##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-K
 þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the fiscal year ended December 31, 2005, or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from  to
 Commission file number 001-32579
 
 RAILAMERICA, INC.
  Delaware
    
    65-0328006(State or Other Jurisdiction of Incorporation or Organization)
    
    (IRS Employer Identification Number)5300 Broken Sound Blvd., N.W., Boca Raton, Florida
    
    33487(Address of principal executive offices)
    
    (Zip Code)
   TITLE OF EACH CLASS
    
    NAME OF EACH EXCHANGE ON WHICH REGISTEREDCommon Stock, $.001 Par Value
    
    New York Stock ExchangeCommon Stock Purchase Rights
    
    New York Stock Exchange
  o þ
 o þ
 þ o
 o
  o þ o
 o þ
       1




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##### 



PAGEPART IItem 1.
    
    Business
    
    
    3Item 1A.
    
    Risk Factors
    
    
    10Item 1B.
    
    Unresolved Staff Comments
    
    
    13Item 2.
    
    Properties
    
    
    13Item 3.
    
    Legal Proceedings
    
    
    16Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    17PART IIItem 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    18Item 6.
    
    Selected Financial Data
    
    
    19Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    20Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    38Item 8.
    
    Financial Statements and Supplementary Data
    
    
    39Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    40Item 9A.
    
    Controls and Procedures
    
    
    40Item 9B.
    
    Other Information
    
    
    40PART IIIItem 10.
    
    Directors and Executive Officers of the Registrant
    
    
    41Item 11.
    
    Executive Compensation
    
    
    41Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    41Item 13.
    
    Certain Relationships and Related Transactions
    
    
    41Item 14.
    
    Principal Accountant Fees and Services
    
    
    41PART IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    42Signatures
    
    
    
    
    46Code of EthicsSubsidiaries of RegistrantConsent of PricewaterhouseCoopers LLPSection 302 PEO CertificationSection 302 PFO CertificationSection 906 PEO CertificationSection 906 PFO Certification
  2




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GENERAL
   
    
    In February 2000, we acquired RailTex, Inc., a holding company that owned 25
railroads in the United States and Canada, for $294.2 million.
    
    In January 2002, we acquired StatesRail, Inc., a holding company of 8 railroads in
the United States, for $84.4 million.
    
    In January 2002, we acquired ParkSierra Corp., a holding company of 3 railroads in
the United States, for $46.2 million.
    
    In May 2003, we acquired/leased a branch line in Alabama and Mississippi that is
contiguous to our existing Alabama and Gulf Coast Railway for $15.1 million.
    
    In June 2003, we acquired the San Luis & Rio Grande Railroad, a branch line in Colorado, for $7.2 million.
    
    In January 2004, we acquired the Central Michigan Railway for $25.3 million.
    
    In August 2004, we commenced operations under a 20 year lease agreement of the
Chicago, Fort Wayne & Eastern Railroad, for an initial lease payment of $10.0 million.
    
    In October 2004, we acquired the Midland Subdivision in Ohio for $8.6 million.
    
    In September 2005, we commenced operations under a 25 year lease agreement for the
Fremont, Michigan Line.
    
    In September 2005, we acquired the Alcoa Railroad Group, comprising four railroads
in the U.S., for $77.8 million.
   
    
    August 2000, Minnesota Northern Railroad and the St. Croix Valley Railroad
    
    December 2000, South Central Tennessee Railroad
    
    December 2000, Pittsburgh Industrial Railroad
 3




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##### Table of Contents




    
    December 2000, Ontario LOriginal Railway
    
    December 2001, Dakota Rail, Inc.
    
    March 2002, Georgia Southwestern Railroad
    
    May 2002, Texas New Mexico Railroad
    
    October 2003, San Pedro & Southwestern Railway
    
    February 2004, Ferronor
    
    August 2004, Freight Australia
    
    December 2004, Arizona Eastern Railway Company
    
    December 2004, West Texas and Lubbock Railroad
    
    December 2005, San Luis & Rio Grande Railroad
    
    January 2006, Mackenzie Northern Railway, Lakeland & Waterways Railway and Central
Western Railway, collectively referred to as the Alberta Railroad Properties
  http://www.sec.gov.
 BUSINESS STRATEGY
    4




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INDUSTRY OVERVIEW
     Number of
    
    
    
    
    
    
    2004 RevenueType of Railroad
    
    Carriers
    
    
    Miles Operated
    
    
    (in billions)
    
    
    % of RevenueClass I
    
    
    7
    
    
    
    97,496
    
    
    $
    39.1
    
    
    
    92.9
    %Regional
    
    
    31
    
    
    
    15,641
    
    
    
    1.4
    
    
    
    3.3Local
    
    
    518
    
    
    
    27,109
    
    
    
    1.6
    
    
    
    3.8Total
    
    
    556
    
    
    
    140,246
    
    
    $
    42.1
    
    
    
    100.0
    %
  5




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RAILROAD OPERATIONS
    RAIL TRAFFIC
    6




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##### Table of Contents



2005
    
    
    2004
    
    
    2003$
    
    
    %
    
    
    $
    
    
    %
    
    
    $
    
    
    %Interline
    
    $
    318,754
    
    
    
    84.3
    %
    
    $
    272,988
    
    
    
    82.6
    %
    
    $
    238,832
    
    
    
    82.6
    %Local
    
    
    17,562
    
    
    
    4.6
    %
    
    
    17,679
    
    
    
    5.4
    %
    
    
    12,735
    
    
    
    4.4
    %Bridge
    
    
    41,784
    
    
    
    11.1
    %
    
    
    39,714
    
    
    
    12.0
    %
    
    
    37,661
    
    
    
    13.0
    %$
    378,100
    
    
    
    100.0
    %
    
    $
    330,381
    
    
    
    100.0
    %
    
    $
    289,228
    
    
    
    100.0
    %
   2005
    
    2004
    
    2003Revenue
    
    Carloads
    
    Revenue
    
    Carloads
    
    Revenue
    
    CarloadsUnion Pacific Railroad
    
    
    26.8
    %
    
    
    25.4
    %
    
    
    28.7
    %
    
    
    27.3
    %
    
    
    31.1
    %
    
    
    28.5
    %CSX Transportation
    
    
    19.5
    %
    
    
    17.2
    %
    
    
    19.1
    %
    
    
    16.1
    %
    
    
    18.9
    %
    
    
    15.1
    %Canadian National Railway
    
    
    16.2
    %
    
    
    14.7
    %
    
    
    17.3
    %
    
    
    16.8
    %
    
    
    14.5
    %
    
    
    14.3
    %Burlington Northern Santa Fe Railway
    
    
    13.5
    %
    
    
    11.8
    %
    
    
    14.2
    %
    
    
    12.2
    %
    
    
    14.4
    %
    
    
    15.1
    %Canadian Pacific
    
    
    7.0
    %
    
    
    13.8
    %
    
    
    6.4
    %
    
    
    12.0
    %
    
    
    7.3
    %
    
    
    12.3
    %Norfolk Southern
    
    
    5.7
    %
    
    
    6.8
    %
    
    
    5.9
    %
    
    
    7.1
    %
    
    
    5.4
    %
    
    
    6.0
    %All other railroads
    
    
    11.3
    %
    
    
    10.3
    %
    
    
    8.4
    %
    
    
    8.5
    %
    
    
    8.4
    %
    
    
    8.7
    %100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
   7




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##### Table of Contents



2005
    
    2004
    
    2003Commodity Group
    
    Carloads
    
    %
    
    Carloads
    
    %
    
    Carloads
    
    %Agricultural & Farm Products
    
    
    106,043
    
    
    
    8
    %
    
    
    97,397
    
    
    
    8
    %
    
    
    90,463
    
    
    
    8
    %Autos
    
    
    24,619
    
    
    
    2
    %
    
    
    28,034
    
    
    
    2
    %
    
    
    33,888
    
    
    
    3
    %Chemicals
    
    
    112,475
    
    
    
    9
    %
    
    
    103,410
    
    
    
    9
    %
    
    
    82,383
    
    
    
    8
    %Coal
    
    
    150,344
    
    
    
    12
    %
    
    
    149,584
    
    
    
    13
    %
    
    
    142,928
    
    
    
    13
    %Food Products
    
    
    87,973
    
    
    
    7
    %
    
    
    79,618
    
    
    
    7
    %
    
    
    63,192
    
    
    
    6
    %Intermodal
    
    
    33,444
    
    
    
    3
    %
    
    
    35,231
    
    
    
    3
    %
    
    
    35,618
    
    
    
    3
    %Lumber & Forest Products
    
    
    126,421
    
    
    
    10
    %
    
    
    119,012
    
    
    
    10
    %
    
    
    115,482
    
    
    
    11
    %Metals
    
    
    98,874
    
    
    
    8
    %
    
    
    88,309
    
    
    
    8
    %
    
    
    84,907
    
    
    
    8
    %Metallic/Non-metallic Ores
    
    
    69,090
    
    
    
    6
    %
    
    
    59,835
    
    
    
    5
    %
    
    
    51,278
    
    
    
    5
    %Minerals
    
    
    59,700
    
    
    
    5
    %
    
    
    53,093
    
    
    
    5
    %
    
    
    48,796
    
    
    
    4
    %Paper Products
    
    
    89,899
    
    
    
    7
    %
    
    
    88,552
    
    
    
    7
    %
    
    
    81,745
    
    
    
    7
    %Petroleum Products
    
    
    48,260
    
    
    
    4
    %
    
    
    44,730
    
    
    
    4
    %
    
    
    39,027
    
    
    
    4
    %Railroad Equipment/Bridge Traffic
    
    
    201,275
    
    
    
    16
    %
    
    
    191,237
    
    
    
    16
    %
    
    
    178,167
    
    
    
    17
    %Other
    
    
    40,618
    
    
    
    3
    %
    
    
    36,010
    
    
    
    3
    %
    
    
    29,718
    
    
    
    3
    %Total
    
    
    1,249,035
    
    
    
    100
    %
    
    
    1,174,052
    
    
    
    100
    %
    
    
    1,077,592
    
    
    
    100
    %
 EMPLOYEES
  SAFETY
  8




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REGULATION
         9




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##### Table of Contents



RAILROAD RETIREMENT
  
  We
have substantial debt and debt service requirements which could have adverse consequences on our
business .
 
    
    our ability to obtain additional financing in the future for capital expenditures,
potential acquisitions, and other purposes may be limited or financing may not be available
on terms favorable to us or at all;
    
    a substantial portion of our cash flow from operations must be used to pay our interest
expense and repay our debt, which reduces the funds that would otherwise be available to us
for our operations and future business opportunities; and
    
    fluctuations in market interest rates will affect the cost of our borrowings to the
extent not covered by interest rate hedge agreements because our credit facilities bear
interest at variable rates and only a portion of our borrowings are covered by hedge
agreements.
   The
credit agreement governing our senior credit facilities contains covenants that
significantly restrict our operations .
 
    
    incur more debt;
    
    redeem or repurchase our common stock;
    
    pay dividends or make other distributions;
    
    make acquisitions or investments;
    
    use assets as security in other transactions;
    
    enter into transactions with affiliates;
 10




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##### Table of Contents




    
    merge or consolidate with others;
    
    dispose of assets or use asset sale proceeds;
    
    create liens on our assets;
    
    make certain payments or capital expenditures;
    
    extend credit; and
    
    withstand a future downturn in our business.
  Rising fuel costs could materially adversely affect our business .
 As part of our railroad operations, we frequently transport hazardous materials.
 The availability of qualified personnel and an aging workforce may adversely affect our
operations.
 Some of our employees belong to labor unions and strikes or work stoppages could adversely
affect our operations.
 Our inability to integrate acquired businesses successfully could have adverse consequences
for our business. Our acquisition program could be materially
affected by the availability of suitable candidates and competition
from other companies for the purchase of available candidates.
   11




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Because we depend on Class I railroads for our operations, our business and financial results
may be adversely affected if our relationships with Class I carriers deteriorates .
  We are subject to the risks of doing business in foreign countries .
 
    
    adverse changes in the economy of those countries;
    
    exchange rate fluctuations;
    
    government policies against ownership of businesses by non-nationals; and
    
    economic uncertainties including, among others, risk of renegotiation or modification of existing agreements or
arrangements with governmental authorities, exportation and transportation tariffs, foreign exchange restrictions and
changes in taxation structure.
 We are subject to significant governmental and environmental regulation of our railroad
operations. The failure to comply with environmental and other governmental regulations could have
a material adverse effect on us .
 A
downturn in the economy could negatively affect demand for
our services.
 Severe
weather and natural disasters could disrupt normal business operations, which could
result in increased costs and liabilities and decreases in revenues.
 We may face liability for casualty losses which are not covered by insurance.
 12




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##### Table of Contents



Future acts of terrorism or war, as well as the threat of war, may cause significant
disruptions in our business operations.
 
