Unassociated Document

Genesee & Wyoming Reports Results for the Third Quarter of 2009

GREENWICH, Conn., November 3, 2009/PRNewswire-FirstCall/ -- Genesee & Wyoming Inc. (GWI) (NYSE: GWR) reported net income in the third quarter of 2009 of $21.7 million, compared with net income of $21.2 million in the third quarter of 2008. GWI's diluted earnings per share (EPS) in the third quarter of 2009 were $0.53 with 41.2 million weighted average shares outstanding, compared with diluted EPS of $0.58 with 36.6 million weighted average shares outstanding in the third quarter of 2008.

GWI’s income from continuing operations in the third quarter of 2009 was $19.6 million, or $0.48 per diluted share, compared with income from continuing operations of $20.1 million, or $0.55 per diluted share in the third quarter of 2008.

In the third quarter of 2009, GWI completed the sale of both its Mexican operations and Bolivian investment. The sale of GWI’s Mexican operations resulted in a gain of $2.2 million ($2.4 million after-tax, or $0.06 per diluted share) in discontinued operations and GWI realized total cash proceeds of $2.2 million. The sale of GWI’s Bolivian investment resulted in a gain of $0.4 million ($0.4 million after-tax, or $0.01 per diluted share) from continuing operations and cash proceeds of $3.8 million.

Results from Continuing Operations

In the third quarter of 2009, GWI's total revenues decreased $23.0 million, or 14.4%, to $136.4 million, compared with $159.4 million in the third quarter of 2008. The decrease in total revenues was primarily due to a decrease in same railroad revenues of $35.9 million, or 22.5%, partially offset by revenues of $12.9 million from acquisitions. The decrease in same railroad revenues included a $2.2 million decrease due to the depreciation of the Australian and Canadian dollars and the Euro versus the U.S. dollar and a $6.7 million decrease due to a decline in third-party fuel sales. Excluding currency and fuel sales, GWI’s same railroad revenues declined $27.0 million, or 16.9%.

Freight revenues in the third quarter of 2009 decreased by $12.4 million, or 13.0%, to $83.2 million, compared with $95.6 million in the third quarter of 2008. Same railroad freight revenues decreased $23.8 million, partially offset by $11.3 million in freight revenues from acquisitions. Same railroad freight revenues were reduced by $1.0 million due to the depreciation of the Australian and Canadian dollars. Excluding currency, GWI’s same railroad freight revenues decreased by $22.8 million, or 23.8%.

Average freight revenues per carload declined 10.0% in the third quarter of 2009. The impact of lower fuel surcharges, changes in commodity mix, acquisitions and the depreciation of the Canadian and Australian dollars reduced average revenues per carload by 8.7%, 1.4%, 1.2% and 1.0%, respectively. Excluding these factors, same railroad average revenues per carload increased 2.4%. In the United States and Canada, excluding currency effects, changes in commodity mix and changes in fuel surcharges, same railroad average revenues per carload increased 2.8%. Decreases in the rail cost adjustment factor (RCAF), a measure of railroad inflation published by the Association of American Railroads to which certain contract freight rates are indexed, had the impact of reducing U.S. and Canada same railroad average revenues per carload by approximately 1%.

GWI’s non-freight revenues in the third quarter of 2009 decreased $10.5 million, or 16.5%, to $53.3 million compared with $63.8 million in the third quarter of 2008. Same railroad non-freight revenues decreased $12.1 million, or 19.0%, partially offset by $1.6 million in non-freight revenues from acquisitions. The decrease in same railroad non-freight revenues included a $1.2 million decrease due to the depreciation of the Australian and Canadian dollars and the Euro versus the U.S. dollar and a $6.7 million decrease due to a decline in third-party fuel sales. Excluding currency and fuel sales, GWI’s same railroad non-freight revenues decreased $4.2 million, or 6.6%.

GWI's operating income in the third quarter of 2009 decreased $3.5 million, or 10.0%, to $31.1 million, compared with $34.6 million in the third quarter of 2008. The operating ratio was 77.2% in the third quarter of 2009, compared with an operating ratio of 78.3% in the third quarter of 2008. In the third quarter of 2009, operating income benefited $2.6 million ($1.7 million after-tax, or $0.04 per diluted share) due to insurance recoveries related to prior year events. In the third quarter of 2008, operating income included $1.2 million in gains on the sale of assets ($0.8 million after-tax, or $0.02 per diluted share). Excluding these items, GWI’s operating ratio was 79.1% in the third quarter of 2009 and 2008. (1)

Comments from the Chief Executive Officer

John C. Hellmann, President and CEO of GWI, commented, “Despite an extremely weak economic environment, we continue to manage our costs well and to generate strong free cash flow. In the third quarter, we maintained an operating ratio of 79% despite significant volume declines, and we are focused on ensuring that our productivity improvements remain intact when the economy improves. Meanwhile, we believe that the 5% increase in our revenues from the second quarter to the third quarter is indicative of a growing degree of economic stability.”

