Genesee & Wyoming Reports 64.9% Increase in Earnings Per Share for the Third Quarter of 2005; Integration of Rail Management Acquisition Completed

GREENWICH, Conn., Nov. 1, 2005 /PRNewswire-FirstCall/ -- Genesee & Wyoming Inc. (GWI) reported today that net income in the third quarter of 2005 increased 68.0% to $17.0 million, compared to net income of $10.1 million in the third quarter of 2004. GWI's diluted earnings per share in the third quarter of 2005 increased 64.9% to $0.61 with 27.9 million shares outstanding, compared to diluted earnings per share of $0.37 with 27.5 million shares outstanding in the third quarter of 2004.

The results for the third quarter of 2005 include (i) $0.9 million of non- cash expense ($0.7 million after-tax or $0.03 per share) for the cost of stock options due to the early adoption of FAS123R, (ii) a one-time tax benefit of $0.7 million (or $0.03 per share), related to a change of tax law in Mexico, and (iii) a $3.4 million gain ($2.4 million after-tax or $0.09 per share) from the sale of surplus rail.

North American Results

In the third quarter of 2005, North American revenue increased 36.3% to $105.3 million, compared to $77.2 million in the third quarter of 2004. This $28.1 million increase in revenue included $6.0 million in same-railroad growth, $17.3 million from railroads acquired from Rail Management Corporation on June 1, 2005, $3.1 million from the Tazewell & Peoria Railroad and $1.7 million from two short-lines acquired from CSX Corp. The increase in same railroad revenue was due to approximately $4.7 million in rate increases, $1.6 million in higher fuel surcharges, $0.6 million in higher non-freight revenue, offset by a $0.9 million decrease in freight revenue due to lower same railroad traffic volumes in the quarter when compared to the prior year.

North American operating income in the third quarter of 2005 increased 82.4% to $24.1 million, compared with $13.2 million in the third of 2004. The North American operating ratio was 77.1% in the third quarter of 2005, compared with 82.9% in the third quarter of 2004. GWI's results in the third quarter of 2005 included a $3.4 million gain from the disposition of the surplus rail partially offset by $0.9 million of stock options expense. Excluding these items the operating ratio would have been 79.4%.

For the nine months ended September 30, 2005, GWI's North American Free Cash Flow was $33.3 million (defined as Cash from Operations of $50.5 million less Cash used in Investing of $261.9 million, excluding the Cost of Acquisitions of $244.7 million) compared with $26.7 million of Free Cash Flow (defined as Cash from Operations of $40.4 million less Cash used in Investing of $15.8 million, excluding Cash used for Acquisitions of $2.1 million) for the nine months ended September 30, 2004. See the attached schedule for a description and discussion of Free Cash Flow.

Australian Results (Equity Accounting)

In Australia, revenue at GWI's 50%-owned subsidiary, Australian Railroad Group (ARG), increased 4.3% to US$87.3 million in the third quarter of 2005, compared with US$83.7 million in the third quarter of 2004. The US$3.6 million increase was principally due to a 7.5% strengthening of the Australian Dollar in the third quarter of 2005 compared to the third quarter of 2004. In Australian dollars, ARG's total revenue declined 2.6% in the third quarter of 2005 compared with the third quarter of 2004. The increase in US dollar revenues was principally due to a US$4.7 increase in iron ore shipments, a US$2.2 million increase in hook and pull shipments and a US$1.4 million increase in non-freight revenue, partially offset by a US$5.8 million decrease in grain shipments.

ARG's operating income in the third quarter of 2005 was US$14.1 million, compared with operating income of US$16.7 million in the third quarter of 2004. The operating ratio was 83.9% in the third quarter of 2005, compared with 80.0% in the third quarter of 2004. Equity income from ARG was US$2.4 million in the third quarter of 2005, compared with US$3.5 million of equity income in the third quarter of 2004.

Year to Date Consolidated Results

For the nine months ended September 30, 2005, GWI reported net income of $39.3 million, of which $31.9 million (81.1 %) was from North America, $6.9 million (17.7%) was from Australia and $0.5 million (1.2%) was from South America. This represents a 29.1% increase over the $30.4 million of net income reported in the nine months ended September 30, 2004. GWI's diluted earnings per share increased 30.3% to $1.42 in the first nine months of 2005 (27.7 million shares outstanding), compared to $1.09 in the first nine months of 2004 (27.4 million shares outstanding).

