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RailAmerica 2Q profit rises on higher hauls

JACKSONVILLE, Fla. (AP) -- Short-line and regional freight railroad operator RailAmerica Inc., which has agreed to a buyout offer from Genesee & Wyoming, said Wednesday that its second-quarter net income jumped 31 percent on increased hauls of everything from cars to corn.

RailAmerica said its strongest hauls were agricultural products in the Central and Western U.S. and vehicle shipments in the Midwest and Northeast.

The Jacksonville, Fla., company reported net income of $11.4 million, or 23 cents per share, compared with $8.7 million, or 17 cents per share, a year earlier. Excluding one-time gains and charges, the company earned 34 cents per share on the most recent quarter.

Revenue rose 12 percent to $156.1 million from $139,2 million a year ago.

It started integrating two railroads it previously acquired during the quarter. Overall, RailAmerica said traffic rose 3.6 percent across its lines during the second quarter, but just 1.5 percent without the benefit of those acquired companies.

RailAmerica said on Monday that it has agreed to a $1.39 billion buyout offer from Genesee, after shopping for a possible buyer since May, to diversify what the railroads carry and make it less dependent on certain big customers. That will offer protection from prolonged weakness in certain shipments like coal. The combination will also allow the two companies to streamline their operations to save money.

Together, they will operate 108 railroads in the U.S. and abroad, if the deal is approved by regulators.

Greenwich, Conn.-based Genesee & Wyoming agreed to pay $27.50 in cash for each share of RailAmerica, which is based in Jacksonville, Fla.

Shares of RailAmerica rose just 2 cents to $27.29 in afternoon trading Wednesday.