Second Quarter 2015 Earnings Call August 3, 2015 Genesee & - - PowerPoint PPT Presentation

1 Genesee & Wyoming Inc.

Second Quarter 2015 Earnings Call

August 3, 2015

2 Genesee & Wyoming Inc.

Forward-Looking Statements

This presentation 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 those expressed or forecasted, including, but not limited to, risks related to the operation of our railroads, severe weather conditions and other natural

• ccurrences, economic and market conditions, customer demand, railroad network congestion,

derailments, currency fluctuations, changes in commodity prices, increased competition in the relevant market, and others, many of which are beyond our control. The Company refers you to the documents that it files from time to time with the Securities and Exchange Commission, such as the Company’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 discussed during this presentation. Forward-looking statements speak only as of the date of this presentation or the date they were made. Genesee & Wyoming Inc. does not undertake, and expressly disclaims, any duty to update any forward-looking statement contained in this presentation whether as a result of new information, future events or otherwise, except as required by law.

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G&W Safety Performance – 2015

3.14 2.37 1.86 1.71 1.05 0.98 0.88 0.80 0.76 0.54 FRA Group 2 FRA Group 3 KCS Freightliner Railroads NS Class I Avg UP BNSF CSX G&W *

Injury Frequency Rate per 200,000 man-hours G&W through June; others through April

* Excludes Freightliner

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Q2 2015 Results Versus Q2 2014

(1) Adjusted Diluted Earnings Per Common Share (EPS) is a non-GAAP financial measure. Reconciliations of non-

GAAP financial measures accompany this presentation.

($ per share) Q2 2015 Q2 2014 Variance % Ex-FX Diluted EPS 0.92 $ 1.07 $ (0.15) $ Adjustments: Business Development and Related Costs 0.01 $ 0.02 $ (0.01) $ Net Gain on Sale of Assets (0.01) (0.02) 0.01 Credit Facility Refinancing-Related Costs

• 0.05

(0.05) Total Adjustments

• $

0.05 $ (0.05) $ Adjuted Diluted EPS (1) 0.93 $ 1.12 $ (0.19) $ (17.0%) (13.1%)

• Adjusted Diluted EPS consistent with revised guidance of $0.90 - $0.94(1)
• Adjusted Diluted EPS of $0.93 decreased 17% (or 13%, excluding FX)(1)

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($ in millions, except per share amounts) Q2 2015 Actual Original Q2 2015 Guidance (April 2015) Variance to Mid-Point

Operating Revenues 542.2 $ $565 - $580 (30.3) $ Income from Operations 99.5 $ Business Development and Related Costs 0.8 0.8 Net Gain on Sale of Assets (0.5) (0.5) Adjusted Income from Operations* 99.8 $ $114 - $118 (16.2) $ Adjusted Operating Ratio* 81.6% ~80% (160 bps) Adjusted Diluted EPS* 0.93 $ $1.05 - $1.10 (0.15) $

Variance to Mid-Point ($ in millions, except per share amounts) Operating Revenues Adjusted Income from Operations* Adjusted EPS* Notes

North America (19.0) $ (14.9) $ (0.14) $ Coal, Steel, Grain, Frac Sand U.K./Europe (8.1) (2.3) (0.02) Primarily U.K. Coal Australia (3.2) 1.0 0.01 Cost controls Variance to Original Outlook (30.3) $ (16.2) $ (0.15) $

Q2 2015 Results Versus Original Guidance

* Adjusted Income from Operations, Adjusted Operating Ratio and Adjusted Diluted EPS are non-GAAP financial measures. Reconciliations of non-GAAP financial measures accompany this presentation.

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(US$ in millions) Q2 2015 Actual Q2 2014 Actual % Change Same Railroad (ex. FX)

Operating Revenues 311.0 $ 325.7 $ (4.5%) (8.2%) Income from Operations 76.6 $ 85.4 $ (10.3%) Operating Ratio 75.4% 73.8% (160 bps)

North America: Q2 2015 Overview

• North American operating revenues included $15.2 million from RCP&E and Pinsly Arkansas
• Same railroad operating revenues (ex. FX) declined 8.2% which included:

– 31% decline in coal, primarily due to competition from low priced natural gas – 22% decline in metals (steel and scrap), primarily due to competition from imported steel

