Greenbrier Announces Record Fourth Quarter Earnings; $110 Million Net Debt Reduction Over Q3; $50 Million Share Repurchase Program Authorized
~ Posts Q4 EPS of $0.69, before restructuring charges
LAKE OSWEGO, Ore., Oct. 31, 2013 /PRNewswire/ -- The Greenbrier Companies, Inc. (NYSE: GBX) today reported financial results for its fourth quarter and fiscal year ended August 31, 2013.
Fourth Quarter Highlights
- Record net earnings for the quarter were $22.5 million, or $0.69 per diluted share, excluding restructuring charges of $1.8 million, on revenue of $484.2 million. "Economic" EPS was $0.79, which excludes the impact of out-of-the-money shares underlying our 3.5% convertible bonds.
- Net earnings attributable to Greenbrier, including restructuring charges, for the quarter were $20.7 million, or $0.64 per diluted share.
- Record Adjusted EBITDA for the quarter was $49.5 million or 10.2% of revenue.
- New railcar backlog as of August 31, 2013 was 14,400 units with an estimated value of $1.52 billion (average unit sale price of $106,000), compared to 14,200 units with an estimated value of $1.57 billion (average unit sales price of $111,000) on May 31, 2013.
- New railcar deliveries totaled 3,500 units for the quarter.
- Orders for 3,400 new railcars were received during the quarter. Subsequent to quarter end, Greenbrier received orders for another 1,700 units valued at approximately $140 million.
- Entered into several new long-term railcar maintenance agreements, including multi-year transaction with CIT Rail.
- Marine backlog as of August 31, 2013 was $10 million, compared to $1.6 million as of May 31, 2013.
Fiscal Year 2013 Highlights
- Record net earnings, excluding goodwill impairment and restructuring charges, were $62.5 million, or $2.00 per diluted share, on revenue of $1.76 billion.
- Goodwill impairment and restructuring charges of $73.6 million net of tax, or $2.41 per diluted share, related to the Wheels, Repair & Parts segment, led to a Net loss attributable to Greenbrier of $11.0 million, or $0.41 per share.
- Adjusted EBITDA was $157.2 million or 9.0% of revenue, just under the 2012 record of $158.3 million.
- New railcar deliveries were 11,600 units for 2013.
- Orders for the year totaled 14,800 units valued at $1.41 billion across a broad range of railcar types. An initial order for Greenbrier's new plastic pellet car was received along with orders for nearly 3,000 units of automotive-related products, including Multi-MaxTM and Auto-Max®.
- Cash from operating activities was $105 million.
- Proprietary automotive-related product Multi-Max was successfully launched.
Progress on Strategic Initiatives
- Substantially met $100 million minimum capital efficiency goal originally scheduled to be met by February 2014; management continues to focus on capital liberation.
- Improved overall gross margins in fourth quarter by 100 bps; halfway to fourth quarter 2014 minimum goal of at least 200 basis point improvement.
- Closed or sold four underperforming or non-core facilities in our Wheels, Repair & Parts segment; three additional facilities to occur by 2013 calendar year end.
William A. Furman, president and chief executive officer, said, "Our business performed well in 2013, notwithstanding weak markets for certain products such as double stack intermodal cars and marine barges, as well as other events, such as a low grain harvest due to drought. We hit our stride in Manufacturing, improved our Leasing model and took initial steps to address difficult conditions in our Wheels, Repair & Parts unit in order to achieve a record fourth quarter. In addition, we made meaningful progress on our previously announced strategic initiatives to enhance margins and liberate capital, which will grow return on invested capital (ROIC) and enhance shareholder value."