Comments from the Chief Executive Officer

Mortimer B. Fuller III, Chairman and Chief Executive Officer of GWI, commented, "We are pleased with our results this quarter. First, we have successfully completed the integration of Rail Management Corporation, our largest North American acquisition. Results to date are as expected and the outlook is good. Second, as revenue grows across most of our operating regions and commodity groups, the key measure of our business, free cash flow, continues to increase."

Mr. Fuller continued, "In Australia the intermodal and iron ore traffic discussed last quarter contributed to results this quarter. Additionally, grain traffic has picked up in anticipation of a bigger harvest in the 4th quarter. ARG continues to reduce the number of contract drivers and to receive relief from high fuel prices through contractual revenue escalators. Disciplined management of other operating expenses combined with strong growth in iron ore traffic and expectations for a good grain harvest make our outlook optimistic for the balance of 2005 and for 2006."

Fuller added, "While we were fortunate that Hurricanes Katrina, Rita, and Wilma did not cause significant damage to our properties, Hurricane Stan's damage to our Mexican operations will likely impact our Mexican operating results for the next two quarters. We are discussing reconstruction of the affected portion of the line with the Mexican authorities."

GWI is a leading operator of short line and regional freight railroads in the United States, Canada, Mexico, Australia and Bolivia, operating over 9,300 miles of owned and leased track and over more than 3,000 additional miles under track access arrangements.

Web site: http://www.gwrr.com/

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Genesee & Wyoming's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.

The company expressly disclaims any current intention to update such forward looking statements.