• Cost reductions, including locomotives removed from service, headcount reductions and G&A

cuts have been implemented and are ongoing

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(US$ in millions) Q2 2015 Actual Q2 2014 Actual % Change % Change (ex. FX) Same Railroad (ex. FX)

Operating Revenues 66.8 $ 83.1 $ (19.6%) (3.7%) (20.4%) Income from Operations 15.1 $ 25.3 $ (40.3%) (28.3%) Operating Ratio 77.4% 69.5% (790 bps)

Australia: Q2 2015 Overview

• Australia operating revenues included $11.6 million from Freightliner Australia (in Freight-

Related revenues)

• Same railroad Australia operating revenues (ex. FX) declined 20.4%, primarily due to lower iron
• re shipments (3 fewer mines)
• Australia income from operations down 40.3%, or 28.3% ex. FX

8 Genesee & Wyoming Inc. (US$ in millions) Q2 2015 Actual Q2 2014 Actual % Change

Operating Revenues 164.4 $ 5.7 $ NM Income from Operations 7.7 $ (0.6) $

(1)

NM Operating Ratio 95.3% 110.7%

(1)

NM

U.K./Europe: Q2 2015 Overview

(1) In 2014 includes significant start-up costs for new long term contract; expected 90% - 95% operating ratio

• New segment reporting for U.K./Europe (details follow)
• U.K. Intermodal and Infrastructure services on plan
• U.K. Coal expected to remain relatively low until Q4 2015/Q1 2016 due to slow stockpile

drawdown following new carbon tax on April 1, 2015 – Expect increases in coal shipments in autumn/winter due to higher electricity demand

• Continental Europe businesses working closely together

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Key Priorities for Second Half 2015

• 1. Safety
• 2. Cost Reductions in North America and Australia
• 3. Successful Freightliner Integration in U.K./Europe/Australia
• 4. Short Line Tax Credit Extension
• 5. Acquisitions and Investments

– Evaluating opportunities in North America and abroad – Near term investments will take into consideration higher than expected leverage (flat at 3.5x Debt/Adj. EBITDA* at year end 2015)

* Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is a non-GAAP financial measure. Reconciliations of non-GAAP financial measures accompany this presentation.

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Updated Revenue Presentation

Segment North America U.K./Europe Australia

Freight revenues Traditional carload business (includes fuel surcharges) Bulk commodities and Intermodal (includes fuel surcharges) Bulk commodities and Intermodal (includes fuel surcharges) Freight-Related revenues Switching, car hire, ancillary freight charges, trackage rights, contracted services Switching, traction service/hook and pull (locomotive + drivers), infrastructure services Switching, contracted services, trackage rights, crewing All other revenues Easements, real estate, 3rd party car and locomotive repair, passenger related revenues Real estate, 3rd party car and locomotive repair Real estate, 3rd party car and locomotive repair

• Non-freight revenues is now divided into two categories: Freight-Related and All other

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($ in millions) Q2 2015 Actual % of Revenue Notes

Operating revenues: Freight revenues 98.0 $ 59.6% Intermodal 70%; Minerals & Stone 18%; Coal 9% Freight-related revenues 61.0 37.1% Switching; Traction service; Infrastructure All other revenues 5.4 3.3% Total operating revenues 164.4 100.0% Operating expenses: Labor and benefits 46.2 $ 28.1% Equipment rents 23.0 14.0% Leased locomotives and freight cars Purchased services 35.2 21.4% Contract drivers/traction in Europe; Port/terminal handling & trucking in U.K. Depreciation and amortization 5.7 3.5% Diesel fuel used in train operations 11.9 7.2% Electricity used in train operations 5.0 3.0% New category for U.K. and Continental Europe Casualties and insurance 1.5 0.9% Materials 8.5 5.2% Trackage rights 12.5 7.6% Track access fees Net gain on the sale of assets

• 0.0%

Other expenses 7.2 4.4% Total operating expenses 156.7 $ 95.3% Income from Operations 7.7 $ 4.7%

Introduction to the U.K./Europe Segment

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North American Operations Operating Revenues: Q2 2015 vs. Q2 2014

($ millions)

(4.5%) ($14.7)

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North American Operations Same Railroad Carloads: Q2 2015 vs. Q2 2014

