RailAmerica Completes Acquisition of Central Michigan Railway Company.Business Editors
BOCA RATON, Fla.--(BUSINESS WIRE)--Jan. 26, 2004
RailAmerica, Inc. (NYSE NYSE
See: New York Stock Exchange :RRA RRA Registered Record Administrator. ) today announced that it has completed its acquisition of the Bay City, Michigan-based Central Michigan Railway Company (CMGN CMGN Central Michigan Railway Company
CMGN Carver Media Group Network (James Bond movie Tomorrow Never Dies)
CMGN California Master Gardeners Network
CMGN Chaw Media Group Network ) for $25.3 million. The transaction was funded by utilizing cash on hand supplemented by funds from the Company's $100 million revolving credit Revolving Credit
A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility.
The Central Michigan Railway operates 100 miles of rail line from Midland, Michigan, south to Durand, Michigan and generated revenues of approximately $11 million in 2003. CMGN provides rail freight service to the Saginaw, Michigan area, and interchanges traffic with Canadian National, CSXT CSXT Civilian Space Exploration Team
CSXT Chessie System Railway and Seaboard Coast Line Railroad Transportation (Jacksonville, FL, USA) , Lake State Railway, Tuscola & Saginaw Bay Railway, in addition to RailAmerica's Huron & Eastern Railway (HESR HESR High Energy Storage Ring
HESR Huron & Eastern Railway
HESR Harris Extremely Sensitive Receiver ) and Saginaw Valley Railway (SGVY SGVY Sparkling Generation Valkyrie Yuuki (magical girl webcomic)
SGVY Saginaw Valley Railway ). Major shippers on the CMGN include Dow Chemical and Consumers Energy. Commodities moved on the CMGN include chemicals, coal, agricultural commodities, sugar beets, fertilizer and cement. CMGN also has cross-dock, warehouse and transload facilities.
Gary O. Marino, Chairman, President & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of RailAmerica said, "The CMGN represents our sixth Michigan railroad, where we now operate over 500 miles of rail lines and move over 60,000 freight carloads a year. The Central Michigan Railway has a history of strong operational performance and free cash flow (free cash flow is defined as operating income Operating Income
The profit realized from a business' own operations.
This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. plus depreciation less capital expenditures and debt service). Due to the fact that its operations fit so well with RailAmerica's other Michigan railroads, we expect that we will derive significant cost savings and synergies from its integration into our organization. In fact, we anticipate that CMGN will be accretive to our earnings in 2004."
RailAmerica, Inc. (NYSE:RRA) is the world's largest short line and regional railroad operator with 49 railroads operating approximately 17,800 miles in the United States, Canada, Australia, Chile and Argentina, including track access arrangements. The Company is a member of the Russell 2000(R) Index. Its website may be found at http://www.railamerica.com.
Disclaimer Regarding Forward-Looking Statements: This press release contains forward-looking statements regarding future events and the performance of RailAmerica that involve risks and uncertainties that could cause actual results to differ materially including, but not limited to, fuel costs, foreign currency risks, failure to successfully integrate acquisitions, failure to service debt, failure to successfully market and sell non-operating/non-strategic properties and assets when scheduled or at all, failure to accomplish new marketing initiatives, economic and weather conditions, customer demand, increased competition in the relevant market, and others. In particular, forward-looking statements regarding earnings of the Company and entities to be acquired are subject to inherent economic, financial and operating uncertainties, including changes in economic and weather conditions, the ability to retain key customers and the impact of unforeseen costs and liabilities of such entities. Forward-looking statements speak only as of the date the statement was made. The Company assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. If the Company does update any forward-looking statement, no inference should be drawn that the Company will make additional updates with respect to that statement or any other forward-looking statements. We refer you to the documents that RailAmerica files from time to time with the Securities and Exchange Commission, such as the Form 10-K Form 10-K
A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information.
See 10-K. , Form 10-Q Form 10-Q
See 10-Q. and Form 8-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.