<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
for the quarter ended March 31, 2000 Commission File No. 0-20847
GENESEE & WYOMING INC.
(Exact name of registrant as specified in its charter)
Delaware 06-0984624
- ------------------------------- -------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
71 Lewis Street, Greenwich, Connecticut 06830
- --------------------------------------- -------------------------------------
(Address of principal executive offices) (Zip Code)
(203) 629-3722
- --------------
(Telephone No.)
Shares of common stock outstanding as of the close of business on
May 4, 2000:
Class Number of Shares Outstanding
- ----- ----------------------------
Class A Common Stock 3,480,394
Class B Common Stock 845,447
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.
[X] YES [ ] NO
<PAGE>
INDEX
Part I - Financial Information
Item 1. Financial Statements: Page
-------
Consolidated Statements of Income - For the
Three Month Periods Ended March 31, 2000
and 1999................................. ..... 3
Consolidated Balance Sheets - As of March 31,
2000 and December 31, 1999..................... 4
Consolidated Statements of Cash Flows - For the
Three Month Periods Ended March 31, 2000
and 1999....................................... 5
Notes to Consolidated Financial Statements....... 6 - 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.. 10 - 21
Item 3. Quantitative and Qualitative Disclosures About
Market Risk.................................... 21
Part II - Other Information................................ 22
Index to Exhibits.......................................... 23 - 24
Signatures................................................. 25
2
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GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(Unaudited)
Three Months
Ended March 31,
2000 1999
--------------------------------
OPERATING REVENUES $ 55,411 $ 34,172
--------------------------------
OPERATING EXPENSES:
Transportation 18,721 11,317
Maintenance of ways and structures 5,956 4,160
Maintenance of equipment 10,941 6,942
General and administrative 8,309 7,020
Depreciation and amortization 3,187 2,695
--------------------------------
Total operating expenses 47,114 32,134
--------------------------------
INCOME FROM OPERATIONS 8,297 2,038
Interest expense (2,752) (1,394)
Other income (expense) 1,430 (596)
--------------------------------
Income before provision for income taxes 6,975 48
Provision for income taxes 2,563 379
--------------------------------
NET INCOME (LOSS) $ 4,412 $ (331)
================================
Earnings (loss) per common share - basic $ 1.02 $ (0.07)
================================
Weighted average number of shares of
common stock - basic 4,328 4,933
================================
Earnings (loss) per common share - diluted $ 1.00 $ (0.07)
================================
Weighted average number of shares of
common stock - diluted 4,425 4,933
================================
3
<PAGE>
GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
(Unaudited)
<TABLE>
<CAPTION>
As of As of
March 31, Dec. 31,
ASSETS 2000 1999
-----------------------------
<S> <C> <C>
CURRENTS ASSETS:
Cash and cash equivalents $ 9,352 $ 7,791
Accounts receivable, net 46,620 47,870
Materials and supplies 6,385 6,141
Prepaid expenses and other 6,621 7,689
Deferred income tax assets, net 3,255 3,087
------------------------------
Total current assets 72,233 72,578
------------------------------
PROPERTY AND EQUIPMENT, net 188,827 185,970
------------------------------
SERVICE ASSURANCE AGREEMENT, net 11,877 12,065
------------------------------
INVESTMENT IN UNCONSOLIDATED AFFILIATES 1,585 1,576
------------------------------
OTHER ASSETS, net 26,461 29,751
------------------------------
Total assets $ 300,983 $ 301,940
==============================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $ 15,580 $ 15,146
Accounts payable 41,959 52,501
Accrued expenses 11,284 9,738
------------------------------
Total current liabilities 68,823 77,385
------------------------------
LONG-TERM DEBT, less current portion 96,375 93,230
------------------------------
OTHER LIABILITIES 4,013 4,231
------------------------------
DEFERRED INCOME TAX LIABILITIES, net 15,001 13,145
------------------------------
DEFERRED ITEMS--grants from governmental agencies 27,648 27,427
------------------------------
DEFERRED GAIN--sale/leaseback 3,965 4,109
------------------------------
MINORITY INTEREST 610 584
------------------------------
STOCKHOLDERS' EQUITY:
Class A common stock, $0.01 par value, one vote per share;
12,000,000 shares authorized; 4,480,100 and 4,453,368 issued and
outstanding on March 31, 2000 and December 31, 1999, respectively 45 45
Class B common stock, $0.01 par value, 10 votes per share;
1,500,000 shares authorized; 845,447 and 845,539 issued and outstanding
on March 31, 2000 and December 31, 1999, respectively 8 8
Additional paid-in capital 47,081 47,072
Retained earnings 51,436 47,023
Currency translation adjustment (3,019) (1,316)
Less treasury stock, at cost, 1,000,000 Class A shares (11,003) (11,003)
------------------------------
Total stockholders' equity 84,548 81,829
------------------------------
Total liabilities and stockholders' equity $ 300,983 $ 301,940
==============================
</TABLE>
4
<PAGE>
GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
2000 1999
-------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 4,412 $ (331)
Adjustments to reconcile net income (loss) to net cash provided
by operating activities-
Depreciation and amortization 3,187 2,695
Deferred income taxes 1,720 282
Loss (gain) on disposition of property and equipment 27 (16)
Minority interest expense 26 -
Valuation adjustment of U.S. dollar denominated foreign debt (871) -
Changes in assets and liabilities -
Accounts receivable 985 6,879
Materials and supplies (312) (53)
Prepaid expenses and other 1,168 12
Accounts payable and accrued expenses (8,123) (8,351)
Other assets and liabilities, net (527) 825
-------------------------------
Net cash provided by operating activities 1,692 1,942
-------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (4,823) (3,231)
Proceeds from disposition of property 68 38
-------------------------------
Net cash used in investing activities (4,755) (3,193)
-------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term borrowings, including capital leases (10,987) (9,551)
Proceeds from issuance of long-term debt 15,262 13,000
Net proceeds on governmental grants 682 225
Proceeds from employee stock purchases 9 14
Purchase of treasury stock - (1,417)
-------------------------------
Net cash provided by financing activities 4,966 2,271
-------------------------------
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS (342) (13)
-------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS 1,561 1,007
CASH AND CASH EQUIVALENTS, beginning of period 7,791 14,396
-------------------------------
CASH AND CASH EQUIVALENTS, end of period $ 9,352 $ 15,403
===============================
CASH PAID DURING PERIOD FOR:
Interest $ 946 $ 1,202
Incomes taxes 485 1,900
===============================
</TABLE>
5
<PAGE>
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. References to "GWI" or
the "Company" mean Genesee & Wyoming Inc. and, unless the context indicates
otherwise, its consolidated subsidiaries. All significant intercompany
transactions and accounts have been eliminated in consolidation. These interim
consolidated financial statements have been prepared by the Company, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission (the "SEC"). In the opinion of management, the unaudited financial
statements for the three-month periods ended March 31, 2000 and 1999, are
presented on a basis consistent with audited financial statements and contain
all adjustments, consisting only of normal recurring adjustments, necessary for
a fair presentation. The interim consolidated financial statements should be
read in conjunction with the audited financial statements and notes thereto for
the year ended December 31, 1999 included in the Company's Form 10-K.
The results of operations for interim periods are not necessarily
indicative of results of operations for the full year.
2. EXPANSION OF OPERATIONS:
Compania de Ferrocarriles Chiapas-Mayab, S.A. de C.V.
In August 1999, the Company's wholly-owned subsidiary, Compania de
Ferrocarriles Chiapas-Mayab, S.A. de C.V. (FCCM), was awarded a 30-year
concession to operate certain railways owned by the state-owned Mexican rail
company Ferronales. FCCM also acquired equipment and other assets. The aggregate
purchase price, including acquisition costs, was approximately 297 million
pesos, or approximately $31.5 million at then-current exchange rates. The
purchase included $12.3 million of rolling stock, a $9.7 million advance payment
on track improvements to be completed on the state-owned track property by
mid-2001, a $1.0 million escrow payment which will be returned to the Company
upon successful completion of the track improvements, an expected future
utilization by the Company of $2.2 million of value-added taxes paid on the
transaction, and $1.0 million in goodwill. The remaining purchase price ($5.3
million) was allocated to the 30-year operating license.
Genesee Rail-One Inc.
On April 15, 1999, the Company closed on an agreement to acquire Rail-One
Inc. (Rail-One) which has a 47.5% ownership interest in Genesee Rail-One Inc.
(GRO), thereby increasing the Company's ownership of GRO to 95%. GRO owns and
operates two short line railroads in Canada. Under the terms of the purchase
agreement, the Company converted outstanding notes receivable from Rail-One of
$4.6 million into capital, will pay approximately $844,000 in cash to the
sellers of Rail-One in installments over a four year period, and granted options
to the sellers of Rail-One to purchase up to 80,000 shares of the Company's
Class A Common Stock at an exercise price of $8.625 per share. Exercise of the
option is contingent on the Company's recovery of its capital investment in GRO
including debt assumed if the Company were to sell GRO, and upon certain GRO
income performance measures. Effective with this agreement, the operating
results of GRO have been consolidated within the financial
6
<PAGE>
statements of the Company, with a 5% minority interest due to another GRO
shareholder. Prior to April 15, 1999, the Company accounted for its investment
in GRO under the equity method.