Commodity Change % Comment Agricultural Products (5,727) (11%) Timing / Grain Market Conditions Autos & Auto Parts (519) (7%) Chemicals & Plastics 523 1% Coal & Coke (25,969) (29%) Steam Coal Food & Kindred Products (994) (6%) Timing Lumber & Forest Products (1,880) (5%) West Coast Housing Market, Weather Metallic Ores 774 15% Copper Metals (14,051) (29%) Steel Minerals & Stone (1,779) (4%) Frac sand Petroleum Products (1,166) (5%) Lower Crude Oil, Higher LPGs/NGLs Pulp & Paper 1,740 4% Waste 557 6% Other (8,396) (33%) Class I Overhead Traffic Total Carloads (56,887) (13%)

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North American Operations Same Railroad Freight Revenues Average Revenues Per Carload

Q2 2015 Q2 2014 Change Average Revenues Per Carload $571 $559 2.1% Changes in Commodity Mix (a) 2.4% Fuel Surcharge (5.2%) FX (Depreciation of C$) (1.0%) Average Revenues Per Carload (excl. Mix, Fuel, FX) (b) 5.9% (a) Changes in Commodity Mix illustrates changes between commodity groups, not within a commodity group (b) Average Revenues per Carload impacted by changes in customer mix in Other (Class I Overhead traffic) and Metals commodity groups

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Australian Operations Operating Revenues: Q2 2015 vs. Q2 2014

($ millions)

$83.1 $66.8 ($13.8) ($1.4) ($10.1) ($1.2) ($1.4) $11.6

$40 $50 $60 $70 $80 Q2 2014 FX Fuel Surcharge Iron Ore Agricultural Products Other Freightliner Australia Q2 2015

(19.6%) ($16.3)

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• North America
• Traffic modestly improving
• Seasonal improvements in agricultural products, construction

aggregates and cement

• Expense reduction plans implemented
• U.K./Europe
• Intermodal sequentially improves in peak season
• Coal expected to seasonally strengthen in Q4 2015 and Q1 2016
• Australia
• Expect seasonally weaker agricultural products traffic heading into

new harvest in Q4 2015

• Ongoing commodity weakness
• Weaker Australian dollar

Outlook Overview for 2H 2015

(August 3, 2015)

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North American Operations Outlook 2H 2015 Commodity Trends – versus Q2 2015A

* Includes carloads and intermodal units **Includes 2013 classification adjustments Commodity Q2 2015A Q3 2015E Q4 2015E Comment Agricultural Products 53,700 + 55,000 - 60,000 Grain market conditions, timing Autos & Auto Parts 7,500 + + Chemicals & Plastics 45,600 +

• Coal & Coke

63,500 60,000 - 65,000 60,000 - 65,000 Flat Food & Kindred Products 14,700 + + Lumber & Forest Products 35,000 + + Metallic Ores 6,100

• Metals

35,100 + + Minerals & Stone 55,900 55,000 - 60,000 45,000 - 50,000 Seasonality of aggregates Petroleum Products 23,900 + + Pulp & Paper 45,300 + + Waste 10,200 +

• Other

17,500 15,000 15,000 Class I overhead Total Carloads 414,000 410,000 - 425,000 400,000 - 415,000 Same Railroad vs. Prior Year (10%) - (13%) (11%) - (14%) Commodities +/-: expected changes from Q2 up/down 1,000 – 2,000 carloads

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Australian Operations Outlook 2H 2015 Commodity Trends - versus Q2 2015A

Commodity Q2 2015A Q3 2015E Q4 2015E Comment Agricultural Products 14,800 10,000 - 12,000 10,000 - 12,000 Normal Seasonality Intermodal 15,700 + + Metallic Ores* 7,100 5,000 5,000 Iron Ore Service Ceased in Q2 Minerals & Stone 14,400 + + Total Carloads 52,000 45,000 - 47,000 45,000 - 47,000 Same Railroad vs Prior Year (18%) - (22%) (14%) - (17%) * Includes carloads and intermodal units Commodities +/-: expected changes from Q2 up/down 1,000 – 2,000 carloads

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U.K./European Operations Outlook 2H 2015 Commodity Trends - versus Q2 2015A

