Genesee & Wyoming Reports Results for the First Quarter of 2009

GREENWICH, Conn., April 29, 2009 /PRNewswire-FirstCall/ -- Genesee & Wyoming
Inc. (GWI) (NYSE: GWR) reported net income in the first quarter of 2009 of
$13.9 million, compared with net income of $10.4 million in the first quarter
of 2008. GWI's diluted earnings per share (EPS) in the first quarter of 2009
were $0.38 with 36.4 million weighted average shares outstanding, compared
with diluted EPS of $0.29 with 36.0 million weighted average shares
outstanding in the first quarter of 2008.

GWI's income from continuing operations in the first quarter of 2009 was $14.0
million, or $0.38 per diluted share, compared with income from continuing
operations of $11.2 million, or $0.31 per diluted share, in the first quarter
of 2008.

GWI's results in the first quarter benefited $0.05 per diluted share from the
positive impact of the U.S. short line tax credit, which is in effect through
2009. Primarily as a result of the tax credit, GWI's effective income tax
rate on its continuing operations decreased from 37.7% in the first quarter of
2008 to 27.0% in the first quarter of 2009.

Continuing Operations
In the first quarter of 2009, GWI's revenues decreased $2.2 million, or 1.6%,
to $138.5 million, compared with $140.7 million in the first quarter of 2008.
Same railroad revenues decreased $23.4 million, or 16.6%, partially offset by
revenues of $21.2 million from acquisitions. The decrease in same railroad
revenues included an $8.4 million decrease due to the depreciation of the
Australian and Canadian dollars and a $5.5 million decrease due to a decline
in third-party fuel sales. Excluding currency effects and fuel sales, GWI's
same railroad revenues declined $9.5 million, or 6.8%.

Freight revenues in the first quarter of 2009 increased by $1.4 million, or
1.6%, to $89.2 million, compared with $87.7 million in the first quarter of
2008. Our acquisitions provided $16.0 million in freight revenues, partially
offset by a decrease of $14.6 million in same railroad freight revenues. Same
railroad freight revenues were reduced by $4.7 million due to the depreciation
of the Australian and Canadian dollars. Excluding currency effects, GWI's same
railroad freight revenues decreased by $9.9 million, or 11.3%.

GWI's traffic in the first quarter of 2009 increased 25,012 carloads, or
13.2%, compared with the first quarter of 2008. Same railroad traffic
decreased by 15,759 carloads, or 8.3%. The decrease was principally due to
declines of 7,292 carloads of pulp and paper traffic, 6,494 carloads of metals
traffic and 3,616 carloads of lumber and forest products traffic. These
decreases were partially offset by a 6,353 carload increase in farm and food
products traffic primarily in Australia. All other same railroad traffic
decreased by a net 4,710 carloads.

Average freight revenues per carload declined 10.2% in the first quarter of
2009. Same railroad average revenues per carload declined 9.1%. Same
railroad average revenues per carload were negatively impacted by three
factors: changes in commodity mix, the depreciation of the Canadian and
Australian dollars and lower fuel surcharges, which reduced average revenues
per carload by 5.4%, 5.2%, and 3.1%, respectively. Excluding these three
factors, same railroad average revenues per carload increased 4.6%. In the
United States and Canada, excluding currency effects, changes in commodity mix
and changes in fuel surcharges, same railroad average revenues per carload
increased 5.0%.

GWI's non-freight revenues in the first quarter of 2009 decreased $3.7
million, or 6.9%, compared with the first quarter of 2008. Same railroad
non-freight revenues decreased $8.8 million, or 16.6%, partially offset by
$5.1 million in non-freight revenues from acquisitions. The same railroad
non-freight revenues decrease was composed of $3.7 million due to the
depreciation of the Australian and Canadian dollars and $5.5 million due to a
decline in third-party fuel sales. Excluding currency effects and fuel sales,
GWI's same railroad non-freight revenues increased $0.4 million.