"In Manufacturing, where we are improving margins, we continue to ramp tank car production for this high margin product and are approaching our goal of producing 16 units a day to meet strong demand. While we continue to benefit from participation in the energy markets, we remain focused on product diversification. This is reflected by the broad range of railcar types in backlog. More than half of our new railcar orders during the year were for non-energy uses, and in the fourth quarter, 22% of orders were for automotive-related products, including Multi-Max, our proprietary railcar featuring adjustable auto decks. "
"Our Leasing & Services business continues to deliver enhanced performance within our integrated business model. Through refinements to our leasing model, we are steadily increasing transaction volumes through lease syndication and asset management. We are also reducing the permanent capital invested in this business, and increasing fee income. In the fourth quarter we realized proceeds of nearly $35 million from the sale of assets from our lease fleet, while retaining management of these assets. In the first quarter of 2014, we will continue this trend through the sale of additional lease fleet assets that we will continue to manage. Going forward, we will make further refinements to this business."
"Improvements in operational efficiencies and margins in our Wheels, Repair & Parts segment represent a clear opportunity in 2014. We closed or sold four locations in 2013 and plan to close several more. The remaining underperforming facilities are implementing operational improvements, and we have negotiated more balanced commercial terms with select business partners. While fourth quarter results for this segment do not yet reflect these efforts, we expect to demonstrate better results in 2014. Overall, we are on-track to liberate $25 million of capital from this segment," Furman continued.
Business Outlook
"The decisive actions we took to strengthen our operational performance and business strategy in 2012 and 2013 position us for growth in 2014. We have substantially met our capital efficiency goal of liberating at least $100 million of capital by February 2014 with more to come, and we are on track to improve gross margins to at least 13.5% by the fourth quarter of 2014," Furman concluded.
Greenbrier believes its diverse product mix and integrated business model places the Company in a superior position during the current railcar cycle as overall transportation dynamics continue to improve. Based on current business trends and industry forecasts, in 2014 Greenbrier believes its:
- Deliveries will exceed 15,000 units
- Revenue will exceed $2 billion
- EPS, excluding restructuring charges, will be in the range of $2.45 to $2.70
Similar to previous years, financial results in the second half of the year are expected to be stronger than the first half. Also, while gross margins are expected to increase overall, management does not believe its track will be linear. Beginning next quarter, Greenbrier will disclose segment operating income.
Stock Repurchase Program
Greenbrier today announced that its Board of Directors has approved a $50 million share repurchase program to be executed over the next 18 months. Repurchases under the program will be made through open market transactions or through privately negotiated transactions from time-to-time, based on market conditions, legal and regulatory limitations and other factors. The Company is confident its balance sheet and liquidity will support this program, while it also continues to de-lever and take advantage of growth opportunities.
Financial Summary
Q4 FY13 |
Q3 FY13 |
Sequential Comparison – Main Drivers |
|
Revenue |
$484.2M |
$433.7M |
Up 11.7% due to increased deliveries and Manufacturing product mix, partially offset by lower revenues in Wheels, Repair & Parts |
Gross margin |
12.5% |
11.5% |
Up 100 bps attributable to Manufacturing operating efficiencies, favorable product mix, and lease syndications |
SG&A |
$26.8M |
$25.3M |
Up due to higher incentive compensation on record quarterly Adjusted EBITDA |
Gain on disposition of equipment |
$8.5M |
$5.1M |
Increase reflects sale of leasing assets aligned with capital liberation goals |
Other charges |
$2.7M |
$76.9M |
Goodwill impairment in Q3 and restructuring charges in Q4, both related to the Wheels, Repair & Parts segment |
Adjusted EBITDA (1) |
$49.5M |
$39.6M |
Up principally due to gross margin and capital efficiency initiatives |
Effective tax rate (excluding impairment) |
34.5% |
32.9% |
Reflects geographic mix of earnings |
Net earnings (1) |
$22.5M |
$15.7M |
Higher manufacturing performance and gains on sale |
Diluted EPS (1) |
$0.69 |
$0.50 |
Higher net earnings |
Economic EPS (1) |
$0.79 |
$0.56 |
Excludes "if converted" impact of out-of-the-money bonds due 2018 |
(1) |
Excluding goodwill impairment and restructuring charges. |
Segment Summary
Q4 FY13 |
Q3 FY13 |
Sequential Comparison – Main Drivers |
|
Manufacturing |
|||
Revenue |
$351.7M |
$284.6M |