Commodity Q2 2015A Q3 2015E Q4 2015E Comment Coal & Coke 23,400 20,000 - 25,000 40,000 - 45,000 Seasonality; U.K. and Poland Intermodal 214,200 245,000 - 255,000 230,000 - 240,000 Seasonality; U.K. and Europe Minerals & Stone 44,100 +

• Seasonality; Poland and

U.K. Other 3,200 + + Total Carloads 284,900 315,000 - 330,000 315,000 - 335,000 Commodities +/-: expected changes from Q2 up/down 1,000 – 2,000 carloads

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Outlook – Third Quarter 2015

(August 3, 2015)

(in millions, except per share amounts)

North America U.K./Europe Australia Consolidated Q3 2015 Outlook Revenues $310 - $315 $170 - $175 $60 - $65 $540 - $555 Adjusted Operating Ratio(1) ~73% 92% - 93% ~78% ~80% Adjusted Income from Operations(1) $82 - $86 $10 - $12 ~$14 $106 - $112 Net Interest Expense $18 Depreciation and Amortization $35 $6 $7 $48 Effective Tax Rate (2) ~36% Adjusted Diluted EPS (1) $0.95 - $1.05 Diluted Shares 57.5

(1) Adjusted Operating Ratio, Adjusted Income from Operations and Adjusted Diluted EPS are non-GAAP financial measures. Reconciliations of non-GAAP financial measures accompany this presentation. (2) Excludes the short line tax credit. FX: A$1.00 = US$0.73, C$1.00 = US$0.77, €1.00 = US$1.09, £1.00 = US$1.55, PLN1.00 = US$0.26

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Outlook – Fourth Quarter 2015

(August 3, 2015)

(in millions, except per share amounts)

North America U.K./Europe Australia Consolidated Q4 2015 Outlook Revenues $310 - $315 $170 - $175 $60 - $65 $540 - $555 Adjusted Operating Ratio(1) ~73% 92% - 93% ~78% ~80% Adjusted Income from Operations(1) $82 - $86 $10 - $12 ~$14 $106 - $112 Net Interest Expense $18 Depreciation and Amortization $37 $6 $7 $50 Effective Tax Rate (2) ~37% Adjusted Diluted EPS (1) $0.95 - $1.05 Diluted Shares 57.5

(1) Adjusted Operating Ratio, Adjusted Income from Operations and Adjusted Diluted EPS are non-GAAP financial measures. Reconciliations of non-GAAP financial measures accompany this presentation. (2) Excludes the short line tax credit. FX: A$1.00 = US$0.73, C$1.00 = US$0.77, €1.00 = US$1.09, £1.00 = US$1.55, PLN1.00 = US$0.26

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Balance Sheet

• Net Debt of $2.3 billion at June 30, 2015
• 3.5x Debt/Adjusted EBITDA* at June 30, 2015

($ in millions) June 30, 2015 Cash & Equivalents 30 $ Debt: Senior Secured Credit Facility, due March 2020 2,272 $ Other Debt 95 $ TOTAL DEBT 2,367 $ Total Equity 2,432 $ TOTAL CAPITALIZATION 4,799 $ Total Debt/Total Capitalization 49% Net Debt/Total Capitalization 49%

* Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is a non-GAAP financial measure. Reconciliations of non-GAAP financial measures accompany this presentation.

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Reconciliation of Non-GAAP Financial Measures

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Non-GAAP Financial Measures

This presentation contains references to Adjusted Income from Operations, Adjusted Operating Expenses, Adjusted Operating Ratios, Adjusted Diluted Earnings Per Common Share (EPS), Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), Adjusted EBITDA and Debt to Adjusted EBITDA, which are “non-GAAP financial measures” as this term is defined in Item 10(e) of Regulation S-K under the Securities Act

• f 1933 and the Securities Exchange Act of 1934 and Regulation G under the Securities Exchange Act of 1934.

In accordance with these rules, G&W has reconciled these non-GAAP financial measures to their most directly comparable U.S. GAAP measures. Management views these non-GAAP financial measures as important measures of G&W’s operating

• performance. Management also views these non-GAAP financial measures as a way to assess comparability

between periods. These non-GAAP financial measures are not intended to represent, and should not be considered more meaningful than, or as an alternative to, their most directly comparable GAAP measures. These non-GAAP financial measures may be different from similarly-titled non-GAAP financial measures used by other companies. The following tables set forth reconciliations of each of these non-GAAP financial measures to their most directly comparable GAAP measure (in millions, except percentages and per share amounts).