GWI's operating income in the first quarter of 2009 increased 22.5% to $26.1
million, compared with $21.3 million in the first quarter of 2008. The
operating ratio was 81.1% in the first quarter of 2009, compared with an
operating ratio of 84.9% in the first quarter of 2008. Excluding currency
effects and changes in the cost of third-party fuel sales, GWI's same railroad
operating expenses declined by $10.7 million, or 9.0%, in the first quarter of
2009 compared to the first quarter of 2008.

Comments from the Chief Executive Officer
John C. Hellmann, President and CEO of GWI, commented, "GWI's net income for
the first quarter of 2009 was generally consistent with our expectations. The
severe contraction of North American industrial production reduced our
shipments of economically sensitive commodities such as steel, paper and
lumber by 34%, 24% and 20%, respectively, on a same railroad basis. While
these volume declines were significant, we have been able to offset a
significant portion of the revenue losses with cost reductions, as illustrated
by our operating ratio improving to 81.1% in the first quarter of 2009
compared with 84.9% in the same period last year."

"Several areas of GWI's business have been less affected by the recession,
including our grain shipments in Australia, our coal shipments in the United
States and our contract revenues such as industrial switching. Even in these
relatively stable categories, however, we remain focused on cutting costs and
maximizing cash flow for the remainder of 2009. Until we have greater
clarity on the timing of any global economic recovery, we will continue to be
aggressive in the management of our cost structure and patient in targeting
new acquisition opportunities."

Free Cash Flow from Continuing Operations (1)

($ in millions) Three Months Ended
March 31,
--------
2009 2008
------ ------

$25.5 $8.1
Net cash provided by operating activities
Net cash used in investing activities (19.1) (7.0)
Net cash paid for acquisitions (a) 5.8 3.6
------ ------
Free cash flow (1) $12.2 $4.7
====== ======

(a) The 2009 period includes: 1) $4.8 million in net cash paid for final
working capital adjustments related to the acquisition of the Ohio
Central Railroad System (OCR) and 2) $1.0 million (or euro 0.8
million) in net cash paid in contingent consideration related to the
Rotterdam Rail Feeding B.V. (RRF) acquisition. The 2008 period
includes $3.6 million in net cash paid for the acquisition of
Maryland Midland Railway, Inc. (Maryland Midland).

GWI's continuing operations generated free cash flow of $12.2 million and $4.7
million for the first quarter 2009 and 2008, respectively. For the first
quarter of 2009, changes in working capital reduced net cash flow from
operating activities by $3.5 million. For the first quarter of 2008, changes
in working capital reduced net cash flow from operating activities by $15.1
million.

Net cash used in investing activities for the first quarter of 2009 included
$20.7 million in purchases of property and equipment, partially offset by $3.8
million in cash received from grants from outside parties and $3.6 million
from sales of assets. Net cash used in investing activities for the first
quarter of 2008 included $15.7 million in purchases of property and equipment,
partially offset by $10.4 million in cash received from grants from outside
parties and $1.9 million from sales of assets.

Conference Call and Webcast Details
As previously announced, GWI's conference call to discuss financial results
for the first quarter will be held Wednesday, April 29, 2009 at 11:00 a.m.
(Eastern Time). The dial-in number for the teleconference is (800) 288-8967;
outside U.S., call (612) 332-0632, or the call may be accessed live over the
Internet (listen only) under the "Investors" tab of GWI's website
(http://www.gwrr.com), by selecting "First Quarter Earnings Audio Webcast." An
audio replay of the conference call will be accessible via the "Investors" tab
of GWI's website starting at 1:00 p.m. Wednesday, April 29, 2009.

About Genesee & Wyoming Inc.
GWI owns and operates short line and regional freight railroads in the United
States, Canada, Australia and the Netherlands and owns a minority interest in
a railroad in Bolivia. Operations currently include 63 railroads organized in
nine regions, with more than 6,800 miles of owned and leased track and
approximately 3,100 additional miles under track access arrangements. GWI
provides rail service at 16 ports in North America and Europe and performs
contract coal loading and railcar switching for industrial customers.

