIVE INCOME/(LOSS):
Foreign currency translation adjustment, net of tax provision	(36,647)	(9,501)	(32,641)	(59,042)
Net unrealized (loss)/gain on qualifying hedges, net of tax benefit/(provision)	(27,462)	5,153	(61,139)	14,756
Changes in pension and other postretirement benefits, net of tax (provision)/benefit	60	43	(94)	129
Other comprehensive (loss)/income	(64,049)	(4,305)	(93,874)	(44,157)
COMPREHENSIVE INCOME	5,722	68,005	66,076	152,789
Less: Comprehensive loss attributable to noncontrolling interest	(4,759)	(2,179)	(7,211)	(9,495)
COMPREHENSIVE INCOME ATTRIBUTABLE TO G&W	$ 10,481	$ 70,184	$ 73,287	$ 162,284

XML

Accounts Receivable Grants from Outside Parties (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Nontrade Receivables [Abstract]
Grant proceeds from outside parties			$ 22,987	$ 16,696
Amortization of deferred grants included as offset to depreciation expense	$ 3,442	$ 3,173	$ 10,265	$ 8,776

XML

Earnings per Share Antidilutive Shares (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares	0	704	249	1,045

XML

Cover Page - shares	9 Months Ended
	Sep. 30, 2019	Nov. 01, 2019
Cover page.
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2019
Entity File Number	001-31456
Entity Registrant Name	GENESEE & WYOMING INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	06-0984624
Entity Address, Address Line One	20 West Avenue
Entity Address, City or Town	Darien
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06820
City Area Code	203
Local Phone Number	202-8900
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Class A Common Stock
Trading Symbol	GWR
Security Exchange Name	NYSE
Document Information [Line Items]
Document Transition Report	false
Entity Central Index Key	0001012620
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false
Class A Common Shares [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		57,037,678
Class B Common Shares [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		2,072

XML

Consolidated Statements of Cash Flows $ in Thousands, $ in Millions	9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 159,950	$ 196,946
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	188,169	197,127
Stock-based compensation	12,371	13,029
Deferred income taxes	34,468	7,978
Gain on insurance recoveries	(2,500)	0
Net gain on sale and impairment of assets	(1,151)	(2,501)
Changes in assets and liabilities which provided/(used) cash:
Accounts receivable, net	2,594	(50,143)
Materials and supplies	(3,550)	3,133
Prepaid expenses and other	(4,519)	(11,663)
Accounts payable and accrued expenses	(7,065)	33,818
Other assets and liabilities, net	5,434	9,750
Net cash provided by operating activities	384,201	397,474
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(227,266)	(194,132)
Grant proceeds from outside parties	22,987	16,696
Proceeds from settlement of derivative transactions	45,360	0
Proceeds from sale of business	0	7,927
Insurance proceeds for replacement of assets	4,297	2,780
Proceeds from disposition of property and equipment	5,200	3,710
Contributions to joint ventures	(2,965)	(2,921)
Net cash used in investing activities	(152,387)	(165,940)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on revolving line-of-credit, long-term debt and finance lease obligations	(426,276)	(799,726)
Proceeds from revolving line-of-credit and long-term debt	195,335	854,679
Debt amendment/issuance costs	0	(5,318)
Purchase of additional shares in Freightliner Australia	(4,696)	0
Common share repurchases	(4,796)	(270,488)
Distribution to noncontrolling interest	0	14,900
Installment payments on Freightliner deferred consideration	(2,522)	(6,255)
Other financing related activities, net	6,534	5,006
Net cash used in financing activities	(236,421)	(237,000)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	1,132	(939)
DECREASE IN CASH AND CASH EQUIVALENTS	(3,475)	(6,405)
CASH AND CASH EQUIVALENTS, beginning of period	90,387	80,472
CASH AND CASH EQUIVALENTS, end of period	$ 86,912	$ 74,067

XML

Fair Value of Financial Instruments Financial Instruments Carried at Historical Costs (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	$ 2,136,846	$ 2,391,633
Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	2,140,745	2,406,601
Australian Credit Agreement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	422,120	450,252
Australian Credit Agreement [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	427,617	457,978
Australia Subordinated Shareholder Loan from MIRA [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	160,675	167,796
Australia Subordinated Shareholder Loan from MIRA [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	157,652	166,974
United States term loan [Member] | Credit agreement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	1,261,983	1,295,672
United States term loan [Member] | Credit agreement [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	1,258,527	1,296,079
U.K. term loan [Member] | Credit agreement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	289,357	315,524
U.K. term loan [Member] | Credit agreement [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	290,883	319,556
Revolving credit facility [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	319	160,033
Revolving credit facility [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	3,687	163,662
Other debt [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value	2,392	2,356
Other debt [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	$ 2,379	$ 2,352

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Accumulated Other Comprehensive Income/(Loss) AOCI Attributable to G&W (Details) - USD ($)	3 Months Ended						9 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive income/(loss), beginning balance			$ (146,456,000)			$ (105,534,000)	$ (146,456,000)	$ (105,534,000)
Other comprehensive income/(loss) before reclassifications							(81,638,000)	(26,469,000)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit							(2,014,000)	(103,000)
Current period change in OCI							(83,652,000)	(26,572,000)
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings						0
Accumulated other comprehensive income/(loss), ending balance	$ (230,108,000)			$ (135,076,000)			(230,108,000)	(135,076,000)
Other Comprehensive Income (Loss), Derivative, Excluded Component, Increase (Decrease), Adjustments, Tax							(26,000)	0
Foreign Currency Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive income/(loss), beginning balance			(144,503,000)			(74,617,000)	(144,503,000)	(74,617,000)
Other comprehensive income/(loss) before reclassifications							(24,026,000)	(41,395,000)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit							82,000	0
Current period change in OCI							(23,944,000)	(41,395,000)
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings								0
Accumulated other comprehensive income/(loss), ending balance	(168,447,000)			(116,012,000)			(168,447,000)	(116,012,000)
Defined Benefit Plans [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive income/(loss), beginning balance			11,120,000			(19,601,000)	11,120,000	(19,601,000)
Other comprehensive income/(loss) before reclassifications							0	0
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit							(94,000)	129,000
Current period change in OCI							(94,000)	129,000
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings								(132,000)
Accumulated other comprehensive income/(loss), ending balance	11,026,000			(19,604,000)			11,026,000	(19,604,000)
Tax benefit/(provision) on amounts reclassified from AOCI for defined benefit plans							74,000	(42,000)
Accumulated Gain (Loss), Net, Hedges, Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive income/(loss), beginning balance			(13,073,000)			(11,316,000)	(13,073,000)	(11,316,000)
Other comprehensive income/(loss) before reclassifications							(57,612,000)	14,926,000
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit							(2,002,000)	(232,000)
Current period change in OCI							(59,614,000)	14,694,000
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings								(2,838,000)
Accumulated other comprehensive income/(loss), ending balance	(72,687,000)			540,000			(72,687,000)	540,000
Tax (provision)/benefit on amounts reclassified from AOCL for hedges							593,000	76,000
AOCI Attributable to Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Current period change in OCI	$ (56,311,000)	$ (20,352,000)	$ (6,989,000)	$ 594,000	$ (37,511,000)	$ 10,345,000
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings								$ (2,970,000)
Interest Expense [Member] | Accumulated Gain (Loss), Net, Hedges, Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit							(1,700,000)
Other income/(loss), net [Member] | Accumulated Gain (Loss), Net, Hedges, Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit							$ (300,000)

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Segment Information Segments (Details) $ in Thousands, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) reportable_segment provinces region	Sep. 30, 2018 AUD ($)	Sep. 30, 2018 USD ($)
Segment Reporting Information [Line Items]
Number of operating regions | region			8
Number of reportable segments | reportable_segment			3
Noncontrolling Interest, Ownership Percentage by Parent	51.10%		51.10%
Payments of Ordinary Dividends				$ 40.0
Payments of Ordinary Dividends, Parent				20.4	$ 15,600
Distribution to noncontrolling interest			$ 0	$ (19.6)	(14,900)
Operating revenue	$ 583,694	$ 603,304	1,713,263		1,772,955
Operating income/(loss)	112,756	127,820	286,666		317,858
Depreciation and amortization	63,026	65,392	188,169		197,127
Interest expense, net	24,142	26,012	77,780		79,106
Provision for/(benefit from) income taxes	19,975	31,013	53,101		41,569
Cash expenditures for additions to property and equipment, net of grants from outside parties	74,420	57,009	$ 204,279		177,436
North American Operations [Member]
Segment Reporting Information [Line Items]
Number of operating regions | provinces			6
Operating revenue	352,442	355,709	$ 1,026,735		1,020,896
Operating income/(loss)	95,633	102,484	249,209		255,918
Depreciation and amortization	39,164	41,388	116,333		123,266
Interest expense, net	12,599	10,339	36,871		30,572
Provision for/(benefit from) income taxes	16,876	26,323	49,103		26,930
Cash expenditures for additions to property and equipment, net of grants from outside parties	53,239	42,120	153,959		129,607
Australia Operations [Member]
Segment Reporting Information [Line Items]
Operating revenue	71,600	76,703	203,238		230,566
Operating income/(loss)	19,484	20,713	43,642		62,585
Depreciation and amortization	13,779	14,937	42,382		46,232
Interest expense, net	10,694	12,780	34,618		38,914
Provision for/(benefit from) income taxes	2,641	2,398	2,711		7,120
Cash expenditures for additions to property and equipment, net of grants from outside parties	14,845	8,185	26,797		27,936
U.K./European Operations [Member]
Segment Reporting Information [Line Items]
Operating revenue	159,652	170,892	483,290		521,493
Operating income/(loss)	(2,361)	4,623	(6,185)		(645)
Depreciation and amortization	10,083	9,067	29,454		27,629
Interest expense, net	849	2,893	6,291		9,620
Provision for/(benefit from) income taxes	458	2,292	1,287		7,519
Cash expenditures for additions to property and equipment, net of grants from outside parties	$ 6,336	$ 6,704	$ 23,523		$ 19,893
MIRA [Member]
Segment Reporting Information [Line Items]
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	48.90%		48.90%

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Recently Issued Accounting Standards (Notes)

9 Months Ended

Sep. 30, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

RECENTLY ISSUED ACCOUNTING STANDARDS:

Accounting Standards Not Yet Effective

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Measurement of Credit Losses on Financial Instruments, which requires assessment of credit losses on an expected model rather than an incurred loss model. The guidance requires the consideration of all available relevant information when estimating expected credit losses, including past events, current conditions and forecasts. The amendment will become effective for the Company beginning January 1, 2020. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles–Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The amendments will become effective for the Company beginning January 1, 2020. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework–Changes to the Disclosure for Fair Value Measurement. The amendments modify the disclosure requirements for fair value measurements in FASB Accounting Standards Codification (ASC) 820 based on revisions to the FASB Concepts Statement, Conceptual Framework for Financial Reporting (Concepts Statement), and cost/benefit considerations. The amendments will become effective for the Company beginning January 1, 2020. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its disclosure requirements.

In August 2018, the FASB issued ASU 2018-14, Compensation–Retirement Benefits–Defined Benefit Plans–General (Subtopic 715-20): Changes to the Disclosure Requirements for Defined Benefit Plans. The amendments modify the disclosure requirements for employers that sponsor defined benefit pension plans or other postretirement benefit plans to make disclosure requirements more consistent with the revisions to the Concepts Statement. The amendments will become effective for the Company beginning January 1, 2021. Early adoption is permitted on a retrospective basis to all periods presented. The Company is still evaluating the potential impact of this guidance on its disclosure requirements.

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Earnings per Share (Tables)

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table sets forth the computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Numerators:
Net income attributable to Genesee & Wyoming Inc.	$	66,792	$	69,590	$	156,939	$	188,856
Denominators:
Weighted average Class A common shares outstanding – Basic	56,638		59,168		56,497		60,343
Weighted average Class B common shares outstanding	376		664		426		679
Dilutive effect of employee stock-based awards	518		299		374		233
Weighted average shares – Diluted	57,532		60,131		57,297		61,255
Earnings per common share attributable to Genesee & Wyoming Inc. common stockholders:
Basic earnings per common share	$	1.18	$	1.18	$	2.78	$	3.13
Diluted earnings per common share	$	1.16	$	1.16	$	2.74	$	3.08

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following total number of shares of Class A Common Stock issuable under the assumed exercise of stock-based awards computed based on the treasury stock method were excluded from the calculation of diluted earnings per common share, as the effect of including these shares would have been antidilutive (in thousands):

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2019	2018	2019	2018
Antidilutive shares	—	704	249	1,045

Class of Treasury Stock [Table Text Block]

The table below presents information regarding shares repurchased by the Company under the share repurchase programs during the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Class A Common Stock repurchased	—		894		65		3,560
Average price paid per share of Class A Common Stock repurchased	$	—	$	87.46	$	73.94	$	75.99

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Changes in Operations Changes in Operations

9 Months Ended

Sep. 30, 2019

Significant Changes in Operations [Abstract]

Changes in Operations

CHANGES IN OPERATIONS:

Proposed Merger

On July 1, 2019, the Company, together with Brookfield Infrastructure, GIC and Brookfield Infrastructure's institutional partners, announced an agreement pursuant to which affiliates of Brookfield Infrastructure and GIC will acquire G&W for a transaction price of $112.00 per share of common stock valued at approximately $8.4 billion including debt (the Merger). The proposed Merger was approved by the Company stockholders on October 3, 2019 by an affirmative vote of the holders of approximately 82.9% of the voting power of the outstanding shares of G&W's common stock on the record date. Subject to the satisfaction of the other closing conditions, the Merger is expected to close by year end 2019 or early 2020.

The Merger will be effected pursuant to the Agreement and Plan of Merger (the Merger Agreement), by and among the Company, DJP XX, LLC, a Delaware limited liability company (Parent), and MKM XXII Corp., a Delaware corporation and a wholly owned subsidiary of Parent (Merger Sub). Merger Sub will be merged with and into G&W with G&W surviving the Merger as a wholly-owned subsidiary of Parent. The proposed Merger will result in G&W becoming a privately held company.

Completion of the proposed Merger is subject to various closing conditions, including, among others, (i) the absence of any law, injunction or other order that prohibits the consummation of the Merger, (ii) the approval or authorization of, or exemption by, the Surface Transportation Board (or approval of the use of a voting trust structure), which exemption was granted on October 29, 2019, (iii) receipt of other antitrust and regulatory approvals, including approval of the Committee on Foreign Investment in the United States, and (iv) other customary closing conditions, including the accuracy of each party’s representations and warranties and each party’s compliance with its covenants and agreements contained in the Merger Agreement (subject in the case of this clause (iv) to certain materiality qualifiers).

