Global Railway Reports 2006 Q4 & Annual Financial Results



    2006 earnings from continuing operations doubled to $3.6 million
    Year-end cash-on-hand of $6.8 million with no debt
    Investor conference call on March 21st @11am EDT

    Stock Symbol: GBI
    Listing: Toronto Stock Exchange
    Outstanding Shares: 14.9 Million
    Web Site: www.globalrailway.com

    BERWICK, PA, March 20 /CNW/ - Global Railway Industries Ltd., -
(GBI:TSX): Global Railway Industries Ltd., www.globalrailway.com, ("Global" or
the "Company"), a leading North American provider of railway products and
services, today reports the Company's 2006 fourth quarter financial results
for the three month period ended December 31, 2006 and 2006 annual financial
results for the twelve month period ended December 31, 2006. All dollar
figures are reported in Canadian currency.

    
    2006 Annual Financial Highlights:

    -   Total revenue increased by 6.7% to $31.9 million compared with
        $29.9 million in 2005
    -   Net earnings from continuing operations increased to $3.6 million
        compared with $1.8 million in 2005
    -   Earnings per share from continuing operations increased 100% to $0.24
        (diluted)
    -   Cash-on-hand of $6.8 million and no debt as of December 31, 2006

    Fourth Quarter 2006 Financial Highlights:

    -   Total revenue increased by 6.3% to $7.6 million compared with
        $7.1 million in 2005
    -   Net earnings from continuing operations increased to $0.7 million
        compared with a $40,000 loss in 2005
    -   Earnings per share from continuing operations increased to $0.05
        (diluted)
    

    Terry McManaman, Chief Executive Officer and President of Global Railway
Industries Ltd. commented, "We are pleased with our results in 2006 and on our
ability to execute against the stated 2006 plan that focused on improving the
bottom line performance of our continuing operations through revenue growth,
expense reduction, capitalizing on synergies between subsidiaries and
broadening the senior management team."
    Total revenue in 2006 increased by 6.7% to $31.9 million compared with
$29.9 million in 2005. Fourth quarter revenue in 2006, increased 6.3% to
$7.6 million compared with $7.1 million in the fourth quarter of 2005. The
effect of the strengthening Canadian dollar currency over the United States
dollar currency negatively impacted 2006 revenue results. Had the exchange
rate remained constant year over year, 2006 revenues would have increased by
12% compared to 2005.
    McManaman continues, "The sales growth for the year reflects continued
strong demand in the railroad and transit markets served by the Company."
    Net earnings from continuing operations for 2006 increased to
$3.6 million or $0.24 per share (diluted) compared with $1.8 million or $0.12
per share (diluted) in 2005. Fourth quarter net earnings from continuing
operations for 2006 increased to $0.7 million compared with a loss of $40,000
in the fourth quarter of 2005.
    "All subsidiaries contributed to Global's excellent results," said
McManaman. "In 2006, G&B Specialties, Inc. continued to be the leader of
Global's subsidiaries in both revenue growth and income contribution.
Bach-Simpson Corporation saw both its revenues and profitability improve
greatly in 2006 driven in part by continued acceptance of the Company's Crash
Hardened Memory Module technology which is integrated in the Company's line of
Event Recorders. Prime Steel Inc. continued to reposition itself in the box
car repair business."
    As of December 31, 2006, Global had $6.8 million in cash-on-hand, no
debt, and a working capital ratio of 7.8 to 1. Shareholders' equity was
$31.3 million.

    2007 Outlook

    In 2006, North American rail traffic reached record levels despite
experiencing weakness in some sectors such as lumber and automotive. Total
freight volume was up 2.5% from 2005. In the fourth quarter, North American
rail carloads increased 0.9% and intermodal traffic was up 1.4% over Q4 2005.
Throughout 2006, demand for coal was strong and helped to offset weaknesses in
other sectors. This demand is expected to remain strong in 2007 by the freight
rail companies. All of the major North American Class 1 rail operators have
announced plans to increase capital spending for track, signaling, locomotives
and other equipment in 2007. Many Transit Authorities have also announced
steady or increased capital spending for 2007 vs. 2006.
    As a supplier of components to all three main railroad product markets;
locomotive, rolling stock, and track and signal, Global's management team
believes that the Company will benefit from these rail spending increases and
continue to realize strong revenue growth in 2007.
    The Company's development objectives call for growth through accretive
acquisitions. Given the Company's strong cash position and available debt
leverage, management believes any initial acquisition could be funded using
Global's internal financial resources.

    Appointment of New Chief Financial Officer

    Effective April 2, 2007, Brian McMullan has been appointed by Global as
the Company's Chief Financial Officer ("CFO"). Brian is a Chartered Accountant
who began his career with KPMG. Over the last eighteen years, Brian has been a
senior financial executive with progressive and varied experience with Canon
Canada Inc.
    Brian will be assuming the CFO position from Michael Feschak. Michael is
retiring from Global but will remain working with the Company for
approximately 60 days to assist with the transition. Global's Management and
Board of Directors sincerely thank Michael for his significant contribution to
Global.