Cautionary Statement Concerning Forward-Looking Statements
This press release contains forward-looking statements regarding future events
and the future performance of Genesee & Wyoming Inc. that involve risks and
uncertainties that could cause actual results to differ materially from its
current expectations including, but not limited to, economic, political and
industry conditions; customer demand, retention and contract continuation;
legislative and regulatory developments; increased competition in relevant
markets; funding needs and financing sources; susceptibility to various legal
claims and lawsuits; strikes or work stoppages; severe weather conditions and
other natural occurrences; and others. Words such as "anticipates," "intends,"
"plans," "believes," "seeks," "expects," "estimates," variations of these
words and similar expressions are intended to identify these forward-looking
statements. GWI refers you to the documents that it files from time to time
with the Securities and Exchange Commission, such as GWI's Forms 10-Q and 10-K
which contain additional important factors that could cause its actual results
to differ from its current expectations and from the forward-looking
statements contained in this press release. GWI disclaims any intention to
update the current expectations or forward looking statements contained in
this press release.

(1) Free Cash Flow is a non-GAAP financial measure and is not intended
to replace net cash provided by operating activities, its most
directly comparable GAAP measure. The information required by
Regulation G under the Securities Exchange Act of 1934, including a
reconciliation to net cash provided by operating activities, is
included in the tables attached to this press release.

Michael Williams of GWI Corporate Communications
1-203-629-3722
mwilliams@gwrr.com

GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2009 AND 2008
(In thousands, except per share amounts)
(unaudited)

Three Months Ended
March 31,
---------
2009 2008
---- ----

OPERATING REVENUES $138,458 $140,681

OPERATING EXPENSES 112,358 119,375
------- -------
INCOME FROM OPERATIONS 26,100 21,306

INTEREST INCOME 182 585
INTEREST EXPENSE (7,180) (3,909)
OTHER INCOME, NET 42 98
-- --

INCOME FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES 19,144 18,080

PROVISION FOR INCOME TAXES 5,163 6,819
----- -----

INCOME FROM CONTINUING OPERATIONS, NET OF TAX 13,981 11,261

LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX (33) (839)
--- ----

NET INCOME 13,948 10,422

LESS: NET INCOME ATTRIBUTABLE TO THE
NONCONTROLLING INTEREST (1) (25)
-- ---

NET INCOME ATTRIBUTABLE TO GENESEE & WYOMING INC. $13,947 $10,397
======= =======

BASIC EARNINGS PER SHARE ATTRIBUTABLE TO
GENESEE & WYOMING INC. COMMON STOCKHOLDERS:
BASIC EARNINGS PER COMMON SHARE FROM
CONTINUING OPERATIONS $0.42 $0.36
BASIC LOSS PER COMMON SHARE FROM DISCONTINUED
OPERATIONS - (0.03)
- -----
BASIC EARNINGS PER COMMON SHARE $0.42 $0.33
===== =====

WEIGHTED AVERAGE SHARES - BASIC 33,467 31,498
====== ======

DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO
GENESEE & WYOMING INC. COMMON STOCKHOLDERS:
DILUTED EARNINGS PER COMMON SHARE FROM
CONTINUING OPERATIONS $0.38 $0.31
DILUTED LOSS PER COMMON SHARE FROM
DISCONTINUED OPERATIONS - (0.02)
- -----
DILUTED EARNINGS PER COMMON SHARE $0.38 $0.29
===== =====

WEIGHTED AVERAGE SHARES - DILUTED 36,370 36,033
====== ======

GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2009 AND DECEMBER 31, 2008
(In thousands)
(unaudited)

March 31, December 31,
ASSETS 2009 2008
---- ----

CURRENT ASSETS:
Cash and cash equivalents $31,134 $31,693
Accounts receivable, net 109,127 120,874
Materials and supplies 7,272 7,708
Prepaid expenses and other 12,019 12,270
Current assets of discontinued operations 1,530 1,676
Deferred income tax assets, net 18,101 18,101
------ ------
Total current assets 179,183 192,322
------- -------