Mr. Hellmann continued, “We remain active in evaluating investment opportunities in both North America and Australia. Given the strength of our balance sheet, we are well positioned to execute quickly on the right transactions.”

Free Cash Flow from Continuing Operations (2)

($ in millions)	Nine Months Ended September 30,
	2009			2008
Net cash provided by operating activities	$	88.4		$	93.7
Net cash used in investing activities		(35.3	)		(148.5	)
Net cash paid/(received) for acquisitions/divestitures (a)		2.0			115.7
Free cash flow (2)	$	55.1		$	60.9

(a) The 2009 period includes: 1) $4.8 million in net cash paid for final working capital adjustments related to the acquisition of the Ohio Central Railroad System (OCR), 2) $1.0 million in net cash paid in contingent consideration related to the Rotterdam Rail Feeding B.V. (RRF) acquisition and 3) $3.8 million in cash received from the sale of Bolivia. The 2008 period includes 1) $89.5 million in net cash paid for the acquisition of CAGY Industries Inc. (CAGY), 2) $22.6 million in net cash paid for the acquisition of Rotterdam Rail Feeding (RRF) and 3) $3.6 million for final working capital adjustments related to the December 2007 acquisition of Maryland Midland Railway, Inc. (MMID).

GWI’s continuing operations generated free cash flow of $55.1 million and $60.9 million for the nine months ended September 30, 2009 and 2008, respectively. For the nine months ended September 30, 2009, changes in working capital increased net cash flow from operating activities by $3.8 million. For the nine months ended September 30, 2008, changes in working capital increased net cash flow from operating activities by $11.5 million.

Net cash used in investing activities for the quarter ended September 30, 2009, included $60.0 million in purchases of property and equipment, partially offset by $16.5 million in cash received from government grants and $10.2 million from sales of assets and insurance proceeds. Net cash used in investing activities in the nine months ended September 30, 2008, included $62.0 million in purchases of property and equipment, partially offset by $21.8 million in cash received from government grants and $7.4 million from sales of assets and insurance proceeds.

Discontinued Operations

For the quarter ended September 30, 2009, GWI reported income related to its discontinued Mexican business of $2.0 million after-tax (or $0.05 per diluted share), compared with income of $1.1 million after-tax (or $0.03 per diluted share) for the quarter ended September 30, 2008. Results from discontinued operations in the third quarter of 2009 included a net gain on the sale of 100% of the share capital of its Mexican subsidiary, Ferrocarriles Chiapas-Mayab, S.A. de C.V. (FCCM). Results from discontinued operations in the third quarter of 2008 included a tax benefit of $0.9 million ($0.02 per diluted share) primarily associated with the filing of GWI's 2007 U.S. income tax return.

Conference Call and Webcast Details

As previously announced, GWI's conference call to discuss financial results for the third quarter will be held Tuesday, November 3, 2009, at 11:00 a.m. (Eastern Time). The dial-in number for the teleconference is (800) 230 1092; outside U.S., call (612) 234-9960, 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 "Third Quarter Earnings Audio Webcast." Management will be referring to a slide presentation that will also be available under the “Investors” tab of GWI’s website prior to the conference call. An audio replay of the conference call will be accessible via the “Investors” tab of GWI's website starting at 1:00 p.m. Tuesday, November 3, 2009. Telephone replay is available for 30 days beginning at 12 p.m. EDT on November 3, 2009, by dialing (800) 475-6701 (or outside U.S., dial (320) 365-3844). The access code is 974251.

About Genesee & Wyoming Inc.

GWI owns and operates short line and regional freight railroads in the United States, Canada, Australia and the Netherlands. Operations currently include 62 railroads organized in nine regions, with more than 6,000 miles of owned and leased track and approximately 3,100 additional miles under track access arrangements. GWI provides rail service at 16 ports in North America and Europe and performs contract coal loading and railcar switching for industrial customers.