Up 23.6% due to increased deliveries and favorable product mix |
Gross margin |
12.3% |
11.0% |
Up 130 bps due to improved operating efficiencies, favorable product mix, and strong syndication activity |
Deliveries |
3,500 |
2,500 |
Strong syndication activity and successful tank ramp |
Wheels, Repair & Parts |
|||
Revenue |
$114.0M |
$131.2M |
Down 13.1% due to mix of work and lower wheel volumes |
Gross margin |
6.7% |
8.2% |
Down 150 bps due to less profitable mix and lower wheel volumes |
Leasing & Services |
|||
Revenue |
$18.5M |
$17.9M |
Up 3.2% due to higher interim rents on railcars held for syndication |
Gross margin |
50.7% |
45.2% |
Up 550 bps due primarily to higher interim rents |
Lease fleet utilization |
97.4% |
97.9% |
Conference Call
Greenbrier will host a teleconference to discuss its fourth quarter and 2013 results. In conjunction with this news release, Greenbrier has posted a supplemental earnings presentation to our website. Teleconference details are as follows:
- October 31, 2013
- 9:00 a.m. Pacific Daylight Time
- Phone: 1-630-395-0143, Password: "Greenbrier"
- Real-time Audio Access: ("Newsroom" at http://www.gbrx.com)
Please access the site 10 minutes prior to the start time. Following the call, a webcast replay will be available for 30 days. Telephone replay will be available through November 16, 2013, at 203-369-1175.
About Greenbrier Companies
Greenbrier (www.gbrx.com), headquartered in Lake Oswego, Oregon, is a leading supplier of transportation equipment and services to the railroad industry. Greenbrier builds new railroad freight cars in its four manufacturing facilities in the U.S. and Mexico and marine barges at its U.S. facility. It also repairs and refurbishes freight cars and provides wheels and railcar parts at 37 locations across North America. Greenbrier builds new railroad freight cars and refurbishes freight cars for the European market through both its operations in Poland and various subcontractor facilities throughout Europe. Greenbrier owns approximately 8,600 railcars, and performs management services for approximately 224,000 railcars.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This press release may contain forward-looking statements, including statements regarding expected new railcar production volumes and schedules, expected customer demand for the Company's products and services, plans to increase manufacturing capacity, restructuring plans, new railcar delivery volumes and schedules, growth in demand for the Company's railcar services and parts business, and the Company's future financial performance. Greenbrier uses words such as "anticipates," "believes," "forecast," "potential," "goal," "contemplates," "expects," "intends," "plans," "projects," "hopes," "seeks," "estimates," "could," "would," "will," "may," "can," "designed to," "foreseeable future" and similar expressions to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to certain risks and uncertainties that could cause actual results to differ materially from in the results contemplated by the forward-looking statements. Factors that might cause such a difference include, but are not limited to, reported backlog is not indicative of our financial results; turmoil in the credit markets and financial services industry; high levels of indebtedness and compliance with the terms of our indebtedness; write-downs of goodwill, intangibles and other assets in future periods; sufficient availability of borrowing capacity; fluctuations in demand for newly manufactured railcars or failure to obtain orders as anticipated in developing forecasts; loss of one or more significant customers; customer payment defaults or related issues; actual future costs and the availability of materials and a trained workforce; failure to design or manufacture new products or technologies or to achieve certification or market acceptance of new products or technologies; steel or specialty component price fluctuations and availability and scrap surcharges; changes in product mix and the mix between segments; labor disputes, energy shortages or operating difficulties that might disrupt manufacturing operations or the flow of cargo; production difficulties and product delivery delays as a result of, among other matters, changing technologies, production of new railcar types, or non-performance of subcontractors or suppliers; ability to obtain suitable contracts for the sale of leased equipment and risks related to car hire and residual values; difficulties associated with governmental regulation, including environmental liabilities; integration of current or future acquisitions; succession planning; all as may be discussed in more detail under the headings "Risk Factors" and "Forward Looking Statements" in our Annual Report on Form 10-K for the fiscal year ended August 31, 2012, and our other reports on file with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date hereof. Except as otherwise required by law, we do not assume any obligation to update any forward-looking statements.
