8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of Earliest Event Reported): May 1, 2007

Genesee & Wyoming Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-31456	06-0984624
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

66 Field Point Road, Greenwich, Connecticut06830

(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (203) 629-3722

Not Applicable

Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02. Results of Operations and Financial Condition

On May 1, 2007, Genesee & Wyoming Inc. (GWI) issued a press release reporting financial results for the first quarter of 2007. A copy of the press release is attached hereto as Exhibit 99.1. The attached Exhibit 99.1 is furnished in its entirety pursuant to this Item 2.02 and is incorporated herein by reference.

Item 8.01. Other Events

As previously disclosed in GWI's Form 10-K for the fiscal year ended December 31, 2006 (Form 10-K), in October 2005,  GWI's Mexican railroad operation, Compañía de Ferrocarriles Chiapas-Mayab, S.A. de C.V. (FCCM) was struck by Hurricane Stan with the most severe impact concentrated in the State of Chiapas between the town of Tonalá and the Guatemalan border. Approximately 70 bridges were damaged or destroyed, and various segments of track were washed out, rendering portions of the rail line inoperable absent reconstruction. There has been uncertainty as to whether sufficient funds would be available from the Mexican government to fund the reconstruction of the damaged rail line.

Although a definitive agreement with the Mexican government regarding the reconstruction of the rail line in Chiapas has not yet been reached, there have been non-binding agreements in principle relating to the following key items. First, the Mexican Ministry of Communications and Transportation (SCT), represented by the Undersecretary of Transportation, will seek to secure funds to rebuild the Chiapas line. Second, the SCT has agreed that if the rail line reconstruction is not completed by a specific date, GWI will have the right to sell the business back to the Mexican government for a pre-arranged price. Third, the SCT has agreed that the Mexican government will put in place insurance coverage related to catastrophic events. However, the details of the insurance coverage have not been finalized.

No assurance can be given that GWI will be able to obtain appropriate insurance protection or enter into satisfactory definitive agreements with the Mexican government. GWI'sinability to obtain appropriate insurance protection or finalize agreements to its satisfaction could result in our exiting Mexico. 

For additional information on GWI's Mexican operations, see the discussion under “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Overview-Mexico” and under “Risk Factors” in our Form 10-K.

ITEM 9.01. Financial Statements and Exhibits

(d) Exhibit.

99.1 Press release, dated May 1, 2007, announcing results for the first quarter of 2007

Forward-Looking Statements

Certain statements in this report that discuss GWI’s expectations are forward-looking statements within the meaning of the federal securities laws and are based upon GWI’s current belief as to the outcome of future events. Although GWI believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual results could differ materially from those set forth in the forward-looking statements. GWI cautions investors and potential investors not to place undue reliance on such statements and disclaims any intention to update the current expectations or forward-looking statements contained in this filing.

SIGNATURES

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

	GENESEE & WYOMING INC.
Date: May 1, 2007	By:	/s/ Timothy J. Gallagher
		Name: Timothy J. Gallagher
		Title: Chief Financial Officer

EX-99.1

Genesee & Wyoming Reports Results for the First Quarter of 2007

GREENWICH, Conn., May 1, 2007 /PRNewswire-FirstCall/ -- Genesee & Wyoming Inc. (GWI) (NYSE: GWR) reported that net income in the first quarter of 2007 increased 2.2% to $14.3 million, compared with net income of $14.0 million in the first quarter of 2006. GWI's diluted earnings per share (EPS) in the first quarter of 2007 increased 3.0% to $0.34 with 41.9 million shares outstanding, compared with diluted EPS of $0.33 with 42.4 million shares outstanding in the first quarter of 2006. Operating losses from GWI's hurricane-damaged Mexico operations reduced EPS by $0.03 in the first quarter of 2007 compared with no EPS impact in the first quarter of 2006. GWI also announced today that it had repurchased 1.5 million shares during the first quarter of 2007 at an average price of $25.30 per share.

Operating Results

In the first quarter of 2007, GWI's revenue increased 15.8% to $130.8 million, compared with $113.0 million in the first quarter of 2006. Revenue increased by $20.1 million due to acquisitions, primarily Genesee & Wyoming Australia Pty Ltd (GWA), partially offset by a same-railroad decrease in revenue of $2.3 million, of which $1.7 million was due to a decline in revenue from GWI's Mexico operations.