    New Corporate Office

    Effective May 1, 2007, Global will open its new corporate head office in
Rochester, New York.


    
    2006 Annual and Q4 Financial Highlights:

    -------------------------------------------------------------------------
                             3-months     3-months    12-months    12-months
    Income Statement           ending       ending       ending       ending
     - audited In             Dec. 31,     Dec. 31,     Dec. 31,     Dec. 31,
     Canadian dollars            2006         2005         2006         2005
    -------------------------------------------------------------------------
    Revenues               $7,559,864   $7,114,866  $31,883,903  $29,881,306
    Net earnings (loss)
     - continuing
     operations              $737,408     ($40,431)  $3,626,841   $1,790,055
    EPS - continuing
     operations (diluted)       $0.05       ($0.01)       $0.24        $0.12
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
    Balance Sheet -
     audited  In Canadian                               Dec. 31,     Dec. 31,
     dollars                                               2006         2005
    -------------------------------------------------------------------------
    Cash                                             $6,830,949     $564,237
    Current assets                                  $18,577,535  $24,045,631
    Total assets                                    $35,247,140  $40,415,162
    Current liabilities                              $2,389,097  $11,750,466
    Future income tax
     liabilities                                     $1,545,866   $1,192,940
    Total liabilities                                $3,934,963  $12,943,406
    Shareholders' equity                            $31,312,177  $27,471,756
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    The Company's 2006 annual financial statements and management's
discussion and analysis are posted in the investor information section of
Global's web site at www.globalrailway.com and are also available on SEDAR at
www.sedar.com.

    Investor Conference Call

    A conference call to review 2006 annual and fourth quarter financial
results for the periods ending December 31, 2006 will take place on Wednesday
March 21st, 2007 at 11:00 am EDT.
    Mr. Terry McManaman, CEO and President, Bill Sturtz, COO and Michael
Feschak, CFO of Global will speak on behalf of the Company. A
question-and-answer forum will follow the review of the 2006 annual and fourth
quarter financial results and update on the Company's operations and growth
strategies.
    To listen and/or participate in this conference call, please dial
1-800-731-5774 (from Toronto: 416-644-3419) approximately 10 minutes prior to
the beginning of the conference call.

    For those unable to participate in the conference call, a recording of
the conference call will be available from 1pm EDT, Wednesday March 21st,
2007, until 11:59 p.m. EDT, Wednesday March 28th, 2007. Please dial
1-877-289-8525 (from Toronto: 416-640-1917) and enter the reservation number
21222745 followed by the "pound sign" to listen to the rebroadcast.

    Annual General Meeting Information:

    Global's annual general meeting will be held on Wednesday May 16th, 2007
at the TSX Market Gallery, Ground Floor-Exchange Tower, 130 King Street West,
Toronto, Ontario beginning at 3:30 PM (EDT).

    About Global Railway Industries: Global Railway Industries Ltd. is a
diversified rail product company serving the railway industry in North
America. Global Railway is a public company whose shares are listed for
trading on the Toronto Stock Exchange (TSX) under the symbol "GBI". The
Company has a total of 14.9 million shares outstanding. For more information:
visit www.globalrailway.com or www.investorfile.com.

    THIS NEWS RELEASE MAY CONTAIN FORWARD-LOOKING INFORMATION. ACTUAL FUTURE
RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTEMPLATED. THE RISKS,
UNCERTAINTIES AND OTHER FACTORS, BOTH KNOWN AND UNKNOWN, THAT COULD INFLUENCE
ACTUAL RESULTS MAY BE SUBSTANTIAL AND INCLUDE THOSE DESCRIBED IN DOCUMENTS
FILED WITH REGULATORY AUTHORITIES, SUCH AS THE COMPANY'S MOST RECENTLY FILED
ANNUAL REPORT AND ANNUAL INFORMATION FORM. ACCORDINGLY, NO ASSURANCES CAN BE
GIVEN THAT ANY OF THE EVENTS ANTICIPATED BY THE FORWARD-LOOKING STATEMENTS
WILL TRANSPIRE OR OCCUR, OR IF ANY OF THEM DO SO, WHAT BENEFITS THE COMPANY
WILL DERIVE THEREFROM.

    %SEDAR: 00010076E




For further information:

For further information: Company Contact: Terry McManaman, President &
CEO, Tel: (507) 802-0366, E-mail: terry.mcmanaman@globalrailway.com, Web:
www.globalrailway.com; Investor Relations: Gerry Wimmer, INVESTORFILE.com,
Tel: (416) 360-8895, Toll Free: 1-888-894-8222, E-mail :
gwimmer@investorfile.com, Web: www.investorfile.com

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