   
    
 13




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DATE OF
    
    TRACK
    
    
    
    
    
    PRINCIPALRAILROAD
    
    ACQUISITION
    
    MILES
    
    STRUCTURE
    
    LOCATION
    
    COMMODITIESAlabama & Gulf Coast Railway
    
    Jan. 2002
May 2003
    
    
    429
    
    
    Owned; Trackage
rights
    
    Alabama, Florida
    
    Forest and paper products,
chemicals, minerals, stoneArizona & California Railroad
    
    Jan. 2002
    
    
    297
    
    
    Owned; Trackage
rights
    
    Arizona, California
    
    Cement, asphalt, forest
products, petroleumBauxite & Northern Railway
    
    Sept. 2005
    
    
    3
    
    
    Owned
    
    Arkansas
    
    ChemicalsCalifornia Northern Railroad
    
    Jan. 2002
    
    
    255
    
    
    Leased;
Trackage rights
    
    California
    
    Food, metal, lumber, farm,
chemicalsCape Breton & Central Nova
Scotia Railway
    
    Feb. 2000
    
    
    245
    
    
    Owned
    
    Nova Scotia
    
    Coal, paper, petroleumCarolina Piedmont Railroad
    
    Feb. 2000
    
    
    49
    
    
    Owned
    
    South Carolina
    
    Chemicals, food, mineralsCascade and Columbia River
Railroad
    
    Sept. 1996
    
    
    130
    
    
    Owned;
Trackage rights
    
    Washington
    
    Lumber, minerals,
agricultural productsCentral Oregon & Pacific
Railroad
    
    Feb. 2000
    
    
    449
    
    
    Owned; Leased;
Trackage rights
    
    Oregon, California
    
    Lumber, paper, chemicalsCentral Railroad Company of Indiana
    
    Feb. 2000
    
    
    81
    
    
    Owned
    
    Indiana, Ohio
    
    Metal products, chemicals,
farm and food productsCentral Railroad Company of
Indianapolis
    
    Feb. 2000
    
    
    73
    
    
    Leased;
Trackage rights
    
    Indiana
    
    Farm and food products,
chemicals, metalsChicago, Fort Wayne & Eastern Railroad
    
    July 2004
    
    
    276
    
    
    Leased
    
    Indiana, Ohio
    
    Agricultural products,
metals and food productsConnecticut Southern Railroad
    
    Feb. 2000
    
    
    78
    
    
    Owned;
Trackage rights
    
    Connecticut
    
    Lumber, paper products,
chemicals, bridge trafficDallas Consolidated
    
    Feb. 2000
    
    
    305
    
    
    Leased
    
    Texas
    
    Minerals, food, paper
products, chemicals(Dallas, Garland & Northeastern Railroad and
Texas Northeastern Railroad)E&N Railway
    
    Jan. 1999
    
    
    181
    
    
    Owned; Leased
    
    British Columbia
    
    Chemicals, agriculturalEastern Alabama Railway
    
    Jan. 2002
    
    
    25
    
    
    Owned
    
    Alabama
    
    MineralsGoderich-Exeter Railway
    
    Feb. 2000
    
    
    159
    
    
    Owned;
Leased
    
    Ontario
    
    Auto parts, chemicals,
non-metallics, mineralsHuron and Eastern Railway
    
    Mar. 1986
    
    
    328
    
    
    Owned; leased;
    
    Michigan
    
    Agricultural products, food,(including Central Michigan Railway)
    
    May 1988
    
    
    
    
    
    Trackage rights
    
    
    
    chemicals, coalJan. 2004Ohio Consolidated
    
    Feb. 2000
    
    
    684
    
    
    Owned; Leased
    
    Michigan,
    
    Autos, bridge traffic,(Indiana & Ohio Railway,
and Midland Subdivision)
    
    Oct. 2004
    
    
    
    
    
    
    
    Ohio, Indiana
    
    agricultural productsIndiana Southern Railroad
    
    Feb. 2000
    
    
    176
    
    
    Owned;
Trackage rights
    
    Indiana
    
    Coal, farm products,
chemicalsKiamichi Railroad
    
    Jan. 2002
    
    
    230
    
    
    Owned;
Trackage rights
    
    Arkansas,
Oklahoma,
Texas
    
    Coal, paper products,
minerals, forest productsKyle Railroad
    
    Jan. 2002
    
    
    692
    
    
    Leased; owned
    
    Colorado,
Kansas
    
    Agricultural products, coal,
mineralsLahaina, Kaanapali & Pacific Railroad
    
    Jan. 2002
    
    
    6
    
    
    Owned; leased
    
    Hawaii
    
    N/A
 14




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DATE OF
    
    TRACK
    
    
    
    
    
    PRINCIPALRAILROAD
    
    ACQUISITION
    
    MILES
    
    STRUCTURE
    
    LOCATION
    
    COMMODITIESMassena Terminal Railroad
    
    Sept. 2005
    
    
    3
    
    
    Owned
    
    New York
    
    Metallic and non-metallic
oresMichigan Consolidated
(Mid-Michigan Railroad,
Grand Rapids Eastern Railroad and
Michigan Shore Railroad)
    
    Feb. 2000
    
    
    166
    
    
    Owned; leased
    
    Michigan
    
    Agricultural products,
auto parts, non-metallic ores, mineralsMissouri & Northern
Arkansas Railroad
    
    Feb. 2000
    
    
    527
    
    
    Owned; leased;
trackage rights
    
    Missouri, Arkansas, Kansas
    
    Railroad equipment, coal,
food products, agricultural productsNew England Central
Railroad
    
    Feb. 2000
    
    
    343
    
    
    Owned;
Leased
    
    Vermont, New
Hampshire,
Massachusetts,
Connecticut
    
    Lumber, paper products,
minerals, petroleumOttawa Valley Railway
    
    July 1999
    
    
    389
    
    
    Leased
    
    Ontario
    
    Bridge trafficOtter Tail Valley Railroad
    
    Oct. 1996
    
    
    72
    
    
    Leased
    
    Minnesota
    
    Coal, agricultural
products, fertilizerPoint Comfort & Northern Railway
    
    Sept. 2005
    
    
    13
    
    
    Owned
    
    Texas
    
    Metallic and non-metallic
oresPuget Sound and Pacific Railroad
    
    Jan. 2002
    
    
    150
    
    
    Owned;
Trackage rights
    
    Washington
    
    Forest products, chemicals,
intermodalRockdale, Sandow & Southern Railroad
    
    Sept. 2005
    
    
    6
    
    
    Owned
    
    Texas
    
    Metallic and non-metallic
oresSan Diego & Imperial Valley Railroad
    
    Feb. 2000
    
    
    124
    
    
    Trackage rights
    
    California,
    
    Petroleum, paperproducts, lumberSan Joaquin Valley Railroad
    
    Jan. 2002
    
    
    341
    
    
    Owned;
Trackage rights
    
    California
    
    Food products, petroleum,
chemicals, mineralsSouth Carolina Central
Railroad
    
    Feb. 2000
    
    
    97
    
    
    Owned
    
    South Carolina
    
    Chemicals, metals, coal,
paper productsSouthern Ontario Railway
    
    July 1999
    
    
    54
    
    
    Leased
    
    Ontario
    
    Petroleum, metals,
chemicalsToledo, Peoria and Western
Railway
    
    Sept. 1999
    
    
    293
    
    
    Owned;
Trackage rights
    
    Indiana, Illinois
    
    Intermodal, agricultural
products, chemicalsVentura County Railroad
    
    Aug. 1998
    
    
    13
    
    
    Leased
    
    California
    
    Automobiles, chemicals,
paper productsVirginia Consolidated
(Chesapeake & Albermarle
Railroad, North Carolina
& Virginia Railroad, and
Virginia Southern
Railroad)
    
    Feb. 2000
    
    
    210
    
    
    Leased;
Owned
    
    Virginia,
North Carolina
    
    Metals, coal, mineralsTotal track miles
    
    
    
    
    7,952
 15




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##### Table of Contents



FREIGHT CARSTYPE
    
    OWNED
    
    LEASED
    
    TOTALCovered hopper cars
    
    
    32
    
    
    
    2,943
    
    
    
    2,975Open top hopper cars
    
    
    105
    
    
    
    135
    
    
    
    240Box cars
    
    
    37
    
    
    
    2,662
    
    
    
    2,699Flat cars
    
    
    193
    
    
    
    2,035
    
    
    
    2,228Tank cars
    
    
    6
    
    
    
    4
    
    
    
    10Gondolas
    
    
    3
    
    
    
    650
    
    
    
    653Passenger cars
    
    
    10
    
    
    
    0
    
    
    
    10386
    
    
    
    8,429
    
    
    
    8,815
 LOCOMOTIVESHORSEPOWER/UNIT
    
    OWNED
    
    LEASED
    
    TOTALOver 2,000
    
    
    13
    
    
    
    186
    
    
    
    1991,500 to 2,000
    
    
    85
    
    
    
    183
    
    
    
    268Under 1,500
    
    
    17
    
    
    
    15
    
    
    
    32115
    
    
    
    384
    
    
    
    499
     
     16




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17




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##### Table of Contents



Market Information
  Description of Common Stock
    2004
    
    High Sales Price
    
    Low Sales PriceFirst Quarter
    
    $
    13.40
    
    
    $
    10.80Second Quarter
    
    
    14.75
    
    
    
    11.55Third Quarter
    
    
    14.73
    
    
    
    10.18Fourth Quarter
    
    
    13.39
    
    
    
    10.30
 2005
    
    High Sales Price
    
    Low Sales PriceFirst Quarter
    
    $
    13.40
    
    
    $
    11.55Second Quarter
    
    
    12.67
    
    
    
    9.95Third Quarter
    
    
    12.31
    
    
    
    10.60Fourth Quarter
    
    
    12.09
    
    
    
    10.11
 2006
    
    High Sales Price
    
    Low Sales PriceFirst Quarter (through March 10)
    
    $
    12.00
    
    
    $
    8.97
 Issuer Purchases of Equity Securities Information
  18




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AS OF AND FOR THEYEAR ENDED DECEMBER 31,(in thousands, except operating and per share data)
    
    2005
    
    2004
    
    2003
    
    2002
    
    2001INCOME STATEMENT DATAOperating revenue
    
    $
    423,682
    
    
    $
    369,432
    
    
    $
    329,810
    
    
    $
    309,499
    
    
    $
    227,167Operating income
    
    
    51,265
    
    
    
    38,646
    
    
    
    68,359
    
    
    
    61,749
    
    
    
    48,498Income (loss) from continuing operations
    
    
    30,845
    
    
    
    (23,134
    )
    
    
    21,125
    
    
    
    288
    
    
    
    5,757Basic earnings (loss) per common share from
continuing operations
    
    $
    0.82
    
    
    $
    (0.66
    )
    
    $
    0.66
    
    
    $
    0.01
    
    
    $
    0.26Diluted earnings (loss) per common share from
continuing operations
    
    $
    0.80
    
    
    $
    (0.66
    )
    
    $
    0.65
    
    
    $
    0.01
    
    
    $
    0.24Weighted
average common shares  Basic
    
    
    37,817
    
    
    
    34,982
    
    
    
    31,806
    
    
    
    32,047
    
    
    
    21,510Weighted
average common shares  Diluted
    
    
    38,460
    
    
    
    34,982
    
    
    
    34,336
    
    
    
    32,620
    
    
    
    22,706BALANCE SHEET DATATotal assets
    
    $
    1,147,376
    
    
    $
    1,016,143
    
    
    $
    1,232,490
    
    
    $
    1,106,553
    
    
    $
    891,168Long-term obligations, including current maturities
    
    
    433,873
    
    
    
    363,350
    
    
    
    330,839
    
    
    
    387,321
    
    
    
    301,687Subordinated debt, including current maturities
    
    
    
    
    
    
    4,028
    
    
    
    143,040
    
    
    
    141,331
    
    
    