Australian Operations

Divestiture of 51.1% Interest in G&W Australia Holdings LP (GWAHLP): Under the Merger Agreement (as described in more detail above), the Company agreed to use reasonable best efforts to assist and cooperate with Parent in Parent’s efforts to consummate any planned divestiture by Parent of G&W's interests in GWAHLP, the holding company for all of the Company's Australian businesses, to a third party (the GWA Divestiture), provided that (i) such cooperation would not unreasonably interfere with the Company's business or operations and (ii) the Company would not be required to take any action that would subject it to actual or potential liability, to bear any cost or expense or to pay any fee or make any other payment or agree to provide any indemnity in connection with the GWA Divestiture prior to the effective time of the Merger. Following the execution of the Merger Agreement, Parent requested that G&W cause certain of its subsidiaries to enter into a Definitive Interest Sale Agreement for the GWA Divestiture (the GWA Divestiture Agreement), and on August 4, 2019, G&W's board of directors and the governing bodies of such subsidiaries approved the GWA Divestiture Agreement and such subsidiaries entered into the GWA Divestiture Agreement.

Under the GWA Divestiture Agreement, certain entities affiliated with MIRA that currently own 48.9% of GWAHLP will acquire, directly or indirectly, the remaining interests in GWAHLP from certain subsidiaries of G&W in exchange for A$627.4 million, subject to adjustment. The GWA Divestiture is subject to customary closing conditions, including the satisfaction of the closing conditions set forth in the Merger Agreement. Neither the Company nor any of its subsidiaries will have any liability under the GWA Divestiture Agreement prior to the consummation of the Merger. The GWA Divestiture Agreement may be terminated under certain circumstances, including by any party thereto if the transactions contemplated by the GWA Divestiture Agreement have not been consummated on or before July 1, 2020.

The consideration to be received by the subsidiaries of the Company that are parties to the GWA Divestiture Agreement will not be distributed to any of the Company’s stockholders prior to consummation of the Merger, and the sole consideration that the Company's stockholders will receive in the Merger is $112.00 in cash per share of G&W common stock on the terms and conditions set forth in the Merger Agreement.

The consummation of the GWA Divestiture is not a condition to the closing of the Merger or any of Parent’s other obligations under the Merger Agreement.

North American Operations

Canada Lease Expirations: Two of the Company's short line railroad leases in Canada (Goderich-Exeter Railway (GEXR) and Southern Ontario Railway (SORR)) expired at the end of 2018. The Company's results for the three and nine months ended September 30, 2018 included $5.1 million and $16.1 million, respectively, of revenues and operating losses of $0.9 million and $1.3 million, respectively, from these leased railroads.

U.K./European Operations

U.K. Operations Optimization: In May 2018, the Company began a program to restructure and further optimize its operations in the U.K., which it intends to complete by 2020. The program includes the rationalization of the locomotive and railcar fleet, management restructuring (following the U.K. consultative process) and technology investments to upgrade systems to enhance productivity and service quality.

Restructuring and related costs associated with the optimization are expected to be approximately $43 million (at an exchange rate of $1.28 for one British pound) and are comprised of the following (dollars in thousands):

	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019		Total Costs Incurred Through September 30, 2019		Estimated Total Restructuring and Related Costs
Rationalization of locomotive and railcar fleet	$	—	$	—	$	6,301	$	11,000
Management restructuring(a)	1,240		10,381		15,021		17,000
Productivity and automation investments	1,998		5,136		9,179		15,000
Total	$	3,238	$	15,517	$	30,501	$	43,000

(a) Subject to requisite U.K. consultative process.

Changes in restructuring and related liabilities for the U.K. Operations Optimization program for the nine months ended September 30, 2019 was as follows (dollars in thousands):

	Rationalization of Locomotive and Railcar Fleet			Management Restructuring			Productivity and Automation Investments			Total
Restructuring and related liabilities as of December 31, 2018	$	4,094		$	982		$	—		$	5,076
Restructuring and related costs incurred	—			10,381			5,136			15,517
Cash payments	(1,394		)	(8,079		)	(5,136		)	(14,609		)
Non-cash settlements	—			—			—			—
Restructuring and related liabilities as of September 30, 2019	$	2,700		$	3,284		$	—		$	5,984

Continental Europe Intermodal Business: On June 5, 2018, the Company sold its Continental Europe intermodal business, ERS Railways B.V. (ERS), for gross cash proceeds of €11.2 million (or $13.1 million at the exchange rate on June 5, 2018) or €6.8 million (or $7.9 million at the exchange rate on June 5, 2018) net of €4.4 million (or $5.2 million at the exchange rate on June 5, 2018) of cash on hand that transferred to the buyer. The Company's results for the nine months ended September 30, 2018 included $24.1 million of revenues and $1.6 million of operating income from ERS.

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Derivative Financial Instruments

9 Months Ended

Sep. 30, 2019

Summary of Derivative Instruments [Abstract]

Derivative Financial Instruments

DERIVATIVE FINANCIAL INSTRUMENTS:

The Company actively monitors its exposure to interest rate and foreign currency exchange rate risks and uses derivative financial instruments to manage the impact of risks associated with underlying interest rate and foreign exchange rate exposures. The Company's use of these derivative financial instruments may result in short-term gains or losses and increased earnings volatility. The instruments held by the Company are recorded in the consolidated balance sheets at fair value in prepaid expenses and other, other assets, accrued expenses or other long-term liabilities.

The Company may designate derivatives as a hedge of a forecasted transaction or a hedge of the variability of the cash flows to be received or paid in the future related to a recognized asset or liability (cash flow hedge). The portion of the changes in the fair value of the derivative used as a cash flow hedge that is offset by changes in the expected cash flows related to a recognized asset or liability is recorded in other comprehensive income/(loss) (OCI). Amounts recorded in OCI may be realized and reported in the consolidated statements of operations on the same line item as the hedged item in the event the hedged item is settled, did not or is no longer expected to occur or if the hedging relationship is no longer effective.

The Company may designate fair value hedges to mitigate foreign currency exchange rates on non-functional currency assets or liabilities. The Company uses the mark-to-market approach to remeasure the hedged item and the hedging instrument. The changes in the fair value of the hedged item is included in other income/(loss), net and are offset by changes in the fair value of the hedging instrument which are reported in the same income statement line item.

In addition, the Company may designate net investment hedges to reduce the impact of the variability of foreign currency exchange rates on its net investments in certain non-U.S. operations using cross-currency swaps. The Company measures the effectiveness of the hedge by offsetting the changes in the fair value of the cross-currency swap and the hedged asset or liability. Gains and losses on the after-tax effective portion of the net investment hedge are reported in currency translation adjustments where they remain until the investment is liquidated. The Company records the portion of the gain or loss on the hedging instrument that exceeds the gain or loss of the hedged item as an offset to the tax impact recognized during the period.

The Company matches the hedge instrument to the underlying hedged item (assets, liabilities, firm commitments or forecasted transactions). At inception of the hedge and at least quarterly thereafter, the Company assesses whether the derivatives used to hedge transactions are highly effective in offsetting changes in either the fair value or cash flows of the hedged item. When it is determined that a derivative instrument ceases to be a highly effective hedge of the underlying transaction, the Company discontinues hedge accounting, and any gains or losses on the derivative instrument thereafter are recognized in earnings during the period in which it no longer qualifies for hedge accounting. Gains and losses on any excluded components of derivatives designated as hedges are recorded in OCI and amortized to other income/(loss), net over the life of the hedge.

From time to time, the Company may enter into certain derivative instruments that may not be designated as hedges for accounting purposes. The Company believes such instruments are closely correlated with the underlying exposure, thus reducing the associated risk. The gains or losses from the changes in the fair value of derivative instruments not accounted for using hedge accounting are recognized in current period earnings within other income/(loss), net.

The following table summarizes the fair value of the Company's derivative instruments recorded in the consolidated balance sheets as of September 30, 2019 and December 31, 2018 (dollars in thousands):

		Fair Value
	Balance Sheet Location	September 30, 2019		December 31, 2018
Asset Derivatives:
Derivatives designated as cash flow hedges:
British pound forward contracts	Prepaid expenses and other	$	4,535	$	—
British pound forward contracts	Other assets	—		26,011
Derivative designated as a net investment hedge:
Cross-currency swap contract	Other assets	8,039		—
Total derivatives designated as hedges		$	12,574	$	26,011
Derivatives not designated as hedges:
Cross-currency swap contract	Prepaid expenses and other	$	—	$	19,684
Total derivatives not designated as hedges		$	—	$	19,684
Liability Derivatives:
Derivatives designated as cash flow hedges:
Interest rate swap agreements	Accrued expenses	$	8,545	$	1,954
Interest rate swap agreements	Other long-term liabilities	86,483		12,441
British pound forward contracts	Other long-term liabilities	—		59
Derivative designated as a fair value hedge:
Cross-currency swap contract	Other long-term liabilities	4,047		—
Total derivatives designated as hedges		$	99,075	$	14,454

The following table shows the effective portion of net changes in the fair value of the Company's derivative instruments designated as hedges recognized in OCI, net of tax for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Total Derivatives Designated as Hedges OCI Activity, Net of Tax
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Derivatives Designated as Hedges:
Cash Flow Hedges:
Interest rate swap agreements	$	(26,746	)	$	4,816		$	(61,451	)	$	14,396
Foreign currency forward contracts	—			(13		)	—			275
British pound forward contracts, net (a)	(12		)	350			1,446			85
	$	(26,758	)	$	5,153		$	(60,005	)	$	14,756
Net Investment Hedge:
Cross-currency swap contract	$	6,821		$	—		$	6,048		$	—
Fair Value Hedge:
Cross-currency swap contract	$	(704	)	$	—		$	(1,134	)	$	—
Total derivatives designated as hedges	$	(20,641	)	$	5,153		$	(55,091	)	$	14,756

(a) The three months ended September 30, 2019 represented a net loss of $1.0 million for the mark-to-market of the U.K. intercompany loan, partially offset by a net gain of $1.0 million for the mark-to-market of the British pound forward contracts. The nine months ended September 30, 2019 represented a net gain of $18.5 million for the mark-to-market of the U.K. intercompany loan, partially offset by a net loss of $17.0 million for the mark-to-market of the British pound forward contracts.

The three and nine months ended September 30, 2018 represented a net loss of $1.7 million and $5.4 million, respectively, for the mark-to-market of the U.K. intercompany loan, partially offset by a net gain of $2.0 million and $5.5 million, respectively, for the mark-to-market of the British pound forward contracts.

The following table shows the effect of the Company's derivative instruments not designated as hedges for the three and nine months ended September 30, 2019 and 2018 in the consolidated statements of operations (dollars in thousands):

		Amount Recognized in Earnings
	Location of Amount Recognized in Earnings	Three Months Ended					Nine Months Ended
		September 30,					September 30,
		2019		2018			2019			2018
Derivatives Not Designated as Hedges:
Cross-currency swap agreements, net (a)	Other income/(loss), net	$	—	$	(2,410	)	$	(1,770	)	$	(4,900	)

(a) The nine months ended September 30, 2019 represented a net loss of $1.4 million for the mark-to-market of the GRail Intercompany Loan and a net loss of $0.3 million for the mark-to-market of the swaps. This derivative was settled in June 2019, and the Company received cash proceeds of €17.0 million (or $19.3 million at the exchange rate on June 30, 2019).

The three months ended September 30, 2018 represented a net loss of $3.0 million for the mark-to-market of the GRail Intercompany Loan, partially offset by a net gain of $0.6 million for the mark-to-market of the swaps. The nine months ended September 30, 2018 represented a net loss of $8.1 million for the mark-to-market of the GRail Intercompany Loan, partially offset by a net gain of $3.2 million for the mark-to-market of the swaps.

The following table shows the cash flow impacts from the Company's derivatives that settled during the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended
	September 30, 2019
Derivatives designated as hedges:
British pound forward contracts	$	26,088
Derivatives not designated as hedges:
Cross-currency swap contract	19,272
Total cash received from settlement of derivative transactions, investing activities	$	45,360

Interest Rate Risk Management

The Company uses interest rate swap agreements to manage its exposure to the changes in interest rates on the Company's variable rate debt. Interest payments accrued each reporting period for these interest rate swaps are recognized in interest expense.

The following table summarizes the terms of the Company's outstanding interest rate swap agreements entered into to manage the Company's exposure to changes in interest rates on its variable rate debt (amounts in thousands):

Effective Date	Expiration Date	Notional Amount		Pay Fixed Rate	Receive Variable Rate
12/1/2016	12/1/2021	A$	517,500	2.44%	AUD-BBR
8/31/2018	8/31/2021 - 8/31/2048	$	500,000	2.70% - 2.87%	1-month LIBOR

During the three and nine months ended September 30, 2019, $1.7 million and $3.2 million, respectively, of net losses associated with the Company's interest rate swaps were realized and recorded as interest expense in the consolidated statements of operations. During the three and nine months ended September 30, 2018, $0.5 million and $1.2 million, respectively, of net losses associated with the Company's interest rate swaps were realized and recorded as interest expense in the consolidated statements of operations. Based on the Company's fair value assumptions as of September 30, 2019, it expects to realize $8.9 million of net losses that are reported in accumulated other comprehensive loss (AOCL) into earnings within the next 12 months. See Note 11, Accumulated Other Comprehensive Loss, for additional information regarding the Company's derivatives designated as hedges.

Foreign Currency Exchange Rate Risk

As of September 30, 2019, the Company's foreign subsidiaries had $948.4 million of third-party debt, including finance leases, denominated in the local currencies in which the Company's foreign subsidiaries operate, including the Australian dollar, the British pound, the Canadian dollar and the Euro. The debt service obligations associated with this foreign currency debt are generally funded directly from those foreign operations. As a result, foreign currency risk related to this portion of the Company's debt service payments is limited. However, in the event the foreign currency debt service is not paid by the Company's foreign subsidiaries and is paid by its United States subsidiaries, the Company may face exchange rate risk if the Australian dollar, the British pound, the Canadian dollar or the Euro were to appreciate relative to the United States dollar and require higher United States dollar equivalent cash.

The Company is also exposed to foreign currency exchange rate risk, including non-functional currency intercompany debt, typically associated with acquisitions and any timing difference between announcement and closing of an acquisition of a foreign business. To mitigate currency exposures related to non-functional currency denominated intercompany debt, foreign currency forward contracts or cross-currency swaps may be entered into for periods consistent with the underlying debt. In cases where foreign currency forward contracts or cross-currency swaps do not qualify for hedge accounting, the gains or losses from changes in the fair value are recognized in current period earnings within other income/(loss), net.