Net earnings excluding goodwill impairment and restructuring charges, Adjusted EBITDA, Adjusted weighted average diluted common shares outstanding and Diluted earnings per share excluding goodwill impairment and restructuring charges are not financial measures under generally accepted accounting principles (GAAP). We define Net earnings excluding goodwill impairment and restructuring charges as Net earnings (loss) attributable to Greenbrier before goodwill impairment (after-tax) and restructuring charges (after-tax). We define Adjusted EBITDA as earnings (loss) attributable to Greenbrier before interest and foreign exchange, income tax expense, goodwill impairment, restructuring charges and depreciation and amortization. We define Adjusted weighted average diluted common shares outstanding as Weighted average diluted common shares outstanding plus the dilutive effect of common stock equivalents related to warrants, restricted stock, restricted stock units and convertible notes to the extent that they are considered dilutive in the Diluted earnings per share excluding goodwill impairment and restructuring charges calculation. We define Diluted earnings per share excluding goodwill impairment and restructuring charges as Net earnings excluding goodwill impairment and restructuring charges before interest and debt issuance costs (net of tax) on convertible notes divided by Adjusted weighted average diluted common shares outstanding. Net earnings excluding goodwill impairment and restructuring charges, Adjusted EBITDA, Adjusted weighted average diluted common shares outstanding and Diluted earnings per share excluding goodwill impairment and restructuring charges are performance measurement tools used by Greenbrier. You should not consider Net earnings excluding goodwill impairment and restructuring charges, Adjusted EBITDA, Adjusted weighted average diluted common shares outstanding and Diluted earnings per share excluding goodwill impairment and restructuring charges in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because Adjusted EBITDA and Diluted earnings per share excluding goodwill impairment and restructuring charges are not measures of financial performance under GAAP and are susceptible to varying calculations, the Adjusted EBITDA and Diluted earnings per share excluding goodwill impairment and restructuring charges measures presented may differ from and may not be comparable to similarly titled measures used by other companies.
THE GREENBRIER COMPANIES, INC. |
|||||
CONSOLIDATED BALANCE SHEETS |
|||||
(In thousands, unaudited) |
|||||
August 31, 2013 |
May 31, 2013 |
February 28, 2013 |
November 30, 2012 |
August 31, 2012 |
|
Assets |
|||||
Cash and cash equivalents |
$ 97,435 |
$ 31,606 |
$ 55,637 |
$ 41,284 |
$ 53,571 |
Restricted cash |
8,807 |
8,906 |
8,899 |
7,322 |
6,277 |
Accounts receivable, net |
154,848 |
162,352 |
144,933 |
163,385 |
146,326 |
Inventories |
316,783 |
344,168 |
359,281 |
363,642 |
316,741 |
Leased railcars for syndication |
68,480 |
71,091 |
36,198 |
54,297 |
97,798 |
Equipment on operating leases, net |
305,468 |
332,924 |
344,576 |
362,522 |
362,968 |
Property, plant and equipment, net |
201,533 |
197,779 |
194,887 |
186,715 |
182,429 |
Goodwill |
57,416 |
57,416 |
134,316 |
137,066 |
137,066 |
