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Reckson Associates Realty Corp Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: October 27, 2011 11:22AM

Reckson Associates Realty Corp (RA) filed Quarterly Report for the period ended 2011-09-30. Railamerica has a market cap of $724 million; its shares were traded at around $13.88 with a P/E ratio of 16.4 and P/S ratio of 1.4.



Highlight of Business Operations:

Our operating ratio, defined as total operating expenses divided by total operating revenue, was 79.1% in the nine months ended September 30, 2011, compared with an operating ratio of 80.5% in the nine months ended September 30, 2010. This improvement was primarily due to the lack of track maintenance credits in 2010, partially offset by increased diesel fuel expenses and impairment of assets. Operating expenses were $319.4 million in the nine months ended September 30, 2011, compared with $291.9 million in the nine months ended September 30, 2010, an increase of $27.5 million, or 9%.

Interest Expense. Interest expense, including amortization of deferred financing costs, decreased $1.9 million to $17.8 million for the three months ended September 30, 2011, from $19.7 million in the three months ended September 30, 2010. This decrease is primarily due to the decrease of swap termination cost amortization to $2.7 million during the three months ended September 30, 2011 from $4.9 million during the three months ended September 30, 2010. Interest expense includes $4.0 million and $6.0 million of amortization costs for the three months ended September 30, 2011 and 2010, respectively.

Interest Expense. Interest expense, including amortization of deferred financing costs, decreased $10.1 million to $54.5 million for the nine months ended September 30, 2011, from $64.6 million in the nine months ended September 30, 2010. This decrease is primarily due to a decrease in the principal amount of the senior secured notes as a result of the June 2010 $74 million repayment and the decrease of swap termination cost amortization to $9.6 million during the nine months ended September 30, 2011 from $16.6 million during the nine months ended September 30, 2010. Interest expense includes $13.2 million and $20.2 million of amortization costs for the nine months ended September 30, 2011 and 2010, respectively.

Cash used in investing activities was $67.4 million for the nine months ended September 30, 2011, compared to $67.4 million for the nine months ended September 30, 2010. Cash used in investing activities included cash used for the acquisition of three short line railroads for $12.7 million in 2011 and Atlas Railroad Construction Company for $23.9 million in 2010. Capital expenditures, net of NECR grant reimbursements were higher in 2011 at $62.2 million compared to $46.8 million in 2010, primarily due to our portion of NECR expenditures and the purchase of 26 previously leased locomotives for $4.5 million. Asset sale proceeds were $7.6 million for the nine months ended September 30, 2011 compared to $3.3 million for the nine months ended September 30, 2010.

As of September 30, 2011, we had working capital of $122.9 million, including cash on hand of $95.8 million, and approximately $75 million of availability under the Revolving Credit Facility, compared to working capital of $152.0 million, including cash on hand of $153.0 million, and $21.4 million of availability under the ABL Facility at December 31, 2010. The working capital decrease at September 30, 2011, compared to December 31, 2010, is primarily due to the use of cash to repurchase $57.7 million of common stock as part of stock repurchase plans and the acquisition of three short-line railroads for $12.7 million. Our cash flows from operations and borrowings under our credit agreements historically have been sufficient to meet our ongoing operating requirements, to fund capital expenditures for property, plant and equipment, and to satisfy our debt service requirements.

Read the The complete Report



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