In 2015, the Company, in conjunction with the acquisition of Freightliner Group Limited (Freightliner) in the U.K., transferred cash from the United States to the U.K. through an intercompany loan with a notional amount of £120.0 million (or $181.0 million at the exchange rate on the effective date of the loan). To mitigate the foreign currency exchange rate risk related to the outstanding balance of this loan, the Company entered into British pound forward contracts, which were accounted for as cash flow hedges. During the nine months ended September 30, 2019, the Company settled certain of its British pound forward contracts, which had notional amounts totaling £120.0 million with a settlement date of March 31, 2020 and exchange rates ranging from 1.50 to 1.51 GBP to USD. Upon settlement, the Company received cash proceeds of $26.1 million.

As of September 30, 2019, the Company's outstanding British pound forward contracts had a notional amount of £32.6 million with a settlement date of March 31, 2020 and exchange rates ranging from 1.28 to 1.57 GBP to USD. During the three and nine months ended September 30, 2019, $0.1 million and $0.8 million, respectively, of net gains were recorded as interest income in the consolidated statements of operations. During the three and nine months ended September 30, 2018, $0.2 million and $0.5 million, respectively, of net gains were recorded as interest income in the consolidated statements of operations. Based on the Company's fair value assumptions as of September 30, 2019, it expects to realize $0.2 million of net gains that are reported in AOCL into earnings within the next 12 months. See Note 11, Accumulated Other Comprehensive Loss, for additional information regarding the Company's derivatives designated as hedges.

In 2016, in conjunction with an acquisition in Australia, the Company's subsidiaries, G&W Australia Holdings LP (GWAHLP) and GWI Holding B.V. (GWBV), entered into an A$248.9 million non-recourse subordinated partner loan agreement (GRail Intercompany Loan), which is eliminated in consolidation. To mitigate the foreign currency exchange rate risk related to the non-functional currency intercompany loan, the Company entered into two Euro/Australian dollar floating-to-floating cross-currency swap agreements (the Swaps) on December 22, 2016. These agreements did not qualify as hedges for accounting purposes, and, accordingly, mark-to-market changes in the fair value of the Swaps relative to the underlying GRail Intercompany Loan were recorded over the life of the agreements, which expired on June 30, 2019. Upon settlement of the agreements, the Company received cash proceeds of €17.0 million (or $19.3 million at the exchange rate on June 30, 2019).

In June 2019, the Company entered into two new cross-currency swap agreements designated as fair value hedges of the non-functional currency GRail intercompany loan. In addition, the Company entered into a cross-currency swap in June 2019 that was designated as a net investment hedge of the GWBV investment. During the three and nine months ended September 30, 2019, the Company recognized a gain of $0.1 million within other income/(loss), net in the consolidated statement of operations related to amortization of excluded components of its net investment hedge. Based on the Company's assumptions as of September 30, 2019, its net investment hedge and fair value hedge, which each terminate on June 30, 2021, are expected to realize $0.6 million of net gains and $0.9 million of net losses, respectively, that are currently reported in AOCL into earnings within the next 12 months. See Note 11, Accumulated Other Comprehensive Loss, for additional information regarding the Company's derivatives designated as hedges.

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Commitments and Contingencies (Notes)

9 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

COMMITMENTS AND CONTINGENCIES:

From time to time, the Company is a defendant in certain lawsuits and a party to certain arbitrations resulting from the Company's operations in the ordinary course as the nature of the Company's business exposes it to the potential for various claims and litigation, including those related to property damage, personal injury, freight loss, labor and employment, environmental and other matters. The Company maintains insurance policies to mitigate the financial risk associated with such claims. However, any material changes to pending litigation or a catastrophic rail accident or series of accidents involving material freight loss or property damage, personal injuries or environmental liability or other claims or disputes that are not covered by insurance could have a material adverse effect on the Company's results of operations, financial condition and liquidity.

In November 2014, the Company received a notice from the United States Environmental Protection Agency (EPA) requesting information under the Clean Water Act related to the discharge of crude oil as a result of a derailment of an Alabama & Gulf Coast Railway LLC (AGR) freight train in November 2013 in the vicinity of Aliceville, Alabama. In May 2018, the EPA notified the AGR of a maximum civil payment of up to $14.1 million, based on the amount of oil allegedly discharged and other relevant factors considered under the applicable regulation. The Company's evaluation of its defenses, settlement options and insurance coverage is ongoing. Although the cleanup associated with this derailment is substantially complete, the civil penalty associated with the contamination is subject to further discussion and potential litigation.

Following the filing of the Company’s definitive proxy statement (the Proxy Statement) associated with the Merger with the Securities and Exchange Commission (the SEC) on August 20, 2019, three lawsuits were filed in connection with the Merger, including two purported class action lawsuits that were filed on August 21, 2019 and September 4, 2019 in the United States District Court for the District of Delaware, and one lawsuit filed on behalf of a purported individual shareholder on September 12, 2019 in the United States District Court for the District of Connecticut. These lawsuits, Gordon vs. Genesee & Wyoming Inc. et al., Case No. 1:19-cv-01558-MN, Thompson vs. Genesee & Wyoming Inc. et al., Case No. 1;19-cv-01650-MN and Geery vs. Genesee & Wyoming Inc. et al., Case No. 3:19-cv-01438-VLB (collectively, the Disclosure Actions), named the Company and individual officers and members of the Company’s board of directors as defendants. The actions alleged, among other things, that the defendants failed to disclose certain information relating to the Company’s financial projections set forth in the Proxy Statement.

On September 25, 2019, solely to eliminate the burden, expense, and uncertainty inherent in such litigation, and without admitting any liability or wrongdoing, the Company filed a Form 8-K containing certain supplemental disclosures with the SEC. In consideration for such supplemental disclosures by the Company, plaintiffs in the Disclosure Actions had agreed to voluntarily dismiss the Disclosure Actions. On October 4, 2019, pursuant to those agreements, plaintiffs filed voluntary dismissals of the Disclosure Actions.

On September 17, 2019, in New South Wales, Australia, a complaint was filed by Australia Eastern Railroad Pty Ltd ACN against the Company, GWI Holdings Pty Ltd and Genesee & Wyoming Australia Pty Ltd in connection with the Merger. The complaint seeks an award of damages in connection with a right of first refusal provision in a commercial contract involving the Company’s majority-owned Australian subsidiary. The Company disputes the allegations made in the complaint and intends to defend itself appropriately.

In addition to the EPA matter and the lawsuits set forth above, from time to time, the Company is a defendant in certain lawsuits resulting from its operations in the ordinary course. Management believes there are adequate provisions in the financial statements for any probable liabilities that may result from disposition of the pending lawsuits and the aforementioned EPA matter. Based upon currently available information, management does not believe it is reasonably possible that any such lawsuit, related lawsuit or matter would be material to the Company's results of operations or have a material adverse effect on its financial position or liquidity.

XML

Changes in Operations (Details) $ in Thousands, € in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 EUR (€)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Proceeds from sale of business				$ 0	$ 7,927
Operating revenue	$ 583,694		$ 603,304	1,713,263	1,772,955
Operating income/(loss)	112,756		127,820	286,666	317,858
North American Operations [Member]
Operating revenue	352,442		355,709	1,026,735	1,020,896
Operating income/(loss)	95,633		102,484	249,209	255,918
North American Operations [Member] | GEXR and SORR [Member]
Operating revenue			5,100		16,100
Operating income/(loss)			(900)		(1,300)
U.K./European Operations [Member]
Operating revenue	159,652		170,892	483,290	521,493
Operating income/(loss)	$ (2,361)		4,623	$ (6,185)	(645)
U.K./European Operations [Member] | ERS Railways [Member]
Proceeds from Divestiture of Businesses		€ 11.2	13,100
Proceeds from sale of business		6.8	7,900
Cash Divested from Deconsolidation		€ 4.4	$ 5,200
Operating revenue					24,100
Operating income/(loss)					$ 1,600

XML

U.K. Pension Plan (Tables)

9 Months Ended

Sep. 30, 2019

Defined Benefit Plan [Abstract]

Schedule of Net Benefit Costs

The following tables summarize the components of the Pension Program related to the net benefit costs recognized in labor and benefits and other income/(loss), net in the Company's consolidated statements of operations for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
		2019			2018			2019			2018
Operating expense:
	Service cost(a)	$	3,257		$	3,610		$	10,094		$	11,235
Nonoperating income, net:
	Interest cost	2,240			2,383			6,942			7,416
	Expected return on plan assets	(4,158		)	(4,572		)	(12,885		)	(14,231		)
	Amortization of prior year service cost	42			—			130			—
	Total nonoperating income, net(b)	(1,876		)	(2,189		)	(5,813		)	(6,815		)
Net periodic benefit cost		$	1,381		$	1,421		$	4,281		$	4,420

(a) Included in labor and benefits within the Company’s consolidated statements of operations.

(b) Included in other income/(loss), net within the Company’s consolidated statements of operations.

XML

Derivative Financial Instruments Fair Value of the Company's Derivative Instruments (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	$ 12,574,000	$ 26,011,000
Derivative Liability, Fair Value, Gross Liability	99,075,000	14,454,000
Designated as Hedging Instrument [Member] | British Pound Foreign currency forward contracts [Member] | Prepaid expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	4,535,000	0
Designated as Hedging Instrument [Member] | British Pound Foreign currency forward contracts [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	0	26,011,000
Designated as Hedging Instrument [Member] | British Pound Foreign currency forward contracts [Member] | Other long-term liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Liability, Fair Value, Gross Liability	0	59,000
Designated as Hedging Instrument [Member] | Interest rate swap agreements [Member] | Accrued expenses [Member]
Derivatives, Fair Value [Line Items]
Derivative Liability, Fair Value, Gross Liability	8,545,000	1,954,000
Designated as Hedging Instrument [Member] | Interest rate swap agreements [Member] | Other long-term liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Liability, Fair Value, Gross Liability	86,483,000	12,441,000
Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Cross-currency swap contract [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	8,039,000
Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Cross-currency swap contract [Member] | Other long-term liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset		0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Cross-currency swap contract [Member] | Other long-term liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Liability, Fair Value, Gross Liability	4,047,000	0
Not Designated as Hedging Instrument [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	0	19,684,000
Not Designated as Hedging Instrument [Member] | Cross-currency swap contract [Member] | Prepaid expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative Asset, Fair Value, Gross Asset	$ 0	$ 19,684,000

XML

Derivative Financial Instruments Outstanding Interest Rate Swap Agreements (Details) $ in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 AUD ($)	Sep. 30, 2019 USD ($)
Interest Rate Swap [Member]
Derivative [Line Items]
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion	$ 1,700	$ 500	$ 3,200	$ 1,200
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Net Amount to be Transferred			$ (8,900)
Australia Dollar Interest Rate Swap [Member]
Derivative [Line Items]
Effective Date			Dec. 01, 2016
Settlement Date			Dec. 01, 2021
Notional Amount					$ 517,500
Pay Fixed Rate					2.44%	2.44%
United States Dollar Interest Rate Swaps [Member]
Derivative [Line Items]
Effective Date			Aug. 31, 2018
Notional Amount						$ 500,000
United States Dollar Interest Rate Swaps [Member] | Minimum [Member]
Derivative [Line Items]
Settlement Date			Aug. 31, 2021
Pay Fixed Rate					2.70%	2.70%
United States Dollar Interest Rate Swaps [Member] | Maximum [Member]
Derivative [Line Items]
Settlement Date			Aug. 31, 2048
Pay Fixed Rate					2.87%	2.87%

XML

Segment Information Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Operating revenue	$ 583,694	$ 603,304	$ 1,713,263	$ 1,772,955
Freight [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	410,149	423,374	1,196,619	1,241,245
Freight [Member] | Agricultural Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	37,968	35,768	110,078	110,342
Freight [Member] | Autos & Auto Parts [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	6,339	5,513	17,905	16,686
Freight [Member] | Chemicals & Plastics [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	39,518	38,436	116,504	113,625
Freight [Member] | Coal & Coke [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	52,129	57,951	153,607	167,295
Freight [Member] | Food & Kindred Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	8,355	8,761	25,559	25,587
Freight [Member] | Intermodal [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	73,905	76,661	221,644	244,229
Freight [Member] | Lumber & Forest Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	22,862	24,113	68,238	70,362
Freight [Member] | Metallic Ores [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	11,261	12,487	32,060	35,586
Freight [Member] | Metals [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	28,115	34,904	87,032	95,791
Freight [Member] | Minerals & Stone [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	65,050	62,980	176,349	177,218
Freight [Member] | Petroleum Product [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	19,833	18,559	59,291	53,537
Freight [Member] | Pulp & Paper [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	30,648	31,961	88,940	90,346
Freight [Member] | Waste [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	8,278	8,089	23,104	21,316
Freight [Member] | Other Commodity [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	5,888	7,191	16,308	19,325
Freight-related [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	141,369	145,450	420,027	429,049
All other revenue [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	32,176	34,480	96,617	102,661
North American Operations [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	352,442	355,709	1,026,735	1,020,896
North American Operations [Member] | Freight [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	268,025	273,432	778,969	778,717
North American Operations [Member] | Freight [Member] | Agricultural Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	34,574	30,565	99,383	91,630
North American Operations [Member] | Freight [Member] | Autos & Auto Parts [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	6,339	5,513	17,905	16,686
North American Operations [Member] | Freight [Member] | Chemicals & Plastics [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	39,518	38,436	116,504	113,625
North American Operations [Member] | Freight [Member] | Coal & Coke [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	18,336	23,006	56,089	62,038
North American Operations [Member] | Freight [Member] | Food & Kindred Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	8,355	8,761	25,559	25,587
North American Operations [Member] | Freight [Member] | Intermodal [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	461	514	1,439	1,203
North American Operations [Member] | Freight [Member] | Lumber & Forest Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	22,862	24,113	68,238	70,362
North American Operations [Member] | Freight [Member] | Metallic Ores [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	4,225	3,573	9,883	10,816
North American Operations [Member] | Freight [Member] | Metals [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	28,115	34,904	87,032	95,791
North American Operations [Member] | Freight [Member] | Minerals & Stone [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	41,399	38,570	111,806	107,122
North American Operations [Member] | Freight [Member] | Petroleum Product [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	19,027	18,236	56,779	52,870
North American Operations [Member] | Freight [Member] | Pulp & Paper [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	30,648	31,961	88,940	90,346
North American Operations [Member] | Freight [Member] | Waste [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	8,278	8,089	23,104	21,316
North American Operations [Member] | Freight [Member] | Other Commodity [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	5,888	7,191	16,308	19,325
North American Operations [Member] | Freight-related [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	68,129	66,045	198,740	193,344
North American Operations [Member] | All other revenue [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	16,288	16,232	49,026	48,835
Australia Operations [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	71,600	76,703	203,238	230,566
Australia Operations [Member] | Freight [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	61,457	65,249	174,199	194,335
Australia Operations [Member] | Freight [Member] | Agricultural Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	2,631	4,150	8,684	15,639
Australia Operations [Member] | Freight [Member] | Autos & Auto Parts [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Chemicals & Plastics [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Coal & Coke [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	33,187	32,357	91,323	96,506
Australia Operations [Member] | Freight [Member] | Food & Kindred Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Intermodal [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	16,446	17,538	45,705	50,613
Australia Operations [Member] | Freight [Member] | Lumber & Forest Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Metallic Ores [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	7,036	8,914	22,177	24,770
Australia Operations [Member] | Freight [Member] | Metals [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Minerals & Stone [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	1,979	2,066	5,834	6,247
Australia Operations [Member] | Freight [Member] | Petroleum Product [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	178	224	476	560
Australia Operations [Member] | Freight [Member] | Pulp & Paper [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Waste [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight [Member] | Other Commodity [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
Australia Operations [Member] | Freight-related [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	8,011	10,136	23,902	32,214
Australia Operations [Member] | All other revenue [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	2,132	1,318	5,137	4,017
U.K./European Operations [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	159,652	170,892	483,290	521,493
U.K./European Operations [Member] | Freight [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	80,667	84,693	243,451	268,193
U.K./European Operations [Member] | Freight [Member] | Agricultural Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	763	1,053	2,011	3,073
U.K./European Operations [Member] | Freight [Member] | Autos & Auto Parts [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Chemicals & Plastics [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Coal & Coke [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	606	2,588	6,195	8,751
U.K./European Operations [Member] | Freight [Member] | Food & Kindred Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Intermodal [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	56,998	58,609	174,500	192,413
U.K./European Operations [Member] | Freight [Member] | Lumber & Forest Products [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Metallic Ores [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Metals [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Minerals & Stone [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	21,672	22,344	58,709	63,849
U.K./European Operations [Member] | Freight [Member] | Petroleum Product [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	628	99	2,036	107
U.K./European Operations [Member] | Freight [Member] | Pulp & Paper [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Waste [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight [Member] | Other Commodity [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	0	0	0	0
U.K./European Operations [Member] | Freight-related [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	65,229	69,269	197,385	203,491
U.K./European Operations [Member] | All other revenue [Member]
Disaggregation of Revenue [Line Items]
Operating revenue	$ 13,756	$ 16,930	$ 42,454	$ 49,809