PROPERTY AND EQUIPMENT, net 995,735 998,995
INVESTMENT IN UNCONSOLIDATED AFFILIATES 4,987 4,986
GOODWILL 151,624 150,958
INTANGIBLE ASSETS, net 222,072 223,442
DEFERRED INCOME TAX ASSETS, net 16,540 16,578
------ ------
Total assets $1,570,141 $1,587,281
========== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Current portion of long-term debt $27,007 $26,034
Accounts payable 107,404 124,162
Accrued expenses 35,274 37,903
Current liabilities of discontinued operations 980 1,121
Deferred income tax liabilities, net 2 192
- ---
Total current liabilities 170,667 189,412
------- -------

LONG-TERM DEBT, less current portion 525,788 535,231
DEFERRED INCOME TAX LIABILITIES, net 239,157 234,979
DEFERRED ITEMS - grants from outside parties 113,934 113,302
OTHER LONG-TERM LIABILITIES 27,073 34,943

TOTAL STOCKHOLDERS' EQUITY 493,522 479,414
------- -------
Total liabilities and stockholders'
equity $1,570,141 $1,587,281
========== ==========

GENESEE & WYOMING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2009 AND 2008
(In thousands)
(unaudited)

Three Months
Ended March 31,
----------------
2009 2008
---- ----

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $13,948 $10,422
Adjustments to reconcile net income to net cash
provided by operating activities:
Loss from discontinued operations, net of tax 33 839
Depreciation and amortization 11,506 9,199
Compensation cost related to equity awards 1,564 1,338
Excess tax benefits from share-based compensation (10) (845)
Deferred income taxes 2,240 2,826
Net gain on sale of assets (239) (550)
Changes in assets and liabilities which provided
(used) cash, net of effect of acquisitions:
Accounts receivable, net 5,253 (2,994)
Materials and supplies 368 (268)
Prepaid expenses and other 175 594
Accounts payable and accrued expenses (9,264) (12,716)
Other assets and liabilities, net (42) 256
--- ---
Net cash provided by operating
activities from continuing operations 25,532 8,101
Net cash used in operating activities
from discontinued operations (411) (776)
---- ----
Net cash provided by operating
activities 25,121 7,325
------ -----

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (20,701) (15,664)
Grant proceeds from outside parties 3,771 10,360
Cash paid for acquisitions, net (5,780) (3,613)
Proceeds from disposition of property and equipment 3,631 1,897
----- -----
Net cash used in investing activities
from continuing operations (19,079) (7,020)
------- ------

CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term borrowings,
including capital leases (76,671) (30,058)
Proceeds from issuance of long-term debt 69,000 17,500
Net proceeds from employee stock purchases 660 2,353
Excess tax benefits from share-based compensation 10 845
-- ---
Net cash used in financing activities
from continuing operations (7,001) (9,360)
------ ------

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
EQUIVALENTS 242 1,067
--- -----

CHANGE IN CASH BALANCES INCLUDED IN CURRENT ASSETS OF
DISCONTINUED OPERATIONS 158 41
--- --

DECREASE IN CASH AND CASH EQUIVALENTS (559) (7,947)
CASH AND CASH EQUIVALENTS, beginning of period 31,693 46,684
------ ------
CASH AND CASH EQUIVALENTS, end of period $31,134 $38,737
======= =======

GENESEE & WYOMING INC. AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)

Three Months Ended
March 31,
---------
2009 2008
---- ----
% of % of
Amount Revenue Amount Revenue
------ ------- ------ -------
Revenues:
---------
Freight $89,166 64.4% $87,728 62.4%
Non-freight 49,292 35.6% 52,953 37.6%
------ ---- ------ ----

Total revenues $138,458 100.0% $140,681 100.0%
======== ===== ======== =====

Operating Expense Comparison:
-----------------------------
Natural Classification
----------------------
Labor and benefits $49,964 36.1% $46,117 32.8%
Equipment rents 7,890 5.7% 8,381 6.0%
Purchased services 9,311 6.7% 10,837 7.7%
Depreciation and
amortization 11,506 8.3% 9,199 6.5%
Diesel fuel used in
operations 8,993 6.5% 15,785 11.2%
Diesel fuel sold to third
parties 3,389 2.4% 8,567 6.1%
Casualties and insurance 3,584 2.6% 4,234 3.0%
Materials 5,603 4.1% 6,105 4.4%
Net gain on sale of assets (239) -0.2% (550) -0.4%
Other expenses 12,357 8.9% 10,700 7.6%
------ --- ------ ---