Intangibles and other assets, net |
78,971 |
79,364 |
86,194 |
79,500 |
81,368 |
$ 1,289,741 |
$ 1,285,606 |
$ 1,364,921 |
$ 1,395,733 |
$ 1,384,544 |
|
Liabilities and Equity |
|||||
Revolving notes |
$ 48,209 |
$ 92,968 |
$ 50,058 |
$ 89,826 |
$ 60,755 |
Accounts payable and accrued liabilities |
315,938 |
286,964 |
278,221 |
282,925 |
329,508 |
Deferred income taxes |
86,040 |
86,229 |
99,965 |
96,498 |
95,363 |
Deferred revenue |
8,838 |
16,203 |
23,178 |
28,283 |
17,194 |
Notes payable |
373,889 |
372,942 |
427,553 |
427,697 |
428,079 |
Total equity - Greenbrier |
428,202 |
404,707 |
461,136 |
447,080 |
431,777 |
Noncontrolling interest |
28,625 |
25,593 |
24,810 |
23,424 |
21,868 |
Total equity |
456,827 |
430,300 |
485,946 |
470,504 |
453,645 |
$ 1,289,741 |
$ 1,285,606 |
$ 1,364,921 |
$ 1,395,733 |
$ 1,384,544 |
THE GREENBRIER COMPANIES, INC. |
|||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(In thousands, except per share amounts, unaudited) |
|||||||
Years Ended August 31, |
|||||||
(In thousands, except per share amounts) |
2013 |
2012 |
2011 |
||||
Revenue |
|||||||
Manufacturing |
$ 1,215,734 |
$ 1,253,964 |
$ 721,102 |
||||
Wheels, Repair & Parts |
469,222 |
481,865 |
452,865 |
||||
Leasing & Services |
71,462 |
71,887 |
69,323 |
||||
1,756,418 |
1,807,716 |
1,243,290 |
|||||
Cost of revenue |
|||||||
Manufacturing |
1,082,889 |
1,122,384 |
661,127 |
||||
Wheels, Repair & Parts |
431,501 |
433,541 |
405,449 |
||||
Leasing & Services |
35,655 |
37,371 |
37,183 |
||||
1,550,045 |
1,593,296 |
1,103,759 |
|||||
Margin |
206,373 |
214,420 |
139,531 |
||||
Selling and administrative |
103,175 |
104,596 |
80,326 |
||||
Net gain on disposition of equipment |
(18,072) |
(8,964) |
(8,369) |
||||
Goodwill impairment |
76,900 |
- |
- |
||||
Restructuring charges |
2,719 |
- |
- |
||||
Earnings from operations |
41,651 |
118,788 |
67,574 |
||||
Other costs |
|||||||
Interest and foreign exchange |
22,158 |
24,809 |
36,992 |
||||
Loss on extinguishment of debt |
- |
- |
15,657 |
||||
Earnings before income tax and earnings (loss) from unconsolidated affiliates |
19,493 |
93,979 |
14,925 |
||||
Income tax expense |
(25,060) |
(32,393) |
(3,564) |
||||
Earnings (loss) before earnings (loss) from unconsolidated affiliates |
(5,567) |
61,586 |
11,361 |
||||
Earnings (loss) from unconsolidated affiliates |
186 |
(416) |
(2,974) |
||||
Net earnings (loss) |
(5,381) |
61,170 |
8,387 |
||||
Net earnings attributable to noncontrolling interest |
(5,667) |
(2,462) |
(1,921) |
||||
Net earnings (loss) attributable to Greenbrier |
$ (11,048) |
$ 58,708 |
$ 6,466 |
||||
Basic earnings (loss) per common share: |
$ (0.41) |
$ 2.21 |
$ 0.27 |
||||
Diluted earnings (loss) per common share: |
$ (0.41) |
$ 1.91 |
$ 0.24 |
||||
Weighted average common shares: |
|||||||
Basic |
26,678 |
26,572 |
24,100 |
||||
Diluted |
26,678 |
33,718 |
26,501 |
||||
THE GREENBRIER COMPANIES, INC. |
||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||
(In thousands, unaudited) |
||||||
Years Ended August 31, |
||||||
(In thousands) |
2013 |
2012 |
2011 |
|||
Cash flows from operating activities: |
||||||
Net earnings (loss) |
$ (5,381) |
$ 61,170 |
$ 8,387 |
|||
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities: |
||||||
Deferred income taxes |
(9,662) |
11,617 |
2,399 |
|||