XML

Income Taxes (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income tax provision	$ 19,975,000	$ 31,013,000	$ 53,101,000	$ 41,569,000
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations	$ 4,200,000		4,200,000
Tax Cuts and Jobs Act, Measurement Period Adjustment, Income Tax Expense (Benefit)		$ (1,600,000)
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions				$ 5,500,000
Tax Benefit from United States Short Line Tax Credit, Amount			$ 31,600,000
Effective income tax rate	22.30%	30.00%	24.90%	17.40%
Effective income tax reconciliation excluding short line tax credit and prior period portion of the reserve for uncertain tax positions, percentage				29.10%
Tax credits percentage of qualified maintenance expenditures to reduce federal income tax			50.00%
Tax credit limitation per mile on maintenance expenditures to reduce federal income tax			$ 3,500
March 25, 2015 through December 31, 2017
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions		$ 3,700,000

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Significant Non-Cash Investing Activities (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Other Significant Noncash Transactions [Line Items]
Outstanding receivables from outside parties for the funding of capital expenditures	$ 449,575		$ 436,360
Purchases of property and equipment accrued in accounts payable	24,500	$ 16,100
Accounts receivable - grants from outside parties [Member]
Other Significant Noncash Transactions [Line Items]
Outstanding receivables from outside parties for the funding of capital expenditures	$ 24,677	$ 14,600	$ 19,376

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Consolidated Statement of Changes in Equity Statement - USD ($) $ in Thousands	Total	Conversion of Class B Common Stock to Class A Common Stock [Member]	Common Stock [Member] Class A Common Shares [Member]	Common Stock [Member] Class A Common Shares [Member] Conversion of Class B Common Stock to Class A Common Stock [Member]	Common Stock [Member] Class B Common Shares [Member]	Common Stock [Member] Class B Common Shares [Member] Conversion of Class B Common Stock to Class A Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Retained Earnings [Member] ASU 2018-02 [Member]	AOCI Attributable to Parent [Member]	AOCI Attributable to Parent [Member] ASU 2018-02 [Member]	Treasury Stock [Member]	Noncontrolling Interest [Member]
Equity, balance at Dec. 31, 2017	$ 3,896,092		$ 748		$ 7		$ 1,757,332	$ 2,234,864		$ (105,534)		$ (236,951)	$ 245,626
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent								75,098
Net Income/(Loss) Attributable to Noncontrolling Interest													927
Net income	76,025
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent										10,345
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest													(4,018)
Other Comprehensive Income (Loss), Net of Tax	6,327
Value of stock issued for stock-based compensation	1,050		1				1,049
Compensation cost related to stock-based compensation	4,056						4,056
Value of treasury stock repurchased	(60,175)											(60,175)
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings	0
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings | Adjustments for New Accounting Principle, Early Adoption [Member]									$ 2,970		$ (2,970)
Other	1												1
Equity, balance at Mar. 31, 2018	3,923,376		749		7		1,762,437	2,312,932		(98,159)		(297,126)	242,536
Equity, balance at Dec. 31, 2017	3,896,092		748		7		1,757,332	2,234,864		(105,534)		(236,951)	245,626
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent	188,856
Net Income/(Loss) Attributable to Noncontrolling Interest	8,090
Net income	196,946
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	(26,572)
Other Comprehensive Income (Loss), Net of Tax	(44,157)
United States Tax Cuts and Jobs Act 2017, Reclassification from AOCL to Retained Earnings										(2,970)
Equity, balance at Sep. 30, 2018	3,782,570		752		5		1,779,168	2,426,690		(135,076)		(510,245)	221,276
Equity, balance at Mar. 31, 2018	3,923,376		749		7		1,762,437	2,312,932		(98,159)		(297,126)	242,536
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent								44,168
Net Income/(Loss) Attributable to Noncontrolling Interest													4,443
Net income	48,611
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent										(37,511)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest													(8,668)
Other Comprehensive Income (Loss), Net of Tax	(46,179)
Stock Issued During Period, Value, Conversion of Convertible Securities		$ 0		$ 0		$ 0
Value of stock issued for stock-based compensation	1,857		1				1,856
Compensation cost related to stock-based compensation	4,515						4,515
Value of treasury stock repurchased	(134,952)											(134,952)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(14,898)												(14,898)
Other	48												48
Equity, balance at Jun. 30, 2018	3,782,378		750		7		1,768,808	2,357,100		(135,670)		(432,078)	223,461
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent	69,590							69,590
Net Income/(Loss) Attributable to Noncontrolling Interest	2,720												2,720
Net income	72,310
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent										594
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest													(4,899)
Other Comprehensive Income (Loss), Net of Tax	(4,305)
Stock Issued During Period, Value, Conversion of Convertible Securities		0		(2)		(2)
Value of stock issued for stock-based compensation	5,902						5,902
Compensation cost related to stock-based compensation	4,458						4,458
Value of treasury stock repurchased	(78,167)											(78,167)
Other	(6)												(6)
Equity, balance at Sep. 30, 2018	3,782,570		752		5		1,779,168	2,426,690		(135,076)		(510,245)	221,276
Equity, balance at Dec. 31, 2018	3,630,052		752		5		1,785,005	2,482,252		(146,456)		(699,852)	208,346
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent								38,706
Net Income/(Loss) Attributable to Noncontrolling Interest													100
Net income	38,806
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent										(6,989)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest													818
Other Comprehensive Income (Loss), Net of Tax	(6,171)
Stock Issued During Period, Value, Conversion of Convertible Securities		0		(1)		(1)
Value of stock issued for stock-based compensation	2,071		2				2,069
Compensation cost related to stock-based compensation	3,884						3,884
Value of treasury stock repurchased	(8,630)											(8,630)
Other	(2,732)						(832)	(1,104)					(796)
Equity, balance at Mar. 31, 2019	3,657,280		755		4		1,790,126	2,519,854		(153,445)		(708,482)	208,468
Equity, balance at Dec. 31, 2018	3,630,052		752		5		1,785,005	2,482,252		(146,456)		(699,852)	208,346
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent	156,939
Net Income/(Loss) Attributable to Noncontrolling Interest	3,011
Net income	159,950
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	(83,652)
Other Comprehensive Income (Loss), Net of Tax	(93,874)
Equity, balance at Sep. 30, 2019	3,707,257		757		4		1,812,085	2,638,043		(230,108)		(711,922)	198,398
Equity, balance at Mar. 31, 2019	3,657,280		755		4		1,790,126	2,519,854		(153,445)		(708,482)	208,468
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent								51,441
Net Income/(Loss) Attributable to Noncontrolling Interest													(68)
Net income	51,373
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent										(20,352)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest													(3,302)
Other Comprehensive Income (Loss), Net of Tax	(23,654)
Stock Issued During Period, Value, Conversion of Convertible Securities		$ 0		$ 0		$ 0
Value of stock issued for stock-based compensation	2,096		1				2,095
Compensation cost related to stock-based compensation	4,227						4,227
Value of treasury stock repurchased												0
Other	(420)						1,346	(44)					(1,722)
Equity, balance at Jun. 30, 2019	3,690,902		756		4		1,797,794	2,571,251		(173,797)		(708,482)	203,376
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income Attributable to Parent	66,792							66,792
Net Income/(Loss) Attributable to Noncontrolling Interest	2,979												2,979
Net income	69,771
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent										(56,311)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Noncontrolling Interest													(7,738)
Other Comprehensive Income (Loss), Net of Tax	(64,049)
Value of stock issued for stock-based compensation	10,228		1				10,227
Compensation cost related to stock-based compensation	4,277						4,277
Value of treasury stock repurchased	(3,440)											(3,440)
Other	(432)						(213)						(219)
Equity, balance at Sep. 30, 2019	$ 3,707,257		$ 757		$ 4		$ 1,812,085	$ 2,638,043		$ (230,108)		$ (711,922)	$ 198,398

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Accounts Receivable Accounts Receivable, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	$ 449,575	$ 436,360
Allowance for doubtful accounts	(12,513)	(10,055)
Accounts receivable, net	437,062	426,305
Accounts receivable - trade [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	395,512	397,255
Accounts receivable - grants from outside parties [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	24,677	19,376	$ 14,600
Accounts receivable - insurance and other third-party claims [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	$ 29,386	$ 19,729

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Changes in Operations U.K./Europe Optimization Restructuring Reserve Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		18 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred	$ 3,561	$ 3,286	$ 18,756	$ 12,931
U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related liabilities - beginning balance			5,076
Restructuring and related costs incurred	3,238		15,517		$ 30,501
Cash payments			(14,609)
Non-cash settlements			0
Restructuring and related liabilities - ending balance	5,984		5,984		5,984
Rationalization of locomotive and railcar fleet [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related liabilities - beginning balance			4,094
Restructuring and related costs incurred	0		0		6,301
Cash payments			(1,394)
Non-cash settlements			0
Restructuring and related liabilities - ending balance	2,700		2,700		2,700
Management restructuring [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related liabilities - beginning balance			982
Restructuring and related costs incurred	1,240		10,381		15,021
Cash payments			(8,079)
Non-cash settlements			0
Restructuring and related liabilities - ending balance	3,284		3,284		3,284
Productivity and automation investments [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related liabilities - beginning balance			0
Restructuring and related costs incurred	1,998		5,136		9,179
Cash payments			(5,136)
Non-cash settlements			0
Restructuring and related liabilities - ending balance	$ 0		$ 0		$ 0

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Consolidated Balance Sheets Parentheticals - $ / shares	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Class A Common Shares [Member]
Common Stock, par value per share	$ 0.01		$ 0.01
Common Stock, votes per share	1	1
Common Stock, shares authorized	180,000,000		180,000,000
Common Stock, shares issued	75,696,850		75,240,513
Common Stock, shares outstanding	56,663,012		56,349,327
Treasury Stock, shares	19,033,838		18,891,186
Class B Common Shares [Member]
Common Stock, par value per share	$ 0.01		$ 0.01
Common Stock, votes per share	10	10
Common Stock, shares authorized	30,000,000		30,000,000
Common Stock, shares issued	376,392		517,138
Common Stock, shares outstanding	376,392		517,138

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Leases Lease Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019
Operating lease liabilities	$ 471,777
Total leased assets	557,159
Total lease liabilities	550,488
Other assets [Member]
Operating leased assets	471,929
Property and equipment, net [Member]
Finance leased assets, net	85,230
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	30,100
Accrued expenses [Member]
Operating lease liabilities, current	60,624
Current portion of long-term debt [Member]
Finance lease liabilities, current	14,402
Other long-term liabilities [Member]
Operating lease liabilities, non-current	411,153
Long-term debt, less current portion [Member]
Finance lease liabilities, non-current	$ 64,309
Accounting Standards Update 2016-02 [Member]
Operating leased assets		$ 495,000
Operating lease liabilities		$ 495,000

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Leases (Tables)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Schedule of Supplemental Balance Sheet Information Related to Leases [Table Text Block]

The following table summarizes the Company's leased assets and lease liabilities recorded in the consolidated balance sheet as of September 30, 2019 (dollars in thousands):

	Balance Sheet Location	September 30, 2019
Leased right-of-use assets:
Operating leased assets	Other assets	$	471,929
Finance leased assets, net	Property and equipment, net(a)	85,230
Total leased assets		$	557,159
Lease liabilities:
Current
Operating lease liabilities	Accrued expenses	$	60,624
Finance lease liabilities	Current portion of long-term debt	14,402
Non-current
Operating lease liabilities	Other long-term liabilities	411,153
Finance lease liabilities	Long-term debt, less current portion	64,309
Total lease liabilities		$	550,488

(a)

Net of $30.1 million of accumulated amortization as of September 30, 2019, which was recognized in depreciation and amortization expense within the Company's consolidated statement of operations.

