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Friday March 27, 2:45 pm Eastern Time
Company Press Release
RailAmerica, Inc. Reports Record Earnings For The Fourth Quarter And Year-End 1997
1997 Income From Continuing Operations Increases 144 Percent
BOCA RATON, Fla.--(BUSINESS WIRE)--March 27, 1998--RailAmerica, Inc. (Nasdaq/NNM:RAIL - news) today reported financial results for the fourth quarter and year ended December 31, 1997. The Company achieved record quarterly and annual revenues, carloadings, operating income and income from continuing operations.
Revenues for the fourth quarter of 1997 reached $14.0 million, 112% higher than the $6.6 million reported in the comparable 1996 quarter. Operating income more than doubled to $2.9 million in the quarter, from $1.2 million in 1996. Income from continuing operations for the fourth quarter of 1997 rose to $1.2 million, or $.14 per basic share, on 8.8 million weighted average common shares, compared with $0.3 million, or $.04 per basic share, on 5.9 million weighted average common shares in the 1996 quarter. Net income for the 1997 fourth quarter, after the loss from the Company's discontinued motor carrier segment, was $682,571, or $.08 per basic share, versus a loss of $61,403, or $(.01) per basic share, reported in the comparable 1996 period.
For the year ended December 31, 1997, revenues increased 85% to a record $47.4 million, compared with $25.7 million in the prior year. Operating income rose 89% to $7.3 million, from $3.9 million in 1996. Income from continuing operations for 1997 was $2.6 million, or $.32 per basic share, versus $1.1 million, or $.22 per basic share, in 1996. Net income for the year, after the loss from discontinued operations, was $1.9 million, or $.23 per basic share, on 8.3 million weighted average common shares, compared with $0.5 million, or $.10 per basic share, on 5.0 million weighted average common shares in 1996. The Company stated that its 1997 earnings were impacted by its decision to adjust certain revenues and previously deferred start-up costs recorded during the first half of 1997 associated with commencement of rail services on railroads acquired in Washington and Minnesota. This reduced the Company's 1997 income from continuing operations by $536,190.
Revenues from rail operations for the year rose 125% to $22.0 million, from $9.8 million in 1996. Fourth quarter rail revenues were $6.4 million, up 103% from those revenues achieved in the 1996 quarter. Rail freight carloadings for 1997 totalled 69,140, a 167% increase over 1996 carloadings. For the fourth quarter of 1997, carloadings totalled 21,423, a 137% increase over the 1996 quarter. The growth in carloadings for the fourth quarter and the year was primarily attributable to the inclusion of the Company's new railroads acquired in the latter half of 1996 and in 1997, including railroads in Washington, Pennsylvania, Minnesota and Chile.
Revenues at Kalyn/Siebert, Inc. (''Kalyn''), RailAmerica's wholly-owned specialty truck trailer manufacturing subsidiary, were a record $22.9 million for the year and $6.6 million for the fourth quarter. This represents increases of 68% and 159%, respectively, over the comparable 1996 periods. The Company stated that the commencement of production in February of 1997 under Kalyn's previously announced U.S. Army Tank Automotive Command (TACOM) contract and strong commercial trailer business were the primary reasons for these increases.
Gary O. Marino, RailAmerica, Inc. Chairman, President and Chief Executive Officer said, ''We are pleased with the outstanding 1997 operating and financial results achieved by our Company. Virtually every segment of our continuing operations contributed to this exceptional growth. Despite delayed carloadings at some of our domestic railroads due to rail car shortage problems associated with congestion in the nation's western rail system and lower market prices for grain during the fourth quarter, the performance of our domestic railroads exceeded our expectations. At Ferronor, our Chilean railroad, the recently announced $68 million, 10-year transportation contract, combined with the previously-announced $165 million, 20-year transportation contract, both of which are scheduled to commence in July 1998, should provide strong carloadings at Ferronor for the foreseeable future. Our trailer manufacturing business has started the new year on a positive note and we expect that Kalyn's January 1998 acquisition of Canadian manufacturer Fabrex and Services Remorques Plus, combined with Kalyn's record backlog, should lead to continued strong growth in 1998. We anticipate building upon this momentum during 1998 and beyond through further development and growth of our existing businesses. In addition, the recent expansion of our banking relationships, coupled with additions to our management team in 1997, should supply the resources we need to continue our aggressive acquisition strategy.''
RailAmerica, Inc. is a diversified international transportation holding company operating 11 railroads over approximately 2,400 route miles in seven U.S. states and the Republic of Chile. The Company holds a minority equity interest in the Great Southern Railway Limited consortium which operates the 4,000 mile transcontinental Australian passenger rail service. The Company also owns Kalyn/Siebert, Inc., a specialty truck trailer manufacturer with production facilities in Gatesville, Texas and Trois-Rivieres, Quebec, Canada.
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