    144,988Stockholders equity
    
    
    431,278
    
    
    
    380,926
    
    
    
    371,760
    
    
    
    278,903
    
    
    
    220,959OPERATING DATAFreight carloads (continuing operations)
    
    
    1,249,035
    
    
    
    1,174,052
    
    
    
    1,077,592
    
    
    
    1,052,140
    
    
    
    840,322Track mileage
    
    
    8,000
    
    
    
    8,800
    
    
    
    13,300
    
    
    
    12,900
    
    
    
    11,000Number of full time employees
    
    
    2,000
    
    
    
    1,900
    
    
    
    2,700
    
    
    
    2,700
    
    
    
    2,200
 19




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GENERAL
  Carload Growth and Acquisitions
         20




---



##### Table of Contents



Divestitures
        21




---



##### Table of Contents



Commodity Mix
  Critical Accounting Estimates
       22




---



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RESULTS OF OPERATIONS
   NAME OF RAILROAD
    
    DATE OF ACQUISITIONMobile Line
    
    May 2003San Luis and Rio Grande Railroad
    
    June 2003Central Michigan Railway
    
    January 2004Chicago, Fort Wayne & Eastern Railroad
    
    August 2004Midland Subdivision
    
    October 2004Fremont Line
    
    September 2005Alcoa Railroad Group
    
    October 2005
  NAME OF RAILROAD
    
    DATE OF DISPOSITIONSan Pedro & Southwestern Railway
    
    October 2003Arizona Eastern Railway Company
    
    December 2004West Texas and Lubbock Railroad
    
    December 2004San Luis and Rio Grande Railroad
    
    December 2005
  COMPARISON OF CONSOLIDATED OPERATING RESULTS FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2004
  For the years ended December 31,2005
    
    2004Operating revenue
    
    $
    423,682
    
    
    
    100
    %
    
    $
    369,432
    
    
    
    100
    %Operating expenses:Maintenance of way
    
    
    52,902
    
    
    
    12.5
    %
    
    
    45,378
    
    
    
    12.3
    %Maintenance of equipment
    
    
    16,078
    
    
    
    3.8
    %
    
    
    13,350
    
    
    
    3.6
    %Transportation
    
    
    140,775
    
    
    
    33.2
    %
    
    
    112,093
    
    
    
    30.3
    %Equipment rental
    
    
    48,425
    
    
    
    11.4
    %
    
    
    37,196
    
    
    
    10.1
    %Selling, general and administrative
    
    
    84,262
    
    
    
    19.9
    %
    
    
    85,701
    
    
    
    23.2
    %Net gain on sale of assets
    
    
    (1,139
    )
    
    
    -0.3
    %
    
    
    (3,963
    )
    
    
    -1.1
    %Impairment of assets
    
    
    
    
    
    
    0.0
    %
    
    
    12,569
    
    
    
    3.4
    %Depreciation and amortization
    
    
    31,114
    
    
    
    7.4
    %
    
    
    28,462
    
    
    
    7.7
    %Total operating expenses
    
    
    372,417
    
    
    
    87.9
    %
    
    
    330,786
    
    
    
    89.5
    %Operating income
    
    $
    51,265
    
    
    
    12.1
    %
    
    $
    38,646
    
    
    
    10.5
    %
 23




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For the years ended December 31,2005
    
    2004Operating revenue
    
    $
    423,682
    
    
    
    100
    %
    
    $
    369,432
    
    
    
    100
    %Operating expenses:Labor and benefits
    
    
    131,107
    
    
    
    30.9
    %
    
    
    125,679
    
    
    
    34.0
    %Equipment rents
    
    
    51,088
    
    
    
    12.1
    %
    
    
    38,865
    
    
    
    10.5
    %Purchased services
    
    
    32,718
    
    
    
    7.7
    %
    
    
    26,368
    
    
    
    7.2
    %Diesel fuel
    
    
    46,699
    
    
    
    11.0
    %
    
    
    33,504
    
    
    
    9.1
    %Casualties and insurance
    
    
    23,083
    
    
    
    5.5
    %
    
    
    19,948
    
    
    
    5.4
    %Materials
    
    
    10,345
    
    
    
    2.4
    %
    
    
    8,274
    
    
    
    2.2
    %Joint facilities
    
    
    12,375
    
    
    
    2.9
    %
    
    
    11,902
    
    
    
    3.2
    %Other expenses
    
    
    35,027
    
    
    
    8.3
    %
    
    
    29,178
    
    
    
    7.9
    %Net gain on sale of assets
    
    
    (1,139
    )
    
    
    -0.3
    %
    
    
    (3,963
    )
    
    
    -1.1
    %Impairment of assets
    
    
    
    
    
    
    0.0
    %
    
    
    12,569
    
    
    
    3.4
    %Depreciation and amortization
    
    
    31,114
    
    
    
    7.4
    %
    
    
    28,462
    
    
    
    7.7
    %Total operating expenses
    
    
    372,417
    
    
    
    87.9
    %
    
    
    330,786
    
    
    
    89.5
    %Operating income
    
    $
    51,265
    
    
    
    12.1
    %
    
    $
    38,646
    
    
    
    10.5
    %
    For the year ended
    
    For the year endedDecember 31, 2005
    
    December 31, 2004Freight
    
    
    
    
    
    Average rate
    
    Freight
    
    
    
    
    
    Average rate(dollars in thousands, except average rate per carload)
    
    Revenue
    
    Carloads
    
    per carload
    
    Revenue
    
    Carloads
    
    per carloadLumber & Forest Products
    
    $
    55,556
    
    
    
    126,421
    
    
    $
    439
    
    
    $
    47,830
    
    
    
    119,012
    
    
    $
    402Chemicals
    
    
    45,991
    
    
    
    112,475
    
    
    
    409
    
    
    
    40,428
    
    
    
    103,410
    
    
    
    391Metal
    
    
    37,690
    
    
    
    98,874
    
    
    
    381
    
    
    
    31,662
    
    
    
    88,309
    
    
    
    359Agricultural & Farm Products
    
    
    35,458
    
    
    
    106,043
    
    
    
    334
    
    
    
    30,239
    
    
    
    97,397
    
    
    
    310Paper Products
    
    
    32,936
    
    
    
    89,899
    
    
    
    366
    
    
    
    29,298
    
    
    
    88,552
    
    
    
    331Coal
    
    
    32,622
    
    
    
    150,344
    
    
    
    217
    
    
    
    28,137
    
    
    
    149,584
    
    
    
    188Food Products
    
    
    29,428
    
    
    
    87,973
    
    
    
    335
    
    
    
    26,474
    
    
    
    79,618
    
    
    
    333Railroad Equipment/Bridge Traffic
    
    
    25,217
    
    
    
    201,275
    
    
    
    125
    
    
    
    24,494
    
    
    
    191,237
    
    
    
    128Minerals
    
    
    22,953
    
    
    
    59,700
    
    
    
    384
    
    
    
    19,214
    
    
    
    53,093
    
    
    
    362Metallic/Non-metallic Ores
    
    
    19,485
    
    
    
    69,090
    
    
    
    282
    
    
    
    16,691
    
    
    
    59,835
    
    
    
    279Petroleum Products
    
    
    17,657
    
    
    
    48,260
    
    
    
    366
    
    
    
    15,267
    
    
    
    44,730
    
    
    
    341Other
    
    
    12,986
    
    
    
    40,618
    
    
    
    320
    
    
    
    10,185
    
    
    
    36,010
    
    
    
    283Autos
    
    
    6,339
    
    
    
    24,619
    
    
    
    257
    
    
    
    6,759
    
    
    
    28,034
    
    
    
    241Intermodal
    
    
    3,782
    
    
    
    33,444
    
    
    
    113
    
    
    
    3,703
    
    
    
    35,231
    
    
    
    105Total
    
    $
    378,100
    
    
    
    1,249,035
    
    
    $
    303
    
    
    $
    330,381
    
    
    
    1,174,052
    
    
    $
    281
  24




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28




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COMPARISON OF CONSOLIDATED OPERATING RESULTS FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003
  For the years ended December 31,2004
    
    2003Operating revenue
    
    $
    369,432
    
    
    
    100
    %
    
    $
    329,810
    
    
    
    100
    %Operating expenses:Maintenance of way
    
    
    45,378
    
    
    
    12.3
    %
    
    
    34,794
    
    
    
    10.6
    %Maintenance of equipment
    
    
    13,350
    
    
    
    3.6
    %
    
    
    12,280
    
    
    
    3.7
    %Transportation
    
    
    112,093
    
    
    
    30.3
    %
    
    
    87,831
    
    
    
    26.6
    %Equipment rental
    
    
    37,196
    
    
    
    10.1
    %
    
    
    31,493
    
    
    
    9.6
    %Selling, general and administrative
    
    
    85,701
    
    
    
    23.2
    %
    
    
    75,159
    
    
    
    22.8
    %Net gain on sale of assets
    
    
    (3,963
    )
    
    
    -1.1
    %
    
    
    (3,213
    )
    
    
    -1.0
    %Impairment of assets
    
    
    12,569
    
    
    
    3.4
    %
    
    
    
    
    
    
    0.0
    %Depreciation and amortization
    
    
    28,462
    
    
    
    7.7
    %
    
    
    23,107
    
    
    
    7.0
    %Total operating expenses
    
    
    330,786
    
    
    
    89.5
    %
    
    
    261,451
    
    
    
    79.3
    %Operating income
    
    $
    38,646
    
    
    
    10.5
    %
    
    $
    68,359
    
    
    
    20.7
    %
  For the years ended December 31,2004
    
    2003Operating revenue
    
    $
    369,432
    
    
    
    100
    %
    
    $
    329,810
    
    
    
    100
    %Operating expenses:Labor and benefits
    
    
    125,679
    
    
    
    34.0
    %
    
    
    107,086
    
    
    
    32.5
    %Equipment rents
    
    
    38,865
    
    
    
    10.5
    %
    
    
    32,929
    
    
    
    10.0
    %Purchased services
    
    
    26,368
    
    
    
    7.2
    %
    
    
    22,917
    
    
    
    7.0
    %Diesel fuel
    
    
    33,504
    
    
    
    9.1
    %
    
    
    22,533
    
    
    
    6.8
    %Casualties and insurance
    
    
    19,948
    
    
    
    5.4
    %
    
    
    14,084
    
    
    
    4.3
    %Materials
    
    
    8,274
    
    
    
    2.2
    %
    
    
    7,397
    
    
    
    2.2
    %Joint facilities
    
    
    11,902
    
    
    
    3.2
    %
    
    
    8,258
    
    
    
    2.5
    %Other expenses
    
    
    29,178
    
    
    
    7.9
    %
    
    
    26,353
    
    
    
    8.0
    %Net gain on sale of assets
    
    
    (3,963
    )
    
    
    -1.1
    %
    
    
    (3,213
    )
    
    
    -1.0
    %Impairment of assets
    
    
    12,569
    
    
    
    3.4
    %
    
    
    
    
    
    
    0.0
    %Depreciation and amortization
    
    
    28,462
    
    
    
    7.7
    %
    
    
    23,107
    
    
    
    7.0
    %Total operating expenses
    
    
    330,786
    
    
    
    89.5
    %
    
    
    261,451
    
    
    
    79.3
    %Operating income
    
    $
    38,646
    
    
    
    10.5
    %
    
    $
    68,359
    
    
    
    20.7
    %
  29




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For the year ended
    
    For the year endedDecember 31, 2004
    
    December 31, 2003Freight
    
    
    
    
    
    Average rate
    
    Freight
    
    
    
    
    
    Average rate(dollars in thousands, except average rate per carload)
    
    Revenue
    
    Carloads
    
    per carload
    
    Revenue
    
    Carloads
    
    per carloadLumber & Forest Products
    
    $
    47,830
    
    
    
    119,012
    
    
    $
    402
    
    
    $
    46,352
    
    
    
    115,482
    
    
    $
    401Chemicals
    
    
    40,428
    
    
    
    103,410
    
    
    
    391
    
    
    
    29,811
    
    
    
    82,383
    
    
    
    362Metal
    
    
    31,662
    
    
    
    88,309
    
    
    
    359
    
    
    
    26,513
    
    
    
    84,907
    
    
    
    312Agricultural & Farm Products
    
    
    30,239
    
    
    
    97,397
    
    
    
    310
    
    
    
    27,862
    
    
    
    90,463
    
    
    