Lease, Cost [Table Text Block]

The following table summarizes the components of lease expense for the three and nine months ended September 30, 2019 (dollars in thousands):

	Location of Amount Recognized in Earnings	Three Months Ended			Nine Months Ended
		September 30, 2019			September 30, 2019
Finance leases:
Amortization of right-of-use assets	Depreciation and amortization	$	2,069		$	5,830
Interest on lease liability	Interest expense	881			2,554
Total finance lease cost		$	2,950		$	8,384
Operating leases:
Operating lease cost	Equipment rents/Trackage rights	$	22,292		$	66,976
Short-term lease cost	Equipment rents/Trackage rights	2,071			7,064
Variable lease cost	Equipment rents/Trackage rights	1,964			6,871
Sublease income (gross basis)	Operating revenues	(1,291		)	(3,541		)
Total operating lease cost		$	25,036		$	77,370
Total lease cost		$	27,986		$	85,754

Finance Lease, Liability, Maturity [Table Text Block]

The maturities of lease liabilities under the New Standard based on the Company's reasonably certain holding period for each lease were as follows as of September 30, 2019 (dollars in thousands):

	Finance Leases		Operating Leases
Maturity of lease liabilities:
2019 (remainder)	$	3,299	$	23,076
2020	19,373		72,851
2021	10,495		63,445
2022	14,650		52,080
2023	10,551		43,398
Thereafter	34,778		553,484
Total lease payments	93,146		808,334
Less: Imputed interest	14,435		336,557
Total lease liabilities	$	78,711	$	471,777

Lessee, Operating Lease, Liability, Maturity [Table Text Block]

The maturities of lease liabilities under the New Standard based on the Company's reasonably certain holding period for each lease were as follows as of September 30, 2019 (dollars in thousands):

	Finance Leases		Operating Leases
Maturity of lease liabilities:
2019 (remainder)	$	3,299	$	23,076
2020	19,373		72,851
2021	10,495		63,445
2022	14,650		52,080
2023	10,551		43,398
Thereafter	34,778		553,484
Total lease payments	93,146		808,334
Less: Imputed interest	14,435		336,557
Total lease liabilities	$	78,711	$	471,777

Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]

The following is a summary of future minimum lease payments based on the minimum non-cancelable lease term as required under previous guidance for capital and operating leases as of December 31, 2018 (dollars in thousands):

	Capital		Operating
2019	$	11,405	$	82,191
2020	17,261		63,062
2021	8,668		54,305
2022	9,625		44,739
2023	10,780		35,919
Thereafter	13,988		383,739
Total minimum payments	$	71,727	$	663,955

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

The following is a summary of future minimum lease payments based on the minimum non-cancelable lease term as required under previous guidance for capital and operating leases as of December 31, 2018 (dollars in thousands):

	Capital		Operating
2019	$	11,405	$	82,191
2020	17,261		63,062
2021	8,668		54,305
2022	9,625		44,739
2023	10,780		35,919
Thereafter	13,988		383,739
Total minimum payments	$	71,727	$	663,955

Other Supplemental Lease Information

The following table presents supplemental cash flow and other information for the Company's leases as of and for the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended
	September 30, 2019
Cash flow information:
Cash paid for operating leases included in operating activities	$	69,533
Cash paid for finance leases included in operating activities	$	2,608
Cash paid for finance leases included in financing activities	$	9,694
Weighted average remaining lease term (in years):
Operating leases	26.8
Finance leases	8.1
Weighted average discount rate:
Operating leases	3.8		%
Finance leases	4.5		%
New leases:
Right-of-use assets obtained in exchange for operating lease liabilities	$	36,333
Right-of-use assets obtained in exchange for finance lease liabilities	$	27,592

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Significant Non-Cash Investing Activities	9 Months Ended
	Sep. 30, 2019
Cash Flow, Noncash Investing and Financing Activities Disclosure [Abstract]
Significant Non-Cash Investing and Financing Activities	SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES:As of September 30, 2019 and 2018, the Company had outstanding accounts receivable from outside parties for the funding of capital expenditures of $24.7 million and $14.6 million, respectively. As of September 30, 2019 and 2018, the Company also had $24.5 million and $16.1 million, respectively, of purchases of property and equipment that were not paid and, accordingly, were accrued in accounts payable in the normal course of business. See Note 5, Leases, for ROU assets obtained during the reporting period in exchange for lease liabilities.

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Leases (Policies)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Lessee, Leases [Policy Text Block]

On January 1, 2019, the Company adopted Accounting Standards Update (ASU) 2016-02, Leases (the New Standard), and all related amendments, which supersedes the previous lease guidance, using the transition method with the election not to adjust comparative periods. The New Standard requires lessees to recognize leases on their balance sheet as a right-of-use (ROU) asset with a corresponding lease liability. The adoption resulted in the recognition of ROU assets included in other assets and lease liabilities included in accrued expenses and other long-term liabilities of approximately $495 million in the Company's consolidated balance sheet, each as a result of the new requirement to recognize operating leases. No material cumulative-effect adjustment was recognized in retained earnings, and the adoption did not materially impact operating results, liquidity or the Company's debt-covenant compliance under these agreements. The Company continues to recognize its capital leases on the balance sheet but these leases are now referred to as "finance" leases, as required by the New Standard.

The Company enters into leases for railcars, locomotives and other equipment as well as real property. These leases may contain variable payments that vary with rate or index changes or include payment of a per car fee or per mile fee to use the track under variable lease contracts. The Company may receive rent holidays and other incentives provided by the lessor on lease agreements. On occasion, the Company subleases assets to other parties.

As of January 1, 2019, the Company adopted a number of practical expedients and exemptions included in the New Standard, which were intended to reduce the cost and complexity of complying with the transition requirements. The Company chose the following practical expedients and exemptions in setting its accounting policy elections for transition to:

1. Not recognize an asset and liability for leases of all asset classes with a term of 12 months or less;

2. Carry forward the historical lease classification and not reassess its existing contracts to determine whether the arrangements contained a lease or whether initial direct costs qualified for capitalization;

3. Not separate lease and non-lease components; and

4. Carry forward its current accounting treatment for land easements on existing agreements.

Lease contracts may include one or more renewal options, with renewal terms from one to fifty years or more. Leases may also include options to terminate the arrangement or options to purchase the underlying leased property. The exercise of lease options are generally at the discretion of the Company's management team. The Company determines the expected term of a lease and includes options that are reasonably certain to be exercised in the calculation of its ROU assets and lease liabilities.

The determination of whether a contract contains a lease, as well as the analysis regarding the allocation of consideration in a contract between lease and non-lease components, is performed on a case by case basis and considers the nature and interdependency of the individual assets in the arrangement. The Company generally accounts for lease assets as a single component as the assets in most agreements are highly interrelated and dependent upon each other to fulfill the arrangement.

As the implicit rate is not readily determinable in most of the Company's lease agreements, the Company uses its estimated secured incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Foreign Currency Disclosure [Text Block]

The following table reflects the balance sheet exchange rates used to translate each foreign entity's respective local currency balance sheet into United States dollars as of September 30, 2019 and December 31, 2018:

	September 30, 2019		December 31, 2018
United States dollar per Australian dollar	$	0.67	$	0.70
United States dollar per British pound	$	1.23	$	1.28
United States dollar per Canadian dollar	$	0.76	$	0.73
United States dollar per Euro	$	1.09	$	1.15

The following table reflects the average exchange rates used to translate each foreign entity's respective local currency results of operations into United States dollars for the three and nine months ended September 30, 2019 and 2018:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
United States dollar per Australian dollar	$	0.69	$	0.73	$	0.70	$	0.76
United States dollar per British pound	$	1.23	$	1.30	$	1.27	$	1.35
United States dollar per Canadian dollar	$	0.76	$	0.77	$	0.75	$	0.78
United States dollar per Euro	$	1.11	$	1.16	$	1.12	$	1.19

Schedule of segment reporting information, by segment [Table Text Block]

The following tables set forth select financial data for the Company's reportable segments, including operating revenues by commodity group, for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	34,574	$	2,631	$	763		$	37,968
Autos & Auto Parts	6,339		—		—			6,339
Chemicals & Plastics	39,518		—		—			39,518
Coal & Coke	18,336		33,187		606			52,129
Food & Kindred Products	8,355		—		—			8,355
Intermodal	461		16,446		56,998			73,905
Lumber & Forest Products	22,862		—		—			22,862
Metallic Ores	4,225		7,036		—			11,261
Metals	28,115		—		—			28,115
Minerals & Stone	41,399		1,979		21,672			65,050
Petroleum Products	19,027		178		628			19,833
Pulp & Paper	30,648		—		—			30,648
Waste	8,278		—		—			8,278
Other	5,888		—		—			5,888
Total freight revenues	268,025		61,457		80,667			410,149
Freight-related revenues	68,129		8,011		65,229			141,369
All other revenues	16,288		2,132		13,756			32,176
Total operating revenues	$	352,442	$	71,600	$	159,652		$	583,694
Operating income/(loss)	$	95,633	$	19,484	$	(2,361	)	$	112,756
Depreciation and amortization	$	39,164	$	13,779	$	10,083		$	63,026
Interest expense, net	$	12,599	$	10,694	$	849		$	24,142
Provision for income taxes	$	16,876	$	2,641	$	458		$	19,975
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	53,239	$	14,845	$	6,336		$	74,420

	Three Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	30,565	$	4,150	$	1,053	$	35,768
Autos & Auto Parts	5,513		—		—		5,513
Chemicals & Plastics	38,436		—		—		38,436
Coal & Coke	23,006		32,357		2,588		57,951
Food & Kindred Products	8,761		—		—		8,761
Intermodal	514		17,538		58,609		76,661
Lumber & Forest Products	24,113		—		—		24,113
Metallic Ores	3,573		8,914		—		12,487
Metals	34,904		—		—		34,904
Minerals & Stone	38,570		2,066		22,344		62,980
Petroleum Products	18,236		224		99		18,559
Pulp & Paper	31,961		—		—		31,961
Waste	8,089		—		—		8,089
Other	7,191		—		—		7,191
Total freight revenues	273,432		65,249		84,693		423,374
Freight-related revenues	66,045		10,136		69,269		145,450
All other revenues	16,232		1,318		16,930		34,480
Total operating revenues	$	355,709	$	76,703	$	170,892	$	603,304
Operating income	$	102,484	$	20,713	$	4,623	$	127,820
Depreciation and amortization	$	41,388	$	14,937	$	9,067	$	65,392
Interest expense, net	$	10,339	$	12,780	$	2,893	$	26,012
Provision for income taxes	$	26,323	$	2,398	$	2,292	$	31,013
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	42,120	$	8,185	$	6,704	$	57,009

	Nine Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	99,383	$	8,684	$	2,011		$	110,078
Autos & Auto Parts	17,905		—		—			17,905
Chemicals & Plastics	116,504		—		—			116,504
Coal & Coke	56,089		91,323		6,195			153,607
Food & Kindred Products	25,559		—		—			25,559
Intermodal	1,439		45,705		174,500			221,644
Lumber & Forest Products	68,238		—		—			68,238
Metallic Ores	9,883		22,177		—			32,060
Metals	87,032		—		—			87,032
Minerals & Stone	111,806		5,834		58,709			176,349
Petroleum Products	56,779		476		2,036			59,291
Pulp & Paper	88,940		—		—			88,940
Waste	23,104		—		—			23,104
Other	16,308		—		—			16,308
Total freight revenues	778,969		174,199		243,451			1,196,619
Freight-related revenues	198,740		23,902		197,385			420,027
All other revenues	49,026		5,137		42,454			96,617
Total operating revenues	$	1,026,735	$	203,238	$	483,290		$	1,713,263
Operating income/(loss)	$	249,209	$	43,642	$	(6,185	)	$	286,666
Depreciation and amortization	$	116,333	$	42,382	$	29,454		$	188,169
Interest expense, net	$	36,871	$	34,618	$	6,291		$	77,780
Provision for income taxes	$	49,103	$	2,711	$	1,287		$	53,101
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	153,959	$	26,797	$	23,523		$	204,279

	Nine Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	91,630	$	15,639	$	3,073		$	110,342
Autos & Auto Parts	16,686		—		—			16,686
Chemicals & Plastics	113,625		—		—			113,625
Coal & Coke	62,038		96,506		8,751			167,295
Food & Kindred Products	25,587		—		—			25,587
Intermodal	1,203		50,613		192,413			244,229
Lumber & Forest Products	70,362		—		—			70,362
Metallic Ores	10,816		24,770		—			35,586
Metals	95,791		—		—			95,791
Minerals & Stone	107,122		6,247		63,849			177,218
Petroleum Products	52,870		560		107			53,537
Pulp & Paper	90,346		—		—			90,346
Waste	21,316		—		—			21,316
Other	19,325		—		—			19,325
Total freight revenues	778,717		194,335		268,193			1,241,245
Freight-related revenues	193,344		32,214		203,491			429,049
All other revenues	48,835		4,017		49,809			102,661
Total operating revenues	$	1,020,896	$	230,566	$	521,493		$	1,772,955
Operating income/(loss)	$	255,918	$	62,585	$	(645	)	$	317,858
Depreciation and amortization	$	123,266	$	46,232	$	27,629		$	197,127
Interest expense, net	$	30,572	$	38,914	$	9,620		$	79,106
Provision for income taxes	$	26,930	$	7,120	$	7,519		$	41,569
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	129,607	$	27,936	$	19,893		$	177,436

Disaggregation of Revenue [Table Text Block]

The following tables set forth select financial data for the Company's reportable segments, including operating revenues by commodity group, for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	34,574	$	2,631	$	763		$	37,968
Autos & Auto Parts	6,339		—		—			6,339
Chemicals & Plastics	39,518		—		—			39,518
Coal & Coke	18,336		33,187		606			52,129
Food & Kindred Products	8,355		—		—			8,355
Intermodal	461		16,446		56,998			73,905
Lumber & Forest Products	22,862		—		—			22,862
Metallic Ores	4,225		7,036		—			11,261
Metals	28,115		—		—			28,115
Minerals & Stone	41,399		1,979		21,672			65,050
Petroleum Products	19,027		178		628			19,833
Pulp & Paper	30,648		—		—			30,648
Waste	8,278		—		—			8,278
Other	5,888		—		—			5,888
Total freight revenues	268,025		61,457		80,667			410,149
Freight-related revenues	68,129		8,011		65,229			141,369
All other revenues	16,288		2,132		13,756			32,176
Total operating revenues	$	352,442	$	71,600	$	159,652		$	583,694
Operating income/(loss)	$	95,633	$	19,484	$	(2,361	)	$	112,756
Depreciation and amortization	$	39,164	$	13,779	$	10,083		$	63,026
Interest expense, net	$	12,599	$	10,694	$	849		$	24,142
Provision for income taxes	$	16,876	$	2,641	$	458		$	19,975
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	53,239	$	14,845	$	6,336		$	74,420