Same-railroad revenue in the U.S. and Canada decreased $0.6 million, as a $1.3 million increase in non-freight revenue, primarily due to new industrial switching contracts and higher revenue at GWI's port railroads, was more than offset by a $1.9 million decline in freight revenue. This decline in freight revenue was the result of a 7.3% decrease in carloads, partially offset by an increase in average revenue per carload of 5.3%. The decrease in freight revenue was principally composed of a $1.2 million decline in coal, a $0.8 million decline in lumber and forest products, and a $0.8 million decline in minerals and stone, partially offset by a net increase of $0.9 million in all other commodities. The increase in average revenue per car was due to higher rates of 7.0%, partially offset by a 0.8% decrease in fuel surcharges and a 0.9% decrease due to change in commodity mix. Including GWI's Mexico operations and the effect of acquisitions, average revenue per car increased 1.1%.

GWI's operating income in the first quarter of 2007 was $22.1 million, unchanged from the first quarter of 2006. The operating ratio was 83.1% in the first quarter of 2007, compared with an operating ratio of 80.5% in the first quarter of 2006. The operating ratio for the first quarter of 2007 was impacted by (i) a $1.4 million operating loss from GWI's Mexico operations, (ii) a tunnel fire in Oregon, which cost $0.7 million, and (iii) the higher operating ratio of the GWA acquisition (which includes low margin third-party fuel sales).

Free Cash Flow (dollars in millions) (1)

	Quarter Ended
	March 31,
	2007			2006
Net cash provided by operating activities	$	30.2		$	27.5
Net cash used in investing activities		(1.4	)		(6.3	)
Free cash flow	$	28.8		$	21.2

For the quarter ended March 31, 2007, GWI's operations generated net cash from operating activities of $30.2 million and free cash flow of $28.8 million. For the quarter ended March 31, 2006, GWI generated net cash from operating activities of $27.5 million and free cash flow of $21.2 million. Net cash used in investing activities in the first quarter of 2007 included $6.0 million in purchases of property and equipment, partially offset by $4.5 million in cash received from government grants and insurance proceeds for capital projects completed in 2006.

Comments from the Chief Executive Officer

Mortimer B. Fuller, Chairman and Chief Executive Officer of GWI, commented, "Our financial results for the first quarter of 2007 were slightly weaker than our outlook, primarily due to lower shipments of paper and forest products in our Oregon and Southern Regions. Elsewhere in the U.S. and in Canada, our business is performing well in the current economy. Meanwhile, South Australia continues to meet our expectations thanks to strength from the natural resources sector.

"We remain intensely engaged with the Mexican Government in reaching an agreement with respect to the rebuilding of the Chiapas line in Mexico. Reaching resolution is of the highest priority to GWI, and we expect to determine if we can reach a mutually acceptable agreement with the Mexican Government in the near term."

"Conference Call and Webcast Details"

As previously announced, GWI's conference call to discuss financial results for the first quarter will be held Tuesday, May 1, 2007, at 11:00 a.m. (Eastern Time). The dial-in number for the teleconference is 888-428-4480; outside U.S., call 651-291-5254, or the call may be accessed live over the Internet (listen only) under the "Investors" tab of GWI's website (http://www.gwrr.com), by selecting "First Quarter Earnings Audio Webcast." An audio replay of the conference call will be accessible via the Investors tab of GWI's website starting at 2:30 p.m. Tuesday, May 1, 2007.

About Genesee & Wyoming Inc.

GWI is a leading operator of short line and regional freight railroads in the United States, Canada, Mexico, Australia and Bolivia. Operations currently include 48 railroads organized in 10 regions, as well as service at 12 U.S. ports, contract coal loading and industrial switching. GWI operates more than 6,800 miles of owned and leased track and approximately 3,700 additional miles under track access arrangements.

Cautionary Statement Concerning Forward-Looking Statements

This press release contains forward-looking statements regarding future events and the future performance of Genesee & Wyoming Inc. that involve risks and uncertainties that could cause actual results to differ materially from its current expectations including, but not limited to, economic conditions, customer demand, increased competition in relevant markets, and others. GWI refers you to the documents that it files from time to time with the Securities and Exchange Commission, such as GWI's Forms 10-Q and 10-K which contain additional important factors that could cause its actual results to differ from its current expectations and from the forward-looking statements contained in this press release. GWI disclaims any intention to update the current expectations or forward-looking statements contained in this press release.