    308Paper Products
    
    
    29,298
    
    
    
    88,552
    
    
    
    331
    
    
    
    25,135
    
    
    
    81,745
    
    
    
    307Coal
    
    
    28,137
    
    
    
    149,584
    
    
    
    188
    
    
    
    24,475
    
    
    
    142,928
    
    
    
    171Food Products
    
    
    26,474
    
    
    
    79,618
    
    
    
    333
    
    
    
    20,351
    
    
    
    63,192
    
    
    
    322Railroad Equipment/Bridge Traffic
    
    
    24,494
    
    
    
    191,237
    
    
    
    128
    
    
    
    23,319
    
    
    
    178,167
    
    
    
    131Minerals
    
    
    19,214
    
    
    
    53,093
    
    
    
    362
    
    
    
    17,254
    
    
    
    48,796
    
    
    
    354Metallic/Non-metallic Ores
    
    
    16,691
    
    
    
    59,835
    
    
    
    279
    
    
    
    13,827
    
    
    
    51,278
    
    
    
    270Petroleum Products
    
    
    15,267
    
    
    
    44,730
    
    
    
    341
    
    
    
    12,998
    
    
    
    39,027
    
    
    
    333Other
    
    
    10,185
    
    
    
    36,010
    
    
    
    283
    
    
    
    9,012
    
    
    
    29,718
    
    
    
    303Autos
    
    
    6,759
    
    
    
    28,034
    
    
    
    241
    
    
    
    8,088
    
    
    
    33,888
    
    
    
    239Intermodal
    
    
    3,703
    
    
    
    35,231
    
    
    
    105
    
    
    
    4,231
    
    
    
    35,618
    
    
    
    119Total
    
    $
    330,381
    
    
    
    1,174,052
    
    
    $
    281
    
    
    $
    289,228
    
    
    
    1,077,592
    
    
    $
    268
       30




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LIQUIDITY AND CAPITAL RESOURCES  COMBINED OPERATIONS
  33




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Operating Activities
   Investing Activities
   34




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##### Table of Contents



Financing Activities
   Working Capital
  Long-term debt
   
    
    the alternative base rate, defined as the greater of:
 (i)
    
    UBS AGs prime rate and(ii)
    
    the Federal Funds Effective Rate plus, if the loan is a term loan or U.S.
revolving loan, 0.50%, or, if the loan is a Canadian revolving loan, the Canadian Prime
Rate, which is defined as the greater of:
 35




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(a)
    
    UBS AGs Canadian prime rate or(b)
    
    the average rate for 30 day Canadian dollar bankers acceptances plus 1.0% per
annum,
 plus, in each case, a specified margin determined based on our leverage ratio, which
margin was 1.25% for term loans and 1.00% for revolving loans at December 31, 2005, or
    
    the reserve-adjusted LIBOR plus a specified margin determined based on our leverage
ratio, which margin was 2.25% for term loans and 2.00% for revolving loans at December
31, 2005.
    
    
    incur more debt,
    
    redeem or repurchase our common stock,
    
    pay dividends or make other distributions,
    
    make acquisitions or investments,
    
    use assets as security in other transactions,
    
    enter into transactions with affiliates,
    
    merge or consolidate with others,
    
    dispose of assets or use asset sale proceeds,
    
    create liens on our assets,
    
    make certain payments or capital expenditures, and
    
    extend credit.
   36




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Contractual Obligations
  2007 -
    
    2009-
    
    AfterTOTAL
    
    2006
    
    2008
    
    2010
    
    2010Long-term debt
    
    $
    430,993
    
    
    $
    5,562
    
    
    $
    9,282
    
    
    $
    117,948
    
    
    $
    298,201Capital lease obligations
    
    $
    2,880
    
    
    $
    517
    
    
    $
    1,173
    
    
    $
    727
    
    
    $
    463Operating lease obligations
    
    $
    136,995
    
    
    $
    32,402
    
    
    $
    52,277
    
    
    $
    21,544
    
    
    $
    30,772Other long-term liabilities
    
    $
    15,337
    
    
    $
    1,269
    
    
    $
    2,047
    
    
    $
    2,050
    
    
    $
    9,971Total contractual cash obligations (1)
    
    $
    586,205
    
    
    $
    39,750
    
    
    $
    64,779
    
    
    $
    142,269
    
    
    $
    339,407
 
 (1)
    
    There were no material purchase obligations outstanding as of December 31, 2005. Common Stock Repurchase Program
  37




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Credit Ratings
  RECENT ACCOUNTING PRONOUNCEMENTS
   
      38




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39




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Internal Control  Integrated Framework
  Officer Certifications
  
   40




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(a)
    
    The financial statements filed as part of this report are listed separately in the Index of
Financial Statements on page F-1 of this report.(b)
    
    Exhibits
 2.1
    
    Amended and Restated Agreement and Plan of Merger, dated as of November 26, 2001, by and among
RailAmerica, Inc., ParkSierra Acquisition Corp. and ParkSierra Corp. (9)2.2
    
    Merger Agreement, dated as of October 12, 2001, among RailAmerica, Inc., StatesRail Acquisition Corp.
and StatesRail, Inc. (11)2.3
    
    Stock Purchase Agreement, dated October 12, 2001, among RailAmerica, Inc., New StatesRail Holdings,
Inc., StatesRail L.L.C., West Texas and Lubbock Railroad Company, Inc. and the Members of StatesRail
L.L.C. (11)2.4
    
    Letter Agreement, dated as of October 12, 2001, between the parties to Exhibits 2.2 and 2.3 above (11)2.5
    
    Asset Purchase Agreement, dated November 25, 2003, among the Huron and Eastern Railway Company, Inc.
and the Straits Corporation (19)2.6
    
    Lease and purchase of rail improvements agreement, dated as of October 13, 2004, between the Indiana &
Ohio Central Railroad Company Inc. and CSX Transportation, Inc. (18)2.7
    
    Stock Purchase Agreement, dated September 13, 2005, between RailAmerica Transportation Corp. and Alcoa
Inc. (22)3.1
    
    Amended and Restated Certificate of Incorporation of RailAmerica, Inc., as amended (1)3.2
    
    By-laws of RailAmerica, Inc. as amended and restated (14)3.3
    
    Certificate of Amendment to Amended and Restated Certificate of Incorporation of RailAmerica, Inc. (10)4.1
    
    Form of Common Stock Purchase Rights Agreement, dated as of January 6, 1998, between RailAmerica, Inc.
and American Stock Transfer & Trust Company (2)4.2
    
    Certificate of Designation of Series A Convertible Redeemable Preferred Stock of RailAmerica, Inc. (5)4.3
    
    Third Amendment to the Rights Agreement, dated as of January 13, 2000, between RailAmerica, Inc. and
American Stock Transfer & Trust Company (4)4.6
    
    Fourth Amendment to the Rights Agreement, dated as of April 13, 2000, between RailAmerica, Inc. and
American Stock Transfer and Trust Company (6)4.7
    
    Waiver and Supplemental Agreement, dated as of April 13, 2000, among RailAmerica, Inc. and EGS
Associates, L.P., EGS Partners, L.L.C., BEV Partners, L.P., Jonas Partners, L.P., EGS Management,
L.L.C., William Ehrman, Frederic Greenberg, Jonas Gerstl and Juli Oliver (7)4.8
    
    Indenture, dated as of August 14, 2000, between RailAmerica Transportation Corp., the Guarantors named
therein and Wells Fargo Bank Minnesota, N.A. (8)4.13
    
    First Supplemental Indenture (11)4.14
    
    Second Supplemental Indenture (11)4.15
    
    Third Supplemental Indenture (20)
 42




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##### Table of Contents



4.16
    
    Fourth Supplemental Indenture (20)10.45
    
    RailAmerica, Inc. 1995 Non-Employee Director Stock Option Plan (1)+10.46
    
    RailAmerica, Inc. 1995 Employee Stock Purchase Plan (1)+10.63
    
    RailAmerica, Inc. 1998 Executive Incentive Compensation Plan (3)+10.80
    
    Form of Change in Control Agreements between RailAmerica, Inc. and certain executive officers (11) +10.81
    
    Service Agreement, dated April 4, 2001, between
RailAmerica, Inc. and Marinus van Onselen and first amendment thereto (11) +10.82
    
    Amended and Restated Executive Employment Agreement, dated as of January 1, 2002, between RailAmerica, Inc. and Gary O. Marino (11) +10.83
    
    Amended and Restated Executive Employment Agreement, dated as of January 1, 2002, between RailAmerica, Inc. and Donald D. Redfearn (11) +10.84
    
    Employment Agreement, dated as of January 1, 2002, between RailAmerica, Inc. and Gary M. Spiegel (11)+10.86
    
    Amendment No. 1 to Credit Agreement (12)10.87
    
    Deferred Compensation Plan, as amended (12) +10.88
    
    Adoption Agreement relating to Deferred Compensation Plan, as amended (12) +10.89
    
    Long Term Incentive Plan, as amended (13) +10.90
    
    Annual Incentive Plan (13) +10.91
    
    Separation Agreeement, dated as of November 14, 2003, between RailAmerica, Inc. and Gary M. Spiegel (15)10.92
    
    Separation Agreeement, dated as of April 7, 2004, between RailAmerica, Inc. and Gary O. Marino (16)10.93
    
    Land and track lease agreement, dated as of July 26, 2004, between the Central Railroad Company of
Indianapolis and CSX Transportation, Inc. (17)10.94
    
    Amendment to the land and track lease agreement, dated as of July 30, 2004, between the Central
Railroad Company of Indianapolis and CSX Transportation, Inc. (17)10.95
    
    Amended and Restated Credit Agreement, dated as of September 29, 2004, among RailAmerica, Inc., Palm
Beach Rail Holdings, Inc., RailAmerica Transportation Corp., as Borrower, RailAmerica Canada Corp., as
the Canadian Term Borrower, Railink Canada Ltd., as the Canadian Revolver Borrower, as the Lenders,
UBS Securities LLC, as sole Lead Arranger and Bookrunner, UBS AG, Stamford Branch, as Administrative
Agent, and the Bank of Nova Scotia, as Collateral Agent (21)10.96
    
    Employment agreement, dated as of August 1, 2004, between RailAmerica, Inc. and Charles Swinburn. (18)+10.97
    
    Amendment to the Amended and Restated Employment agreement, dated as of July 5, 2004, between
RailAmerica, Inc. and Donald D. Redfearn (18)+10.98
    
    Employment agreement, dated as of July 22, 2004, between RailAmerica, Inc. and Rodney J. Conklin (18)+10.99
    
    Employment agreement, dated as of June 16, 2004, between RailAmerica, Inc. and Michael J. Howe (18)+10.100
    
    Change in control severance agreement, dated as of August 1, 2004, between RailAmerica, Inc. and
Charles Swinburn (18)
 43




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##### Table of Contents



10.101
    
    RailAmerica, Inc. 2005 Employee Stock Purchase Plan (23)10.102
    
    Second Amendment to the RailAmerica, Inc. 1998 Executive Incentive Compensation Plan (23)+10.103
    
    Change in control severance agreement, dated as of May 26, 2005, between RailAmerica, Inc. and Robert
J. Rabin (24)10.104
    
    Change in control severance agreement, dated as of May 26, 2005, between RailAmerica, Inc. and Scott
G. Williams (24)10.105
    
    Amendment No. 1 to the Amended and Restated Credit Agreement, dated September 30, 2005 (25)14.1
    
    Code of Ethics21.1
    
    Subsidiaries of Registrant23.1
    
    Consent of PricewaterhouseCoopers LLP31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of the Principal Executive Officer31.2
    
    Rule 13a-14(a)/15d-14(a) Certification of the Principal Financial Officer32.1
    
    Principal Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of The Sarbanes-Oxley Act of 2002.32.2
    
    Principal Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of The Sarbanes-Oxley Act of 2002.
 