	Three Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	30,565	$	4,150	$	1,053	$	35,768
Autos & Auto Parts	5,513		—		—		5,513
Chemicals & Plastics	38,436		—		—		38,436
Coal & Coke	23,006		32,357		2,588		57,951
Food & Kindred Products	8,761		—		—		8,761
Intermodal	514		17,538		58,609		76,661
Lumber & Forest Products	24,113		—		—		24,113
Metallic Ores	3,573		8,914		—		12,487
Metals	34,904		—		—		34,904
Minerals & Stone	38,570		2,066		22,344		62,980
Petroleum Products	18,236		224		99		18,559
Pulp & Paper	31,961		—		—		31,961
Waste	8,089		—		—		8,089
Other	7,191		—		—		7,191
Total freight revenues	273,432		65,249		84,693		423,374
Freight-related revenues	66,045		10,136		69,269		145,450
All other revenues	16,232		1,318		16,930		34,480
Total operating revenues	$	355,709	$	76,703	$	170,892	$	603,304
Operating income	$	102,484	$	20,713	$	4,623	$	127,820
Depreciation and amortization	$	41,388	$	14,937	$	9,067	$	65,392
Interest expense, net	$	10,339	$	12,780	$	2,893	$	26,012
Provision for income taxes	$	26,323	$	2,398	$	2,292	$	31,013
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	42,120	$	8,185	$	6,704	$	57,009

	Nine Months Ended
	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	99,383	$	8,684	$	2,011		$	110,078
Autos & Auto Parts	17,905		—		—			17,905
Chemicals & Plastics	116,504		—		—			116,504
Coal & Coke	56,089		91,323		6,195			153,607
Food & Kindred Products	25,559		—		—			25,559
Intermodal	1,439		45,705		174,500			221,644
Lumber & Forest Products	68,238		—		—			68,238
Metallic Ores	9,883		22,177		—			32,060
Metals	87,032		—		—			87,032
Minerals & Stone	111,806		5,834		58,709			176,349
Petroleum Products	56,779		476		2,036			59,291
Pulp & Paper	88,940		—		—			88,940
Waste	23,104		—		—			23,104
Other	16,308		—		—			16,308
Total freight revenues	778,969		174,199		243,451			1,196,619
Freight-related revenues	198,740		23,902		197,385			420,027
All other revenues	49,026		5,137		42,454			96,617
Total operating revenues	$	1,026,735	$	203,238	$	483,290		$	1,713,263
Operating income/(loss)	$	249,209	$	43,642	$	(6,185	)	$	286,666
Depreciation and amortization	$	116,333	$	42,382	$	29,454		$	188,169
Interest expense, net	$	36,871	$	34,618	$	6,291		$	77,780
Provision for income taxes	$	49,103	$	2,711	$	1,287		$	53,101
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	153,959	$	26,797	$	23,523		$	204,279

	Nine Months Ended
	September 30, 2018
	North American Operations		Australian Operations		U.K./European Operations			Total Operations
Operating revenues:
Freight revenues by commodity group:
Agricultural Products	$	91,630	$	15,639	$	3,073		$	110,342
Autos & Auto Parts	16,686		—		—			16,686
Chemicals & Plastics	113,625		—		—			113,625
Coal & Coke	62,038		96,506		8,751			167,295
Food & Kindred Products	25,587		—		—			25,587
Intermodal	1,203		50,613		192,413			244,229
Lumber & Forest Products	70,362		—		—			70,362
Metallic Ores	10,816		24,770		—			35,586
Metals	95,791		—		—			95,791
Minerals & Stone	107,122		6,247		63,849			177,218
Petroleum Products	52,870		560		107			53,537
Pulp & Paper	90,346		—		—			90,346
Waste	21,316		—		—			21,316
Other	19,325		—		—			19,325
Total freight revenues	778,717		194,335		268,193			1,241,245
Freight-related revenues	193,344		32,214		203,491			429,049
All other revenues	48,835		4,017		49,809			102,661
Total operating revenues	$	1,020,896	$	230,566	$	521,493		$	1,772,955
Operating income/(loss)	$	255,918	$	62,585	$	(645	)	$	317,858
Depreciation and amortization	$	123,266	$	46,232	$	27,629		$	197,127
Interest expense, net	$	30,572	$	38,914	$	9,620		$	79,106
Provision for income taxes	$	26,930	$	7,120	$	7,519		$	41,569
Cash expenditures for additions to property & equipment, net of grants from outside parties	$	129,607	$	27,936	$	19,893		$	177,436

Certain asset information by segment [Table Text Block]

The following tables set forth select balance sheet data for the Company's reportable segments as of September 30, 2019 and December 31, 2018 (dollars in thousands): 

	September 30, 2019
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Cash and cash equivalents	$	37,261	$	31,142	$	18,509	$	86,912
Property and equipment, net	$	3,747,047	$	587,793	$	329,997	$	4,664,837

	December 31, 2018
	North American Operations		Australian Operations		U.K./European Operations		Total Operations
Cash and cash equivalents	$	33,996	$	26,902	$	29,489	$	90,387
Property and equipment, net	$	3,679,279	$	609,450	$	324,285	$	4,613,014

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Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2019

Derivative [Line Items]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

The following table summarizes the fair value of the Company's derivative instruments recorded in the consolidated balance sheets as of September 30, 2019 and December 31, 2018 (dollars in thousands):

		Fair Value
	Balance Sheet Location	September 30, 2019		December 31, 2018
Asset Derivatives:
Derivatives designated as cash flow hedges:
British pound forward contracts	Prepaid expenses and other	$	4,535	$	—
British pound forward contracts	Other assets	—		26,011
Derivative designated as a net investment hedge:
Cross-currency swap contract	Other assets	8,039		—
Total derivatives designated as hedges		$	12,574	$	26,011
Derivatives not designated as hedges:
Cross-currency swap contract	Prepaid expenses and other	$	—	$	19,684
Total derivatives not designated as hedges		$	—	$	19,684
Liability Derivatives:
Derivatives designated as cash flow hedges:
Interest rate swap agreements	Accrued expenses	$	8,545	$	1,954
Interest rate swap agreements	Other long-term liabilities	86,483		12,441
British pound forward contracts	Other long-term liabilities	—		59
Derivative designated as a fair value hedge:
Cross-currency swap contract	Other long-term liabilities	4,047		—
Total derivatives designated as hedges		$	99,075	$	14,454

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) [Table Text Block]

The following table shows the effective portion of net changes in the fair value of the Company's derivative instruments designated as hedges recognized in OCI, net of tax for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Total Derivatives Designated as Hedges OCI Activity, Net of Tax
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Derivatives Designated as Hedges:
Cash Flow Hedges:
Interest rate swap agreements	$	(26,746	)	$	4,816		$	(61,451	)	$	14,396
Foreign currency forward contracts	—			(13		)	—			275
British pound forward contracts, net (a)	(12		)	350			1,446			85
	$	(26,758	)	$	5,153		$	(60,005	)	$	14,756
Net Investment Hedge:
Cross-currency swap contract	$	6,821		$	—		$	6,048		$	—
Fair Value Hedge:
Cross-currency swap contract	$	(704	)	$	—		$	(1,134	)	$	—
Total derivatives designated as hedges	$	(20,641	)	$	5,153		$	(55,091	)	$	14,756

(a) The three months ended September 30, 2019 represented a net loss of $1.0 million for the mark-to-market of the U.K. intercompany loan, partially offset by a net gain of $1.0 million for the mark-to-market of the British pound forward contracts. The nine months ended September 30, 2019 represented a net gain of $18.5 million for the mark-to-market of the U.K. intercompany loan, partially offset by a net loss of $17.0 million for the mark-to-market of the British pound forward contracts.

The three and nine months ended September 30, 2018 represented a net loss of $1.7 million and $5.4 million, respectively, for the mark-to-market of the U.K. intercompany loan, partially offset by a net gain of $2.0 million and $5.5 million, respectively, for the mark-to-market of the British pound forward contracts

Schedule of Derivative Instruments, Gain (Loss) in Consolidated Statement of Operations [Table Text Block]

The following table shows the effect of the Company's derivative instruments not designated as hedges for the three and nine months ended September 30, 2019 and 2018 in the consolidated statements of operations (dollars in thousands):

		Amount Recognized in Earnings
	Location of Amount Recognized in Earnings	Three Months Ended					Nine Months Ended
		September 30,					September 30,
		2019		2018			2019			2018
Derivatives Not Designated as Hedges:
Cross-currency swap agreements, net (a)	Other income/(loss), net	$	—	$	(2,410	)	$	(1,770	)	$	(4,900	)

(a) The nine months ended September 30, 2019 represented a net loss of $1.4 million for the mark-to-market of the GRail Intercompany Loan and a net loss of $0.3 million for the mark-to-market of the swaps. This derivative was settled in June 2019, and the Company received cash proceeds of €17.0 million (or $19.3 million at the exchange rate on June 30, 2019).

The three months ended September 30, 2018 represented a net loss of $3.0 million for the mark-to-market of the GRail Intercompany Loan, partially offset by a net gain of $0.6 million for the mark-to-market of the swaps. The nine months ended September 30, 2018 represented a net loss of $8.1 million for the mark-to-market of the GRail Intercompany Loan, partially offset by a net gain of $3.2 million for the mark-to-market of the swaps.

Schedule of Cash Flow, Supplemental Disclosures [Table Text Block]

The following table shows the cash flow impacts from the Company's derivatives that settled during the nine months ended September 30, 2019 (dollars in thousands):

	Nine Months Ended
	September 30, 2019
Derivatives designated as hedges:
British pound forward contracts	$	26,088
Derivatives not designated as hedges:
Cross-currency swap contract	19,272
Total cash received from settlement of derivative transactions, investing activities	$	45,360

Interest Rate Swap [Member]

Derivative [Line Items]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

The following table summarizes the terms of the Company's outstanding interest rate swap agreements entered into to manage the Company's exposure to changes in interest rates on its variable rate debt (amounts in thousands):

Effective Date	Expiration Date	Notional Amount		Pay Fixed Rate	Receive Variable Rate
12/1/2016	12/1/2021	A$	517,500	2.44%	AUD-BBR
8/31/2018	8/31/2021 - 8/31/2048	$	500,000	2.70% - 2.87%	1-month LIBOR

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Changes in Operations Divestiture of GWAHLP (Details) - AUD ($) $ in Millions	9 Months Ended
	Jul. 01, 2020	Sep. 30, 2019
MIRA [Member]
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners		48.90%
Scenario, Forecast [Member] | GWAHLP [Member] | Australia Operations [Member]
Proceeds from Divestiture of Businesses	$ 627.4

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Accounts Receivable

9 Months Ended

Sep. 30, 2019

Accounts Receivable, Net [Abstract]

Accounts Receivable

ACCOUNTS RECEIVABLE:

Accounts receivable consisted of the following as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019			December 31, 2018
Accounts receivable – trade	$	395,512		$	397,255
Accounts receivable – grants from outside parties	24,677			19,376
Accounts receivable – insurance and other third-party claims	29,386			19,729
Total accounts receivable	449,575			436,360
Less: Allowance for doubtful accounts	(12,513		)	(10,055		)
Accounts receivable, net	$	437,062		$	426,305

The timing of revenue recognition, billings and cash collections result in trade accounts receivable, contract assets and contract liabilities. The Company’s contract assets and liabilities are typically short-term in nature, with terms settled within a 12-month period. The Company had no material contract assets or contract liabilities recorded on the consolidated balance sheet as of September 30, 2019 or December 31, 2018.

Grants from Outside Parties

The Company periodically receives grants for the upgrade and construction of rail lines and the upgrade of locomotives from federal, provincial, state and local agencies in the United States and provinces in Canada in which the Company operates.

These grants typically reimburse the Company for 50% to 100% of the actual cost of specific projects. In total, the Company received grant proceeds of $23.0 million and $16.7 million for the nine months ended September 30, 2019 and 2018, respectively, from such grant programs. The proceeds were presented as cash inflows from investing activities within the statement of cash flows for each of the applicable periods. The Company records additions to property and equipment for its grant-funded projects and defers the amount of the grants. The amortization of deferred grants is a non-cash offset to depreciation expense over the useful lives of the related assets.

The following table sets forth the offset to depreciation expense from the amortization of deferred grants recorded by the Company during the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Amortization of deferred grants	$	3,442	$	3,173	$	10,265	$	8,776

Insurance and Third-Party Claims

The increase in the balance of the accounts receivable from insurance and other third-party claims for the nine months ended September 30, 2019 was primarily related to the anticipated insurance recovery associated with a personal injury that occurred in the U.K. in 2019. The receivable and the associated claim liability were recorded on the balance sheet as of September 30, 2019.

The Company completed its annual property insurance renewal during the third quarter of 2019, which became effective on August 1, 2019. Effective with this renewal, the Company's property policies have various self-insured retentions, which vary based on the type and location of the incident, up to $10.0 million. The Company recently completed its annual liability insurance renewal, which became effective on November 1, 2019. Effective with this renewal, the Company's liability policies have various self-insured retentions up to $5.0 million.

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U.K. Pension Plan

9 Months Ended

Sep. 30, 2019

Defined Benefit Plan [Abstract]

U.K. Pension Plan

U.K. PENSION PLAN:

Through its Freightliner subsidiary, the Company has a defined benefit pension plan for Freightliner's eligible U.K. employees through a standalone shared cost arrangement within the Railways Pension Scheme (Pension Program). The Pension Program is managed and administered by a professional pension administration company and is overseen by trustees with professional advice from independent actuaries and other advisers. The Pension Program is a shared cost arrangement with required contributions shared between Freightliner and its participating members, with Freightliner contributing 60% and the remaining 40% contributed by active employees. The Company engages independent actuaries to compute the amounts of liabilities and expenses relating to the Pension Program subject to the assumptions that the Company selects.

The following tables summarize the components of the Pension Program related to the net benefit costs recognized in labor and benefits and other income/(loss), net in the Company's consolidated statements of operations for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
		2019			2018			2019			2018
Operating expense:
	Service cost(a)	$	3,257		$	3,610		$	10,094		$	11,235
Nonoperating income, net:
	Interest cost	2,240			2,383			6,942			7,416
	Expected return on plan assets	(4,158		)	(4,572		)	(12,885		)	(14,231		)
	Amortization of prior year service cost	42			—			130			—
	Total nonoperating income, net(b)	(1,876		)	(2,189		)	(5,813		)	(6,815		)
Net periodic benefit cost		$	1,381		$	1,421		$	4,281		$	4,420

(a) Included in labor and benefits within the Company’s consolidated statements of operations.