(1) Management views Free Cash Flow, as reconciled within this earnings release, as an important financial measure of how well GWI is managing its assets. Subject to the limitations discussed below, Free Cash Flow is a useful indicator of cash flow that may be available for discretionary use by GWI. Free Cash Flow is defined as Net Cash Provided by Operating Activities less Net Cash Used in/Provided by Investing Activities, excluding the Cost of Acquisitions/Proceeds from Divestitures. Key limitations of the Free Cash Flow measure include the assumptions that GWI will be able to refinance its existing debt when it matures and meet other cash flow obligations from financing activities, such as required dividend payments and principal payments on debt. Free Cash Flow is not intended to represent, and should not be considered more meaningful than, or as an alternative to, measures of cash flow determined in accordance with Generally Accepted Accounting Principles (GAAP).

Contact:

Michael Williams of GWI Corporate Communications

1-203-629-3722

mwilliams@gwrr.com

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(unaudited)

	Three Months Ended
	March 31,
	2007			2006
OPERATING REVENUES	$	130,827		$	112,982
OPERATING EXPENSES		108,758			90,922
INCOME FROM OPERATIONS		22,069			22,060
EQUITY INCOME OF UNCONSOLIDATED
INTERNATIONAL AFFILIATES		-			2,007
INTEREST INCOME		3,363			100
INTEREST EXPENSE		(3,823	)		(5,008	)
OTHER (EXPENSE) INCOME, NET		(83	)		445
INCOME BEFORE INCOME TAXES		21,526			19,604
PROVISION FOR INCOME TAXES		7,206			5,590
NET INCOME	$	14,320		$	14,014
BASIC EARNINGS PER COMMON SHARE	$	0.38		$	0.38
WEIGHTED AVERAGE SHARES - BASIC		37,270			37,326
DILUTED EARNINGS PER COMMON SHARE	$	0.34		$	0.33
WEIGHTED AVERAGE SHARES -
DILUTED		41,861			42,411

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

	March 31,		December 31,
ASSETS	2007		2006
CURRENT ASSETS:
Cash and cash equivalents	$	235,846	$	240,206
Accounts receivable, net		106,181		117,099
Materials and supplies		11,971		11,302
Prepaid expenses and other		16,030		14,695
Deferred income tax assets, net		7,604		7,617
Total current assets		377,632		390,919
PROPERTY AND EQUIPMENT, net		573,784		573,292
INVESTMENT IN UNCONSOLIDATED AFFILIATES		4,588		4,644
GOODWILL		37,874		37,788
INTANGIBLE ASSETS, net		119,778		120,669
DEFERRED INCOME TAX ASSETS, net		2,387		2,697
OTHER ASSETS, net		10,516		11,055
Total assets	$	1,126,559	$	1,141,064
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt	$	15,653	$	4,372
Accounts payable		97,802		98,186
Accrued expenses		35,057		38,364
Income tax payable - Australia		95,073		91,925
Deferred income tax liabilities, net		443		291
Total current liabilities		244,028		233,138
LONG-TERM DEBT, less current portion		229,866		241,313
DEFERRED INCOME TAX LIABILITIES, net		75,212		72,876
DEFERRED ITEMS - grants from governmental agencies		58,004		56,588
OTHER LONG-TERM LIABILITIES		17,042		16,962
TOTAL STOCKHOLDERS' EQUITY		502,407		520,187
Total liabilities and
stockholders' equity	$	1,126,559	$	1,141,064

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

	Three Months Ended March 31,
	2007			2006
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	14,320		$	14,014
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		7,894			7,311
Amortization of restricted stock and units		329			143
Compensation cost related to stock options		877			877
Excess tax benefits from share-based compensation		(420	)		(2,341	)
Deferred income taxes		2,752			4,547
Net gain on sale and impairment of assets		(50	)		(94	)
Equity income of unconsolidated international affiliates, net of tax		-			(1,415	)
Changes in assets and liabilities which provided (used) cash, net of effect of acquisitions:
Accounts receivable, net		7,781			1,216
Materials and supplies		(613	)		22
Prepaid expenses and other		(1,288	)		(520	)
Accounts payable and accrued expenses		(3,316	)		4,004
Income tax payable - Australia		930			-
Other assets and liabilities,net		957			(308	)
Net cash provided by operating activities		30,153			27,456
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net of government grants		(2,886	)		(6,592	)
Insurance proceeds for the replacement of assets		1,422			-
Valuation adjustment of split dollar life insurance		37			12
Proceeds from disposition of property and equipment		79			306
Net cash used in investing activities		(1,348	)		(6,274	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term
borrowings, including capital
leases		(458	)		(77,208	)
Proceeds from issuance of
long-term debt		-			53,500
Net proceeds from employee stock
purchases		1,552			2,365
Treasury stock purchases		(37,370	)		-
Excess tax benefits from
share-based compensation		420			2,341
Net cash used in financing
activities		(35,856	)		(19,002	)
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS		2,691			(543	)
(DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS		(4,360	)		1,637
CASH AND CASH EQUIVALENTS, beginning
of period		240,206			18,669
CASH AND CASH EQUIVALENTS, end of
period	$	235,846		$	20,306