3. NON-CASH GAIN ON U.S. DOLLAR DENOMINATED FOREIGN DEBT:
At March 31, 2000, the Company's Mexican subsidiary, FCCM, had
approximately $36.9 million of U.S. dollar denominated debt outstanding (see
Note 2. above). The functional currency of FCCM's business is the Mexican peso
while the subsidiary is financed with U.S. dollar denominated debt. Generally
Accepted Accounting Principles require that the debt be translated into its
value in Mexican pesos at the end of each quarter. Therefore any fluctuation in
the U.S. dollar/Mexican peso exchange rate between consecutive quarters results
in a non-cash gain or non-cash expense as the debt is marked to market. For the
quarter ended March 31, 2000, the Company recorded approximately $871,000 of
non-cash income related to the valuation adjustment on this debt in the Other
Income caption in the accompanying consolidated statement of income. If the peso
depreciates relative to the U.S. dollar in subsequent quarters, a non-cash
expense would result.
4. CREDIT FACILITIES:
On August 17, 1999, the Company amended and restated its credit facilities
agreement to provide for an increase from $65.0 million to $150.0 million. The
agreement provides for $88.0 million in revolving credit facilities and $62.0
million in term loan facilities. The revolving credit facility provides for a
sub limit of $15.0 million in Australian dollar equivalents to be allocated to
the Australian subsidiaries. The amended and restated credit facilities
agreement also provides for a U.S. Term Loan facility in the amount of $10.0
million, a Canadian Term Loan facility in the Canadian Dollar Equivalent of
$22.0 million, and a Mexican Term Loan facility of $30.0 million. The facility
has a maturity date of August 17, 2004. The credit facilities accrue interest at
various rates, plus the applicable margins, as defined in the agreement. The
credit facilities are secured by essentially all the assets of the Company and
its subsidiaries. The credit facilities agreement requires the maintenance of
certain commitment fees, prepayments from the issuance of new equity or debt and
annual sale of assets, and covenant ratios or amounts, including, but not
limited to, funded debt to EBITDA, minimum EBITDA for a period, cash flow
coverage, and Net Worth, all as defined in the agreement.
5. CONTINGENCIES:
On August 6, 1998, a lawsuit was commenced against the Company and its
subsidiary, Illinois & Midland Railroad, Inc. (IMRR), by Commonwealth Edison
Company (ComEd) in the Circuit Court of Cook County, Illinois. The suit alleges
that IMRR is in breach of certain provisions of a stock purchase agreement
entered into by a prior unrelated owner of the IMRR rail line. The provisions
allegedly pertain to limitations on rates received by IMRR and the unrelated
predecessor for freight hauled for ComEd's Powerton plant. The suit seeks
unspecified compensatory damages for alleged past rate overcharges. The Company
believes the suit is without merit and intends to vigorously defend against the
suit.
The parent company of ComEd has sold certain of ComEd's power facilities,
one of which is the Powerton plant served by IMRR under the provisions of a 1987
Service Assurance Agreement (the SAA), entered into by a prior unrelated owner
of the IMRR rail line. The SAA, which is not terminable except for failure to
perform, provides that IMRR has exclusive access to provide rail service to the
Powerton plant. On April 6, 1999, a lawsuit was commenced by the Company and its
subsidiary, IMRR,
7
<PAGE>
against ComEd in the Circuit Court of Sangamon County, Illinois. The suit sought
declaration of certain rights regarding the SAA including declarations that the
SAA is not terminable at will and that ComEd must assign its contractual
obligations under the SAA to the purchaser of the Powerton plant. On June 10,
1999, the suit commenced by the Company and IMRR against ComEd in Sangamon
County was voluntarily withdrawn without prejudice in partial resolution of
several procedural motions pending in the Cook County action, and with the
explicit recognition from ComEd that the action may be re-filed in Cook County.
Revenue for haulage to the Powerton Plant accounted for 6.6% of the consolidated
revenues of the Company and its subsidiaries in 1999. Failure to satisfactorily
resolve this litigation could have a material adverse effect on the Company.
6. COMPREHENSIVE INCOME:
Comprehensive income is the total of net income and all other non-owner
changes in equity. The following table sets forth the Company's comprehensive
income for the three months ended March 31, 2000 and 1999:
Statement of Comprehensive Income
(in thousands)
Three Months Ended
March 31,
2000 1999
------- -----
Net income (loss) $ 4,412 $(331)
Other comprehensive income (loss) - Foreign
currency translation adjustments (1,703) 407
----------------------
Comprehensive income $ 2,709 $ 76
======================
7. BUSINESS SEGMENT INFORMATION:
The Company operates in three business segments in two geographic areas:
North American Railroad Operations, which includes operating short line and
regional railroads, and buying, selling, leasing and managing railroad
transportation equipment within the United States, Canada and Mexico; Australian
Railroad Operations, which includes operating a regional railroad and providing
hook and pull (haulage) services to other railroads within Australia; and
Industrial Switching, which includes providing freight car switching and related
services to industrial companies with extensive railroad facilities within their
complexes in the United States.
Corporate overhead expenses, including acquisition expense, are primarily
reported in North American Railroad Operations.
The accounting policies of the reportable segments are the same as those of
the consolidated company. The Company evaluates the performance of its operating
segments based on operating income. Intersegment sales and transfers are not
significant. Summarized financial information for each business segment for the
quarters ended March 31, 2000 and 1999 is shown in the following tables:
The remainder of this page is intentionally left blank.
8
<PAGE>
Business Segment
(amounts in thousands)
North American Australian Industrial
Railroad Railroad Switching
2000 Operations Operations Operations Total
- -------------------------- ---------- ---------- ---------- --------
Revenues $ 42,240 $10,630 $ 2,541 $ 55,411
Operating income (loss) 7,443 884 (30) 8,297
Other expense, net (830) (359) (133) (1,322)
Income (loss) before taxes 6,613 525 (163) 6,975
Identifiable assets 253,958 38,765 8,260 300,983
- -------------------------- -------- ------- ------- --------
North American Australian Industrial
Railroad Railroad Switching
1999 Operations Operations Operations Total
- -------------------------- ---------- ---------- ---------- --------
Revenues $ 19,939 $11,022 $ 3,211 $ 34,172
Operating income (loss) 417 1,922 (301) 2,038
Other (expense) income, net (1,923) 45 (112) (1,990)
Income (loss) before taxes (1,052) 1,512 (412) 48
Identifiable assets 159,447 42,513 10,040 212,000
- -------------------------- -------- ------- ------- --------
8. RECENTLY ISSUED ACCOUNTING STANDARDS:
The Financial Accounting Standards Board recently issued SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities, which establishes
accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts (collectively referred to as
derivatives), and hedging activities. The new standard requires that an entity
recognize all derivatives as either assets or liabilities in the balance sheet
and measure those instruments at fair value with changes in fair value reported
in income. This statement will require the Company to provide separate
disclosure of derivative instruments either on the face of the balance sheet or
within the footnotes to the financial statements. Adoption of this statement is
required no later than the first quarter of 2001, which is when the Company
expects to adopt it. The Company is in the process of assessing the impact of
this statement.
The remainder of this page is intentionally left blank.
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Company's
consolidated financial statements and related notes included elsewhere in this
Quarterly Report on Form 10-Q, and with the consolidated financial statements,
related notes and other financial information included in the Company's 1999
Form 10-K.
General
The Company is a holding company whose subsidiaries own and/or operate
short line and regional freight railroads and provide related rail services in
the United States, Australia, Canada and Mexico. The Company, through its U.S.
industrial switching subsidiary, also provides freight car switching and related
services to United States industrial companies with extensive railroad
facilities within their complexes. The Company generates revenues primarily from
the movement of freight over track owned or operated by its railroads. The
Company also generates non-freight revenues primarily by providing freight car
switching and related rail services such as railcar leasing, railcar repair and
storage to industrial companies with extensive railroad facilities within their
complexes, to shippers along its lines, and to the Class I railroads that
connect with its North American lines.
The Company's operating expenses include wages and benefits, equipment
rents (including car hire), purchased services, depreciation and amortization,
diesel fuel, casualties and insurance, materials and other expenses. Car hire is
a charge paid by a railroad to the owners of railcars used by that railroad in
moving freight. Other expenses generally include property and other non-income
taxes, professional services, communication and data processing costs and
general overhead expense.
When comparing the Company's results of operations from one reporting
period to another, the following factors should be taken into consideration. The
Company has historically experienced fluctuations in revenues and expenses such
as one-time freight moves, customer plant expansions and shut-downs, railcar
sales, accidents and derailments. In periods when these events occur, results of
operations are not easily comparable to other periods. Also, much of the
Company's growth to date has resulted from acquisitions. The Company completed
two acquisitions during the first four months of 1996, one in November 1996, and
another in November 1997. On April 15, 1999, the Company began consolidating the
results of Genesee Rail-One Inc. (as described below), and on September 1, 1999,
the Company began operations of its newly-formed subsidiary, Compania de
Ferrocarriles Chiapas-Mayab, S.A. de C.V. as described below. Because of
variations in the structure, timing and size of these acquisitions and
differences in economics among the Company's railroads resulting from
differences in the rates and other material terms established through
negotiation, the Company's results of operations in any reporting period may not
be directly comparable to its results of operations in other reporting periods.