GENESEE & WYOMING INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 REVENUES $105,250 $77,243 $282,073 $223,707 EQUITY ISSUANCE EXPENSE - - - 542 OPERATING EXPENSES 81,171 64,043 227,715 184,825 TOTAL OPERATING EXPENSES 81,171 64,043 227,715 185,367 INCOME FROM OPERATIONS 24,079 13,200 54,358 38,340 INTEREST EXPENSE (4,919) (2,352) (9,875) (7,070) OTHER INCOME, NET 82 (221) (296) 203 INCOME BEFORE INCOME TAXES AND EQUITY EARNINGS 19,242 10,627 44,187 31,473 PROVISION FOR INCOME TAXES 4,747 4,284 12,304 12,267 INCOME BEFORE EQUITY EARNINGS 14,495 6,343 31,883 19,206 EQUITY IN NET INCOME OF INTERNATIONAL AFFILIATES: AUSTRALIAN RAILROAD GROUP 2,386 3,529 6,957 10,746 SOUTH AMERICA 163 273 468 496 NET INCOME 17,044 10,145 39,308 30,448 IMPACT OF PREFERRED STOCK OUTSTANDING - - - 479 NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $17,044 $10,145 $39,308 $29,969 BASIC EARNINGS PER SHARE: NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $0.69 $0.42 $1.60 $1.24 WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 24,690 24,213 24,553 24,086 DILUTED EARNINGS PER SHARE: NET INCOME $0.61 $0.37 $1.42 $1.09 WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 27,877 27,497 27,738 27,412 GENESEE & WYOMING INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) September 30, December 31, ASSETS 2005 2004 CURRENT ASSETS: Cash and cash equivalents $6,219 $14,451 Accounts receivable, net 89,023 64,537 Materials and supplies 7,596 5,263 Prepaid expenses and other 7,706 7,784 Deferred income tax assets, net 3,194 3,190 Total current assets 113,738 95,225 PROPERTY AND EQUIPMENT, net 531,169 337,024 INVESTMENT IN UNCONSOLIDATED AFFILIATES 137,630 132,528 GOODWILL 31,442 24,682 INTANGIBLE ASSETS, net 136,388 77,778 OTHER ASSETS, net 12,479 10,014 Total assets $962,846 $677,251 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term debt $4,712 $6,356 Accounts payable 85,454 63,794 Accrued expenses 29,522 21,598 Total current liabilities 119,688 91,748 LONG-TERM DEBT, less current portion 330,285 125,881 DEFERRED INCOME TAX LIABILITIES, net 55,955 50,517 DEFERRED ITEMS - grants from governmental agencies 48,271 46,229 DEFERRED GAIN - sale/leaseback 3,285 3,495 OTHER LONG-TERM LIABILITIES 14,462 14,122 MINORITY INTEREST 3,484 3,559 REDEEMABLE CONVERTIBLE PREFERRED STOCK TOTAL STOCKHOLDERS' EQUITY 387,416 341,700 Total liabilities and stockholders' equity $962,846 $677,251 GENESEE & WYOMING INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Nine Months Ended September 30, September 30, 2005 2004 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $39,308 $30,448 Adjustments to reconcile net income to net cash provided by operating activities- Depreciation and amortization 17,717 14,295 Amortization of restricted stock 341 93 Compensation cost of stock options 910 - Excess tax benefit from share-based payment arrangements (701) (1,090) Deferred income taxes 5,694 5,827 Net (gain) loss on sale and impairment of assets (3,367) (12) Equity earnings of unconsolidated international affiliates (7,425) (11,242) Minority interest expense 124 142 Valuation adjustment of split dollar life insurance 32 (358) Changes in assets and liabilities, net of effect of acquisitions - Accounts receivable (11,115) (7,774) Materials and supplies (1,091) (184) Prepaid expenses and other 741 (573) Accounts payable and accrued expenses 8,220 10,727 Other assets and liabilities, net 1,118 80 Net cash provided by operating activities 50,506 40,379 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment, net of proceeds from government grants (21,951) (19,751) Additional purchase price of Genesee Rail-One (6,500) - Purchase of Rail Partners, net of cash received (238,204) - Purchase of Homer City and Savannah Wharf rail properties - (2,124) Cash received from unconsolidated international affiliates 655 5,757 Proceeds from disposition of property and equipment, including sale/leasebacks 4,093 315 Net cash used in investing activities (261,907) (15,803) CASH FLOWS FROM FINANCING ACTIVITIES: Principal payments on long-term borrowings, including capital leases (159,398) (151,134) Proceeds from issuance of long-term debt 359,800 121,300 Debt issuance costs (1,629) - Proceeds from employee stock purchases 3,820 2,795 Treasury Stock purchases (1,278) - Excess tax benefit from share-based payment arrangements 701 1,090 Dividend paid on Redeemable Convertible Preferred Stock - (411) Net cash provided by (used in) financing activities 202,016 (26,360) EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 1,153 69 DECREASE IN CASH AND CASH EQUIVALENTS (8,232) (1,715) CASH AND CASH EQUIVALENTS, beginning of period 14,451 11,118 CASH AND CASH EQUIVALENTS, end of period $6,219 $9,403 GENESEE & WYOMING INC. AND SUBSIDIARIES Selected Consolidated Financial Information (In thousands) (Unaudited) Three Months Ended September 30, 2005 2004 % of % of Amount Revenue Amount Revenue Revenues: Freight $76,495 72.7% $57,109 73.9% Non-freight 28,755 27.3% 20,134 26.1% Total revenues $105,250 100.0% $77,243 