(b) Included in other income/(loss), net within the Company’s consolidated statements of operations.

During the nine months ended September 30, 2019, the Company contributed £4.7 million (or $6.0 million at the exchange rate when the payments were made) to fund the Pension Program. The Company expects to contribute £2.3 million (or $2.8 million at the September 30, 2019 exchange rate) to the Pension Program for the remainder of 2019. The Pension Program's assets may undergo significant changes over time as a result of market conditions, and its assets and liabilities are formally valued on an independent actuarial basis every three years to assess the adequacy of funding levels. A key element of the valuation process is an assessment of the creditworthiness of the participating employer. In the event that the Pension Program's projected assets and liabilities reveal additional funding requirements, the shared cost arrangement generally means that the Company will be required to pay 60% of any additional contributions, with active members contributing the remaining 40%, in each case over an agreed recovery period. If the Pension Program was to be terminated and wound up, any deficit would fall entirely on the Company and could not be shared with active members. Currently, the Company has no intention of terminating the Pension Program.

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Derivative Financial Instruments Cross Currency Swap (Details) $ in Thousands, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Dec. 01, 2016 AUD ($)
Derivative [Line Items]
Foreign currency translation adjustment, net of tax provision	$ (36,647)	$ (9,501)	$ (32,641)	$ (59,042)
Other Comprehensive Income (Loss), Net Investment Hedge, Gain (Loss), Reclassification, before Tax	$ 100		$ 100
Intercompany GRail Loan [Member]
Derivative [Line Items]
Debt Instrument, Face Amount					$ 248.9
Cross-currency swap contract [Member] | Net Investment Hedging [Member]
Derivative [Line Items]
Settlement Date			Jun. 30, 2021
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Net Amount to be Transferred			$ 600
Cross-currency swap contract [Member] | Fair Value Hedging [Member]
Derivative [Line Items]
Settlement Date			Jun. 30, 2021
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Net Amount to be Transferred			$ (900)
Cross-currency swap contract [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Settlement Date	Jun. 30, 2019

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Leases Future Minimum Lease Payments for Capital and Operating Leases (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
Capital Leases, Future Minimum Payments Due 2019	$ 11,405
Capital Leases, Future Minimum Payments Due 2020	17,261
Capital Leases, Future Minimum Payments Due 2021	8,668
Capital Leases, Future Minimum Payments Due 2022	9,625
Capital Leases, Future Minimum Payments Due 2023	10,780
Capital Leases, Future Minimum Payments Due Thereafter	13,988
Capital Leases, Future Minimum Payments Due	71,727
Operating Leases, Future Minimum Payments Due 2019	82,191
Operating Leases, Future Minimum Payments, Due 2020	63,062
Operating Leases, Future Minimum Payments, Due 2021	54,305
Operating Leases, Future Minimum Payments, Due 2022	44,739
Operating Leases, Future Minimum Payments, Due 2023	35,919
Operating Leases, Future Minimum Payments, Due Thereafter	383,739
Operating Leases, Future Minimum Payments Due	$ 663,955

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Derivative Financial Instruments Derivative Instruments Not Designated as Hedges Amount Recognized in Earnings (Details) $ in Thousands, € in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 EUR (€)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Derivative Instruments, Gain (Loss) [Line Items]
Proceeds from settlement of derivative transactions				$ 45,360	$ 0
Other income/(loss), net [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(loss) on cross-currency swap agreements, net	$ 0	$ (2,410)		(1,770)	(4,900)
Currency Swap [Member] | Not Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Proceeds from settlement of derivative transactions			€ 17.0	19,300
Intercompany GRail Loan [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Net gain (loss) for mark-to-market of the U.K. intercompany loan		(3,000)		(1,400)	(8,100)
Mark to Market [Member] | Currency Swap [Member] | Not Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Net gain (loss) on mark-to-market of the swaps		$ 600		$ (300)	$ 3,200

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Changes in Operations U.K./Europe Optimization Restructuring Costs (Details) $ in Thousands	3 Months Ended		9 Months Ended		18 Months Ended	21 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($) $ / £
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred	$ 3,561	$ 3,286	$ 18,756	$ 12,931
U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred	3,238		15,517		$ 30,501
Rationalization of locomotive and railcar fleet [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred	0		0		6,301
Management restructuring [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred	1,240		10,381		15,021
Productivity and automation investments [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred	$ 1,998		$ 5,136		$ 9,179
Scenario, Forecast [Member]
Restructuring Cost and Reserve [Line Items]
Foreign Currency Exchange Rate, Translation | $ / £						1.28
Scenario, Forecast [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred						$ 43,000
Scenario, Forecast [Member] | Rationalization of locomotive and railcar fleet [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred						11,000
Scenario, Forecast [Member] | Management restructuring [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred						17,000
Scenario, Forecast [Member] | Productivity and automation investments [Member] | U.K. Operations Optimization [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and related costs incurred						$ 15,000

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Principles of Consolidation and Basis of Presentation Accounting Changes and Error Corrections (Details) - Understatement [Member] - Restatement Adjustment [Member] $ in Millions	9 Months Ended
	Sep. 30, 2019 USD ($)
Principal payments on revolving line-of-credit, long-term debt and finance lease obligations [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Quantifying Misstatement in Current Year Financial Statements, Amount	$ (33.0)
Proceeds from revolving line-of-credit and long-term debt [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Quantifying Misstatement in Current Year Financial Statements, Amount	$ 33.0

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Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Schedule of Financial Instruments Carried at Fair Value [Table Text Block]

The following table presents the Company's financial instruments carried at fair value using Level 2 inputs as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019		December 31, 2018
Financial instruments carried at fair value using Level 2 inputs:
Financial assets carried at fair value:
British pound forward contracts	$	4,535	$	26,011
Cross-currency swap contract - net investment hedge	8,039		—
Cross-currency swap contracts	—		19,684
Total financial assets carried at fair value	$	12,574	$	45,695
Financial liabilities carried at fair value:
Interest rate swap agreements	$	95,028	$	14,395
British pound forward contracts	—		59
Cross-currency swap contract - fair value hedge	4,047		—
Total financial liabilities carried at fair value	$	99,075	$	14,454

Schedule of Financial Instruments Carried at Historical Cost [Table Text Block]

The following table presents the carrying value, net of debt issuance costs and fair value using Level 2 inputs of the Company's financial instruments carried at historical cost as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019				December 31, 2018
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial liabilities carried at historical cost:
United States term loan	$	1,261,983	$	1,258,527	$	1,295,672	$	1,296,079
U.K. term loan	289,357		290,883		315,524		319,556
Australian credit agreement	422,120		427,617		450,252		457,978
Australia subordinated shareholder loan from Macquarie Infrastructure and Real Assets	160,675		157,652		167,796		166,974
Revolving credit facility	319		3,687		160,033		163,662
Other debt	2,392		2,379		2,356		2,352
Total	$	2,136,846	$	2,140,745	$	2,391,633	$	2,406,601

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Earnings per Share

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Earnings Per Share

EARNINGS PER COMMON SHARE:

The following table sets forth the computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Numerators:
Net income attributable to Genesee & Wyoming Inc.	$	66,792	$	69,590	$	156,939	$	188,856
Denominators:
Weighted average Class A common shares outstanding – Basic	56,638		59,168		56,497		60,343
Weighted average Class B common shares outstanding	376		664		426		679
Dilutive effect of employee stock-based awards	518		299		374		233
Weighted average shares – Diluted	57,532		60,131		57,297		61,255
Earnings per common share attributable to Genesee & Wyoming Inc. common stockholders:
Basic earnings per common share	$	1.18	$	1.18	$	2.78	$	3.13
Diluted earnings per common share	$	1.16	$	1.16	$	2.74	$	3.08

The following total number of shares of Class A Common Stock issuable under the assumed exercise of stock-based awards computed based on the treasury stock method were excluded from the calculation of diluted earnings per common share, as the effect of including these shares would have been antidilutive (in thousands):

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2019	2018	2019	2018
Antidilutive shares	—	704	249	1,045

Share Repurchase

In October 2018, the Company completed its $300 million share repurchase program that had been approved in 2015, and the Company's Board of Directors authorized a new $500 million share repurchase program of Class A Common Stock, subject to certain limitations under the Company's credit facility. The table below presents information regarding shares repurchased by the Company under the share repurchase programs during the three and nine months ended September 30, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Class A Common Stock repurchased	—		894		65		3,560
Average price paid per share of Class A Common Stock repurchased	$	—	$	87.46	$	73.94	$	75.99

Repurchased shares are recorded in treasury stock, at cost, which includes any applicable commissions and fees. As of September 30, 2019, the remaining amount authorized for repurchase under the $500 million share repurchase program was $335.0 million. In light of the Company's entry into the Merger Agreement with affiliates of Brookfield Infrastructure and GIC, future share repurchases under the repurchase program have been suspended. See Note 2, Changes in Operations, for additional information regarding the Merger Agreement.

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Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

FAIR VALUE OF FINANCIAL INSTRUMENTS:

The following table presents the Company's financial instruments carried at fair value using Level 2 inputs as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019		December 31, 2018
Financial instruments carried at fair value using Level 2 inputs:
Financial assets carried at fair value:
British pound forward contracts	$	4,535	$	26,011
Cross-currency swap contract - net investment hedge	8,039		—
Cross-currency swap contracts	—		19,684
Total financial assets carried at fair value	$	12,574	$	45,695
Financial liabilities carried at fair value:
Interest rate swap agreements	$	95,028	$	14,395
British pound forward contracts	—		59
Cross-currency swap contract - fair value hedge	4,047		—
Total financial liabilities carried at fair value	$	99,075	$	14,454

Financial Instruments Carried at Fair Value: Derivative instruments are recorded on the consolidated balance sheets as either assets or liabilities measured at fair value. As more fully described in Note 6, Derivative Financial Instruments, during the reporting period, the Company's derivative financial instruments consisted of interest rate swap agreements, foreign currency forward contracts and cross-currency swap agreements. The Company estimated the fair value of its derivative financial instruments based on Level 2 valuation inputs, including fixed interest rates, LIBOR, British pound LIBOR, BBR and EURIBOR implied forward interest rates and the remaining time to maturity.

The following table presents the carrying value, net of debt issuance costs and fair value using Level 2 inputs of the Company's financial instruments carried at historical cost as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019				December 31, 2018
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial liabilities carried at historical cost:
United States term loan	$	1,261,983	$	1,258,527	$	1,295,672	$	1,296,079
U.K. term loan	289,357		290,883		315,524		319,556
Australian credit agreement	422,120		427,617		450,252		457,978
Australia subordinated shareholder loan from Macquarie Infrastructure and Real Assets	160,675		157,652		167,796		166,974
Revolving credit facility	319		3,687		160,033		163,662
Other debt	2,392		2,379		2,356		2,352
Total	$	2,136,846	$	2,140,745	$	2,391,633	$	2,406,601

Financial Instruments Carried at Historical Cost: Since the Company's long-term debt is not actively traded, fair value was estimated using a discounted cash flow analysis based on Level 2 valuation inputs, including borrowing rates the Company believes are currently available to it for loans with similar terms and maturities.

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Leases Maturity of Lease Liabilities (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Leases [Abstract]
Finance Lease, Liability, Payments, Due Remainder of 2019	$ 3,299
Finance Lease, Liability, Payments, Due 2020	19,373
Finance Lease, Liability, Payments, Due 2021	10,495
Finance Lease, Liability, Payments, Due 2022	14,650
Finance Lease, Liability, Payments, Due 2023	10,551
Finance Lease, Liability, Payments, Due Thereafter	34,778
Finance Lease, Liability, Payments, Due	93,146
Finance Lease, Liability, Imputed Interest	14,435
Finance Lease, Liability	78,711
Lessee, Operating Lease, Liability, Payments, Due Remainder of 2019	23,076
Lessee, Operating Lease, Liability, Payments, Due 2020	72,851
Lessee, Operating Lease, Liability, Payments, Due 2021	63,445
Lessee, Operating Lease, Liability, Payments, Due 2022	52,080
Lessee, Operating Lease, Liability, Payments, Due 2023	43,398
Lessee, Operating Lease, Liability, Payments, Due Thereafter	553,484
Lessee, Operating Lease, Liability, Payments, Due	808,334
Lessee, Operating Lease, Liability, Imputed Interest	336,557
Total operating lease liabilities	$ 471,777

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Derivative Financial Instruments Derivative Instruments Designated as Hedges OCI Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Foreign currency translation adjustment, net of tax provision	$ (36,647)	$ (9,501)	$ (32,641)	$ (59,042)
Intercompany Loan [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Net gain (loss) for mark-to-market of the U.K. intercompany loan	(1,000)	(1,700)	18,500	(5,400)
British pound forward contracts, net [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	1,000	2,000	(17,000)	5,500
Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	(20,641)	5,153	(55,091)	14,756
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	(26,758)	5,153	(60,005)	14,756
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Interest rate swap agreements [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	(26,746)	4,816	(61,451)	14,396
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Foreign currency forward contracts [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	0	(13)	0	275
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | British pound forward contracts, net [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	(12)	350	1,446	85
Net Investment Hedging [Member] | Designated as Hedging Instrument [Member] | Cross-currency swap contract [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Foreign currency translation adjustment, net of tax provision	6,821	0	6,048	0
Fair Value Hedging [Member] | Designated as Hedging Instrument [Member] | Cross-currency swap contract [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Effective portion of net changes in fair value recognized in OCI, net of tax	$ (704)	$ 0	$ (1,134)	$ 0

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Derivative Financial Instruments Foreign Currency Exchange Rate Risk (Details) $ in Thousands, £ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($) $ / £	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) $ / £	Sep. 30, 2018 USD ($)	Sep. 30, 2019 GBP (£) $ / £	Mar. 25, 2015 USD ($)	Mar. 25, 2015 GBP (£)
Derivative [Line Items]
Foreign subsidiaries third-party debt denominated in local currencies	$ 948,400		$ 948,400
Proceeds from settlement of derivative transactions			45,360	$ 0
Foreign Exchange Forward, Settled [Member]
Derivative [Line Items]
Notional Amount | £					£ 120.0
British Pound Foreign currency forward contracts [Member]
Derivative [Line Items]
Notional Amount | £					£ 32.6
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion	$ 100	$ 200	800	$ 500
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Net Amount to be Transferred			$ 200
Settlement Date			Mar. 31, 2020
Intercompany Loan [Member]
Derivative [Line Items]
Long-term Debt, Gross						$ 181,000	£ 120.0
Minimum [Member] | Foreign Exchange Forward, Settled [Member]
Derivative [Line Items]
Exchange Rate | $ / £	1.50		1.50		1.50
Minimum [Member] | British Pound Foreign currency forward contracts [Member]
Derivative [Line Items]
Exchange Rate | $ / £	1.28		1.28		1.28
Maximum [Member] | Foreign Exchange Forward, Settled [Member]
Derivative [Line Items]
Exchange Rate | $ / £	1.51		1.51		1.51
Maximum [Member] | British Pound Foreign currency forward contracts [Member]
Derivative [Line Items]
Exchange Rate | $ / £	1.57		1.57		1.57
Designated as Hedging Instrument [Member] | British Pound Foreign currency forward contracts [Member]
Derivative [Line Items]
Proceeds from settlement of derivative transactions			$ 26,088