Compania de Ferrocarriles Chiapas-Mayab, S.A. de C.V.
In August 1999, the Company's wholly-owned subsidiary, Compania de
Ferrocarriles Chiapas-Mayab, S.A. de C.V. (FCCM), was awarded a 30-year
concession to operate certain railways owned by the state-owned Mexican rail
company Ferronales. FCCM also acquired equipment and other assets. The aggregate
purchase price, including acquisition costs, was approximately 297 million
pesos, or approximately $31.5 million at then-current exchange rates. The
purchase included $12.3 million of rolling stock, a $9.7 million advance payment
on track improvements to be completed
10
<PAGE>
on the state-owned track property by mid-2000, a $1.0 million escrow payment
which will be returned to the Company upon successful completion of the track
improvements, an expected future utilization by the Company of $2.2 million of
value-added taxes paid on the transaction, and $1.0 million in goodwill. The
remaining purchase price ($5.3 million) was allocated to the 30-year operating
license.
Genesee Rail-One Inc.
On April 15, 1999, the Company closed on an agreement to acquire Rail-One
Inc. (Rail-One) which has a 47.5% ownership interest in Genesee Rail-One Inc.
(GRO), thereby increasing the Company's ownership of GRO to 95%. GRO owns and
operates two short line railroads in Canada. Under the terms of the purchase
agreement, the Company converted outstanding notes receivable from Rail-One of
$4.6 million into capital, will pay approximately $844,000 in cash to the
sellers of Rail-One in installments over a four year period, and granted options
to the sellers of Rail-One to purchase up to 80,000 shares of the Company's
Class A Common Stock at an exercise price of $8.625 per share. Exercise of the
option is contingent on the Company's recovery of its capital investment in GRO
including debt assumed if the Company were to sell GRO, and upon certain GRO
income performance measures. Effective with this agreement, the operating
results of GRO have been consolidated within the financial statements of the
Company, with a 5% minority interest due to another GRO shareholder. Prior to
April 15, 1999, the Company accounted for its investment in GRO under the equity
method.
Non-Cash Gain on U.S. Dollar Denominated Foreign Debt
At March 31, 2000, the Company's Mexican subsidiary, FCCM, had
approximately $36.9 million of U.S. dollar denominated debt outstanding (see
Note 2. above). The functional currency of FCCM's business is the Mexican peso
while the subsidiary is financed with U.S. dollar denominated debt. Generally
Accepted Accounting Principles require that the debt be translated into its
value in Mexican pesos at the end of each quarter. Therefore any fluctuation in
the U.S. dollar/Mexican peso exchange rate between consecutive quarters results
in a non- cash gain or non-cash expense as the debt is marked to market. For the
quarter ended March 31, 2000, the Company recorded approximately $871,000 of
non-cash income related to the valuation adjustment on this debt in the Other
Income caption in the accompanying consolidated statement of income. If the peso
depreciates relative to the U.S. dollar in subsequent quarters, a non-cash
expense would result.
The remainder of this page is intentionally left blank.
11
<PAGE>
Results of Operations
Three Months Ended March 31, 2000 Compared to Three Months Ended March 31, 1999
Consolidated Operating Revenues
Operating revenues were $55.4 million in the quarter ended March 31, 2000
compared to $34.2 million in the quarter ended March 31, 1999, a net increase of
$21.2 million or 62.1%. The net increase was attributable to a $22.3 million
increase in North American railroad revenues of which $8.8 million were revenues
from new railroad operations in Canada, $8.4 million were revenues from new
railroad operations in Mexico, and $5.1 million were from increased revenues on
existing North American operations, offset by a $391,000 decrease in revenues
from Australian railroad operations and a $670,000 decrease in industrial
switching revenues.
The following three sections provide information on railroad revenues in
North America and Australia, and industrial switching revenues in the United
States.
North American Railroad Operating Revenues
North American railroad operating revenues were $42.2 million in the
quarter ended March 31, 2000 compared to $19.9 million in the quarter ended
March 31, 1999, an increase of $22.3 million or 111.8%. The increase was
attributable to a $18.6 million increase in freight revenues and a $3.7 million
increase in non-freight revenues. The increase of $18.6 million in North
American freight revenues was due to $7.1 million in freight revenues
attributable to new railroad operations in Canada, $7.3 million in freight
revenues attributable to new railroad operations in Mexico, and an increase of
$4.2 million in freight revenues on existing railroad operations.
The following table compares North American freight revenues, carloads and
average freight revenues per carload for the quarters ended March 31, 2000 and
1999:
The remainder of this page is intentionally left blank.
12
<PAGE>
North American Freight Revenues and Carloads Comparison by Commodity Group
Quarters Ended March 31, 2000 and 1999
(dollars in thousands, except average per carload)
<TABLE>
<CAPTION>
Average
Freight
Revenues
Per
Freight Revenues Carloads Carload
------------------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
% of % of % of % of
Commodity Group 2000 Total 1999 Total 2000 Total 1999 Total 2000 1999
- -------------------- ------- ------- ------- ------ ------ ----- ------ ----- ----- -----
Coal, Coke & Ores $ 7,239 21.6% $ 3,674 24.7% 32,590 32.5% 14,972 30.5% $ 222 $ 245
Petroleum Products 5,018 15.0% 1,897 12.7% 8,355 8.3% 4,175 8.5% 601 454
Pulp & Paper 4,865 14.5% 2,011 13.5% 12,765 12.7% 5,706 11.7% 381 352
Minerals & Stone 3,848 11.5% 494 3.3% 8,961 9.0% 1,722 3.5% 429 287
Farm & Food Products 3,467 10.3% 1,018 6.8% 9,928 9.9% 3,591 7.3% 349 283
Metals 2,524 7.5% 1,046 7.0% 9,040 9.0% 4,259 8.7% 279 246
Chemicals &
Plastics 2,261 6.7% 1,809 12.2% 4,412 4.4% 3,471 7.1% 512 521
Lumber & Forest
Products 2,204 6.6% 1,659 11.1% 7,116 7.1% 5,801 11.8% 310 286
Autos & Auto Parts 757 2.3% 600 4.0% 1,380 1.4% 1,182 2.4% 549 508
Other 1,324 4.0% 700 4.7% 5,686 5.7% 4,169 8.5% 233 168
---------------------------------------------------------------------------------------
Total $33,507 100.0% $14,908 100.0% 100,233 100.0% 49,048 100.0% 334 304
========================================================================================================
</TABLE>
Coal increased by $3.6 million or 97.0% of which $3.5 million was on
existing railroad operations and $63,000 was from the acquisition of GRO. The
increase on existing railroad operations in the first quarter of 2000 was
primarily attributable to a return to normalized shipments at a key customer's
facilities relative to reduced shipments in the first quarter of 1999 due to
scheduled inventory reductions and planned maintenance projects at the key
customer's facilities.
Petroleum Products increased by $3.1 million or 164.5% of which $2.9 was
attributable to new railroad operations in Mexico, $163,000 was on existing
railroad operations, and $52,000 was attributable to the acquisition of GRO.
Pulp and Paper increased by $2.8 million or 141.9% of which $2.2 million
was attributable to the acquisition of GRO, $543,000 was on existing railroad
operations, and $95,000 was attributable to new railroad operations in Mexico.
Minerals and Stone increased by $3.4 million or 678.9% of which $2.5
million was attributable to new railroad operations in Mexico, $443,000 was on
existing railroad operations, and $391,000 was attributable to the
acquisition of GRO.
Metals increased by $1.5 million or 141.3% of which $1.2 million was
attributable to the acquisition of GRO, $194,000 was on existing railroad
operations, and $60,000 was attributable to new railroad operations in Mexico.
Freight revenues from all remaining commodities reflected a net increase of
$4.2 million or 73.1% of which $3.2 million was attributable to the acquisition
of GRO and $1.7 million was attributable to new railroad operations in Mexico,
which were offset by a $610,000 decrease on existing railroad operations.
13
<PAGE>
Total North American carloads were 100,233 in the quarter ended March 31,
2000 compared to 49,048 in the quarter ended March 31, 1999, an increase of
51,185 or 104.4%. The increase of 51,185 consisted of an increase of 19,058
carloads on existing railroad operations of which 17,387 carloads were coal,
21,322 carloads were attributable to the acquisition of GRO, and 10,805 carloads
were attributable to new railroad operations in Mexico.
The overall average revenue per carload increased to $334 in the quarter
ended March 31, 2000, compared to $304 per carload in the quarter ended March
31, 1999, an increase of 9.9% due primarily to higher per carload revenues
attributable to Canada and Mexico netted against a slight decrease on existing
railroad operations.