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, political and industry conditions; customer demand, retention and contract continuation; legislative and regulatory developments; increased competition in relevant markets; funding needs and financing sources; susceptibility to various legal claims and lawsuits; strikes or work stoppages; severe weather conditions and other natural occurrences; and others. Words such as "anticipates," "intends," "plans," "believes," "seeks," "expects," "estimates," variations of these words and similar expressions are intended to identify these forward-looking statements. 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) The operating ratios that exclude the items described above are non-GAAP financial measures and are not intended to replace the operating ratios calculated using total operating expenses and total revenues, calculated on a basis consistent with GAAP. The information required by Regulation G under the Securities Exchange Act of 1934, including reconciliation to the operating ratios calculated using amounts determined in accordance with GAAP, is included in the tables attached to this press release.

(2) Free Cash Flow is a non-GAAP financial measure and is not intended to replace net cash provided by operating activities, its most directly comparable GAAP measure. The information required by Regulation G under the Securities Exchange Act of 1934, including a reconciliation to net cash provided by operating activities is included in the tables attached to this press release.

SOURCE: Genesee & Wyoming Inc.

Michael Williams of GWI Corporate Communications

1-203-629-3722

mwilliams@gwrr.com

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008

(In thousands, except per share amounts)

(unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2009			2008			2009			2008

OPERATING REVENUES	$	136,446		$	159,432		$	404,959		$	452,828

OPERATING EXPENSES		105,331			124,866			333,104			367,281
INCOME FROM OPERATIONS		31,115			34,566			71,855			85,547

GAIN ON SALE OF INVESTMENT IN BOLIVIA		427			-			427			-
INTEREST INCOME		252			597			677			1,753
INTEREST EXPENSE		(6,376	)		(4,250	)		(20,650	)		(12,203	)
OTHER INCOME/(EXPENSE), NET		665			(99	)		1,909			560

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		26,083			30,814			54,218			75,657

PROVISION FOR INCOME TAXES		6,361			10,686			12,397			28,082

INCOME FROM CONTINUING OPERATIONS		19,722			20,128			41,821			47,575

INCOME/(LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX		2,017			1,087			1,348			(487	)

NET INCOME		21,739			21,215			43,169			47,088

LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST		(78	)		(61	)		(146	)		(146	)

NET INCOME ATTRIBUTABLE TO GENESEE & WYOMING INC.	$	21,661		$	21,154		$	43,023		$	46,942

BASIC EARNINGS PER SHARE ATTRIBUTABLE TO GENESEE & WYOMING INC. COMMON STOCKHOLDERS:
BASIC EARNINGS PER COMMON SHARE FROM CONTINUING OPERATIONS	$	0.51		$	0.63		$	1.18		$	1.49
BASIC EARNINGS/(LOSS) PER COMMON SHARE FROM DISCONTINUED OPERATIONS		0.05			0.03			0.04			(0.02	)
BASIC EARNINGS PER COMMON SHARE	$	0.56		$	0.66		$	1.22		$	1.48

WEIGHTED AVERAGE SHARES - BASIC		38,388			32,018			35,328			31,758

DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO GENESEE & WYOMING INC. COMMON STOCKHOLDERS:
DILUTED EARNINGS PER COMMON SHARE FROM CONTINUING OPERATIONS	$	0.48		$	0.55		$	1.09		$	1.31
DILUTED EARNINGS/(LOSS) PER COMMON SHARE FROM DISCONTINUED OPERATIONS		0.05			0.03			0.04			(0.01	)
DILUTED EARNINGS PER COMMON SHARE	$	0.53		$	0.58		$	1.13		$	1.29

WEIGHTED AVERAGE SHARES - DILUTED		41,183			36,592			38,163			36,334

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2009 AND DECEMBER 31, 2008

(In thousands)

(unaudited)

	September 30,		December 31,
ASSETS	2009		2008

CURRENT ASSETS:
Cash and cash equivalents	$	96,018	$	31,693
Accounts receivable, net		111,918		120,874
Materials and supplies		8,145		7,708
Prepaid expenses and other		10,948		12,270
Current assets of discontinued operations		738		1,676
Deferred income tax assets, net		18,161		18,101
Total current assets		245,928		192,322

PROPERTY AND EQUIPMENT, net		1,004,624		998,995
INVESTMENT IN UNCONSOLIDATED AFFILIATES		1,639		4,986
GOODWILL		161,403		150,958
INTANGIBLE ASSETS, net		246,300		223,442
DEFERRED INCOME TAX ASSETS, net		3,206		-
OTHER ASSETS, net		16,535		16,578
Total assets	$	1,679,635	$	1,587,281

