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Trends behind Genesee & Wyoming’s European Carloads in August 2017

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GWR’s European carloads

In this final part of the series, we’ll take stock of Genesee & Wyoming’s (GWR) European carloads. GWR’s European operations, including the UK, are operated by Freightliner, UK’s largest rail maritime intermodal operator.

Other operations include heavy hauling in Germany and Poland and intermodal services connecting Northern European seaports with Germany’s major industrial regions.

The company’s European volumes fell 2.7% YoY (year-over-year) in August 2017. Genesee & Wyoming hauled ~96,500 railcars in August 2017 from more than 99,000 units in August 2016. The company’s carloads excluding coal and coke fell 0.8% in August 2017 on a YoY basis.

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GWR’s European coal carloads

Genesee & Wyoming saw its coal (ARLP) and coke railcars fall 63% in August 2017. Its coal volumes fell ~2,000 carloads to 1,200 carloads in the same month YoY. GWR’s coal volumes slid due to reduced shipments in the UK.

The company’s intermodal traffic fell ~1,700 carloads, or 2.2%, mainly due to reduced shipments in Continental Europe. Restructuring efforts, which resulted in discontinuing certain routes in that region, led the decline in volumes. Minerals and stone volumes grew due to higher shipments in Poland.

Investors interested in transportation stocks can have indirect exposure to the SPDR S&P Transportation ETF (XTN). Key railroads (UNP) and trucking companies (JBHT) in the US comprise 26% and 14%, respectively, of XTN’s portfolio.

Summary

In this series, we examined the freight traffic of major US rail carriers for week 36, which ended on September 9, 2017. For ongoing updates on key US rail stocks, please visit Market Realist’s Railroads page.

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