 (1)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-QSB for the quarter ended September 30, 1995, filed with the Securities and Exchange
Commission on November 12, 1995.(2)
    
    Incorporated by reference to exhibit No. 4.1 filed as part of RailAmerica, Inc.s
Registration Statement on Form 8-A, filed with the Securities and Exchange Commission on
January 8, 1998.(3)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-Q for the quarter ended March 31, 1998, filed with the Securities and Exchange
Commission on May 14, 1998.(4)
    
    Incorporated by reference to exhibit 4.1 filed as part of RailAmerica, Inc.s Form 8-K as of
January 13, 2000, filed with the Securities and Exchange Commission on January 26, 2000.(5)
    
    Incorporated by reference to the exhibit of the same number filed as part of RailAmerica,
Inc.s Form 10-K for the year ended December 31, 1998, filed with the Securities and Exchange
Commission on March 31, 1999.(6)
    
    Incorporated by reference to Exhibit 4.1 filed as part of RailAmerica, Inc.s Form 8-K, dated
April 13, 2000.(7)
    
    Incorporated by reference to Exhibit 4.2 filed as part of RailAmerica, Inc.s Form 8-K, dated
April 13, 2000.(8)
    
    Incorporated by reference to the Exhibit 4.1 filed as part of RailAmerica, Inc.s
Registration Statement on Form S-4, Registration No. 333-45196.(9)
    
    Incorporated by reference to the Annex A, filed as part of RailAmerica, Inc.s Registration
Statement on Form S-4, Registration No. 333-75290.(10)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-K for the year ended December 31, 2000, filed with the Securities and Exchange
Commission on April 2, 2001. 44




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##### Table of Contents



(11)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-K for the year ended December 31, 2001, filed with the Securities and Exchange
Commission on April 1, 2002.(12)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-K for the year ended December 31, 2002, filed with the Securities and Exchange
Commission on March 27, 2003.(13)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-Q for the quarter ended March 31, 2003, filed with the Securities and Exchange
Commission on May 9, 2003.(14)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-Q for the quarter ended June 30, 2003, filed with the Securities and Exchange
Commission on August 8, 2003.(15)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-K for the year ended December 31, 2003, filed with the Securities and Exchange
Commission on March 15, 2004.(16)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-Q for the quarter ended March 31, 2004, filed with the Securities and Exchange
Commission on May 10, 2004.(17)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-Q for the quarter ended June 30, 2004, filed with the Securities and Exchange
Commission on August 4, 2004.(18)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 10-Q for the quarter ended September 30, 2004, filed with the Securities and Exchange
Commission on November 9, 2004.(19)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 8-K, filed with the Securities and Exchange Commission on February 9, 2004.(20)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 8-K, filed with the Securities and Exchange Commission on October 5, 2004.(21)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 8-K/A, filed with the Securities and Exchange Commission on October 6, 2004.(22)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 8-K, filed with the Securities and Exchange Commission on September 14, 2005.(23)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 8-K, filed with the Securities and Exchange Commission on June 2, 2005.(24)
    
    Incorporated by reference to the same exhibit number filed as part of RailAmerica, Inc.s
Form 8-K, filed with the Securities and Exchange Commission on June 21, 2005.(25)
    
    Incorporated by reference to exhibit number 10.101 filed as part of RailAmerica, Inc.s Form
8-K, filed with the Securities and Exchange Commission on October 4, 2005.+
    
    Executive Compensation Plan or Arrangement. 45




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##### Table of Contents



RAILAMERICA, INC.By:
    /s/  MICHAEL J. HOWEMichael J. Howe, Executive Vice President andChief Financial Officer (Principal Financial Officer)   SIGNATURES
    
    TITLE
    
    DATE/s/ CHARLES SWINBURN

Charles Swinburn
    
    Chief Executive Officer and Director (Principal
Executive Officer)
    
    March 16, 2006/s/ WILLIAM G. PAGONIS

William G. Pagonis
    
    Chairman of the Board of Directors
    
    March 16, 2006/s/ DONALD D. REDFEARN

Donald D. Redfearn
    
    President, Chief Administrative Officer, Secretary
and Director
    
    March 16, 2006/s/ DOUGLAS R. NICHOLS

Douglas R. Nichols
    
    Director
    
    March 16, 2006/s/ RICHARD RAMPELL

Richard Rampell
    
    Director
    
    March 16, 2006/s/ HAROLD R. CURTIS

Harold R. Curtis
    
    Director
    
    March 16, 2006/s/ FERD C. MEYER, JR.

Ferd C. Meyer, Jr.
    
    Director
    
    March 16, 2006/s/ ANNE H. MCNAMARA

Anne H. McNamara
    
    Director
    
    March 16, 2006/s/ ROBERT J. RABIN

Robert J. Rabin
    
    Senior Vice President and Corporate Controller (Principal
Accounting Officer)
    
    March 16, 2006
 46




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##### Table of Contents



PAGEReport of Independent Registered Certified Public Accounting Firm
    
    F-2Consolidated Balance Sheets  December 31, 2005 and 2004
    
    F-4Consolidated Statements of Income  For the Years Ended
December 31, 2005, 2004 and 2003
    
    F-5Consolidated Statements of Stockholders Equity  For the Years
Ended December 31, 2005, 2004 and 2003
    
    F-6Consolidated Statements of Cash Flows  For the Years Ended
December 31, 2005, 2004 and 2003
    
    F-7Notes to Consolidated Financial Statements
    
    F-8
 F-1




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##### Table of Contents



Consolidated financial statements
  Internal control over financial reporting
   F-2




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##### Table of Contents



F-3




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##### Table of Contents



DECEMBER 31,
    
    2005
    
    2004(In thousands, except share data)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    14,310
    
    
    $
    24,331Accounts and notes receivable, net of allowance of
$573 and $518, respectively
    
    
    82,395
    
    
    
    63,414Current assets of discontinued operations
    
    
    3,140
    
    
    
    Other current assets
    
    
    14,114
    
    
    
    14,935Total current assets
    
    
    113,959
    
    
    
    102,680Property, plant and equipment, net
    
    
    904,588
    
    
    
    875,883Long-term assets of discontinued operations
    
    
    25,879
    
    
    
    Other assets
    
    
    102,950
    
    
    
    37,580Total assets
    
    $
    1,147,376
    
    
    $
    1,016,143LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Current maturities of long-term debt
    
    $
    6,079
    
    
    $
    6,097Accounts payable
    
    
    75,222
    
    
    
    61,276Accrued expenses
    
    
    43,524
    
    
    
    41,950Current liabilities of discontinued operations
    
    
    4,275
    
    
    
    Total current liabilities
    
    
    129,100
    
    
    
    109,323Long-term debt, less current maturities
    
    
    427,794
    
    
    
    357,253Subordinated debt
    
    
    
    
    
    
    4,028Deferred income taxes
    
    
    141,606
    
    
    
    149,306Long-term liabilities of discontinued operations
    
    
    2,261
    
    
    
    Other liabilities
    
    
    15,337
    
    
    
    15,307716,098
    
    
    
    635,217Commitments and contingenciesStockholders equity:Common stock, $0.001 par value, 60,000,000 shares authorized;
38,688,496 shares issued and outstanding at December 31, 2005
and 37,389,660 shares issued and outstanding at December 31, 2004
    
    
    39
    
    
    
    37Additional paid in capital and other
    
    
    330,919
    
    
    
    319,417Retained earnings
    
    
    67,628
    
    
    
    36,806Accumulated other comprehensive income
    
    
    32,692
    
    
    
    24,666Total stockholders equity
    
    
    431,278
    
    
    
    380,926Total liabilities and stockholders equity
    
    $
    1,147,376
    
    
    $
    1,016,143
  F-4




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##### Table of Contents



FOR THE YEARS ENDED DECEMBER 31,
    
    2005
    
    2004
    
    2003(In thousands, except earnings per share data)Operating revenue
    
    $
    423,682
    
    
    $
    369,432
    
    
    $
    329,810Operating expenses:Transportation
    
    
    258,180
    
    
    
    208,017
    
    
    
    166,398Selling, general and administrative
    
    
    84,262
    
    
    
    85,701
    
    
    
    75,159Net gain on sale of assets
    
    
    (1,139
    )
    
    
    (3,963
    )
    
    
    (3,213
    )Impairment of assets
    
    
    
    
    
    
    12,569
    
    
    
    Depreciation and amortization
    
    
    31,114
    
    
    
    28,462
    
    
    
    23,107Total operating expenses
    
    
    372,417
    
    
    
    330,786
    
    
    
    261,451Operating income
    
    
    51,265
    
    
    
    38,646
    
    
    
    68,359Interest and other expense, including amortization costs of
$935, $3,742, and $4,810, respectively
    
    
    (20,329
    )
    
    
    (27,696
    )
    
    
    (31,585
    )Financing costs
    
    
    (621
    )
    
    
    (39,549
    )
    
    
    Income (loss) from continuing operations before income taxes
    
    
    30,315
    
    
    
    (28,599
    )
    
    
    36,774Provision (benefit) for income taxes
    
    
    (530
    )
    
    
    (5,465
    )
    
    
    15,649Income (loss) from continuing operations
    
    
    30,845
    
    
    
    (23,134
    )
    
    
    21,125Discontinued operations:Loss on disposal of discontinued business (net of income
taxes of ($499) and $22,384)
    
    
    (1,881
    )
    
    
    (1,706
    )
    
    
    Income (loss) from operations of discontinued business
(net of income taxes of $1,008, ($845) and ($2,408),
respectively)
    
    
    1,858
    
    
    
    (1,099
    )
    
    
    (6,435
    )Net income (loss)
    
    $
    30,822
    
    
    $
    (25,939
    )
    
    $
    14,690Basic earnings (loss) per common share:Continuing operations
    
    $
    0.82
    
    
    $
    (0.66
    )
    
    $
    0.66Discontinued operations
    
    
    
    
    
    
    (0.08
    )
    
    
    (0.20
    )Net income (loss)
    
    $
    0.82
    
    
    $
    (0.74
    )
    
    $
    0.46Diluted earnings (loss) per common share:Continuing operations
    
    $
    0.80
    
    
    $
    (0.66
    )
    
    $
    0.65Discontinued operations
    
    
    
    
    
    
    (0.08
    )
    
    
    (0.19
    )Net income (loss)
    
    $
    0.80
    
    
    $
    (0.74
    )
    
    $
    0.46Weighted average common shares outstanding:Basic
    
    
    37,817
    
    
    
    34,982
    
    
    
    31,806Diluted
    
    
    38,460
    
    
    
    34,982
    
    
    
    34,336
  F-5




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##### Table of Contents



STOCKHOLDERS EQUITYAdditionalNumber of
    
    
    
    
    
    Paid-In
    
    
    
    
    
    OtherFOR THE YEARS ENDED DECEMBER 31,
    
    Shares
    
    Par
    
    Capital
    
    Retained
    
    Comprehensive2005, 2004 AND 2003
    
    Issued
    
    Value
    
    and Other
    
    Earnings
    
    Income (Loss)
    
    Total(In thousands)Balance, January 1, 2003
    
    
    31,880
    
    
    
    32
    
    
    
    261,372
    
    
    
    48,055
    
    
    
    (30,556
    )
    
    
    278,903Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,690
    
    
    
    
    
    
    
    14,690Change in market value of derivative
instruments, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    215
    
    
    
    215Cumulative translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    76,940
    
    
    
    76,940Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    91,845Issuance of common stock
    
    
    209
    
    
    
    
    
    
    
    461
    
    
    
    
    
    
    
    
    
    
    
    461Exercise of stock options
    
    
    192
    
    
    
    
    
    
    
    1,592
    
    
    
    
    
    
    
    
    
    
    
    1,592Tax benefit on exercise of options
    
    
    
    
    
    
    
    
    
    
    185
    
    
    
    
    
    
    
    
    
    
    
    185Purchase of treasury stock
    
    
    (187
    )
    
    
    
    
    
    
    (1,226
    )
    
    
    
    
    
    
    
    
    
    
    (1,226
    )Balance, December 31, 2003
    
    
    32,094
    
    
    
    32
    
    
    
    262,384
    
    
    
    62,745
    
    
    
    46,599
    
    
    
    371,760Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (25,939
    )
    
    
    
    
    
    
    (25,939
    )Change in market value of derivative
instruments, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    734
    
    
    
    734Realization of cumulative translation
adjustment from the sale of Freight
Australia
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (30,119
    )
    
    
    (30,119
    )Cumulative translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,452
    
    
    
    7,452Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (47,872
    )Issuance of common stock
    
    
    40
    
    
    
    
    
    
    
    1,367
    
    
    
    
    
    
    
    
    
    
    
    1,367Conversion of junior subordinated debentures
    
    
    2,120
    
    
    
    2
    
    
    
    21,086
    
    
    
    
    
    
    
    
    
    
    
    21,088Exercise of stock options
    
    
    1,606
    
    
    
