RailAmerica Reports First Quarter 2004 Results; Income from Continuing Operations of $0.14 per Diluted Share.Business Editors/Transportation Writers BOCA RATON Boca Raton (bō`kə rətōn`), city (1990 pop. 61,492), Palm Beach co., SE Fla., on the Atlantic; inc. 1925. Boca Raton is a popular resort and retirement community that experienced significant industrial development in the 1970s and 80s. , Fla.--(BUSINESS WIRE)--April 29, 2004 RailAmerica RailAmerica, Inc. (NYSE: RRA), based in Boca Raton, Florida, is a holding company of several short-line railroads in the United States and Canada, as well as overseas. , Inc. (NYSE NYSE See: New York Stock Exchange :RRA RRA Registered Record Administrator. ) today reported first quarter 2004 earnings from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $4.6 million, or $0.14 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to $5.8 million, or $0.18 per diluted share, for the first quarter of 2003. Consolidated revenue from continuing operations for the first quarter ended March 31, 2004 increased 12% to $97.0 million, from $86.5 million in 2003. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the first quarter of 2004 was $15.7 million, compared to $17.0 million in 2003. Net income, which includes discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , was $1.3 million, or $0.04 per diluted share for the 2004 quarter compared to $4.3 million, or $0.14 per diluted share in 2003. First quarter 2004 net income included a $4 million, or $0.12 per share; tax charge resulting from the sale of the Company's interest in Ferronor, a Chilean railroad railroad or railway, form of transportation most commonly consisting of steel rails, called tracks, on which freight cars, passenger cars, and other rolling stock are drawn by one locomotive or more. . Gus Pagonis, Chairman of RailAmerica, said, "Although our North American operations North American operation Surgical oncology Radical surgery of a 'frozen pelvis', consisting of radical en bloc resection of the uterus and urinary bladder. See 'Frozen pelvis.'. Cf 'All-American' and 'South American' operations. were challenged by higher fuel and labor costs, we were pleased by their results. We completed the acquisition of the Central Michigan
Central Michigan, often called Mid-Michigan, is a region in the Lower Peninsula of the U.S. state of Michigan. Railway and successfully integrated it into our Huron & Eastern Railway. We were encouraged with our improving North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. "same railroad" carload carload In commodities trading, a railroad car or truckload of grain that ranges from 1,400 to 2,500 bushels. levels which increased 4.3% to 286,981, from 275,219 during the first quarter of 2003. The 4.3% increase is higher than any quarter during 2003. In addition, the strengthening Canadian dollar Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents and organic growth led to a 5.3% increase in revenue." Freight Australia's revenue for the first quarter of 2004 increased $18.5 million or 89%, to $39.2 million from $20.7 million for the first quarter of 2003. Grain tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. hauled in the first quarter of 2004 increased 120% to 1.1 million tons from 0.5 million tons in the first quarter of 2003. Freight Australia's operating income increased to $2.6 million compared to a loss of $1.0 million in 2003 primarily due to the resumption RESUMPTION. To reassume; to promise again; as, the resumption of payment of specie by the banks is general. It also signifies to take things back; as the government has resumed the possession of all the lands which have not been paid for according to the requisitions of the law, and the of grain shipments following the end of the drought drought, abnormally long period of insufficient rainfall. Drought cannot be defined in terms of inches of rainfall or number of days without rain, since it is determined by such variable factors as the distribution in time and area of precipitation during and before . Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. J. Howe, Executive Vice President and Chief Financial Officer, said, "In February February: see month. , we closed on the sale of our 55% interest in Ferronor, a Chilean railroad, and in March, we announced that we executed a share sale agreement for our Australian Australian pertaining to or originating in Australia. Australian bat lyssavirus disease see Australian bat lyssavirus disease. Australian cattle dog a medium-sized, compact working dog used for control of cattle. operation, Freight Australia Freight Australia was a railway company in Australia. Initially known as Freight Victoria, it operated rail freight services and controlled non-urban rail track in the state of Victoria, later expanding into freight haulage in other states. . For the sale of Ferronor, RailAmerica received $18.1 million which consisted of a cash payment of $10.75 million and $7.4 million in secured instruments that bear interest and are payable over a 6-1/2 year period. In addition, this sale eliminated $20 million of debt from our balance sheet. In March, RailAmerica executed an agreement to sell 100% of its ownership in Freight Australia to Pacific National for AUD AUD In currencies, this is the abbreviation for the Australian Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. $285 million (US $206 million based on recent exchange rates). Subject to approval by the State of Victoria and the Australian Competition and Consumer Commission For the other Australian organisation with the same acronym, see . The Australian Competition and Consumer Commission (ACCC) is an independent authority of the government of Australia. and satisfaction of other closing conditions, we anticipate closing the transaction in the second quarter of 2004. Additionally, during the first quarter, $8.1 million of our junior convertible bonds were converted into common stock at the conversion price of $10.00 per share resulting in a remaining balance of $13.7 million, which will either be converted or redeemed re·deem tr.v. re·deemed, re·deem·ing, re·deems 1. To recover ownership of by paying a specified sum. 2. To pay off (a promissory note, for example). 3. by July July: see month. 31." RailAmerica, Inc. (NYSE: RRA) is the world's premier short line and regional railroad operator with 47 railroads rail·road n. 1. A road composed of parallel steel rails supported by ties and providing a track for locomotive-drawn trains or other wheeled vehicles. 2. operating approximately 12,000 miles in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , and Australia. The Company is a member of the Russell 2000(R) Index. For more information about RailAmerica, please visit our website at www.railamerica.com DISCLAIMER (networking) disclaimer - Statement ritually appended to many Usenet postings (sometimes automatically, by the posting software) reiterating the fact (which should be obvious, but is easily forgotten) that the article reflects its author's opinions and not necessarily those of the REGARDING FORWARD-LOOKING STATEMENTS forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. : 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 Freight Australia and non- non- word element [L.]not . non- pref. Not: noninvasive. operating/non-strategic properties and assets when scheduled or at all, failure to successfully refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. debt, failure to accomplish new marketing initiatives, economic conditions, customer demand, increased competition in the relevant market, and others. In particular, forward-looking statements regarding earnings and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become of the Company and entities to be acquired are subject to inherent economic, financial and operating uncertainties, including changes in economic conditions, realization of operating synergies, 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 (logic) inference - The logical process by which new facts are derived from known facts by the application of inference rules. See also symbolic inference, type 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. Form 10-K See 10-K. , Form 10-Q Form 10-Q See 10-Q. and Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 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.
RAILAMERICA, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(Unaudited)
Three Months
(Amounts in thousands, except per share) Ended March 31,
2004 2003
-------- --------
Operating revenue $97,043 $86,478
Operating expenses:
Maintenance of way 11,169 8,952
Maintenance of equipment 3,666 3,526
Transportation 28,168 23,347
Equipment rental 9,493 8,147
SG&A 22,511 20,201
Net gain on sale of assets (378) (367)
Depreciation and amortization 6,752 5,638
-------- --------
Total operating expenses 81,381 69,444
-------- --------
Operating income 15,662 17,034
Interest and other expense (including amortization
costs) (8,203) (8,029)
-------- --------
Income from continuing operations before income
taxes 7,459 9,005
Provision for income taxes 2,840 3,193
-------- --------
Income from continuing operations 4,619 5,812
Loss from sale of discontinued operations, net of
income taxes (3,951) --
Income (loss) from discontinued operations, net of
income taxes 607 (1,478)
-------- --------
Net Income $1,275 $4,334
======== ========
Diluted earnings (loss) per common share:
Continuing operations $0.14 $0.18
Discontinued operations (0.10) (0.04)
-------- --------
Net income $0.04 $0.14
======== ========
Weighted average diluted shares outstanding 33,894 34,082
======== ========
RAILAMERICA, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)
March 31, December 31,
(Amounts in thousands) 2004 2003
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $7,819 $13,714
Accounts and notes receivable, net 53,676 52,312
Current assets of discontinued operations 32,488 36,319
Other current assets 12,507 12,118
----------- -----------
Total current assets 106,490 114,463
Property, plant and equipment, net 858,032 826,646
Long-term assets of discontinued operations 216,568 263,007
Other assets 33,089 28,374
----------- -----------
Total assets $1,214,179 $1,232,490
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $17,411 $25,093
Accounts payable 37,779 34,851
Accrued expenses 27,971 31,290
Current liabilities of discontinued
operations 21,726 40,338
----------- -----------
Total current liabilities 104,887 131,572
Long-term debt, less current maturities 340,840 327,280
Subordinated debt 121,827 121,506
Deferred income taxes 153,143 150,784
Long-term liabilities of discontinued
operations 96,927 115,907
Other liabilities 12,162 13,681
Stockholders' equity:
Common stock 33 32
Additional paid-in capital 275,640 262,384
Retained earnings 64,020 62,745
Accumulated other comprehensive income 44,700 46,599
----------- -----------
Total stockholders' equity 384,393 371,760
----------- -----------
Total liabilities and stockholders'
equity $1,214,179 $1,232,490
=========== ===========
RAILAMERICA, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
Three Months
(Amounts in thousands) Ended March 31,
2004 2003
-------- --------
Cash flows from operating activities:
Net income $1,275 $4,334
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 11,849 10,991
Gain on sale of assets (378) (367)
Deferred income taxes and other 6,768 2,300
Changes in operating assets and liabilities, net of
acquisitions and dispositions:
Accounts receivable (4,517) 938
Other current assets (554) 2,246
Accounts payable (8,254) (7,008)
Accrued expenses (1,425) (8,336)
Other assets and liabilities 3,971 (1,012)
-------- --------
Net cash provided by operating activities 8,735 4,086
-------- --------
Cash flows from investing activities:
Purchase of property, plant and equipment (18,926) (11,796)
Proceeds from sale of assets 9,501 917
Acquisitions, net of cash acquired (24,645) (3,547)
Deferred acquisition costs and other (864) (72)
-------- --------
Net cash used in investing activities (34,934) (14,498)
-------- --------
Cash flows from financing activities:
Proceeds from issuance of long-term debt 57,274 --
Principal payments on long-term debt (41,494) (242)
Proceeds from exercise of stock options and
warrants 4,671 282
Purchase of treasury stock -- (542)
Other (26) --
-------- --------
Net cash provided by (used in) financing
activities 20,425 (502)
-------- --------
Effect of exchange rates on cash (121) 355
-------- --------
Net decrease in cash (5,895) (10,559)
Cash, at beginning of period 13,714 28,887
-------- --------
Cash, end of period $7,819 $18,328
======== ========
RAILAMERICA, INC. AND SUBSIDIARIES
Selected Financial Information - North America / Australia
(Unaudited)
(Amounts in thousands) Three Months Ended March 31,
% of % of
2004 Rev. 2003 Rev.
-------- ------ -------- ------
North America (1):
Operating revenue $96,967 100.0% $86,368 100.0%
Operating expenses:
Maintenance of way 11,169 11.5% 8,938 10.3%
Maintenance of equipment 3,666 3.8% 3,526 4.1%
Transportation 28,168 29.0% 23,347 27.0%
Equipment rental 9,493 9.8% 8,147 9.4%
SG&A 19,278 19.9% 17,846 20.7%
Depreciation and amortization 6,596 6.8% 5,489 6.4%
-------- ------ -------- ------
Total operating expenses 78,370 80.8% 67,293 77.9%
-------- ------ -------- ------
Operating income $18,597 19.2% $19,075 22.1%
======== ====== ======== ======
Operating ratio (2) 80.8% 77.9%
======== ========
Australia:
Operating revenue $39,244 100.0% $20,751 100.0%
Operating expenses:
Maintenance of way 3,218 8.2% 2,819 13.6%
Maintenance of equipment 3,120 7.9% 1,666 8.0%
Transportation 21,771 55.5% 11,974 57.7%
Equipment rental 1,246 3.2% 113 0.5%
SG&A 3,641 9.3% 2,078 10.0%
Depreciation and amortization 3,682 9.4% 3,083 14.9%
-------- ------ -------- ------
Total operating expenses 36,678 93.5% 21,733 104.7%
-------- ------ -------- ------
Operating income (loss) $2,566 6.5% ($982) (4.7%)
======== ====== ======== ======
Operating ratio (2) 93.5% 104.7%
======== ========
(1) excludes Corporate
(2) defined as total operating expenses divided by total operating
revenue
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