North American non-freight railroad revenues were $8.7 million in the
quarter ended March 31, 2000 compared to $5.0 million in the quarter March 31,
1999, an increase of $3.7 million or 73.6%. The increase is the net result of
$1.7 million of non-freight revenues attributable to the acquisition of GRO and
$1.1 million of non-freight revenues attributable to new railroad operations in
Mexico, and an increase of $866,000 in non-freight revenues on existing railroad
operations. The following table compares North America non-freight revenues for
the quarters ended March 31, 2000 and 1999:
North American Railroad
Non-Freight Operating Revenue Comparison
Quarters Ended March 31, 2000 and 1999
(dollars in thousands)
2000 1999
------------------- -------------------
$ % of $ % of
Non-Freight Non-Freight
Revenue Revenue
Railroad switching $2,754 31.5% $1,580 31.4%
Car hire and rental income 1,988 22.8% 1,606 31.9%
Car repair services 889 10.2% 548 10.9%
Other operating income 3,101 35.5% 1,297 25.8%
------ ----- ------ -----
Total non-freight revenues $8,732 100.0% $5,031 100.0%
====== ===== ====== =====
Australian Operating Revenues
Australian operating revenues were $10.6 million in the quarter ended March
31, 2000, compared to $11.0 million in the quarter ended March 31, 1999, a
decrease of $391,000 or 3.6%. The decrease was attributable to a $301,000
decline in freight revenues and a $90,000 decrease in non-freight revenues.
The following table outlines Australian freight revenues for the quarters
ended March 31, 2000 and 1999:
The remainder of this page is intentionally left blank.
14
<PAGE>
Australian Freight Revenues by Commodity
Quarters Ended March 31, 2000 and 1999
(in thousands)
<TABLE>
<CAPTION>
Average
Freight
Revenues
Per
Freight Revenues Carloads Carload
------------------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
% of % of % of % of
Commodity Group 2000 Total 1999 Total 2000 Total 1999 Total 2000 1999
- -------------------- ------- ------- ------- ------ ------ ----- ------ ----- ----- -----
Hook and Pull
(Haulage) $4,308 44.8% $4,224 42.6% 13,507 21.4% 12,098 28.8% $ 319 $ 349
Grain 2,659 27.6% 3,663 36.9% 10,470 16.6% 13,906 33.1% 254 263
Iron Ores 1,032 10.7% - 0.0% 25,725 40.8% - 0.0% 40 -
Gypsum 691 7.2% 653 6.6% 9,711 15.4% 8,946 21.3% 71 73
Marble 481 5.0% 472 4.8% 2,018 3.2% 1,970 4.7% 238 240
Lime 430 4.5% 255 2.5% 1,180 1.9% 778 1.9% 364 328
Coal - 0.0% 654 6.5% - 0.0% 4,317 10.2% - 151
Other 25 0.2% 6 0.1% 367 0.7% 10 0.0% 68 60
----------------------------------------------------------------------------------------
Total $9,626 100.0% $9,927 100.0% 62,978 100.0% 42,025 100.0% 153 236
==========================================================================================================
</TABLE>
The net decrease of $301,000 in Australian freight revenues was primarily
attributable to decreases in the shipment of Grain of $1.0 million and Coal of
$654,000, offset by an increase of $1.0 million from the shipment of Iron Ores
for a new customer. Grain revenues for the 1999 quarter reflect the strong
harvest experienced during the 1998/99 season. There were no freight revenues
from coal in the quarter ended March 31, 2000, due to the non-renewal of a coal
contract. Freight revenues from Hook and Pull increased $84,000 while freight
revenues from all remaining commodities increased $241,000.
Australia carloads were 62,978 in the quarter ended March 31, 2000 compared
to 42,025 in the quarter ended March 31, 1999, a net increase of 20,953 or
49.9%. The net increase of 20,953 was primarily the result of 25,725 carloads
from the shipment of Iron Ores for a new customer. The net remaining decrease of
4,772 is comprised of a 1,409 carload increase in Hook and Pull offset by a
decrease in coal carloads of 4,317 and a net decrease in all other commodities
of 1,864 carloads.
The overall average revenue per carload decreased to $153 in the quarter
ended March 31, 2000, compared to $236 per carload in the quarter ended March
31, 1999, a decrease of 35.2% due primarily to the increase in Iron Ores
carloads at a lower revenue per car. Excluding Iron Ores, the average revenue
per carload in the quarter ended March 31, 2000 was $231.
Australian non-freight revenues were $1.0 million in the quarter ended
March 31, 2000, compared to $1.1 million in the quarter ended March 31, 1999, a
decrease of $90,000 or 8.2%. The following table compares Australian non-freight
revenues for the quarters ended March 31, 2000 and 1999:
15
<PAGE>
Australia Railroad
Non-freight Operating Revenue Comparison
Quarters Ended March 31, 2000 and 1999
(dollars in thousands)
2000 1999
------------------- -------------------
$ % of $ % of
Non-freight Non-freight
Revenue Revenue
Car hire and rental income $ 658 65.5% $ 715 65.3%
Other operating income 347 34.5% 380 34.7%
------ ----- ------ -----
Total non-freight revenues $1,005 100.0% $1,095 100.0%
====== ===== ====== =====
Industrial Switching Revenues
Revenues from U.S. industrial switching activities were $2.5 million in the
quarter ended March 31, 2000 compared to $3.2 million in the quarter ended March
31, 1999, a decrease of $670,000 or 20.9% due primarily to the Company's
decision to exit an unprofitable switching contract.
Consolidated Operating Expenses
Operating expenses for all operations combined were $47.1 million in the
quarter ended March 31, 2000, compared to $32.1 million in the quarter ended
March 31, 1999, an increase of $15.0 million or 46.6%. Expenses attributable to
North American railroad operations were $34.8 million in the quarter ended March
31, 2000, compared to $19.5 million in the quarter ended March 31, 1999, an
increase of $15.3 million or 78.2% of which $7.6 million were expenses
attributable to new railroad operations in Canada, $6.3 million were expenses
attributable to new railroad operations in Mexico and $1.4 million were expenses
attributable to existing railroad operations. Expenses attributable to
operations in Australia were $9.7 million in the quarter ended March 31, 2000,
compared to $9.1 million in the quarter ended March 31, 1999, an increase of
$646,000 or 7.1%. Expenses attributable to U.S. industrial switching were $2.6
million in the quarter ended March 31, 2000, compared to $3.5 million in the
quarter ended March 31, 1999, a decrease of $941,000 or 26.8%.
The following three sections provide information on railroad expenses in
North America and Australia, and industrial switching expenses in the United
States.
North America Railroad Operating Expenses
The following table sets forth a comparison of the Company's North American
railroad operating expenses in the quarters ended March 31, 2000 and 1999:
The remainder of this page is intentionally left blank.
16
<PAGE>
North American Railroad
Operating Expense Comparison
Quarters Ended March 31, 2000 and 1999
(dollars in thousands)
2000 1999
--------------- --------------
% of % of
Operating Operating
$ Revenue $ Revenue
Labor and benefits $13,953 33.0% $ 7,164 35.9%
Equipment rents 5,148 12.2% 2,720 13.6%
Purchased services 2,743 6.5% 994 5.0%
Depreciation and amortization 2,422 5.7% 1,992 10.0%
Diesel fuel 3,388 8.0% 572 2.9%
Casualties and insurance 1,788 4.2% 588 2.9%
Materials 2,906 6.9% 1,621 8.1%
Other expenses 2,449 5.9% 3,871 19.5%
------ ---- ------ ----
Total operating expenses $34,797 82.4% $19,522 97.9%
====== ==== ====== ====
Labor and benefits expense was $14.0 million in the quarter ended March 31,
2000 compared to $7.2 million in the quarter ended March 31, 1999, an increase
of $6.8 million or 94.8% of which $2.0 million was attributable to the
acquisition of GRO, $2.7 million was attributable to new railroad operations in
Mexico and $2.1 million was attributable to existing railroad operations. The
increase on existing railroad operations primarily relates to increased freight
operations and the addition of senior administrative and safety personnel.
Equipment rents were $5.1 million in the quarter ended March 31, 2000
compared to $2.7 million in the quarter ended March 31, 1999, a net increase of
$2.4 million or 89.3% of which $1.7 million was attributable to the acquisition
of GRO, $212,000 was attributable to new railroad operations in Mexico and
$480,000 was attributable to existing railroad operations.
Purchased services were $2.7 million in the quarter ended March 31, 2000
compared to $994,000 in the quarter ended March 31, 1999, a net increase of $1.7
million or 176.0% of which $987,000 was attributable to the acquisition of GRO,
$594,000 was attributable to new railroad operations in Mexico and $168,000 was
attributable to an increase on existing railroad operations.
Diesel fuel expense was $3.4 million in the quarter ended March 31, 2000
compared to $572,000 in the quarter ended March 31, 1999, an increase of $2.8
million or 492.3% of which $1.1 million was attributable to the acquisition of
GRO, $728,000 was attributable to new railroad operations in Mexico and $965,000
was attributable to an increase on existing railroad operations. The increase on
existing railroad operations is primarily the result of significant fuel price
increases experienced at all operating locations.
All other expenses combined were $9.6 million in the quarter ended March
31, 2000 compared to $8.1 million in the quarter ended March 31, 1999, a net
increase of $1.5 million or 18.5% of which $1.7 million was attributable to the
acquisition of GRO, $2.0 million was attributable to new railroad operations in
Mexico and $2.2 million was attributable to a decrease on existing railroad
operations primarily due to reduced acquisition costs in the 2000 period.