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Adjusted Income from Operations, Adjusted Operating Expenses and Adjusted Operating Ratio

Actual Outlook (Original - April 2015) Operating revenues 542.2 $ $565 - $580 Operating expenses 442.8 454 - 465 Income from operations (a) 99.5 $ $111 - $115 Operating ratio (b) 81.7% ~80% Operating expenses 442.8 $ $454 - $465 Business development and related costs (0.8) (3) Net gain on sale of assets 0.5

• Adjusted operating expenses

442.5 $ $451 - $462 Adjusted income from operations 99.8 $ $114 - $118 Adjusted operating ratio 81.6% ~80% (a) Income from operations is calculated as operating revenues less operating expenses. (b) Operating ratio is calculated as operating expenses divided by operating revenues. Three Months Ended June 30, 2015

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Adjusted Income from Operations, Adjusted Operating Expenses and Adjusted Operating Ratio – by Segment

Three Months Ended June 30, 2015 North American Operations U.K./European Operations Australian Operations Operating revenues 311.0 $ 164.4 $ 66.8 $ Operating expenses 234.4 156.7 51.7 Income from operations (a) 76.6 $ 7.7 $ 15.1 $ Operating ratio (b) 75.4% 95.3% 77.4% Operating expenses 234.4 $ 156.7 $ 51.7 $ Business development and related costs (0.9)

• 0.1

Net gain on sale of assets 0.4 0.1

• Adjusted operating expenses

233.8 $ 156.8 $ 51.9 $ Adjusted income from operations 77.1 $ 7.7 $ 15.0 $ Adjusted operating ratio 75.2% 95.3% 77.6% (a) Income from operations is calculated as operating revenues less operating expenses. (b) Operating ratio is calculated as operating expenses divided by operating revenues.

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Adjusted Income from Operations, Adjusted Operating Expenses and Adjusted Operating Ratio – by Segment (cont.)

Three Months Ended June 30, 2015 - Outlook (Original - April 2015) North American Operations U.K./European Operations Australian Operations Operating revenues $325 - $335 $170 - $175 ~$70 Operating expenses 238 - 244 160 - 165 56 Income from operations (a) $87 - $91 ~$10 ~13 Operating ratio (b) ~73% ~94% ~80% Operating expenses $238 - $244 $160 - $165 ~$56 Business development and related costs (3)

• Adjusted operating expenses

$235 - $241 $160 - $165 $56 Adjusted income from operations $90 - $94 ~$10 ~$14 Adjusted operating ratio ~72% ~94% ~80% (a) Income from operations is calculated as operating revenues less operating expenses. (b) Operating ratio is calculated as operating expenses divided by operating revenues.

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Adjusted Net Income and Adjusted Diluted EPS

Three Months Ended June 30, 2015 Net Income Diluted EPS As reported 52.8 $ 0.92 $ Add back certain items: Business development and related costs 0.5 0.01 Net gain on sale of assets (0.3) (0.01) As adjusted 53.0 $ 0.93 $ Three Months Ended June 30, 2014 Net Income Diluted EPS As reported 60.7 $ 1.07 $ Add back certain items: Business development and related costs 1.0 0.02 Net gain on sale of assets (1.0) (0.02) Credit facility refinancing-related costs 2.9 0.05 As adjusted 63.7 $ 1.12 $ FX (0.05) As adjusted excluding FX 1.07 $

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Adjusted Diluted EPS

Three Months Ended June 30, 2015 Outlook (Revised - June 2015) Diluted EPS As reported $0.84 - $0.88 Add back certain items: Australian severance costs 0.03 Freightliner acquisition & finance related costs 0.03 As adjusted $0.90 - $0.94 Three Months Ended June 30, 2015 Outlook (Original - April 2015) Diluted EPS As reported $0.99 - $1.04 Add back certain items: Australian severance costs 0.03 Freightliner acquisition & finance related costs 0.03 As adjusted $1.05 - $1.10

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Adjusted Diluted EPS (Cont.)