    2
    
    
    
    14,155
    
    
    
    
    
    
    
    
    
    
    
    14,157Extension/ vesting of stock options
    
    
    
    
    
    
    
    
    
    
    3,164
    
    
    
    
    
    
    
    
    
    
    
    3,164Tax benefit on exercise of options
    
    
    
    
    
    
    
    
    
    
    2,599
    
    
    
    
    
    
    
    
    
    
    
    2,599Exercise of warrants
    
    
    1,530
    
    
    
    1
    
    
    
    14,662
    
    
    
    
    
    
    
    
    
    
    
    14,663Balance, December 31, 2004
    
    
    37,390
    
    
    $
    37
    
    
    $
    319,417
    
    
    $
    36,806
    
    
    $
    24,666
    
    
    $
    380,926Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,822
    
    
    
    
    
    
    
    30,822Change in market value of derivative
instruments, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,622
    
    
    
    2,622Cumulative translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,404
    
    
    
    5,404Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    38,848Issuance of common stock
    
    
    280
    
    
    
    1
    
    
    
    1,166
    
    
    
    
    
    
    
    
    
    
    
    1,167Exercise of stock options
    
    
    1,018
    
    
    
    1
    
    
    
    9,341
    
    
    
    
    
    
    
    
    
    
    
    9,342Tax benefit on exercise of options
    
    
    
    
    
    
    
    
    
    
    995
    
    
    
    
    
    
    
    
    
    
    
    995Balance, December 31, 2005
    
    
    38,688
    
    
    $
    39
    
    
    $
    330,919
    
    
    $
    67,628
    
    
    $
    32,692
    
    
    $
    431,278
  F-6




---



##### Table of Contents



FOR THE YEARS ENDED DECEMBER 31,
    
    2005
    
    2004
    
    2003(In thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    30,822
    
    
    $
    (25,939
    )
    
    $
    14,690Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization
    
    
    33,451
    
    
    
    43,075
    
    
    
    46,753Financing costs
    
    
    621
    
    
    
    39,549
    
    
    
    Net loss (gain) on sale or disposal of properties
    
    
    1,350
    
    
    
    (25,304
    )
    
    
    (3,262
    )Impairment of assets
    
    
    
    
    
    
    16,595
    
    
    
    Initial lease payment to CSX
    
    
    
    
    
    
    (10,000
    )
    
    
    Non-cash CEO retirement costs
    
    
    
    
    
    
    3,600
    
    
    
    Deferred income taxes and other
    
    
    (2,155
    )
    
    
    10,198
    
    
    
    13,040Changes in operating assets and liabilities, net of
acquisitions and dispositions:Accounts receivable
    
    
    (16,903
    )
    
    
    (14,964
    )
    
    
    (3,659
    )Other current assets
    
    
    1,263
    
    
    
    (4,428
    )
    
    
    (1,853
    )Accounts payable
    
    
    3,166
    
    
    
    17,291
    
    
    
    4,827Accrued expenses
    
    
    951
    
    
    
    (3,821
    )
    
    
    1,036Other assets and liabilities
    
    
    1,571
    
    
    
    2,225
    
    
    
    (3,102
    )Net cash provided by operating activities
    
    
    54,137
    
    
    
    48,077
    
    
    
    68,470CASH FLOWS FROM INVESTING ACTIVITIES:Purchase of property, plant and equipment
    
    
    (75,907
    )
    
    
    (75,800
    )
    
    
    (71,508
    )Proceeds from sale of assets, net of cash on hand
    
    
    14,920
    
    
    
    222,741
    
    
    
    11,227Acquisitions, net of cash acquired
    
    
    (77,850
    )
    
    
    (33,209
    )
    
    
    (25,846
    )Deferred transaction costs and other
    
    
    (143
    )
    
    
    (3,063
    )
    
    
    (1,970
    )Net cash provided by (used in) investing activities
    
    
    (138,980
    )
    
    
    110,669
    
    
    
    (88,097
    )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from issuance of long-term debt
    
    
    130,900
    
    
    
    494,478
    
    
    
    48,162Principal payments on long-term debt
    
    
    (60,375
    )
    
    
    (523,815
    )
    
    
    (46,454
    )Repurchase of senior subordinated notes
    
    
    (4,540
    )
    
    
    (144,905
    )
    
    
    Proceeds from exercise of stock options and warrants
    
    
    9,009
    
    
    
    28,843
    
    
    
    1,681Purchase of treasury stock
    
    
    
    
    
    
    
    
    
    
    (1,226
    )Financing costs
    
    
    (492
    )
    
    
    (2,976
    )
    
    
    (695
    )Net cash provided by (used in) financing activities
    
    
    74,502
    
    
    
    (148,375
    )
    
    
    1,468Effect of exchange rates on cash
    
    
    320
    
    
    
    246
    
    
    
    2,986Net increase (decrease) in cash
    
    
    (10,021
    )
    
    
    10,617
    
    
    
    (15,173
    )Cash, beginning of period
    
    
    24,331
    
    
    
    13,714
    
    
    
    28,887Cash, end of period
    
    $
    14,310
    
    
    $
    24,331
    
    
    $
    13,714
  F-7




---



##### Table of Contents



F-8




---



##### Table of Contents



Buildings and improvements
    
    20-33 yearsRailroad track and ties
    
    30-40 yearsRailroad track improvements
    
    3-10 yearsLocomotives, transportation and other equipment
    
    5-30 yearsOffice equipment and capitalized software
    
    5-10 years
       F-9




---



##### Table of Contents



Year Ended December 31,(in thousands, except earnings per share data)
    
    2005
    
    2004
    
    2003Net income (loss), as reported
    
    $
    30,822
    
    
    $
    (25,939
    )
    
    $
    14,690Less: Total stock-based employee compensation determined
under fair value based method for all awards, net of related
tax effects
    
    
    (596
    )
    
    
    (1,446
    )
    
    
    (2,586
    )Pro forma net income (loss)
    
    $
    30,226
    
    
    $
    (27,385
    )
    
    $
    12,104Earnings (loss) per share:Basic-as reported
    
    $
    0.82
    
    
    $
    (0.74
    )
    
    $
    0.46Basic-pro forma
    
    $
    0.80
    
    
    $
    (0.78
    )
    
    $
    0.38Diluted-as reported
    
    $
    0.80
    
    
    $
    (0.74
    )
    
    $
    0.46Diluted-pro forma
    
    $
    0.79
    
    
    $
    (0.78
    )
    
    $
    0.38
    F-10




---



##### Table of Contents



Year Ended December 31,2005
    
    2004
    
    2003Income (loss) from continuing operations (basic)
    
    $
    30,845
    
    
    $
    (23,134
    )
    
    $
    21,125Interest on convertible debt
    
    
    
    
    
    
    
    
    
    
    1,279Income (loss) from continuing operations available
to common stockholders (diluted)
    
    $
    30,845
    
    
    $
    (23,134
    )
    
    $
    22,404Weighted average shares outstanding (basic)
    
    
    37,817
    
    
    
    34,982
    
    
    
    31,806Assumed conversion:Options, warrants and unvested restricted stock
    
    
    643
    
    
    
    
    
    
    
    350Convertible debentures
    
    
    
    
    
    
    
    
    
    
    2,180Weighted average shares outstanding (diluted)
    
    
    38,460
    
    
    
    34,982
    
    
    
    34,336
 F-11




---



##### Table of Contents



For the twelve months ended December 31,2005
    
    2004
    
    2003Operating revenue
    
    $
    3,605
    
    
    $
    3,004
    
    
    $
    1,590Operating income (loss)
    
    $
    488
    
    
    $
    (773
    )
    
    $
    87Income (loss) from discontinued operations
    
    $
    488
    
    
    $
    (773
    )
    
    $
    87Income tax provision (benefit)
    
    
    166
    
    
    
    (263
    )
    
    
    32Income (loss) from discontinued operations, net of tax
    
    $
    322
    
    
    $
    (510
    )
    
    $
    55
    For the twelve months ended December 31,2005
    
    2004
    
    2003Operating revenue
    
    $
    26,024
    
    
    $
    23,128
    
    
    $
    20,938Operating income
    
    $
    2,892
    
    
    $
    4,417
    
    
    $
    5,583Income from discontinued operations
    
    $
    2,378
    
    
    $
    3,470
    
    
    $
    4,734Income tax provision
    
    
    842
    
    
    
    1,223
    
    
    
    1,754Income from discontinued operations, net of tax
    
    $
    1,536
    
    
    $
    2,247
    
    
    $
    2,980
 F-12




---



##### Table of Contents



For the twelve months endedDecember 31, 2005Accounts receivable, net
    
    $
    2,631Other current assets
    
    
    509Total current assets
    
    
    3,140Property, plant and equipment, net
    
    
    25,423Other assets
    
    
    456Total assets
    
    $
    29,019Accounts payable
    
    $
    2,639Accrued expenses
    
    
    1,636Total current liabilities
    
    
    4,275Deferred income taxes
    
    
    2,261Total liabilities
    
    $
    6,536
   For the twelve months ended December 31,2005
    
    2004
    
    2003Operating revenue
    
    $
    
    
    
    $
    286
    
    
    $
    309Operating income (loss)
    
    $
    
    
    
    $
    720
    
    
    $
    (20
    )Income (loss) from discontinued operations
    
    $
    
    
    
    $
    720
    
    
    $
    (20
    )Income tax provision (benefit)
    
    
    
    
    
    
    273
    
    
    
    (8
    )Income (loss) from discontinued operations, net of tax
    
    $
    
    
    
    $
    447
    
    
    $
    (12
    )
  F-13




---



##### Table of Contents



For the twelve months ended December 31,2005
    
    2004
    
    2003Operating revenue
    
    $
    
    
    
    $
    5,178
    
    
    $
    5,735Operating income (loss)
    
    $
    
    
    
    $
    (3,879
    )
    
    $
    894Income (loss) from discontinued operations
    
    $
    
    
    
    $
    (3,879
    )
    
    $
    894Income tax provision (benefit)
    
    
    
    
    
    
    (1,474
    )
    
    
    375Income (loss) from discontinued operations, net of tax
    
    $
    
    
    
    $
    (2,405
    )
    
    $
    519
    For the twelve months ended December 31,2005
    
    2004
    
    2003Operating revenue
    
    $
    
    
    
    $
    103,194
    
    
    $
    96,370Operating income (loss)
    
    
    
    
    
    
    4,778
    
    
    
    (7,453
    )Loss from discontinued operations
    
    
    
    
    
    
    (1,482
    )
    
    
    (14,565
    )Income tax benefit
    
    
    
    
    
    
    (604
    )
    
    
    (4,566
    )Loss from discontinued operations, net of tax
    
    $
    
    
    
    $
    (878
    )
    
    $
    (9,999
    )
 F-14




---



##### Table of Contents



For the twelve months ended December 31,2005
    
    2004
    
    2003Operating revenue
    
    $
    
    
    
    $
    
    
    
    $
    26,165Operating income
    
    $
    
    
    
    $
    
    
    
    $
    2,160Income from discontinued operations
    
    $
    
    
    
    $
    
    
    
    $
    27Income tax provision
    
    
    
    
    
    
    
    
    
    
    5Income from discontinued operations, net of tax
    
    $
    
    
    
    $
    
    
    
    $
    22
  F-15




---



##### Table of Contents



September 30,(in thousands)
    
    2005Accounts receivable, net
    
    $
    5,637Other current assets
    
    
    350Total current assets
    
    
    5,987Property, plant and equipment, net
    
    
    19,754Other assets
    
    
    64,582Total assets
    
    $
    90,323Accounts payable
    
    $
    11,672Accrued liabilities
    
    
    793Total current liabilities
    
    
    12,465Other long term liabilities
    
    
    8Total liabilities
    
    $
    12,473
 F-16




---



##### Table of Contents



For the Year Ended(in thousands, except per share data)
    
    December 31,(Unaudited)
    
    2005
    
    2004Operating revenue
    
    $
    438,395
    
    
    $
    387,536Income (loss) from continuing operations
    
    $
    31,752
    
    
    $
    (21,948
    )Net income (loss)
    