17
<PAGE>
Australian Railroad Operating Expenses
The following table sets forth a comparison of the Company's Australian
railroad operating expenses in the quarters ended March 31, 2000 and 1999:
Australian Railroad Operations
Operating Expense Comparison
Quarters Ended March 31, 2000 and 1999
(dollars in thousands)
2000 1999
-------------- --------------
% of % of
Operating Operating
$ Revenue $ Revenue
Labor and benefits $1,450 13.6% $1,373 12.5%
Equipment rents 47 0.4% 29 0.3%
Purchased services 3,422 32.2% 2,953 26.8%
Depreciation and amortization 605 5.7% 496 4.5%
Diesel fuel 2,183 20.5% 1,978 17.9%
Casualties and insurance 591 5.6% 621 5.6%
Materials 317 3.0% 481 4.4%
Other expenses 1,131 10.7% 1,169 10.6%
----- ---- ----- ----
Total operating expenses $9,746 91.7% $9,100 82.6%
====== ==== ====== ====
Purchased services were $3.4 million in the quarter ended March 31, 2000
compared to $3.0 million in the quarter ended March 31, 1999, an increase of
$469,000 or 15.9%, due primarily to contract maintenance costs associated with
new Iron Ore movements.
Diesel fuel was $2.2 million in the quarter ended March 31, 2000 compared
to $2.0 million in the quarter ended March 31, 1999, an increase of $205,000 or
10.4%, due primarily to price increases.
All other expenses combined were $4.1 million in the quarter ended March
31, 2000 compared to $4.2 million in the quarter ended March 31, 1999, a
decrease of $28,000 or 0.7%.
U. S. Industrial Switching Operating Expenses
The following table sets forth a comparison of the Company's U.S.
industrial switching operating expenses in the quarters ended March 31, 2000 and
1999:
The remainder of this page is intentionally left blank.
18
<PAGE>
U.S. Industrial Switching
Operating Expense Comparison
Quarters Ended March 31, 2000 and 1999
(dollars in thousands)
2000 1999
-------------- --------------
% of % of
Operating Operating
$ Revenue $ Revenue
Labor and benefits $1,542 60.7% $2,297 71.5%
Equipment rents 46 1.8% 47 1.5%
Purchased services 95 3.7% 106 3.3%
Depreciation and amortization 160 6.3% 207 6.4%
Diesel fuel 160 6.3% 120 3.7%
Casualties and insurance 125 4.9% 393 12.2%
Materials 178 7.0% 201 6.3%
Other expenses 265 10.4% 141 4.4%
----- ----- ----- -----
Total operating expenses $2,571 101.1% $3,512 109.3%
====== ===== ===== =====
Labor and benefits expense was $1.5 million in the quarter ended March 31,
2000 compared to $2.3 million in the quarter ended March 31, 1999, a decrease of
$755,000 or 32.9%, due primarily to the Company's decision to exit unprofitable
switching contracts.
All other expenses combined were $1.0 million in the quarter ended March
31, 2000 compared to $1.2 million in the quarter ended March 31, 1999, a
decrease of $186,000 or 15.3% again due primarily to the Company's decision to
exit an unprofitable switching contract.
Operating Ratios
The Company's combined operating ratio decreased to 85.0% in the quarter
ended March 31, 2000 from 94.0% in the quarter ended March 31, 1999. The
operating ratio for North American railroad operations decreased to 82.4% in the
quarter ended March 31, 2000 from 97.9% in the quarter ended March 31, 1999. The
operating ratio for Australian railroad operations increased to 91.7% in the
quarter ended March 31, 2000 from 82.6% in the quarter ended March 31, 1999. The
operating ratio for U.S. industrial switching operations decreased to 101.1% in
the quarter ended March 31, 2000 from 109.3% in the quarter ended March 31,
1999.
Interest Expense and Income Taxes
Interest expense in the quarter ended March 31, 2000 was $2.8 million
compared to $1.4 million in the quarter ended March 31, 1999, an increase of
$1.4 million or 97.4% due primarily to financing of the Canada and Mexico
acquisitions. The Company's effective income tax rate in the quarter ended March
31, 2000 was 36.7% which compared to 46.4% (after adjustment for equity losses
in the then unconsolidated results of GRO) in the quarter ended March 31, 1999.
The decrease is primarily attributable to a statutory reduction in the
Australian income tax rate, a reduced effective tax rate on Canadian operations
resulting from the utilization of net operating loss carry-forwards, and lower
effective tax rates in the United States and Mexico.
19
<PAGE>
Net Income (Loss) and Earnings Per Share
The Company's net income in the quarter ended March 31, 2000 was $4.4
million compared to a net loss of $331,000 in the quarter ended March 31, 1999,
an increase of $4.7 million. The increase in net income is the net result of an
increase in net income from North America railroad operations of $5.2 million
and a decrease in the net loss of industrial switching operations of $176,000,
offset by a decrease in net income from operations in Australia of $631,000.
Basic and Diluted Earnings Per Share in the quarter ended March 31, 2000
were $1.02 and $1.00 respectively, on weighted average shares of 4.3 million and
4.4 million respectively, compared to losses of $0.07 and $0.07 respectively, on
weighted average shares of 4.9 million in the quarter ended March 31, 1999. The
change in weighted average shares outstanding primarily reflects the impact of a
1.0 million share buy-back program which started in August, 1998 and ended in
May, 1999.
Liquidity and Capital Resources
During the three months ended March 31, 2000 the Company generated cash
from operations of $1.7 million, invested $4.8 million in capital assets
(including $682,000 in state grant funds received for track rehabilitation and
construction), had a net increase in debt of $4.3 million, and received $68,000
in proceeds from the disposition of property.
During the three months ended March 31, 1999 the Company generated cash
from operations of $1.9 million, invested $3.2 million in capital assets
(including $225,000 in state grant funds received for track rehabilitation and
construction), had a net increase in debt of $3.5 million, and received $38,000
in proceeds from the disposition of property.
Stock Repurchase - On August 12, 1998, the Company's board of directors
authorized the Company to repurchase up to one million shares of the Company's
Class A common stock under SEC Rule 10b-18. In May, 1999, the Company completed
its purchase of the one million shares authorized by the board of directors at a
total cost of $11.0 million.
Credit Facilities - On August 17, 1999, the Company amended and restated
its credit facilities agreement to provide for an increase from $65.0 million to
$150.0 million. The agreement provides for $88.0 million in revolving credit
facilities and $62.0 million in term loan facilities. The revolving credit
facility provides for a sub limit of $15.0 million in Australian dollar
equivalents to be allocated to the Australian subsidiaries. The amended and
restated credit facilities agreement also provides for a U.S. Term Loan facility
in the amount of $10.0 million, a Canadian Term Loan facility in the Canadian
Dollar Equivalent of $22.0 million, and a Mexican Term Loan facility of $30.0
million. The facility has a maturity date of August 17, 2004. The credit
facilities accrue interest at various rates, plus the applicable margins, as
defined in the agreement. The credit facilities are secured by essentially all
the assets of the Company and its subsidiaries. The credit facilities agreement
requires the maintenance of certain commitment fees, prepayments from the
issuance of new equity or debt and annual sale of assets, and covenant ratios or
amounts, including, but not limited to, funded debt to EBITDA, minimum EBITDA
for a period, cash flow coverage, and Net Worth, all as defined in the
agreement.
The Company has budgeted approximately $38.7 million in capital
expenditures in 2000, primarily for track rehabilitation, of which $7.7 million
is expected to be used in Australia. Of the $38.7 million in capital
expenditures, $12.8 million is
20
<PAGE>
expected to be funded by rehabilitation grants from state and federal agencies
to several of the Company's railroads. Approximately $4.8 million of the
budgeted capital expenditures of $38.7 million were completed as of March 31,
2000.
At March 31, 2000, the Company had long-term debt (including current
portion) totaling $112.0 million, which comprised 57.0% of its total
capitalization. This compares to long-term debt, including current portion, of
$108.4 million at December 31, 1999, comprising 57.0% of total capitalization.
The Company has historically relied primarily on cash generated from
operations to fund working capital and capital expenditures relating to ongoing
operations, while relying on borrowed funds to finance acquisitions and
equipment needs (primarily rolling stock) related to acquisitions. The Company
believes that its cash flow from operations together with amounts available
under its credit facilities will enable the Company to meet its liquidity and
capital expenditure requirements relating to ongoing operations for at least the
duration of its credit facilities.
Forward-Looking Statements
This Report and the documents incorporated herein by reference may contain
forward-looking statements based on current expectations, estimates and
projections about the Company's industry, management's beliefs, and assumptions
made by management. Words such as "anticipates," "intends," "plans," "believes,"
"seeks," "estimates," variations of such words and similar expressions are
intended to identify such forward-looking statements. These statements are no
guarantees of future performance and are subject to certain risks, uncertainties
and assumptions that are difficult to forecast. Therefore, actual results may
differ materially from those expressed or forecast in any such forward-looking
statements. Such risks and uncertainties include, in addition to those set forth
in this Item 2, those noted in the documents incorporated by reference. The
Company undertakes no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or otherwise.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
The Company is exposed to the impact of interest rate changes. The
Company's exposure to changes in interest rates applies to its borrowings under
its credit facilities which have variable interest rates depending on the
country in which the funds are drawn, plus the applicable margin, which varies
from 1.75% to 2.5% depending upon the country in which the funds are drawn and
the Company's funded debt to EBITDA ratio, as defined in the credit facilities
agreement. The Company is also exposed to the impact of foreign currency
exchange rate risk as it relates to debt valuation adjustments resulting from
currency exchange rate changes on certain U.S. denominated foreign debt. At
March 31, 2000, approximately $36.9 million of the Company's debt was U.S.
denominated foreign debt related to the Company's Mexican acquisition (see Notes
2. and 3. to Consolidated Financial Statements) which is subject to debt
valuation adjustments resulting from currency exchange rate changes. The Company
estimates that the fair value of these debt instruments approximated their
market values and carrying values at March 31, 2000. The Company invests excess
cash in overnight money market accounts.