100.0% Operating Expense Comparison: Natural Classification Labor and benefits $31,379 29.8% $26,551 34.4% Equipment rents 9,281 8.8% 7,100 9.2% Purchased services 7,583 7.2% 4,493 5.8% Depreciation and amortization 7,058 6.7% 4,812 6.2% Diesel fuel 10,709 10.2% 6,222 8.1% Casualties and insurance 4,548 4.3% 4,598 6.0% Materials 5,131 4.9% 3,826 5.0% Net (gain) loss on sale and impairment of assets (3,368) -3.2% 81 0.1% Other expenses 8,850 8.4% 6,360 8.1% Total operating expenses $81,171 77.1% $64,043 82.9% Functional Classification Transportation $36,052 34.3% $25,950 33.6% Maintenance of ways and structures 8,687 8.3% 7,516 9.7% Maintenance of equipment 14,991 14.2% 12,060 15.6% General and administrative 17,751 16.8% 13,624 17.7% Net (gain) loss on sale and impairment of assets (3,368) -3.2% 81 0.1% Depreciation and amortization 7,058 6.7% 4,812 6.2% Total operating expenses $81,171 77.1% $64,043 82.9% GENESEE & WYOMING INC. AND SUBSIDIARIES Selected Consolidated Financial Information (In thousands) (Unaudited) Nine Months Ended September 30, 2005 2004 % of % of Amount Revenue Amount Revenue Revenues: Freight $208,659 74.0% $167,826 75.0% Non-freight 73,414 26.0% 55,881 25.0% Total revenues $282,073 100.0% $223,707 100.0% Operating Expense Comparison: Natural Classification Labor and benefits $89,833 31.8% $77,897 34.8% Equipment rents 25,286 9.0% 20,316 9.1% Purchased services 18,778 6.7% 13,272 5.9% Depreciation and amortization 17,717 6.3% 14,295 6.4% Diesel fuel 27,523 9.8% 17,514 7.8% Casualties and insurance 13,682 4.9% 11,958 5.3% Materials 14,159 5.0% 11,144 5.0% Net (gain) loss on sale and impairment of assets (3,367) -1.2% (12) 0.0% Other expenses 24,104 8.4% 18,983 8.6% Total operating expenses $227,715 80.7% $185,367 82.9% Functional Classification Transportation $96,765 34.3% $73,976 33.1% Maintenance of ways and structures 25,137 8.9% 22,002 9.8% Maintenance of equipment 41,771 14.8% 34,789 15.6% General and administrative 49,692 17.6% 40,317 18.0% Net (gain) loss on sale and impairment of assets (3,367) -1.2% (12) 0.0% Depreciation and amortization 17,717 6.3% 14,295 6.4% Total operating expenses $227,715 80.7% $185,367 82.9% GENESEE & WYOMING INC. AND SUBSIDIARIES North American Railroad Freight Revenue, Carloads and Average Revenue Per Carload Comparison by Commodity Group (In thousands, except average revenue per carload) Three Months Ended Three Months Ended September 30, 2005 September 30, 2004 Average Average Revenue Revenue Freight Per Freight Per Commodity Group Revenues Carloads Carload Revenues Carloads Carload Paper $17,272 37,267 $463 $10,420 23,981 $435 Coal, Coke & Ores 13,008 51,548 252 11,641 50,750 229 Lumber & Forest Products 9,667 27,018 358 6,628 19,861 334 Minerals & Stone 8,563 21,495 398 5,866 16,457 356 Metals 7,505 20,047 374 5,973 18,572 322 Petroleum Products 6,164 7,856 785 5,803 7,806 743 Chemicals-Plastics 5,877 10,795 544 4,021 7,499 536 Farm & Food Products 5,079 15,000 339 3,648 8,692 420 Autos & Auto Parts 1,365 2,658 514 1,350 3,048 443 Intermodal 563 1,279 440 587 1,724 340 Other 1,432 4,125 347 1,172 3,402 345 Totals $76,495 199,088 384 $57,109 161,792 353 GENESEE & WYOMING INC. AND SUBSIDIARIES North American Railroad Freight Revenue, Carloads and Average Revenue Per Carload Comparison by Commodity Group (In thousands, except average revenue per carload) Nine Months Ended Nine Months Ended September 30, 2005 September 30, 2004 Average Average Revenue Revenue Freight Per Freight Per Commodity Group Revenues Carloads Carload Revenues Carloads Carload Paper $42,282 93,362 $453 $29,710 70,171 $423 Coal, Coke & Ores 38,421 147,192 261 34,440 144,051 239 Lumber & Forest Products 26,020 72,505 359 18,793 57,323 328 Minerals & Stone 21,389 53,284 401 16,695 44,850 372 Metals 20,847 57,966 360 17,078 53,940 317 Petroleum Products 19,869 25,369 783 18,251 24,301 751 Chemicals-Plastics 15,799 29,868 529 11,996 22,775 527 Farm & Food Products 13,527 39,407 343 11,387 27,058 421 Autos & Auto Parts 5,248 10,866 483 4,946 11,458 432 Intermodal 1,561 3,577 436 1,769 4,824 367 Other 3,695 12,121 305 2,761 9,711 284 Totals $208,658 545,517 382 $167,826 470,462 357 AUSTRALIAN RAILROAD GROUP PTY. LTD. CONSOLIDATED STATEMENTS OF INCOME (U.S. dollars in thousands) (Unaudited - U.S. GAAP) Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 REVENUES $87,318 $83,695 $257,739 $247,765 OPERATING EXPENSES 73,227 66,959 216,256 196,929 INCOME FROM OPERATIONS 14,091 16,736 41,483 50,836 INTEREST EXPENSE (7,426) (6,865) (22,122) (21,068) OTHER INCOME, NET 176 221 583 962 INCOME BEFORE TAX 6,841 10,092 19,944 30,730 PROVISION FOR INCOME TAX 2,072 3,030 6,031 9,236 NET INCOME $4,769 $7,062 $13,913 $21,494 Australian Railroad Group Pty. Ltd. is 50%-owned by Genesee & Wyoming Inc. AUSTRALIAN RAILROAD GROUP PTY. LTD. CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands) (Unaudited - U.S. GAAP) September 30, December 31, 2005 2004 ASSETS CURRENT ASSETS: Cash and cash equivalents $18,578 $21,217 Accounts receivable, net 61,333 