    $
    31,729
    
    
    $
    (24,753
    )Income
(loss) from continuing operations per share  diluted
    
    $
    0.82
    
    
    $
    (0.63
    )Net income (loss)per share  diluted
    
    $
    0.82
    
    
    $
    (0.71
    )
     F-17




---



##### Table of Contents



January 25, 2004Accounts receivable, net
    
    $
    943Other current assets
    
    
    205Total current assets
    
    
    1,148Property, plant and equipment, net
    
    
    24,667Total assets
    
    $
    25,815Accounts payable
    
    $
    521Total current liabilities
    
    
    521Total liabilities
    
    $
    521
    2005
    
    2004Unbilled reimbursable projects
    
    $
    4,492
    
    
    $
    6,691Track supplies
    
    
    3,019
    
    
    
    3,402Prepaid expenses and other
    
    
    6,603
    
    
    
    4,842$
    14,114
    
    
    $
    14,935
  2005
    
    2004Accounts payable
    
    $
    68,673
    
    
    $
    54,431Current taxes payable
    
    
    6,549
    
    
    
    6,845$
    75,222
    
    
    $
    61,276
  2005
    
    2004Accrued warranty reserve
    
    $
    13,928
    
    
    $
    14,884Accrued property damage expense
    
    
    6,935
    
    
    
    7,040Accrued compensation and benefits
    
    
    5,150
    
    
    
    4,032Other accrued liabilities
    
    
    17,511
    
    
    
    15,994$
    43,524
    
    
    $
    41,950
 F-18




---



##### Table of Contents



2005
    
    2004Land
    
    $
    187,727
    
    
    $
    192,724Buildings and improvements
    
    
    20,235
    
    
    
    20,179Railroad track and improvements
    
    
    788,579
    
    
    
    725,364Locomotives, transportation and
other equipment
    
    
    51,556
    
    
    
    54,6251,048,097
    
    
    
    992,892Less: accumulated depreciation
    
    
    (143,509
    )
    
    
    (117,009
    )$
    904,588
    
    
    $
    875,883
   2005
    
    2004Amended and restated senior credit facilities:U.S. Term Loan
    
    $
    380,301
    
    
    $
    313,000Canadian Term Loan
    
    
    36,123
    
    
    
    37,000U.S. Revolver
    
    
    5,000
    
    
    
    Other long-term debt (including capital leases)
    
    
    12,449
    
    
    
    13,350433,873
    
    
    
    363,350Less: current maturities
    
    
    6,079
    
    
    
    6,097Long-term debt, less current maturities
    
    $
    427,794
    
    
    $
    357,253
    F-19




---



##### Table of Contents



2006
    
    $
    6,0792007
    
    
    5,1892008
    
    
    5,2662009
    
    
    9,9642010
    
    
    108,711Thereafter
    
    
    298,664$
    433,873
     F-20




---



##### Table of Contents



F-21




---



##### Table of Contents



Leases
  CAPITAL
    
    OPERATINGLEASES
    
    LEASES2006
    
    $
    708
    
    
    $
    32,4022007
    
    
    708
    
    
    
    29,0502008
    
    
    710
    
    
    
    23,2272009
    
    
    503
    
    
    
    13,1012010
    
    
    303
    
    
    
    8,443Thereafter
    
    
    464
    
    
    
    30,772Total minimum lease payments
    
    $
    3,396
    
    
    $
    136,995Less amount representing interest
    
    
    (516
    )Total obligations under capital leases
    
    $
    2,880Less current maturities of obligations under capital leases
    
    
    (517
    )Obligations under capital leases payable after one year
    
    $
    2,363
  F-22




---



##### Table of Contents



F-23




---



##### Table of Contents



2005
    
    2004
    
    2003Domestic
    
    $
    24,074
    
    
    $
    (23,353
    )
    
    $
    27,171Foreign subsidiaries
    
    
    6,241
    
    
    
    (5,246
    )
    
    
    9,603$
    30,315
    
    
    $
    (28,599
    )
    
    $
    36,774
  2005
    
    2004
    
    2003Federal income taxes:Current
    
    $
    
    
    
    $
    3,354
    
    
    $
    Deferred
    
    
    (9,224
    )
    
    
    1,486
    
    
    
    6,978(9,224
    )
    
    
    4,840
    
    
    
    6,978State income taxes:Current
    
    
    1,530
    
    
    
    5,121
    
    
    
    1,284Deferred
    
    
    1,036
    
    
    
    11
    
    
    
    354Change in tax law
    
    
    (440
    )
    
    
    
    
    
    
    2,126
    
    
    
    5,132
    
    
    
    1,638Foreign income taxesCurrent
    
    
    4,172
    
    
    
    9,491
    
    
    
    3,053Deferred
    
    
    2,644
    
    
    
    (3,389
    )
    
    
    63Change in tax law
    
    
    261
    
    
    
    
    
    
    
    1,5097,077
    
    
    
    6,102
    
    
    
    4,625Total income tax provision (benefit)
    
    $
    (21
    )
    
    $
    16,074
    
    
    $
    13,241
  2005
    
    2004
    
    2003Continuing operations
    
    $
    (530
    )
    
    $
    (5,465
    )
    
    $
    15,649Discontinued operations
    
    
    509
    
    
    
    21,539
    
    
    
    (2,408
    )Total income tax provision (benefit)
    
    $
    (21
    )
    
    $
    16,074
    
    
    $
    13,241
  2005
    
    
    2004
    
    
    2003Income tax provision (benefit), at 35%
    
    $
    10,610
    
    
    $
    (10,009
    )
    
    $
    12,871Statutory federal surtax exemption
    
    
    (303
    )
    
    
    286
    
    
    
    (368
    )Net benefit due to difference between U.S. & Foreign tax rates
    
    
    236
    
    
    
    (30
    )
    
    
    348Net provision (benefit) due to tax law changes
    
    

    (179
    )
    
    
    
    

    
    
    1,509Permanent differences
    
    
    (343
    )
    
    
    566
    
    
    
    (439
    )Track maintenance credit
    
    
    (12,990
    )
    
    
    
    
    
    
    Additional provision due to senior debt refinancing
    
    
    
    
    
    
    1,435
    
    
    
    State income taxes, net
    
    
    1,499
    
    
    
    757
    
    
    
    845Other, net
    
    
    409
    
    
    
    361
    
    
    
    34Valuation allowance
    
    
    531
    
    
    
    1,169
    
    
    
    849Tax provision
    
    $
    (530
    )
    
    $
    (5,465
    )
    
    $
    15,649
 F-24




---



##### Table of Contents



2005
    
    2004Deferred tax assets:Net operating loss carryforward
    
    $
    42,892
    
    
    $
    36,874Alternative minimum tax credit
    
    
    1,383
    
    
    
    1,700Track Maintenance Credit
    
    
    20,400
    
    
    
    Accrued expenses
    
    
    13,895
    
    
    
    15,338Total deferred tax assets
    
    
    78,570
    
    
    
    53,912Less: valuation allowance
    
    
    (7,513
    )
    
    
    (8,018
    )Total deferred tax assets, net
    
    
    71,057
    
    
    
    45,894Deferred tax liabilities:Property, plant and equipment
    
    
    (214,515
    )
    
    
    (194,766
    )Other
    
    
    (409
    )
    
    
    (434
    )Total deferred tax liabilities
    
    
    (214,924
    )
    
    
    (195,200
    )Net deferred tax liability
    
    $
    (143,867
    )
    
    $
    (149,306
    )
  AmountJanuary 1, 2003
    
    $
    5,563Charged to expense
    
    
    1,168Charged to other accounts
    
    
    118December 31, 2003
    
    
    6,849Charged to expense
    
    
    1,169Charged to other accounts
    
    
    December 31, 2004
    
    
    8,018Charged to expense
    
    
    531Expired NOLs
    
    
    (1,036
    )December 31, 2005
    
    $
    7,513
  Amount
    
    Expiration PeriodU.S.  Federal
    
    $
    93,603
    
    
    
    2011  2025U.S.  State
    
    
    263,608
    
    
    
    2006  2025Luxembourg
    
    
    94
    
    
    NoneCanada
    
    
    5,231
    
    
    
    2006  2015$
    362,536
  F-25




---



##### Table of Contents



ExpirationAmount
    
    PeriodTrack maintenance credit
    
    $
    20,400
    
    
    
    2025Total credits
    
    $
    20,400
      WEIGHTED
    
    
    
    
    
    WEIGHTEDNUMBER OF
    
    AVERAGE
    
    NUMBER OF
    
    AVERAGEOUTSTANDING
    
    EXERCISE
    
    SHARES
    
    EXERCISESHARES
    
    PRICE
    
    EXERCISABLE
    
    PRICEOutstanding at January 1, 2003
    
    
    3,946,302
    
    
    $
    9.37Granted
    
    
    227,150
    
    
    $
    8.50Exercised
    
    
    (191,423
    )
    
    $
    7.80Forfeited
    
    
    (458,783
    )
    
    $
    10.52Outstanding at December 31, 2003
    
    
    5,218,175
    
    
    $
    9.64
    
    
    
    4,585,966
    
    
    $
    9.60Granted
    
    
    288,000
    
    
    $
    13.09Exercised
    
    
    (1,541,153
    )
    
    $
    8.71Forfeited
    
    
    (94,982
    )
    
    $
    9.98Outstanding at December 31, 2004
    
    
    3,870,040
    
    
    $
    10.24
    
    
    
    3,599,570
    
    
    $
    10.12Granted
    
    
    55,000
    
    
    $
    12.16Exercised
    
    
    (1,018,014
    )
    
    $
    9.18Forfeited
    
    
    (97,488
    )
    
    $
    12.11Outstanding at December 31, 2005
    
    
    2,809,538
    
    
    $
    10.59
    
    
    
    2,682,205
    
    
    $
    10.49Authorized at December 31, 2005
    
    
    6,217,879
 F-26




---



##### Table of Contents



Options Outstanding


Options ExercisableWeightedAverage
    
    Weighted
    
    
    
    
    
    WeightedRange of
    
    
    
    
    
    Remaining
    
    Average
    
    
    
    
    
    AverageExercise
    
    Number
    
    Contractual
    
    Exercise
    
    Number
    
    ExercisePrice
    
    of Options
    
    Life
    
    Price
    
    of Options
    
    Price$3.50-$7.50
    
    
    118,326
    
    
    
    4.00
    
    
    $
    6.34
    
    
    
    118,326
    
    
    $
    6.34$7.51-$10.00
    
    
    700,312
    
    
    
    4.73
    
    
    $
    8.57
    
    
    
    698,645
    
    
    $
    8.57$10.01-$12.50
    
    
    1,719,400
    
    
    
    5.08
    
    
    $
    11.24
    
    
    
    1,664,400
    
    
    $
    11.23$12.51-$14.45
    
    
    271,500
    
    
    
    7.89
    
    
    $
    13.56
    
    
    
    200,834
    
    
    $
    13.592,809,538
    
    
    
    
    
    
    
    
    
    
    
    2,682,205
     F-27




---



##### Table of Contents



2005
    
    2004
    
    2003Common stock issued for businesses acquired
    
    $
    
    
    
    $
    
    
    
    $
    Details of acquisitions:Working capital components, other than cash
    
    
    6,486
    
    
    
    
    
    
    
    Property and equipment
    
    
    (19,754
    )
    
    
    (33,384
    )
    
    
    (26,941
    )Other assets
    
    
    (18,100
    )
    
    
    (675
    )
    
    
    Goodwill
    
    
    (46,482
    )
    
    
    850
    
    
    
    Deferred income taxes payable
    
    
    
    
    
    
    
    
    
    
    1,095Net cash used in acquisitions
    
    $
    (77,850
    )
    
    $
    (33,209
    )
    
    $
    (25,846
    )
     F-28




---



##### Table of Contents



F-29




---



##### Table of Contents



January 1, 2005 to
    
    January 1, 2004 to
    
    January 1, 2003 toDecember 31, 2005
    
    December 31, 2004
    
    December 31, 2003EXCHANGE RATE BEGINNING OF YEAR
    
    $
    0.83
    
    
    $
    0.77
    
    
    $
    0.63EXCHANGE RATE END OF YEAR
    
    $
    0.86
    
    
    $
    0.83
    
    
    $
    0.77CHANGE IN
BENEFIT OBLIGATIONBenefit obligation at beginning of period
    
    $
    5,859
    
    
    $
    4,973
    
    
    $
    3,910Service cost
    
    
    142
    
    
    
    116
    
    
    
    96Interest cost
    
    
    365
    
    
    
    321
    
    
    
    310Plan participants contributions
    
    
    129
    
    
    
    126
    
    
    