Depreciation and amortization |
41,447 |
42,371 |
38,293 |
|||
Net gain on disposition of equipment |
(18,072) |
(8,964) |
(5,121) |
|||
Accretion of debt discount |
2,455 |
3,259 |
6,583 |
|||
Stock based compensation expense |
6,302 |
8,757 |
7,073 |
|||
Goodwill impairment |
76,900 |
- |
- |
|||
Loss on extinguishment of debt (non-cash portion) |
- |
- |
8,453 |
|||
Other |
(1,055) |
4,905 |
(311) |
|||
Decrease (increase) in assets: |
||||||
Accounts receivable |
(7,323) |
37,763 |
(96,552) |
|||
Inventories |
19,045 |
3,709 |
(116,866) |
|||
Leased railcars for syndication |
22,881 |
(76,071) |
(20,839) |
|||
Other |
969 |
- |
8,863 |
|||
Increase (decrease) in liabilities: |
||||||
Accounts payable and accrued liabilities |
(15,429) |
16,236 |
130,673 |
|||
Deferred revenue |
(8,485) |
11,304 |
(5,287) |
|||
Net cash provided by (used in) operating activities |
104,592 |
116,056 |
(34,252) |
|||
Cash flows from investing activities: |
||||||
Proceeds from sales of assets |
75,338 |
33,560 |
18,730 |
|||
Capital expenditures |
(60,827) |
(117,885) |
(84,302) |
|||
Decrease (increase) in restricted cash |
(2,530) |
(4,164) |
412 |
|||
Investment in and advances to unconsolidated affiliates |
(2,240) |
(506) |
(2,330) |
|||
Other |
(3,582) |
48 |
(1,774) |
|||
Net cash provided by (used in) investing activities |
6,159 |
(88,947) |
(69,264) |
|||
Cash flows from financing activities: |
||||||
Net changes in revolving notes with maturities of 90 days or less |
(16,396) |
(57,302) |
71,625 |
|||
Proceeds from revolving notes with maturities longer than 90 days |
38,177 |
63,773 |
25,159 |
|||
Repayments of revolving notes with maturities longer than 90 days |
(34,966) |
(33,934) |
(10,000) |
|||
Proceeds from issuance of notes payable |
2,186 |
2,750 |
231,250 |
|||
Debt issuance costs |
- |
- |
(11,469) |
|||
Repayments of notes payable |
(58,831) |
(7,070) |
(311,360) |
|||
Proceeds from equity offering |
- |
- |
63,180 |
|||
Expenses from equity offering |
- |
- |
(420) |
|||
Excess tax benefit from restricted stock awards |
900 |
1,627 |
- |
|||
Investment by joint venture partner |
3,206 |
1,362 |
- |
|||
Other |
(8) |
- |
26 |
|||
Net cash provided by (used in) financing activities |
(65,732) |
(28,794) |
57,991 |
|||
Effect of exchange rate changes |
(1,155) |
5,034 |
(3,117) |
|||
Increase (decrease) in cash and cash equivalents |
43,864 |
3,349 |
(48,642) |
|||
Cash and cash equivalents |
||||||
Beginning of period |
53,571 |
50,222 |
98,864 |
|||
End of period |
$ 97,435 |
$ 53,571 |
$ 50,222 |
|||
THE GREENBRIER COMPANIES, INC. |
||||||||||
SUPPLEMENTAL INFORMATION |
||||||||||
Quarterly Results of Operations |
||||||||||
(In thousands, except per share amounts, unaudited) |
||||||||||
First |
Second |
Third |
Fourth |
Total |
||||||
2013 |
||||||||||
Revenue |
||||||||||
Manufacturing |
$ 285,368 |
$ 294,047 |
$ 284,591 |
$ 351,728 |
$ 1,215,734 |
|||||
Wheels, Repair & Parts |
112,100 |
111,952 |
131,167 |
114,003 |
469,222 |
|||||
Leasing & Services |
17,906 |
17,167 |
17,905 |
18,484 |
71,462 |
|||||
415,374 |
423,166 |
433,663 |
484,215 |
1,756,418 |
||||||
Cost of revenue |
||||||||||
Manufacturing |
258,492 |
262,650 |
253,360 |
308,387 |
1,082,889 |
|||||
Wheels, Repair & Parts |
101,476 |
103,134 |
120,476 |
106,415 |
431,501 |
|||||
