Genesee & Wyoming evaluating acquisition, investment opportunities

By Jennifer Lanning Drey

Portland, Ore., Feb. 8 - Genesee & Wyoming Inc. continues to evaluate acquisition and investment opportunities and has a letter of intent for a project in North America that is likely to be announced in the next week or so, John Hellman, chief executive officer of Genesee & Wyoming, said during its fourth-quarter earnings conference call held Monday.

The company had $106 million of cash and zero borrowings outstanding on its revolving credit facility at Dec. 31.

Hellman said Genesee is interested in opportunities in North America and Australia, with near-term activity likely to be centered on natural resource projects.

Genesee generated $75 million of free cash flow in 2009 and is budgeting free cash flow of $80 million to $85 million in 2010.

"Our ability to generate this much cash amidst severe recession is an important indicator of the strength of our business," Hellman said.

Genesee posted fourth-quarter revenues from continuing operations of $139.9 million, compared to revenues of $149.2 million in the same period of 2008.

Net income was $18.3 million in the fourth quarter, compared with net income of $25.3 million in the prior-year period.

"Overall, our fourth-quarter results were good and were stable compared to the third quarter of 2009," Hellman said.

Genesee & Wyoming is a Greenwich, Conn.-based owner and operator of short line and regional freight railroads.

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