    231Actuarial loss (gain)
    
    
    329
    
    
    
    (22
    )
    
    
    580Settlements
    
    
    0
    
    
    
    0
    
    
    
    (916
    )Curtailments
    
    
    0
    
    
    
    0
    
    
    
    (96
    )Benefits paid
    
    
    (41
    )
    
    
    (42
    )
    
    
    (11
    )Foreign currency exchange rate changes
    
    
    211
    
    
    
    387
    
    
    
    869Benefit obligation at end of period
    
    $
    6,994
    
    
    $
    5,859
    
    
    $
    4,973CHANGE IN PLAN ASSETSFair value of plan assets at beginning of period
    
    $
    4,464
    
    
    $
    3,525
    
    
    $
    3,064Actual return on plan assets
    
    
    436
    
    
    
    253
    
    
    
    443Employer contribution
    
    
    262
    
    
    
    327
    
    
    
    129Plan participants contributions
    
    
    129
    
    
    
    126
    
    
    
    135Settlements
    
    
    0
    
    
    
    0
    
    
    
    (916
    )Benefits paid
    
    
    (41
    )
    
    
    (42
    )
    
    
    (11
    )Foreign currency exchange rate changes
    
    
    161
    
    
    
    275
    
    
    
    681Fair value of plan assets at end of period
    
    $
    5,411
    
    
    $
    4,464
    
    
    $
    3,525Funded status  (accrued) benefit cost
    
    $
    (1,583
    )
    
    $
    (1,395
    )
    
    $
    (1,448
    )Unrecognized net actuarial loss
    
    
    1,427
    
    
    
    1,213
    
    
    
    1,183Unrecognized prior service cost
    
    
    142
    
    
    
    157
    
    
    
    164Prepaid (accrued) benefit cost
    
    $
    (14
    )
    
    $
    (25
    )
    
    $
    (101
    )ASSUMPTIONSDiscount rate
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    6.50
    %Expected return on plan assets
    
    
    7.00
    %
    
    
    7.00
    %
    
    
    7.00
    %Rate of compensation increase
    
    
    3.50
    %
    
    
    3.50
    %
    
    
    4.00
    %Inflation rate
    
    
    3.00
    %
    
    
    3.00
    %
    
    
    3.00
    %COMPONENTS OF NET PERIODIC BENEFIT COST IN
PERIODService cost
    
    $
    142
    
    
    $
    116
    
    
    $
    96Interest cost
    
    
    365
    
    
    
    321
    
    
    
    310Expected return on plan assets
    
    
    (323
    )
    
    
    (266
    )
    
    
    (262
    )Amortization of prior service cost
    
    
    21
    
    
    
    20
    
    
    
    18Amortization of net actuarial loss
    
    
    46
    
    
    
    53
    
    
    
    38Curtailment loss
    
    
    0
    
    
    
    0
    
    
    
    40Settlement loss
    
    
    0
    
    
    
    0
    
    
    
    219Net periodic pension cost
    
    $
    251
    
    
    $
    244
    
    
    $
    459
 F-30




---



##### Table of Contents



December 31,
    
    December 31,
    
    December 31,
    
    Target AllocationPlan Assets (Market Value) for the years ending:
    
    2005
    
    2004
    
    2003
    
    2006Integra Strategic Allocated Pool Fund
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %Fund holdings by class:a) Equity securities
    
    
    59.9
    %
    
    
    59.7
    %
    
    
    59.3
    %
    
    
    60.0
    %b) Debt securities
    
    
    40.0
    %
    
    
    39.8
    %
    
    
    36.7
    %
    
    
    40.0
    %c) Real estate
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    0.0
    %d) Other (including cash)
    
    
    0.1
    %
    
    
    0.5
    %
    
    
    4.0
    %
    
    
    0.0
    %Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Expected long-term rate of return on assets
    
    
    7.00
    %
    
    
    7.00
    %
    
    
    7.00
    %Expected rate of return on equity securities
    
    
    8.50
    %
    
    
    8.50
    %
    
    
    8.50
    %Expected rate of return on debt securities
    
    
    5.75
    %
    
    
    5.75
    %
    
    
    5.75
    %
 December 31,
    
    December 31,
    
    December 31,For the years ended:
    
    2005
     
    2004
    
    2003(in thousands)Projected benefit obligation
    
    $
    6,994
    
    
    $
    5,859
    
    
    $
    4,973Accumulated benefit obligation
    
    $
    5,359
    
    
    $
    4,398
    
    
    $
    3,726Fair value of plan assets
    
    $
    5,411
    
    
    $
    4,464
    
    
    $
    3,525
 December 31,Cash Flows (in thousands)
    
    December 31,
    
    
    December 31,
    
    
    December 31,
    
    
    2006For the years ended:
    
    2005
    
    
    2004
    
    
    2003
    
    
    (expected)Employer contributionsCurrent service payments
    
    $
    142
    
    
    $
    136
    
    
    $
    129
    
    
    $
    149Unfunded liability payments
    
    
    120
    
    
    
    191
    
    
    
    0
    
    
    
    112Total
    
    $
    262
    
    
    $
    327
    
    
    $
    129
    
    
    $
    261Participant contributions
    
    $
    129
    
    
    $
    126
    
    
    $
    135
    
    
    $
    133Benefit payments
    
    $
    41
    
    
    $
    42
    
    
    $
    11
    
    
    $
    53
 Estimated Future Benefit Payments(in thousands)2006
    
    $
    532007
    
    
    752008
    
    
    432009
    
    
    412010
    
    
    662011
    
    
    572012-2016
    
    $
    520
   F-31




---



##### Table of Contents



Benchmark PortfolioS&P/TSX Capped Composite Index
    
    
    30
    %S&P 500 (Cdn.$) Index
    
    
    15
    %MSCI EAFE (Cdn.$) Index
    
    
    15
    %Scotia Capital Universe Index
    
    
    40
    %
  Minimum
    
    MaximumAsset Mix Limits:
    
    Policy Mix
    
    Limit
    
    LimitCanadian Equity
    
    
    30
    %
    
    
    20
    %
    
    
    40
    %US Equity
    
    
    15
    %
    
    
    5
    %
    
    
    20
    %International Equity
    
    
    15
    %
    
    
    5
    %
    
    
    20
    %Real Estate
    
    
    0
    %
    
    
    0
    %
    
    
    10
    %Total Equity
    
    
    60
    %
    
    
    25
    %
    
    
    70
    %Bonds
    
    
    40
    %
    
    
    30
    %
    
    
    75
    %Mortgages
    
    
    0
    %
    
    
    0
    %
    
    
    10
    %Short Term
    
    
    0
    %
    
    
    0
    %
    
    
    20
    %Total Fixed Income
    
    
    40
    %
    
    
    30
    %
    
    
    75
    %
 % of BookRegulatory Investment Limits
    
    ValueMaximum investment in one companys securities
    
    
    10
    %Maximum proportion of the voting shares of any company
    
    
    30
    %Maximum holding in one parcel of real estate or one resource property
    
    
    5
    %Maximum aggregate holding of resource properties
    
    
    15
    %Maximum aggregate holding of real estate and resource properties
combined
    
    
    25
    %
     F-32




---



##### Table of Contents



F-33




---



##### Table of Contents



F-34




---



##### Table of Contents



NORTH AMERICA
    
    INTERNATIONALCONSOLIDATED
    
    UNITED STATES
    
    CANADA
    
    CHILE
    
    AUSTRALIARevenue
    
    $
    423,682
    
    
    $
    363,182
    
    
    $
    60,500
    
    
    $
    
    
    
    $
    Depreciation and amortization
    
    $
    31,114
    
    
    $
    25,752
    
    
    $
    5,362
    
    
    $
    
    
    
    $
    Income from continuing operations before income taxes
    
    $
    30,315
    
    
    $
    24,074
    
    
    $
    6,241
    
    
    $
    
    
    
    $
    Interest expense
    
    $
    20,329
    
    
    $
    18,331
    
    
    $
    1,998
    
    
    $
    
    
    
    $
    Total assets
    
    $
    1,147,376
    
    
    $
    938,859
    
    
    $
    208,517
    
    
    $
    
    
    
    $
    Capital expenditures
    
    $
    75,907
    
    
    $
    55,607
    
    
    $
    20,300
    
    
    $
    
    
    
    $
    
  NORTH AMERICA
    
    INTERNATIONALCONSOLIDATED
    
    UNITED STATES
    
    CANADA
    
    CHILE
    
    AUSTRALIARevenue
    
    $
    369,432
    
    
    $
    314,483
    
    
    $
    54,949
    
    
    $
    
    
    
    $
    Depreciation and amortization
    
    $
    28,462
    
    
    $
    23,658
    
    
    $
    4,804
    
    
    $
    
    
    
    $
    Income from continuing operations before income taxes
    
    $
    (28,599
    )
    
    $
    (23,353
    )
    
    $
    (5,246
    )
    
    $
    
    
    
    $
    Interest expense
    
    $
    27,696
    
    
    $
    26,908
    
    
    $
    788
    
    
    $
    
    
    
    $
    Total assets
    
    $
    1,016,143
    
    
    $
    828,807
    
    
    $
    187,336
    
    
    $
    
    
    
    $
    Capital expenditures
    
    $
    75,800
    
    
    $
    49,465
    
    
    $
    12,877
    
    
    $
    
    
    
    $
    13,458
  NORTH AMERICA
    
    INTERNATIONALCONSOLIDATED
    
    UNITED STATES
    
    CANADA
    
    CHILE
    
    AUSTRALIARevenue
    
    $
    329,810
    
    
    $
    279,915
    
    
    $
    49,895
    
    
    $
    
    
    
    $
    Depreciation and amortization
    
    $
    23,107
    
    
    $
    19,536
    
    
    $
    3,571
    
    
    $
    
    
    
    $
    Income from continuing operations before income taxes
    
    $
    36,774
    
    
    $
    27,171
    
    
    $
    9,603
    
    
    $
    
    
    
    $
    Interest expense
    
    $
    31,585
    
    
    $
    30,652
    
    
    $
    933
    
    
    $
    
    
    
    $
    Total assets
    
    $
    1,232,490
    
    
    $
    746,085
    
    
    $
    183,278
    
    
    $
    59,011
    
    
    $
    244,116Capital expenditures
    
    $
    71,508
    
    
    $
    44,034
    
    
    $
    10,257
    
    
    $
    2,189
    
    
    $
    15,028
 F-35




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##### Table of Contents



FIRST
    
    SECOND
    
    THIRD
    
    FOURTHQUARTER
    
    QUARTER
    
    QUARTER
    
    QUARTEROperating revenue
    
    $
    101,681
    
    
    $
    104,135
    
    
    $
    105,797
    
    
    $
    112,069Operating income
    
    $
    9,783
    
    
    $
    14,938
    
    
    $
    12,465
    
    
    $
    14,079Income from continuing operations
    
    $
    4,908
    
    
    $
    9,090
    
    
    $
    7,487
    
    
    $
    9,360Net income
    
    $
    6,216
    
    
    $
    9,278
    
    
    $
    7,674
    
    
    $
    7,654Basic income from continuing operations per share
    
    $
    0.13
    
    
    $
    0.24
    
    
    $
    0.20
    
    
    $
    0.24Diluted income from continuing operations per share
    
    $
    0.13
    
    
    $
    0.24
    
    
    $
    0.19
    
    
    $
    0.24
  FIRST
    
    SECOND
    
    THIRD
    
    FOURTHQUARTER
    
    QUARTER
    
    QUARTER
    
    QUARTEROperating revenue
    
    $
    88,937
    
    
    $
    90,128
    
    
    $
    93,546
    
    
    $
    96,821Operating income
    
    $
    14,765
    
    
    $
    9,553
    
    
    $
    2,408
    
    
    $
    11,920Income (loss) from continuing operations
    
    $
    4,201
    
    
    $
    (587
    )
    
    $
    (31,084
    )
    
    $
    4,336Net income (loss)
    
    $
    1,275
    
    
    $
    1,611
    
    
    $
    (33,139
    )
    
    $
    4,314Basic income (loss) from continuing operations per share
    
    $
    0.13
    
    
    $
    (0.02
    )
    
    $
    (0.86
    )
    
    $
    0.12Diluted income (loss) from continuing operations per share
    
    $
    0.12
    
    
    $
    (0.02
    )
    
    $
    (0.86
    )
    
    $
    0.11
 F-36