Leasing & Services |
7,627 |
9,107 |
9,808 |
9,113 |
35,655 |
|||||
367,595 |
374,891 |
383,644 |
423,915 |
1,550,045 |
||||||
Margin |
47,779 |
48,275 |
50,019 |
60,300 |
206,373 |
|||||
Selling and administrative |
26,100 |
24,942 |
25,322 |
26,811 |
103,175 |
|||||
Net gain on disposition of equipment |
(1,408) |
(3,076) |
(5,131) |
(8,457) |
(18,072) |
|||||
Goodwill impairment |
- |
- |
76,900 |
- |
76,900 |
|||||
Restructuring charges |
- |
- |
- |
2,719 |
2,719 |
|||||
Earnings (loss) from operations |
23,087 |
26,409 |
(47,072) |
39,227 |
41,651 |
|||||
Other costs |
||||||||||
Interest and foreign exchange |
5,900 |
6,322 |
5,905 |
4,031 |
22,158 |
|||||
Earnings (loss) before income tax and earnings (loss) from unconsolidated affiliates |
17,187 |
20,087 |
(52,977) |
35,196 |
19,493 |
|||||
Income tax expense |
(4,586) |
(5,590) |
(2,729) |
(12,155) |
(25,060) |
|||||
Earnings (loss) from unconsolidated affiliates |
(40) |
(105) |
82 |
249 |
186 |
|||||
Net earnings (loss) |
12,561 |
14,392 |
(55,624) |
23,290 |
(5,381) |
|||||
Net earnings attributable to noncontrolling interest |
(2,134) |
(553) |
(406) |
(2,574) |
(5,667) |
|||||
Net earnings (loss) attributable to Greenbrier |
$ 10,427 |
$ 13,839 |
$ (56,030) |
$ 20,716 |
$ (11,048) |
|||||
Basic earnings (loss) per common share: (1) |
$ 0.38 |
$ 0.51 |
$ (2.10) |
$ 0.74 |
$ (0.41) |
|||||
Diluted earnings (loss) per common share: (2) |
$ 0.35 |
$ 0.45 |
$ (2.10) |
$ 0.64 |
$ (0.41) |
(1) |
Quarterly amounts do not total to the year to date amount as each period is calculated discretely. |
(2) |
Quarterly amounts do not total to the year to date amount as each period is calculated discretely. For the first, second and fourth quarters, diluted earnings per common share includes the outstanding warrants using the treasury stock method and the dilutive effect of shares underlying the 2018 Convertible Notes using the "if converted" method in which debt issuance and interest costs, net of tax, were added back to net earnings. |
THE GREENBRIER COMPANIES, INC. |
||||||||||
SUPPLEMENTAL INFORMATION |
||||||||||
Quarterly Results of Operations |
||||||||||
(In thousands, except per share amounts, unaudited) |
||||||||||
First |
Second |
Third |
Fourth |
Total |
||||||
2012 |
||||||||||
Revenue |
||||||||||
Manufacturing |
$ 262,656 |
$ 320,206 |
$ 364,930 |
$ 306,172 |
$ 1,253,964 |
|||||
Wheels, Repair & Parts |
117,749 |
119,894 |
125,145 |
119,077 |
481,865 |
|||||
Leasing & Services |
17,794 |
18,086 |
17,722 |
18,285 |
71,887 |
|||||
398,199 |
458,186 |
507,797 |
443,534 |
1,807,716 |
||||||
Cost of revenue |
||||||||||
Manufacturing |
236,188 |
290,851 |
325,424 |
269,921 |
1,122,384 |
|||||
Wheels, Repair & Parts |
105,891 |
106,554 |
111,610 |
109,486 |
433,541 |
|||||
Leasing & Services |
9,663 |
9,295 |
8,825 |
9,588 |
37,371 |
|||||
351,742 |
406,700 |
445,859 |
388,995 |
1,593,296 |
||||||
Margin |
46,457 |
51,486 |
61,938 |
54,539 |
214,420 |
|||||
Selling and administrative |
23,235 |
24,979 |
28,784 |
27,598 |
104,596 |
|||||
Net gain on disposition of equipment |
(3,658) |
(2,654) |
(2,585) |
(67) |
(8,964) |
|||||
Earnings from operations |
26,880 |
29,161 |
35,739 |
27,008 |
118,788 |
|||||
Other costs |
||||||||||
Interest and foreign exchange |
5,383 |
6,630 |
6,560 |
6,236 |