LIABILITIES AND EQUITY

CURRENT LIABILITIES:
Current portion of long-term debt	$	27,361	$	26,034
Accounts payable		116,115		124,162
Accrued expenses		41,983		37,903
Current liabilities of discontinued operations		22		1,121
Deferred income tax liabilities, net		-		192
Total current liabilities		185,481		189,412

LONG-TERM DEBT, less current portion		428,398		535,231
DEFERRED INCOME TAX LIABILITIES, net		241,733		234,979
DEFERRED ITEMS - grants from outside parties		134,503		113,302
OTHER LONG-TERM LIABILITIES		24,334		34,943

TOTAL EQUITY		665,186		479,414
Total liabilities and equity	$	1,679,635	$	1,587,281

GENESEE & WYOMING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008

(In thousands)

(unaudited)

	Nine Months Ended September 30,
	2009			2008

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	43,169		$	47,088
Adjustments to reconcile net income to net cash provided
by operating activities:
(Income)/Loss from discontinued operations, net of tax		(1,348	)		487
Depreciation and amortization		35,473			28,871
Compensation cost related to equity awards		4,227			4,163
Excess tax benefits from share-based compensation		(1,173	)		(1,830	)
Deferred income taxes		890			7,549
Net loss/(gain) on sale and impairment of assets		4,746			(3,817	)
Gain on insurance recoveries		(3,144	)		(399	)
Insurance proceeds received		2,175			-
Gain on sale of investment in Bolivia		(427	)		-
Changes in assets and liabilities which provided (used) cash, net of effect of acquisitions:
Accounts receivable, net		9,481			(13,089	)
Materials and supplies		514			(662	)
Prepaid expenses and other		1,595			8,968
Accounts payable and accrued expenses		(7,269	)		12,356
Other assets and liabilities, net		(523	)		3,972
Net cash provided by operating activities from continuing operations		88,386			93,657
Net cash used in operating activities from discontinued operations		(275	)		(2,815	)
Net cash provided by operating activities		88,111			90,842

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(59,977	)		(61,999	)
Grant proceeds from outside parties		16,530			21,832
Cash paid for acquisitions, net		(5,780	)		(115,699	)
Insurance proceeds for the replacement of assets		3,996			419
Proceeds from sale of investment in Bolivia		3,771			-
Proceeds from disposition of property and equipment		6,196			6,992
Net cash used in investing activities from continuing operations		(35,264	)		(148,455	)
Net cash provided by investing activities from discontinued operations		1,774			-
Net cash used in investing activities		(33,490	)		(148,455	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term borrowings, including capital leases		(207,221	)		(117,905	)
Proceeds from issuance of long-term debt		98,000			163,000
Net proceeds from employee stock purchases		5,307			9,122
Treasury stock purchases		(434	)		(2,355	)
Stock issuance proceeds, net of stock issuance costs		106,641			-
Excess tax benefits from share-based compensation		1,173			1,830
Net cash provided by financing activities from continuing operations		3,466			53,692

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		6,130			(2,907	)

CHANGE IN CASH BALANCES INCLUDED IN CURRENT ASSETS OF DISCONTINUED OPERATIONS		108			(348	)

INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS		64,325			(7,176	)
CASH AND CASH EQUIVALENTS, beginning of period		31,693			46,684
CASH AND CASH EQUIVALENTS, end of period	$	96,018		$	39,508

GENESEE & WYOMING INC. AND SUBSIDIARIES

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(dollars in thousands)

(unaudited)

	Three Months Ended
	September 30,
	2009						2008
				% of						% of
	Amount			Revenue			Amount			Revenue
Revenues:
Freight	$	83,160			60.9	%	$	95,602			60.0	%
Non-freight		53,286			39.1	%		63,830			40.0	%

Total revenues	$	136,446			100.0	%	$	159,432			100.0	%

Operating Expense Comparison:
Natural Classification
Labor and benefits	$	45,722			33.5	%	$	48,409			30.4	%
Equipment rents		7,447			5.5	%		9,121			5.7	%
Purchased services		10,999			8.1	%		11,975			7.5	%
Depreciation and amortization		12,050			8.8	%		10,219			6.4	%
Diesel fuel used in operations		7,921			5.8	%		15,948			10.0	%
Diesel fuel sold to third parties		3,603			2.6	%		9,947			6.2	%
Casualties and insurance		4,243			3.1	%		3,803			2.4	%
Materials		5,201			3.8	%		6,211			3.9	%
Net loss (gain) on sale and impairment of assets		96			0.1	%		(1,185	)		(0.7	%)
Gain on insurance recoveries		(2,644	)		(1.9	%)		-			0.0	%
Other expenses		10,693			7.8	%		10,418			6.5	%