Three Months Ended September 30, 2015 Outlook (August 3, 2015) Diluted EPS As reported $0.93 - $1.03 Add back certain items: Net gain on sale of assets (0.01) Business development and related costs 0.03 As adjusted $0.95 - $1.05 Three Months Ended December 31, 2015 Outlook (August 3, 2015) Diluted EPS As reported $0.92 - $1.02 Add back certain items: Australian severance costs 0.02 Business development and related costs 0.01 As adjusted $0.95 - $1.05

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Adjusted Income from Operations, Adjusted Operating Expenses and Adjusted Operating Ratio – by Segment

North America U.K./Europe Australia Total Operating revenues $310 - $315 $170 - $175 $60 - $65 $540 - $555 Operating expenses 230 - 231 160 - 163 47 - 51 436 - 445 Income from operations (a) $80 - $84 $10 - $12 ~14 $104 - $110 Operating ratio (b) ~74% 92% - 93% ~78% ~80% Operating expenses $230 - $231 $160 - $163 $47 - $51 $436 - $445 Net gain on sale of assets 1

• 1

Business development and related costs (3)

• (3)

Australian severance costs

• Adjusted operating expenses

$228 - $229 $160 - $163 $47 - $51 $434 - $443 Adjusted income from operations $82 - $86 $10 - $12 ~$14 $106 - $112 Adjusted operating ratio ~73% 92% - 93% ~78% ~80% (a) Income from operations is calculated as operating revenues less operating expenses. (b) Operating ratio is calculated as operating expenses divided by operating revenues. Three Months Ended September 30, 2015 Outlook (August 3, 2015)

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Adjusted Income from Operations, Adjusted Operating Expenses and Adjusted Operating Ratio – by Segment (cont.)

North America U.K./Europe Australia Total Operating revenues $310 - $315 $170 - $175 $60 - $65 $540 - $555 Operating expenses 229 - 230 160 - 163 47 - 53 437 - 446 Income from operations (a) $81 - $85 $10 - $12 ~$13 $103 - $109 Operating ratio (b) ~73% 92% - 93% ~79% ~81% Operating expenses $229 - $230 $160 - $163 $47 - $53 $437 - $446 Net gain on sale of assets

• Business development and related costs

(1)

• (1)

Australian severance costs

• (2)

(2) Adjusted operating expenses $228 - $229 $160 - $163 $46 - $51 $434 - $443 Adjusted income from operations $82 - $86 $10-$12 ~$14 $106 - $112 Adjusted operating ratio ~73% 92% - 93% ~78% ~80% (a) Income from operations is calculated as operating revenues less operating expenses. (b) Operating ratio is calculated as operating expenses divided by operating revenues. Three Months Ended December 31, 2015 Outlook (August 3, 2015)

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Debt/Adjusted EBITDA

Three Months Ended September 30, 2014 Three Months Ended December 31, 2014 Three Months Ended March 31, 2015 Three Months Ended June 30, 2015 G&W LTM Acquisition LTM* Combined Company LTM

Net income 72.7 $ 87.4 $ 23.9 $ 52.8 $ 236.8 $ Add back: Provision for income taxes 36.9 14.7 16.9 29.3 97.8 Other income, net 0.7 (0.8) (0.3) (0.3) (0.7) Interest expense 12.7 12.1 13.5 17.8 56.0 Interest income (0.1) (0.1)

• (0.1)

(0.3) Depreciation and amortization expense 40.3 41.0 41.8 48.0 171.1 EBITDA 163.2 $ 154.2 $ 95.8 $ 147.5 $ 560.6 $ 73.0 $ 633.6 $ Add back certain items Non-cash compensation cost related to equity awards 3.1 $ 3.8 $ 3.8 $ 3.8 $ 14.5 $ Loss on settlement of Freightliner acquisition-related foreign currency forward purchase contracts

• 18.7
• 18.7

Freightliner acquisition-related costs 0.3 1.0 12.6 0.1 13.9 Net gain on sale of assets (1.2) (1.7) (0.3) (0.5) (3.7) Adjusted EBITDA 165.3 $ 157.3 $ 130.6 $ 150.9 $ 604.1 $ 73.0 $ 677.1 $ Combined company debt 2,367 $ Debt/Adjusted EBITDA Ratio 3.50 : 1.0 *Includes Freightliner - 9/1/2014 - 3/24/2015; Pinsly - 7/1/2014 - 12/31/2014; and adjustment for various rail car purchases

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