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U.K. Pension Plan Net Periodic Service Cost (Details) - Pension Plan [Member] - U.K. Pension [Member] $ in Thousands, £ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2019 GBP (£)	Sep. 30, 2018 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2019 GBP (£)
Defined Benefit Plan Disclosure [Line Items]
Company contribution % required in shared cost arrangement			60.00%	60.00%
Defined benefit plan, contribution percent by participant			40.00%	40.00%
Net periodic benefit cost	$ 1,381	$ 1,421	$ 4,281		$ 4,420
Defined Benefit Plan, Contribution by Employer			6,000	£ 4.7
Scenario, Forecast [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Expected Future Benefit Payment, Remainder of Fiscal Year						$ 2,800	£ 2.3
Labor and Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	3,257	3,610	10,094		11,235
Other income/(loss), net [Member]
Defined Benefit Plan Disclosure [Line Items]
Interest cost	2,240	2,383	6,942		7,416
Expected return on plan assets	(4,158)	(4,572)	(12,885)		(14,231)
Amortization of prior year service cost	42	0	130		0
Total nonoperating income, net	$ (1,876)	$ (2,189)	$ (5,813)		$ (6,815)

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Accumulated Other Comprehensive Income/(Loss) OCI Attributable to Noncontrolling Interest (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Noncontrolling Interest [Abstract]
Net income attributable to noncontrolling interest	$ 2,979	$ 2,720	$ 3,011	$ 8,090
Foreign currency translation adjustment, net of tax, portion attributable to noncontrolling interest	(7,690)	(4,804)	(8,697)	(17,647)
Net unrealized gain/(loss) on qualifying cash flow hedges, net of tax	(48)	(95)	(1,525)	62
Comprehensive loss attributable to noncontrolling interest	(4,759)	(2,179)	(7,211)	(9,495)
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Tax, Portion Attributable to Noncontrolling Interest	$ 21	$ 41	$ 654	$ (26)

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Leases Schedule of Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Total finance lease cost	$ 2,950	$ 8,384
Total operating lease cost	25,036	77,370
Total lease cost	27,986	85,754
Depreciation and Amortization [Member]
Amortization of right-of-use assets, Finance leases	2,069	5,830
Interest Expense [Member]
Interest on lease liability, Finance leases	881	2,554
Equipment Rents and Trackage Rights [Member]
Operating lease cost	22,292	66,976
Short-term lease cost	2,071	7,064
Variable lease cost	1,964	6,871
Operating Revenues [Member]
Sublease income (gross basis)	$ (1,291)	$ (3,541)

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Consolidated Statements of Comprehensive Income Parentheticals - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Statement of Comprehensive Income [Abstract]
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax	$ (2,068)	$ 0	$ (1,885)	$ 0
Tax benefit/(provision) on net unrealizable gain/(loss) on qualifying cash flow hedges	8,720	(1,583)	19,430	(4,612)
Tax benefit/(provision) on changes in pension and other postretirement benefits	$ (8)	$ (14)	$ 74	$ (42)

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Accounts Receivable Contract Balances (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Contract Balances [Abstract]
Material Contract Asset	$ 0	$ 0
Material Contract Liability	$ 0	$ 0

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Earnings per Share Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Numerator [Line items]
Net income attributable to Genesee & Wyoming Inc.	$ 66,792	$ 69,590	$ 156,939	$ 188,856
Denominators [Line Items]
Weighted average Class A common shares outstanding-Basic	56,638	59,168	56,497	60,343
Weighted average Class B common shares outstanding	376	664	426	679
Dilutive effect of employee stock-based awards	518	299	374	233
Weighted average shares - Diluted	57,532	60,131	57,297	61,255
Earnings per common share [Line Items]
Basic earnings per common share attributable to Genesee & Wyoming Inc. common stockholders	$ 1.18	$ 1.18	$ 2.78	$ 3.13
Diluted earnings per common share attributable to Genesee & Wyoming Inc. common stockholders	$ 1.16	$ 1.16	$ 2.74	$ 3.08

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Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
CURRENT ASSETS:
Cash and cash equivalents	$ 86,912	$ 90,387
Accounts receivable, net	437,062	426,305
Materials and supplies	58,476	56,716
Prepaid expenses and other	36,275	54,185
Total current assets	618,725	627,593
PROPERTY AND EQUIPMENT, net	4,664,837	4,613,014
GOODWILL	1,096,095	1,115,849
INTANGIBLE ASSETS, net	1,362,963	1,430,197
DEFERRED INCOME TAX ASSETS, net	5,102	4,616
OTHER ASSETS	536,657	77,192
Total assets	8,284,379	7,868,461
CURRENT LIABILITIES:
Current portion of long-term debt	38,951	28,303
Accounts payable	278,418	288,070
Accrued expenses	245,874	165,280
Total current liabilities	563,243	481,653
LONG-TERM DEBT, less current portion	2,176,563	2,425,235
DEFERRED INCOME TAX LIABILITIES, net	884,402	877,721
DEFERRED ITEMS - grants from outside parties	344,813	326,520
OTHER LONG-TERM LIABILITIES	608,101	127,280
COMMITMENTS AND CONTINGENCIES
EQUITY:
Additional paid-in capital	1,812,085	1,785,005
Retained earnings	2,638,043	2,482,252
Accumulated other comprehensive loss	(230,108)	(146,456)
Treasury stock, at cost	(711,922)	(699,852)
Total Genesee & Wyoming Inc. stockholders' equity	3,508,859	3,421,706
Noncontrolling interest	198,398	208,346
Total equity	3,707,257	3,630,052
Total liabilities and equity	8,284,379	7,868,461
Class A Common Stock, $0.01 par value, one vote per share; 180,000,000 shares authorized at September 30, 2019 and December 31, 2018; 75,696,850 and 75,240,513 shares issued and 56,663,012 and 56,349,327 shares outstanding (net of 19,033,838 and 18,891,186 shares in treasury) on September 30, 2019 and December 31, 2018, respectively
EQUITY:
Common Stock	757	752
Class B Common Stock, $0.01 par value, ten votes per share; 30,000,000 shares authorized at September 30, 2019 and December 31, 2018; 376,392 and 517,138 shares issued and outstanding on September 30, 2019 and December 31, 2018, respectively
EQUITY:
Common Stock	$ 4	$ 5

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Accumulated Other Comprehensive Income/(Loss)

9 Months Ended

Sep. 30, 2019

Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Loss

ACCUMULATED OTHER COMPREHENSIVE LOSS:

The following tables set forth the components of AOCL attributable to Genesee & Wyoming Inc. included in the consolidated balance sheets and consolidated statements of comprehensive income (dollars in thousands):

	Foreign Currency Translation Adjustment				Defined Benefit Plans				Net Unrealized Gain/(Loss) on Hedges				Accumulated Other Comprehensive Loss
Balance, December 31, 2018	$	(144,503	)		$	11,120			$	(13,073	)		$	(146,456	)
Other comprehensive loss before reclassifications	(24,026		)		—				(57,612		)		(81,638		)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit of ($26), $74 and $593, respectively	82			(a)	(94		)	(b)	(2,002		)	(c)	(2,014		)
Current period change	(23,944		)		(94		)		(59,614		)		(83,652		)
Balance, September 30, 2019	$	(168,447	)		$	11,026			$	(72,687	)		$	(230,108	)

	Foreign Currency Translation Adjustment			Defined Benefit Plans				Net Unrealized Gain/(Loss) on Hedges				Accumulated Other Comprehensive Loss
Balance, December 31, 2017	$	(74,617	)	$	(19,601	)		$	(11,316	)		$	(105,534	)
Other comprehensive income before reclassifications	(41,395		)	—				14,926				(26,469		)
Amounts reclassified from accumulated other comprehensive loss, net of tax (provision)/benefit of ($42) and $76, respectively	—			129			(b)	(232		)	(c)	(103		)
Current period change	(41,395		)	129				14,694				(26,572		)
Amounts reclassified from accumulated other comprehensive loss to retained earnings related to the United States Tax Cuts and Jobs Act	—			(132		)		(2,838		)		(2,970		)
Balance, September 30, 2018	$	(116,012	)	$	(19,604	)		$	540			$	(135,076	)

(a) Net gains realized were recorded in other income/(loss), net within the consolidated statements of operations.

(b) Net (losses)/gains realized were recorded in labor and benefits on the consolidated statements of operations.

(c) For the nine months ended September 30, 2019, $1.7 million and $0.3 million of net losses were recorded in interest expense and other income/(loss), net, respectively, within the consolidated statements of operations. For the nine months ended September 30, 2018, net losses realized were recorded in interest expense on the consolidated statements of operations. See Note 6, Derivative Financial Instruments.

Comprehensive Loss Attributable to Noncontrolling Interest

The following table sets forth comprehensive loss attributable to noncontrolling interest for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Net income attributable to noncontrolling interest	$	2,979		$	2,720		$	3,011		$	8,090
Other comprehensive income/(loss):
Foreign currency translation adjustment	(7,690		)	(4,804		)	(8,697		)	(17,647		)
Net unrealized (loss)/gain on qualifying cash flow hedges, net of tax benefit/(provision) of $21, $41, $654 and ($26), respectively	(48		)	(95		)	(1,525		)	62
Comprehensive loss attributable to noncontrolling interest	$	(4,759	)	$	(2,179	)	$	(7,211	)	$	(9,495	)

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Principles of Consolidation and Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidation, Policy [Policy Text Block]

The interim consolidated financial statements presented herein include the accounts of Genesee & Wyoming Inc. and its subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. These interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and are unaudited. They do not contain all disclosures which would be required in a full set of financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). In the opinion of management, the unaudited financial statements for the three and nine months ended September 30, 2019 and 2018 are presented on a basis consistent with the audited financial statements and contain all adjustments, consisting only of normal recurring adjustments, necessary to provide a fair statement of the results for the interim periods presented. The results of operations for interim periods are not necessarily indicative of results of operations for the full year. The consolidated balance sheet data for 2018 was derived from the audited financial statements in the Company's 2018 Annual Report on Form 10-K, but does not include all disclosures required by U.S. GAAP.

Foreign Currency Transactions and Translations Policy [Policy Text Block]

The results of operations of the foreign entities are maintained in the local currency of the respective subsidiary and translated into United States dollars at the applicable exchange rates for inclusion in the consolidated financial statements. As a result, any appreciation or depreciation of these currencies against the United States dollar will impact the Company's results of operations.

Derivatives, Policy [Policy Text Block]

The Company actively monitors its exposure to interest rate and foreign currency exchange rate risks and uses derivative financial instruments to manage the impact of risks associated with underlying interest rate and foreign exchange rate exposures. The Company's use of these derivative financial instruments may result in short-term gains or losses and increased earnings volatility. The instruments held by the Company are recorded in the consolidated balance sheets at fair value in prepaid expenses and other, other assets, accrued expenses or other long-term liabilities.

The Company may designate derivatives as a hedge of a forecasted transaction or a hedge of the variability of the cash flows to be received or paid in the future related to a recognized asset or liability (cash flow hedge). The portion of the changes in the fair value of the derivative used as a cash flow hedge that is offset by changes in the expected cash flows related to a recognized asset or liability is recorded in other comprehensive income/(loss) (OCI). Amounts recorded in OCI may be realized and reported in the consolidated statements of operations on the same line item as the hedged item in the event the hedged item is settled, did not or is no longer expected to occur or if the hedging relationship is no longer effective.

The Company may designate fair value hedges to mitigate foreign currency exchange rates on non-functional currency assets or liabilities. The Company uses the mark-to-market approach to remeasure the hedged item and the hedging instrument. The changes in the fair value of the hedged item is included in other income/(loss), net and are offset by changes in the fair value of the hedging instrument which are reported in the same income statement line item.

In addition, the Company may designate net investment hedges to reduce the impact of the variability of foreign currency exchange rates on its net investments in certain non-U.S. operations using cross-currency swaps. The Company measures the effectiveness of the hedge by offsetting the changes in the fair value of the cross-currency swap and the hedged asset or liability. Gains and losses on the after-tax effective portion of the net investment hedge are reported in currency translation adjustments where they remain until the investment is liquidated. The Company records the portion of the gain or loss on the hedging instrument that exceeds the gain or loss of the hedged item as an offset to the tax impact recognized during the period.

The Company matches the hedge instrument to the underlying hedged item (assets, liabilities, firm commitments or forecasted transactions). At inception of the hedge and at least quarterly thereafter, the Company assesses whether the derivatives used to hedge transactions are highly effective in offsetting changes in either the fair value or cash flows of the hedged item. When it is determined that a derivative instrument ceases to be a highly effective hedge of the underlying transaction, the Company discontinues hedge accounting, and any gains or losses on the derivative instrument thereafter are recognized in earnings during the period in which it no longer qualifies for hedge accounting. Gains and losses on any excluded components of derivatives designated as hedges are recorded in OCI and amortized to other income/(loss), net over the life of the hedge.

From time to time, the Company may enter into certain derivative instruments that may not be designated as hedges for accounting purposes. The Company believes such instruments are closely correlated with the underlying exposure, thus reducing the associated risk. The gains or losses from the changes in the fair value of derivative instruments not accounted for using hedge accounting are recognized in current period earnings within other income/(loss), net.

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Accounts Receivable (Tables)

9 Months Ended

Sep. 30, 2019

Accounts Receivable, Net [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable

Accounts receivable consisted of the following as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019			December 31, 2018
Accounts receivable – trade	$	395,512		$	397,255
Accounts receivable – grants from outside parties	24,677			19,376
Accounts receivable – insurance and other third-party claims	29,386			19,729
Total accounts receivable	449,575			436,360
Less: Allowance for doubtful accounts	(12,513		)	(10,055		)
Accounts receivable, net	$	437,062		$	426,305

Grant amortization offset to depreciation expense

The following table sets forth the offset to depreciation expense from the amortization of deferred grants recorded by the Company during the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Amortization of deferred grants	$	3,442	$	3,173	$	10,265	$	8,776