 

GENESEE & WYOMING INC. AND SUBSIDIARIES

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(dollars in thousands)

(unaudited)

	Three Months Ended
	March 31,
	2007						2006
				% of						% of
	Amount			Revenue			Amount			Revenue
Revenues:
Freight	$	88,634			67.7	%	$	85,514			75.7	%
Non-freight		42,193			32.3	%		27,468			24.3	%
Total revenues	$	130,827			100.0	%	$	112,982			100.0	%
Operating Expense Comparison:
Natural Classification
Labor and benefits	$	43,207			33.0	%	$	37,191			32.9	%
Equipment rents		9,902			7.6	%		9,906			8.8	%
Purchased services		10,249			7.8	%		7,351			6.5	%
Depreciation and amortization		7,894			6.0	%		7,311			6.5	%
Diesel fuel used in operations		11,500			8.8	%		11,276			10.0	%
Diesel fuel sold to third parties		4,942			3.8	%		-			0.0	%
Casualties and insurance		5,219			4.0	%		2,783			2.5	%
Materials		6,484			5.0	%		5,795			5.1	%
Net gain on sale and impairment of
assets		(50	)		0.0	%		(94	)		-0.1	%
Other expenses		9,411			7.1	%		9,403			8.3	%
Total operating expenses	$	108,758			83.1	%	$	90,922			80.5	%
Functional Classification
Transportation	$	42,362			32.4	%	$	38,400			34.0	%
Maintenance of ways and structures		11,907			9.1	%		9,926			8.8	%
Maintenance of equipment		19,087			14.6	%		16,432			14.5	%
Diesel fuel sold to third parties		4,942			3.8	%		-			0.0	%
General and administrative		22,616			17.2	%		18,947			16.8	%
Net gain on sale and impairment of
assets		(50	)		0.0	%		(94	)		-0.1	%
Depreciation and amortization		7,894			6.0	%		7,311			6.5	%
Total operating expenses	$	108,758			83.1	%	$	90,922			80.5	%

GENESEE & WYOMING INC. AND SUBSIDIARIES

RAILROAD FREIGHT REVENUE, CARLOADS AND AVERAGE REVENUE PER CARLOAD

COMPARISON BY COMMODITY GROUP

(dollars in thousands, except average revenue per carload)

(unaudited)

		Three Months Ended March 31, 2007					Three Months Ended March 31, 2006
Commodity Group		Freight Revenues	Carloads		Average Revenue Per Carload		Freight Revenues	Carloads		Average Revenue Per Carload
Pulp & Paper	$	17,528	32,057	$	547	$	17,399	35,362	$	492
Coal, Coke & Ores		15,877	49,116		323		17,024	51,695		329
Farm & Food Products		10,584	23,502		450		6,135	16,210		378
Metals		9,157	20,018		457		9,401	22,392		420
Lumber & Forest Products		8,758	20,942		418		9,529	25,432		375
Minerals & Stone		8,752	29,992		292		8,199	20,039		409
Chemicals-Plastics		6,253	10,568		592		6,239	10,999		567
Petroleum Products		6,189	8,227		752		6,451	8,562		753
Autos & Auto Parts		1,837	3,605		509		1,666	3,434		485
Intermodal		282	537		525		451	1,035		436
Other		3,417	15,469		221		3,020	13,614		222
Totals	$	88,634	214,033		414	$	85,514	208,774		410

SOURCE Genesee & Wyoming Inc.
-0-	05/01/2007
/CONTACT: Michael Williams of GWI Corporate Communications,
+1-203-629-3722, mwilliams@gwrr.com/
/Web site: http://www.gwrr.com/
(GWR)