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21
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS - NONE
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS - NONE
ITEM 3. DEFAULTS UPON SENIOR SECURITIES - NONE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - NONE
ITEM 5. OTHER INFORMATION - NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A). EXHIBITS - SEE INDEX TO EXHIBITS
(B). REPORTS ON FORM 8-K:
No Reports on Form 8-K were filed by the Registrant during the period
covered by this Report.
The remainder of this page is intentionally left blank.
22
<PAGE>
INDEX TO EXHIBITS
(2) Plan of acquisition, reorganization, arrangement, liquidation or
succession
Not applicable.
(3) (i) Articles of Incorporation
The Form of Restated Certificate of Incorporation referenced under
(4)(a) hereof is incorporated herein by reference.
(ii) By-laws
The By-laws referenced under (4)(b) hereof are incorporated herein
by reference.
(4) Instruments defining the rights of security holders, including
indentures
(a) Form of Restated Certificate of Incorporation (Exhibit 3.2)2
(b) By-laws (Exhibit 3.3)1
(c) Specimen stock certificate representing shares of Class A Common
Stock (Exhibit 4.1)3
(d) Form of Class B Stockholders' Agreement dated as of May 20, 1996,
among the Registrant, its executive officers and its Class B
stockholders (Exhibit 4.2)2
(e) Promissory Note dated October 7, 1991 of Buffalo & Pittsburgh
Railroad, Inc. in favor of CSX Transportation, Inc. (Exhibit 4.6)1
(f) First Amendment to Promissory Note dated as of March 19, 1999 between
Buffalo & Pittsburgh Railroad, Inc. and CSX Transportation, Inc.
(Exhibit 4.1)4
(g) Third Amended and Restated Revolving Credit and Term Loan Agreement
dated as of August 17, 1999 among the Registrant, certain
subsidiaries, BankBoston, N.A. and the banks named therein
(Exhibit 4.1)5
(10) Material Contracts
*(10.1) Amendment No. 3 to Genesee & Wyoming Inc. 1999 Stock Option Plan
*(11.1) Statement re computation of per share earnings
(15) Letter re unaudited interim financial information
Not applicable.
(18) Letter re change in accounting principles
23
<PAGE>
Not applicable.
(19) Report furnished to security holders
Not applicable.
(22) Published report regarding matters submitted to vote of security
holders
Not applicable.
(23) Consents of experts and counsel
Not applicable.
(24) Power of attorney
Not applicable.
*(27) Financial Data Schedule
(99) Additional Exhibits
Not applicable.
____________________________
*Exhibit filed with this Report.
1Exhibit previously filed as part of, and incorporated herein by reference
to, the Registrant's Registration Statement on Form S-1 (Registration No.
333-3972). The exhibit number contained in parenthesis refers to the exhibit
number in such Registration Statement.
2Exhibit previously filed as part of, and incorporated herein by reference
to, Amendment No. 1 to the Registrant's Registration Statement on Form S-1
(Registration No. 333-3972). The exhibit number contained in parenthesis refers
to the exhibit number in such Amendment.
3Exhibit previously filed as part of, and incorporated herein by reference
to, Amendment No. 2 to the Registrant's Registration Statement on Form S-1
(Registration No. 333-3972). The exhibit number contained in parenthesis refers
to the exhibit number in such Amendment.
4Exhibit previously filed as part of, and incorporated herein by reference
to, the Registrant's Report on Form 10-K for the fiscal year ended December 31,
1998. The exhibit number contained in parenthesis refers to the exhibit number
in such Report.
5Exhibit previously filed as part of, and incorporated herein by reference
to, the Registrant's Report on Form 10-Q for the quarter ended September 30,
1999. The exhibit number contained in parenthesis refers to the exhibit number
in such Report.
The remainder of this page is intentionally left blank.
24
<PAGE>
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: May 12, 2000 By: /s/ Mortimer B. Fuller, III
---------------------------
Name: Mortimer B. Fuller, III
Title: Chairman of the Board and CEO
Date: May 12, 2000 By: /s/ Alan R. Harris
---------------------------
Name: Alan R. Harris
Title: Senior Vice President and
Chief Accounting Officer
The remainder of this page is intentionally left blank.
25
<PAGE>
EXHIBIT 10.1
AMENDMENT NO. 3
to the
GENESEE & WYOMING INC.
1996 STOCK OPTION PLAN
Effective April 14, 2000
WHEREAS, Genesee & Wyoming Inc., a Delaware corporation (the "Company"), has
established the Genesee & Wyoming Inc. 1996 Stock Option Plan, as heretofore
amended (the "Plan"); and
WHEREAS, deeming it appropriate and advisable so to do, and pursuant to
Section 19 of the Plan, the Board of Directors of the Company has authorized,
approved and adopted the further amendments to the Plan set forth herein;
NOW, THEREFORE, the Plan is hereby amended and restated in its entirety,
effective April 14, 2000, as set forth below:
<PAGE>
Genesee & Wyoming Inc.
1996 Stock Option Plan
as amended and restated on April 14, 2000
(including those amendments comprising Amendment No. 3)
1. Purpose.
The Genesee & Wyoming Inc. 1996 Stock Option Plan (the "Plan"), effective
June 24, 1996 and subsequently amended, is designed to create an incentive for
executive and other employees of Genesee & Wyoming Inc., a Delaware corporation
(the "Company"), and its subsidiaries, to remain in the employ of the Company
and its subsidiaries and to contribute to their success by providing the
opportunity for stock ownership. The Company may grant under the Plan both
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code") ("Incentive Stock Options") and
stock options that do not qualify for treatment as Incentive Stock Options
("Nonstatutory Stock Options"). Unless expressly provided to the contrary, all
references herein to "Options" include both Incentive Stock Options and
Nonstatutory Stock Options.
2. Administration.
(a) The Plan shall be administered by a committee (the "Stock Option
Committee") which shall be comprised of two or more members of the Board of
Directors of the Company.
(b) Each member of the Stock Option Committee shall be a "Non-Employee
Director" of the Company within the meaning of Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
(c) Subject to the express provisions of the Plan, the Stock Option
Committee shall have the authority, in its discretion and without limitation:
(i) to determine the individuals to whom Options are granted, whether an
Option is intended to be an Incentive Stock Option or a Nonstatutory Stock
Option, the times when such individuals shall be granted Options, the number
of shares to be subject to each Option, the term of each Option, the date
when each Option shall become exercisable, whether an Option shall be
exercisable in whole or in part in installments, the number of shares to be
subject to each installment, the date each installment shall become
exercisable, the term of each installment, and the option price of each
Option;
(ii) to accelerate the date of exercise of any Option or any installment
thereof (irrespective of any vesting schedule that may have been part of the
grant of such Option);
(iii) to modify unilaterally the terms of any Option grant or Option
exercise (irrespective of the provisions of any stock option agreement) so
as to avoid variable accounting treatment under Accounting Principles Board
Opinion No. 25 or any Financial Accounting Standards Board interpretation;
and
2
<PAGE>
(iv) to make all other determinations necessary or advisable for
administering the Plan.
(d) The Stock Option Committee shall act by majority vote. The decision of
the Stock Option Committee on any question concerning or involving the
interpretation or administration of the Plan shall, as between the Company and
Option holders, be final and conclusive. The Stock Option Committee may consult
with counsel, who may be counsel for the Company, and shall not incur any
liability for any action taken in good faith in reliance upon the advice of
counsel.
3. Eligibility.
(a) Participants in the Plan shall be selected by the Stock Option Committee
from among the full-time employees of the Company, including those who are also
directors or officers thereof. An employee on leave of absence may be
considered as still in the employ of the Company for purposes of eligibility for
participation in the Plan. All references in this Plan to employees of the
Company shall include employees of any parent or subsidiary of the Company, as
those terms are defined in Section 424 of the Code.
(b) The right of the Company to terminate the employment of a Plan
participant at any time, with or without cause, shall in no way be restricted by
the existence of the Plan, any Option granted hereunder, or any stock option
agreement relating thereto.
4. Number of Shares.
Subject to the provisions of Section 5, the total number of shares of the
Company's Class A Common Stock, par value $.01 per share (the "Class A Common
Stock"), which may be issued under Options granted pursuant to the Plan shall
not exceed 850,000. Shares subject to the Plan may be either authorized but
unissued shares or shares that were once issued and subsequently reacquired by
the Company. If any Option is surrendered before exercise, or lapses without
exercise, or for any other reason ceases to be exercisable, the shares reserved
therefor shall continue to be available for the grant of Options under the Plan.
The Plan shall terminate on June 23, 2006, or the earlier dissolution of the
Company, and no Option shall be granted after such date.