49,085 Materials and supplies 12,405 11,580 Prepaid expenses and other 4,135 3,055 Total current assets 96,451 84,937 PROPERTY AND EQUIPMENT, net 550,556 541,470 DEFERRED INCOME TAX ASSETS, net 72,264 77,325 OTHER ASSETS, net 8,140 8,522 Total assets $727,411 $712,254 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $24,064 $19,832 Accrued expenses 27,365 31,989 Current income tax liabilities 286 364 Total current liabilities 51,715 52,185 LONG-TERM DEBT 381,350 383,425 DEFERRED INCOME TAX LIABILITIES, net 24,885 21,207 OTHER LONG-TERM LIABILITIES 10,050 2,177 FAIR VALUE OF INTEREST RATE SWAPS 5,362 9,788 Total non-current liabilities 421,647 416,597 REDEEMABLE PREFERRED STOCK OF STOCKHOLDERS 16,469 16,897 TOTAL STOCKHOLDERS' EQUITY 237,580 226,575 Total liabilities and stockholders' equity $727,411 $712,254 Australian Railroad Group Pty. Ltd. is 50%-owned by Genesee & Wyoming Inc. AUSTRALIAN RAILROAD GROUP PTY. LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (U.S. dollars in thousands) (Unaudited - U.S. GAAP) Nine Months Ended September 30, September 30, 2005 2004 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $13,913 $21,494 Adjustments to reconcile net income to net cash provided by operating activities- Depreciation and amortization 23,912 19,845 Deferred income taxes 7,366 8,894 Net (gain) loss on sale and impairment of assets (297) 376 Changes in assets and liabilities (8,131) 3,345 Net cash provided by operating activities 36,763 53,954 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (48,525) (39,059) Proceeds from disposition of property and equipment 1,980 1,296 Net cash used in investing activities (46,545) (37,763) CASH FLOWS FROM FINANCING ACTIVITIES: Payments on subordinated notes to stockholders - (10,710) Proceeds from borrowings 7,680 - Net cash provided by (used in) financing activities 7,680 (10,710) EFFECT OF EXCHANGE RATE DIFFERENCES ON CASH AND CASH EQUIVALENTS (537) (1,339) (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (2,639) 4,142 CASH AND CASH EQUIVALENTS, beginning of period 21,217 26,618 CASH AND CASH EQUIVALENTS, end of period $18,578 $30,760 Australian Railroad Group Pty. Ltd. is 50%-owned by Genesee & Wyoming Inc. AUSTRALIAN RAILROAD GROUP PTY. LTD. Selected Consolidated Financial Information (U.S. dollars in thousands) (Unaudited - U.S. GAAP) Three Months Ended September 30, 2005 2004 % of % of Amount Revenue Amount Revenue Revenues: Freight $71,895 82.3% $69,653 83.2% Non-freight 15,423 17.7% 14,042 16.8% Total railroad revenues $87,318 100.0% $83,695 100.0% Operating Expenses: Natural Classification Labor and benefits $17,973 20.6% $14,530 17.4% Equipment rents 833 1.0% 667 0.8% Purchased services 17,384 19.9% 20,840 24.9% Depreciation and amortization 7,990 9.2% 6,748 8.1% Diesel fuel used in operations 9,263 10.6% 6,869 8.2% Diesel fuel for sales to third parties 5,645 6.4% 5,385 6.4% Casualties and insurance 2,266 2.6% 1,620 1.9% Materials 4,107 4.7% 3,759 4.5% Net loss (gain) on sale and impairment of assets 22 0.0% (95) -0.1% Other expenses 7,744 8.9% 6,636 7.9% Total operating expenses $73,227 83.9% $66,959 80.0% Functional Classification Transportation $35,307 40.5% $33,378 39.9% Maintenance of ways and structures 12,079 13.8% 10,188 12.2% Maintenance of equipment 7,105 8.1% 7,560 9.0% General and administrative 10,724 12.3% 9,180 10.9% Net loss (gain) on sale and impairment of assets 22 0.0% (95) -0.1% Depreciation and amortization 7,990 9.2% 6,748 8.1% Total operating expenses $73,227 83.9% $66,959 80.0% Australian Railroad Group Pty. Ltd. is 50% owned by Genesee & Wyoming Inc. AUSTRALIAN RAILROAD GROUP PTY. LTD. Selected Consolidated Financial Information (U.S. dollars in thousands) (Unaudited - U.S. GAAP) Nine Months Ended September 30, 2005 2004 % of % of Amount Revenue Amount Revenue Revenues: Freight $209,083 81.1% $208,366 84.1% Non-freight 48,656 18.9% 39,399 15.9% Total railroad revenues $257,739 100.0% $247,765 100.0% Operating Expenses: Natural Classification Labor and benefits $52,734 20.5% $43,731 17.7% Equipment rents 2,356 0.9% 2,198 0.9% Purchased services 51,282 19.9% 60,165 24.3% Depreciation and amortization 23,912 9.3% 19,845 8.0% Diesel fuel used in operations 24,608 9.5% 18,895 7.6% Diesel fuel for sales to third parties 17,401 6.7% 13,549 5.5% Casualties and insurance 9,132 3.5% 6,418 2.6% Materials 11,257 4.4% 10,611 4.3% Net (gain) loss on sale and impairment of assets (297) -0.1% 376 0.1% Other expenses 23,871 9.3% 21,141 8.5% Total operating expenses $216,256 83.9% $196,929 79.5% Functional Classification Transportation $102,436 39.7% $94,185 38.0% Maintenance of ways and structures 31,431 12.2% 29,831 12.1% Maintenance of equipment 22,114 8.6% 22,664 9.2% General and administrative 36,660 14.2% 30,028 12.1% Net (gain) loss on sale and impairment of assets (297) -0.1% 376 0.1% Depreciation and amortization 23,912 9.3% 19,845 8.0% Total operating expenses $216,256 83.9% $196,929 79.5% Australian Railroad Group Pty. Ltd. is 50% owned by Genesee & Wyoming Inc.