Total operating expenses	$	105,331			77.2	%	$	124,866			78.3	%

Functional Classification
Transportation		41,430			30.3	%	$	51,897			32.6	%
Maintenance of ways and structures		12,811			9.4	%		12,535			7.9	%
Maintenance of equipment		16,201			11.9	%		18,084			11.3	%
Diesel fuel sold to third parties		3,603			2.6	%		9,947			6.2	%
General and administrative		21,784			16.0	%		23,369			14.6	%
Net loss (gain) on sale and impairment of assets		96			0.1	%		(1,185	)		(0.7	%)
Gain on insurance recoveries		(2,644	)		(1.9	%)		-			0.0	%
Depreciation and amortization		12,050			8.8	%		10,219			6.4	%

Total operating expenses	$	105,331			77.2	%	$	124,866			78.3	%

GENESEE & WYOMING INC. AND SUBSIDIARIES

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(dollars in thousands)

(unaudited)

	Nine Months Ended
	September 30,
	2009						2008
				% of						% of
	Amount			Revenue			Amount			Revenue
Revenues:
Freight	$	251,622			62.1	%	$	274,749			60.7	%
Non-freight		153,337			37.9	%		178,079			39.3	%

Total revenues	$	404,959			100.0	%	$	452,828			100.0	%

Operating Expense Comparison:
Natural Classification
Labor and benefits	$	143,654			35.5	%	$	140,820			31.1	%
Equipment rents		22,240			5.5	%		26,262			5.8	%
Purchased services		30,316			7.5	%		35,602			7.9	%
Depreciation and amortization		35,473			8.7	%		28,871			6.4	%
Diesel fuel used in operations		24,265			6.0	%		49,311			10.9	%
Diesel fuel sold to third parties		10,096			2.5	%		28,893			6.4	%
Casualties and insurance		10,707			2.6	%		11,841			2.6	%
Materials		16,552			4.1	%		18,808			4.1	%
Net loss (gain) on sale and impairment of assets		4,746			1.2	%		(3,817	)		(0.8	%)
Gain on insurance recoveries		(3,144	)		(0.8	%)		(399	)		(0.1	%)
Restructuring charges		2,288			0.6	%		-			0.0	%
Other expenses		35,911			8.9	%		31,089			6.8	%

Total operating expenses	$	333,104			82.3	%	$	367,281			81.1	%

Functional Classification
Transportation	$	124,501			30.7	%	$	152,629			33.7	%
Maintenance of ways and structures		39,580			9.8	%		38,698			8.5	%
Maintenance of equipment		49,704			12.3	%		53,954			11.9	%
Diesel fuel sold to third parties		10,096			2.5	%		28,893			6.4	%
General and administrative		69,860			17.3	%		68,452			15.1	%
Net loss (gain) on sale and impairment of assets		4,746			1.2	%		(3,817	)		(0.8	%)
Gain on insurance recoveries		(3,144	)		(0.8	%)		(399	)		(0.1	%)
Restructuring charges		2,288			0.6	%		-			0.0	%
Depreciation and amortization		35,473			8.7	%		28,871			6.4	%

Total operating expenses	$	333,104			82.3	%	$	367,281			81.1	%

GENESEE & WYOMING INC. AND SUBSIDIARIES

RAILROAD FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD

COMPARISON BY COMMODITY GROUP

(dollars in thousands, except average revenues per carload)

(unaudited)

	Three Months Ended						Three Months Ended
	September 30, 2009						September 30, 2008
	Freight				Average Revenues		Freight				Average Revenues
Commodity Group	Revenues		Carloads		Per Carload		Revenues		Carloads		Per Carload

Coal, Coke & Ores	$	17,116		49,720	$	344	$	17,223		48,259	$	357
Pulp & Paper		12,794		22,385		572		19,180		30,705		625
Minerals & Stone		10,867		36,459		298		12,952		37,797		343
Farm & Food Products		8,575		16,963		506		8,247		15,161		544
Metals		8,432		18,148		465		12,529		25,330		495
Chemicals-Plastics		8,251		11,891		694		8,650		12,649		684
Lumber & Forest Products		7,485		16,813		445		9,319		20,539		454
Petroleum Products		4,357		6,522		668		4,382		6,434		681
Autos & Auto Parts		1,191		1,921		620		1,719		2,422		710
Other		4,092		16,265		252		1,401		4,757		295