5. Adjustment Provisions.
In the event that:
(a) in connection with a merger or consolidation of the Company or a
sale by the Company of all or a part of its assets, the outstanding shares
of Class A Common Stock are exchanged for a different number or class of
shares of stock or other securities of the Company, or for shares of the
stock or other securities of any other entity; or
(b) new, different or additional shares or other securities of the
Company or of another entity are received by the holders of Class A Common
Stock, whether by way of recapitalization or otherwise; or
3
<PAGE>
(c) any dividend in the form of stock is made to the holders of Class A
Common Stock, or any stock split or reverse split pertaining to Class A
Common Stock is effected;
then the Stock Option Committee shall make the appropriate adjustment to:
(i) the number and kind of shares or other securities that may be issued
upon exercise of Options yet to be granted;
(ii) the option price per share to be paid upon exercise of each
outstanding Option; and
(iii) the number and kind of shares or other securities covered by each
outstanding Option.
6. Incentive Stock Options.
(a) The aggregate fair market value (determined as of the Grant Date of the
Option) of the shares with respect to which Incentive Stock Options are
exercisable for the first time by a grantee during any calendar year (under all
plans of the Company and any parent and subsidiaries of the Company) shall not
exceed $100,000.
(b) If any Incentive Stock Option is for any reason disqualified as an
incentive stock option within the meaning of Section 422 of the Code, it shall
instead remain in full force and effect, in accordance with its terms, as a
Nonstatutory Stock Option.
7. Option Price.
(a) For purposes of the Plan, the term "Grant Date" shall mean either (i)
the date on which the grant of an Option is duly authorized by the Stock Option
Committee, or (ii) the later date specified in the authorizing resolutions of
the Stock Option Committee as the date on which the Option is granted. The
option price at which an Option shall be exercisable shall be at least the fair
market value per share of the Class A Common Stock on the Grant Date of such
Option. However, if an Incentive Stock Option is granted to any person who
would, after the grant of such Option, be deemed to own stock possessing more
than 10 percent of the total combined voting power of all classes of stock of
the Company, or of any parent or subsidiary of the Company (a "Ten Percent
Stockholder"), the option price shall be not less than 110 percent of the fair
market value per share of the Class A Common Stock on the Grant Date of such
Option.
(b) For purposes of the Plan, the fair market value per share of the Class A
Common Stock on any date ("Fair Market Value") shall be the closing price of the
Class A Common Stock on the principal national securities exchange on which the
Class A Common Stock is then listed or admitted to trading, and the closing
price shall be the last reported sale price regular way on such date (or, if no
sale takes place on such date, the last reported sale price regular way on the
next preceding date on which such sale took place), as reported by such
exchange. If the Class A Common Stock is not then so listed or admitted to
trading on a national securities exchange, then Fair Market Value shall be the
closing price (the last reported sale price regular way) of the Class A Common
Stock in the over-the-counter market as reported by the National Association of
Securities Dealers Automated Quotation System ("NASDAQ"), if the closing price
of the Class A Common Stock is then reported by NASDAQ. If the Class A Common
Stock closing price is
4
<PAGE>
not then reported by NASDAQ, then Fair Market Value shall be the mean between
the representative closing bid and closing asked prices of the Class A Common
Stock in the over-the-counter market as reported by NASDAQ. If the Class A
Common Stock bid and asked prices are not then reported by NASDAQ, then Fair
Market Value shall be the quote furnished by any member of the National
Association of Securities Dealers, Inc. selected from time to time by the
Company for that purpose. If no member of the National Association of Securities
Dealers, Inc. then furnishes quotes with respect to the Class A Common Stock,
then Fair Market Value shall be determined by resolution of the Company's Board
of Directors. Notwithstanding the foregoing provisions of this Section 7(b), if
the Board of Directors shall at any time determine that it is impracticable to
apply the foregoing methods of determining Fair Market Value, then the Board of
Directors is hereby empowered to adopt any other reasonable method for such
purpose.
8. Term of Options.
Subject to the provisions of Section 18, the term of each Option shall be
determined by the Stock Option Committee, but in no event shall an Option be
exercisable, either in whole or in part, after the expiration of ten years from
the Grant Date of such Option. Notwithstanding the foregoing, an Incentive
Stock Option granted to a Ten Percent Stockholder shall not be exercisable,
either in whole or in part, after the expiration of five years from the Grant
Date of such Option. The Stock Option Committee and an Option holder may at any
time by mutual agreement terminate any Option held by such Option holder.
9. Stock Option Agreements.
Each Option shall be evidenced by a written agreement which sets forth: (a)
the number of shares subject to the Option; (b) the option price; (c) the
vesting schedule of the Option or a statement that the Option is immediately
exercisable in full; (d) the expiration date of the Option; (e) the method of
payment on exercise of the Option; (f) whether the Option is intended to be an
Incentive Stock Option or a Nonstatutory Stock Option; and (g) such additional
provisions, not inconsistent with the Plan, as the Stock Option Committee may
prescribe.
10. Exercise of Options.
(a) Each Option, or any installment thereof, shall be exercised, whether in
whole or in part, by giving written notice to the Company at its principal
office, specifying the number of shares of Class A Common Stock being purchased
and the purchase price being paid, and accompanied by payment in full of the
purchase price.
(b) An Option holder shall pay for the shares subject to the Option by one
or any combination of the following methods, as determined by the Stock Option
Committee on the Grant Date of the Option: (i) in cash, or (ii) by delivery of
shares of Class A Common Stock already owned by the Option holder and held by
the Option holder for any holding period required by law or regulation. Any
shares of Class A Common Stock that are so delivered to pay the option price
shall be valued at Fair Market Value on the date of such Option exercise.
(c) The exercise of an Option shall be conditioned upon the Option holder
making arrangements satisfactory to the Stock Option Committee for the payment
to the Company of the amount of all taxes required by any governmental authority
to be withheld and paid over by the
5
<PAGE>
Company to the governmental authority on account of the exercise. The payment of
such withholding taxes to the Company shall be made by one or any combination of
the following methods, as determined by the Stock Option Committee on the Grant
Date of the Option: (i) in cash, or (ii) by the Company withholding such taxes
from any other compensation owed to the Option holder by the Company or any of
its subsidiaries.
11. Non-Assignment.
Each Option by its terms shall provide that it is not transferable by the
grantee other than by will or the laws of descent and distribution, and that
during the lifetime of the grantee, it is exercisable only by him; except that a
Nonstatutory Stock Option may be transferred during the lifetime of a grantee,
and may be exercised by the transferee in accordance with the express terms of
such Nonstatutory Stock Option and the stock option agreement applicable
thereto, but only if and to the extent that such transfer is permitted by the
Stock Option Committee, in its discretion, pursuant to the express terms of a
stock option agreement and subject to any terms and conditions which the Stock
Option Committee may impose thereon; provided, however, that Nonstatutory Stock
Options that are transferable may be granted only on terms that do not preclude
other grants of Options under the Plan that are exempt under Rule 16b-3
promulgated under the Exchange Act. A transferee or other person claiming any
rights under the Plan shall be subject to all of the terms and conditions of the
Plan and of the stock option agreement applicable to such transferee's
transferor (except as otherwise determined by the Stock Option Committee) and to
any additional terms and conditions which the Stock Option Committee may deem
appropriate.
12. Death of Grantee.
In the event that a grantee shall die:
(i) while he is an employee of the Company, or within three months after
termination of such employment (or within such other period after termination
of employment as may be determined by the Stock Option Committee and set
forth in the applicable stock option agreement); and
(ii) prior to the complete exercise of Options granted to him under the
Plan;
then any such remaining Options with exercise periods outstanding may be
exercised, in whole or in part, within one year after the date of the grantee's
death (or within such other period after the grantee's death as may be
determined by the Stock Option Committee and set forth in the applicable stock
option agreement) and then only:
(a) by the grantee's estate, by such person(s) to whom the grantee's
rights hereunder shall have passed under his will or the laws of descent and
distribution, or by a transferor contemplated by Section 11;
(b) to the extent that the grantee was entitled to exercise the Option
on the date of his death, and subject to all of the conditions on exercise
imposed hereby; and
(c) prior to the expiration of the term of the Option.
6
<PAGE>
13. Termination of Employment.
(a) During the lifetime of a grantee, an Option shall be exercisable only
while he is an employee of the Company and has been an employee continuously
since the Grant Date of the Option, or within three months after the date on
which he ceases to be such an employee for any reason (or within such other
period after termination of his employment as may be determined by the Stock
Option Committee and set forth in the applicable stock option agreement);
provided, however, that in the case of a grantee who is permanently and totally
disabled (within the meaning of Section 22(e)(3) of the Code), such three-month
period shall instead be one year (or such other period as may be determined by
the Stock Option Committee and set forth in the applicable stock option
agreement).
(b) Any Option that is exercisable after termination of employment, as
provided by Section 13(a), shall be exercisable only to the extent that the
grantee would have been entitled to exercise the Option on the date of
termination of employment; and further, no Option shall be exercisable after the
expiration of the term thereof.