AUSTRALIAN RAILROAD GROUP PTY. LTD. Australian Railroad Freight Revenue, Carloads and Average Revenue Per Carload

Comparison by Commodity Group (U.S. dollars in thousands) (Unaudited) Three Months Ended Three Months Ended September 30, 2005 September 30, 2004 Average Average Revenue Revenue Freight Per Freight Per Commodity Group Revenues Carloads Carload Revenues Carloads Carload Grain $20,580 48,528 $424 $26,392 69,185 $381 Other Ores and Minerals 14,579 24,454 596 14,665 28,218 520 Iron Ore 15,307 56,526 271 10,588 47,886 221 Alumina 5,376 39,902 135 4,837 38,785 125 Bauxite 3,702 34,815 106 3,113 32,101 97 Hook and Pull (Haulage) 2,518 3,778 666 364 960 379 Gypsum 945 12,705 74 748 12,180 61 Other 8,888 19,718 451 8,946 16,927 529 Total $71,895 240,426 299 $69,653 246,242 283 Australian Railroad Group Pty. Ltd. is 50% owned by Genesee & Wyoming Inc.

AUSTRALIAN RAILROAD GROUP PTY. LTD. Australian Railroad Freight Revenue, Carloads and Average Revenue Per Carload

Comparison by Commodity Group (U.S. dollars in thousands) (Unaudited) Nine Months Ended Nine Months Ended September 30, 2005 September 30, 2004 Average Average Revenue Revenue Freight Per Freight Per Commodity Group Revenues Carloads Carload Revenues Carloads Carload Grain $60,942 148,697 $410 $78,323 205,409 $381 Other Ores and Minerals 45,226 77,359 585 43,798 82,033 534 Iron Ore 42,526 166,459 255 32,922 149,415 220 Alumina 16,336 119,272 137 14,589 117,921 124 Bauxite 11,131 105,017 106 9,245 92,352 100 Hook and Pull (Haulage) 4,003 6,007 666 1,279 6,257 204 Gypsum 3,121 36,424 86 2,659 37,587 71 Other 25,798 56,513 456 25,551 50,749 503 Total $209,083 715,748 292 $208,366 741,723 281 Australian Railroad Group Pty. Ltd. is 50% owned by Genesee & Wyoming Inc. 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 less Net Cash Used in Investing Activities, 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 required 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 Generally Accepted Accounting Principles.

The following table sets forth a reconciliation of GWI's Net Cash Provided by Operating Activities to GWI's Free Cash Flow:

Nine Months Ended September 30, 2005 2004 Net cash provided by operating activities $50,506 $40,379 Net cash used in investing activities (261,907) (15,803) Net cash used for acquisitions 244,704 2,124 Free cash flow $33,303 $26,700