Totals	$	83,160		197,087	$	422	$	95,602		204,053	$	469

GENESEE & WYOMING INC. AND SUBSIDIARIES

RAILROAD FREIGHT REVENUES, CARLOADS AND AVERAGE REVENUES PER CARLOAD

COMPARISON BY COMMODITY GROUP

(dollars in thousands, except average revenues per carload)

(unaudited)

	Nine Months Ended						Nine Months Ended
	September 30, 2009						September 30, 2008
	Freight				Average Revenues		Freight				Average Revenues
Commodity Group	Revenues		Carloads		Per Carload		Revenues		Carloads		Per Carload

Coal, Coke & Ores	$	53,962		150,272	$	359	$	49,457		135,213	$	366
Pulp & Paper		38,340		68,348		561		55,991		91,625		611
Minerals & Stone		29,546		103,030		287		33,909		106,491		318
Farm & Food Products		28,603		65,671		436		29,291		51,529		568
Metals		25,644		52,986		484		32,723		65,611		499
Chemicals-Plastics		24,487		36,929		663		24,121		36,173		667
Lumber & Forest Products		21,011		46,727		450		25,958		58,179		446
Petroleum Products		14,645		21,320		687		13,630		20,221		674
Autos & Auto Parts		3,483		5,684		613		5,622		9,200		611
Other		11,900		48,748		244		4,047		15,794		256

Totals	$	251,621		599,715	$	420	$	274,749		590,036	$	466

Reconciliation of non-GAAP Financial Measures

This earnings release contains adjusted operating ratios and free cash flow, which are "non-GAAP financial measures" as this term is defined in Regulation G of the Securities Exchange Act of 1934. In accordance with Regulation G, GWI has reconciled these non-GAAP financial measures to its most directly comparable U.S. GAAP measure.

Adjusted Operating Ratios Description and Discussion

Management views its Operating Ratio, calculated as total Operating Expenses divided by total Revenues, as an important measure of GWI’s operating performance. Because management believes this is useful for investors in assessing GWI’s financial results compared with the same period in the prior year, the Adjusted Operating Ratio for the three months ended September 30, 2009, is presented excluding net (loss) gain on sale and impairment of assets and gain on insurance recoveries and for the three months ended September 30, 2008, is presented excluding net gain on the sale of assets. The Adjusted Operating Ratios presented excluding these effects are not intended to represent, and should not be considered more meaningful than, or as an alternative to, the Operating Ratios calculated using amounts in accordance with GAAP.

The following table sets forth a reconciliation of GWI’s Operating Ratios calculated using amounts determined in accordance with GAAP to the Adjusted Operating Ratios described above for the three months ended September 30, 2009 and 2008 ($ in millions):

2009	Total Revenues		Total Operating Expenses			Operating Income			Operating Ratio
As Reported	$	136.4	$	105.3		$	31.1			77.2	%
Gain on insurance recoveries		-		2.6			(2.6	)
Net (loss) gain on sale and impairment of assets		-		(0.1	)		0.1
Adjusted	$	136.4	$	107.9		$	28.5			79.1	%

2008	Total Revenues		Total Operating Expenses		Operating Income			Operating Ratio
As Reported	$	159.4	$	124.9	$	34.6			78.3	%
Net gain on sale of assets		-		1.2		(1.2	)
Adjusted	$	159.4	$	126.1	$	33.4			79.1	%

Free Cash Flow Description and Discussion

Management views Free Cash Flow 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 from Continuing Operations less Net Cash Used in Investing Activities from Continuing Operations, excluding the cost of acquisitions and 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 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 GAAP.

The following table sets forth a reconciliation of GWI's Net Cash Provided by Operating Activities from Continuing Operations to GWI's Free Cash Flow ($ in millions):

	Nine Months Ended September 30,
($ in millions)	2009			2008

Net cash provided by operation activities from continuing operations	$	88.4		$	93.7
Net cash used in investing activities from continuing operations		(35.3	)		(148.5	)
Net cash paid/(received) for acquisitions/divestitures		2.0			115.7
Free cash flow	$	55.1		$	60.9

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

66 Field Point Road, Greenwich, Connecticut		06830
(Address of principal executive offices)		(Zip Code)

	GENESEE & WYOMING INC.

November 3, 2009	By:	/s/ Timothy J. Gallagher
		Name: Timothy J. Gallagher
		Title: Chief Financial Officer