(c) For purposes of this Section 13, an employment relationship shall be
treated as continuing during the period when a grantee is on military duty, sick
leave or other bona fide leave of absence if the period of such leave does not
exceed 90 days or, if longer, so long as a statute or contract guarantees the
grantee's right to re-employment with the Company. When the period of leave
exceeds 90 days and the individual's right to re-employment is not so
guaranteed, the employment relationship shall be deemed to have terminated on
the 91st day of such leave.
14. Additional Requirements.
Each grant of an Option under the Plan, and (unless a Registration Statement
with respect thereto shall then be effective under the Securities Act of 1933,
as amended (the "Securities Act")) each issuance of shares of Class A Common
Stock upon exercise of an Option, shall be conditioned upon the Company's prior
receipt of representations of investment intent, in form and content
satisfactory to counsel for the Company, of the Option holder that such Option
and such shares are being acquired by such holder solely for investment and not
with a view to, or for sale in connection with, any distribution thereof, nor
with any present intention of selling, transferring or disposing of the same.
Any shares of Class A Common Stock acquired by the holder upon exercise of the
Option may not thereafter be offered for sale, sold or otherwise transferred
unless (a) a Registration Statement with respect thereto shall then be effective
under the Securities Act, and the Company shall have been furnished with proof
satisfactory to it that such holder has complied with applicable state
securities laws, or (b) the Company shall have received an opinion of counsel in
form and substance satisfactory to counsel for the Company that the proposed
offer for sale, sale or transfer is exempt from the registration requirements of
the Securities Act and may otherwise be transferred in compliance with the
Securities Act and in compliance with any other applicable law, including all
applicable state securities laws; and the Company may withhold transfer,
registration and delivery of such securities until one of the foregoing
conditions shall have been met.
7
<PAGE>
15. Listing and Registration.
The Company, in its discretion, may postpone the issuance and delivery of
shares upon any exercise of an Option until completion of such stock exchange
listing, or registration or other qualification of such shares under any state
or federal law, rule or regulation, as the Company may consider appropriate; and
may require any person exercising an Option to make such representations and
furnish such information as it considers appropriate in connection with the
issuance of the shares in compliance with applicable law, including without
limitation federal or state laws regulating the sale or issuance of securities.
Notwithstanding the foregoing, the Company shall be under no obligation
whatsoever to list, register or otherwise qualify any shares subject to Options
under the Plan.
16. Rights as a Stockholder.
No Option holder shall have any rights as a stockholder with respect to the
shares of Class A Common Stock purchased by him pursuant to the exercise of an
Option until the date of the issuance to him of a stock certificate representing
such shares. No adjustment shall be made for dividends or for distributions of
any other kind with respect to shares for which the record date is prior to the
date of the issuance to the Option holder of a certificate for the shares.
17. Effect of Acquisition, Reorganization or Liquidation.
Notwithstanding any provision to the contrary in this Plan or in any
agreement evidencing Options granted hereunder, all Options with exercise
periods then currently outstanding shall become immediately exercisable in full
and remain exercisable until their expiration in accordance with their
respective terms upon the occurrence of either of the following events:
(a) the first purchase of shares pursuant to a tender or exchange offer
which is intended to effect the acquisition of more than 50% of the voting
power of the Company (other than a tender or exchange offer made by the
Company); or
(b) approval by the Company's stockholders of: (i) a merger or
consolidation of the Company with or into another corporation (other than a
merger or consolidation in which the Company is the surviving corporation
and which does not result in any reclassification or reorganization of the
shares), (ii) a sale or disposition of all or substantially all of the
Company's assets, or (iii) a plan of complete liquidation or dissolution of
the Company.
8
<PAGE>
18. Conditional Options.
Prior to approval and ratification of the Plan by the stockholders of the
Company, the Stock Option Committee may grant "Conditional Options" under the
Plan. In addition, in the event that any amendment to the Plan requires
approval and ratification by the stockholders, then prior to such approval and
ratification the Stock Option Committee may grant Conditional Options under the
Plan. Conditional Options may be granted under the Plan only under the
following conditions: (a) a Conditional Option shall be clearly identified as a
Conditional Option; (b) the grant of a Conditional Option shall be expressly
conditioned upon the approval and ratification of the Plan (or of the amendment
to the Plan, as the case may be) by the stockholders of the Company; (c) such
stockholder approval and ratification shall occur no later than the Annual
Meeting of Stockholders of the Company next following the effective date of the
Plan (or of the amendment to the Plan, as the case may be); and (d)
notwithstanding any other provision of the Plan, no holder of a Conditional
Option shall have any right to exercise such Option prior to such approval and
ratification of the Plan (or of the amendment to the Plan, as the case may be)
by the stockholders. Notwithstanding any other provision of the Plan, prior to
approval and ratification of the Plan (or of the amendment to the Plan, as the
case may be) by the stockholders of the Company, no holder of a Conditional
Option shall have any right to sell, assign, transfer, pledge or encumber the
Conditional Option, or the shares underlying the Conditional Option, except by
will or the laws of descent and distribution. If the stockholders of the
Company fail to approve and ratify the Plan (or the amendment to the Plan, as
the case may be) at such Annual Meeting of Stockholders, then all Conditional
Options granted hereunder conditioned upon such approval and ratification shall
be automatically cancelled and shall immediately become null and void.
19. Amendment of Plan.
The Plan may be amended at any time by the Board of Directors, provided that
(except for amendments made pursuant to Section 5) no amendment made without the
approval and ratification of the stockholders of the Company shall increase the
total number of shares which may be issued under Options granted pursuant to the
Plan, reduce the minimum option price, extend the latest date upon which Options
may be granted or shall be exercisable, change the class of employees eligible
to be granted Options, or otherwise materially increase the benefits accruing to
participants under the Plan.
20. No Reservation of Shares.
The Company shall be under no obligation to reserve shares of Class A Common
Stock or other securities to satisfy the exercise of Options. The grant of
Options hereunder shall not be construed as constituting the establishment of a
trust of such shares, and no particular shares shall be identified as optioned
or reserved for issuance hereunder. The Company shall have complied with the
terms of the Plan if, at the time of its delivery of shares upon the exercise of
any Option, it has a sufficient number of shares authorized and unissued, or
issued and held in its treasury, which may then be delivered under the Plan,
irrespective of the date on which such shares were authorized.
9
<PAGE>
21. Application of Proceeds.
The proceeds of the sale of shares of Class A Common Stock by the Company
under the Plan will constitute general funds of the Company and may be used by
the Company for any purpose.
22. Choice of Law.
The validity, interpretation and administration of the Plan and of any
rules, regulations, determinations or decisions made hereunder, and the rights
of any and all persons having or claiming to have any interest herein or
hereunder, shall be determined exclusively in accordance with the laws of the
State of Delaware (without regard to the choice of law provisions of such laws).
23. Rule 16b-3 Qualification.
Some or all of the Options granted under the Plan are intended to qualify
under Rule 16b-3 promulgated under the Exchange Act.
24. In General.
(a) As used herein, the masculine pronoun shall include the feminine and the
neuter, as appropriate to the context.
(b) As used herein, the term "Section" shall mean the appropriate Section of
the Plan.
* * * * *
The foregoing amendment and restatement of the Genesee & Wyoming Inc. 1996
Stock Option Plan was duly adopted by the Board of Directors of Genesee &
Wyoming Inc. on April 14, 2000.
/s/ Mark W. Hastings
--------------------
Mark W. Hastings, Secretary
10
<PAGE>
Exhibit 11.1
GENESEE & WYOMING INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS (LOSS) PER COMMON SHARE
(in thousands, except per share amounts)
Three Months Three Months
Ended Ended
March 31, 2000 March 31, 1999
-------------- --------------
BASIC EARNINGS (LOSS) PER SHARE CALCULATION:
Net Income (loss) $4,412 $ (331)
Weighted average number of shares
of common stock 4,328 4,933
Earnings (loss) per share - basic $ 1.02 $(0.07)
DILUTED EARNINGS (LOSS) PER SHARE CALCULATION:
Net Income (loss) $4,412 $(331)
Weighted average number of shares of common stock
and common stock equivalents outstanding:
Weighted average number of shares
of common stock 4,328 4,933
Common stock equivalents issuable under stock
option plans 97 -0-
Weighted average number of shares of common stock
and common stock equivalents - diluted 4,425 4,933
Earnings (loss) per share - diluted $ 1.02 $(0.07)
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Balance
Sheet Income Statement and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 9,352
<SECURITIES> 0
<RECEIVABLES> 46,620
<ALLOWANCES> 0
<INVENTORY> 6,385
<CURRENT-ASSETS> 72,233
<PP&E> 231,841
<DEPRECIATION> 43,015
<TOTAL-ASSETS> 300,983
<CURRENT-LIABILITIES> 68,823
<BONDS> 96,375
0
0
<COMMON> 53
<OTHER-SE> 84,495
<TOTAL-LIABILITY-AND-EQUITY> 300,983
<SALES> 55,411
<TOTAL-REVENUES> 55,411
<CGS> 47,114
<TOTAL-COSTS> 47,114
<OTHER-EXPENSES> 1,430
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (2,752)
<INCOME-PRETAX> 6,975
<INCOME-TAX> 2,563
<INCOME-CONTINUING> 4,412
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,412
<EPS-BASIC> 1.02
<EPS-DILUTED> 1.00
</TABLE>