Total operating expenses $112,358 81.1% $119,375 84.9%
======== ==== ======== ====

Functional Classification
-------------------------
Transportation $43,129 31.1% $47,856 34.0%
Maintenance of ways and
structures 13,433 9.7% 12,968 9.3%
Maintenance of equipment 17,108 12.4% 17,941 12.8%
Diesel fuel sold to third
parties 3,389 2.4% 8,567 6.1%
General and administrative 24,032 17.4% 23,394 16.6%
Net gain on sale of assets (239) -0.2% (550) -0.4%
Depreciation and
amortization 11,506 8.3% 9,199 6.5%
------ --- ----- ---

Total operating expenses $112,358 81.1% $119,375 84.9%
======== ==== ======== ====

GENESEE & WYOMING INC. AND SUBSIDIARIES
RAILROAD FREIGHT REVENUE, CARLOADS AND AVERAGE REVENUES PER CARLOAD
COMPARISON BY COMMODITY GROUP
(dollars in thousands, except average revenue per carload)
(unaudited)

Three Months Ended Three Months Ended
March 31, 2009 March 31, 2008
-------------- --------------
Average Average
Revenues Revenues
Freight Per Freight Per
Commodity Group Revenues Carloads Carload Revenues Carloads Carload
-------- -------- ------- -------- -------- -------

Coal, Coke & Ores $21,117 57,946 $364 $16,746 45,480 $368
Pulp & Paper 13,400 24,086 556 18,013 29,926 602
Farm & Food
Products 10,803 26,392 409 10,887 17,932 607
Metals 9,467 19,338 490 9,519 19,127 498
Minerals & Stone 8,507 31,250 272 9,214 31,653 291
Chemicals-Plastics 8,358 12,808 653 7,423 11,377 652
Lumber & Forest
Products 6,616 14,715 450 7,972 18,137 440
Petroleum Products 5,689 7,887 721 5,007 7,451 672
Autos & Auto Parts 1,104 1,708 646 1,755 3,345 525
Intermodal 52 174 299 124 259 478
Other 4,053 18,135 223 1,068 4,740 225
----- ------ ----- -----

Totals $89,166 214,439 416 $87,728 189,427 463
======= ======= ======= =======

Reconciliation of non-GAAP Financial Measure

This earnings release contains free cash flow, which is a "non-GAAP financial
measure" as this term is defined in Regulation G of the Securities Exchange
Act of 1934. In accordance with Regulation G, GWI has reconciled this
non-GAAP financial measure to its most directly comparable U.S. GAAP measure.

Free Cash Flow Description and Discussion

Management views Free Cash Flow as an important financial measure of how well
GWI is managing its assets. Subject to the limitations discussed below, Free
Cash Flow is a useful indicator of cash flow that may be available for
discretionary use by GWI. Free Cash Flow is defined as Net Cash Provided by
Operating Activities from Continuing Operations less Net Cash Used in
Investing Activities from Continuing Operations, excluding the cost of
acquisitions. Key limitations of the Free Cash Flow measure include the
assumptions that GWI will be able to refinance its existing debt when it
matures and meet other cash flow obligations from financing activities, such
as principal payments on debt. Free Cash Flow is not intended to represent,
and should not be considered more meaningful than, or as an alternative to,
measures of cash flow determined in accordance with GAAP.

The following table sets forth a reconciliation of GWI's Net Cash Provided by
Operating Activities from Continuing Operations to GWI's Free Cash Flow ($ in
millions):

Three Months Ended
March 31,
-----------------
2009 2008
-------- --------

Net cash provided by operating activities from
continuing operations $25.5 $8.1
Net cash used in investing activities from
continuing operations (19.1) (7.0)
Cash paid for acquisitions, net of cash acquired 5.8 3.6
-------- --------
Free cash flow $12.2 $4.7
======== ========

SOURCE Genesee & Wyoming Inc.

Michael Williams, GWI Corporate Communications, +1-203-629-3722,
mwilliams@gwrr.com