24,809 |
|||||
Earnings before income tax and earnings (loss) from unconsolidated affiliates |
21,497 |
22,531 |
29,179 |
20,772 |
93,979 |
|||||
Income tax expense |
(7,797) |
(5,348) |
(8,655) |
(10,593) |
(32,393) |
|||||
Earnings (loss) from unconsolidated affiliates |
(372) |
72 |
201 |
(317) |
(416) |
|||||
Net earnings |
13,328 |
17,255 |
20,725 |
9,862 |
61,170 |
|||||
Net (earnings) loss attributable to Noncontrolling interest |
1,189 |
415 |
(1,608) |
(2,458) |
(2,462) |
|||||
Net earnings attributable to Greenbrier |
$ 14,517 |
$ 17,670 |
$ 19,117 |
$ 7,404 |
$ 58,708 |
|||||
Basic earnings per common share: |
$ 0.57 |
$ 0.66 |
$ 0.71 |
$ 0.27 |
$ 2.21 |
|||||
Diluted earnings per common share: (1) |
$ 0.48 |
$ 0.57 |
$ 0.61 |
$ 0.26 |
$ 1.91 |
(1) |
Quarterly amounts do not total to the year to date amount as each period is calculated discretely. Diluted earnings per common share includes the outstanding warrants using the treasury stock method and the dilutive effect of shares underlying the 2018 Convertible Notes using the "if converted" method in which debt issuance and interest costs, net of tax, were added back to net earnings. |
THE GREENBRIER COMPANIES, INC. |
|||||||||||||
SUPPLEMENTAL INFORMATION |
|||||||||||||
(In thousands, excluding backlog and delivery units, unaudited) |
|||||||||||||
Reconciliation of Net earnings (loss) attributable to Greenbrier to Adjusted EBITDA |
|||||||||||||
Three Months Ended |
Years Ended |
||||||||||||
August 31, 2013 |
May 31, 2013 |
August 31, 2013 |
August 31, 2012 |
||||||||||
Net earnings (loss) attributable to Greenbrier |
$ 20,716 |
$ (56,030) |
$ (11,048) |
$ 58,708 |
|||||||||
Interest and foreign exchange |
4,031 |
5,905 |
22,158 |
24,809 |
|||||||||
Income tax expense |
12,155 |
2,729 |
25,060 |
32,393 |
|||||||||
Depreciation and amortization |
9,924 |
10,125 |
41,447 |
42,371 |
|||||||||
Goodwill impairment |
- |
76,900 |
76,900 |
- |
|||||||||
Restructuring charges |
2,719 |
- |
2,719 |
- |
|||||||||
Adjusted EBITDA(1) |
$ 49,545 |
$ 39,629 |
$ 157,236 |
$ 158,281 |
|||||||||
(1) |
Adjusted EBITDA is not a financial measure under generally accepted accounting principles (GAAP). We define Adjusted EBITDA as Net earnings (loss) attributable to Greenbrier before interest and foreign exchange, income tax expense, goodwill impairment, restructuring charges, depreciation and amortization. Adjusted EBITDA is a performance measurement tool commonly used by rail supply companies and Greenbrier. You should not consider Adjusted EBITDA in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because Adjusted EBITDA is not a measure of financial performance under GAAP and is susceptible to varying calculations, the Adjusted EBITDA measure presented may differ from and may not be comparable to similarly titled measures used by other companies. |
Three Months Ended August 31, 2013 |
Year Ended August 31, 2013 |
||||
Backlog Activity (units) |
|||||
Beginning backlog |
14,200 |
10,700 |
|||
Orders received |
3,400 |
14,800 |
|||
Production held as Leased railcars for syndication |
(400) |
(1,600) |
|||
Production sold directly to third parties |
(2,800) |
(9,500) |
|||
Ending backlog |
14,400 |
14,400 |
|||
Delivery Information (units) |
|||||
Production sold directly to third parties |
2,800 |
9,500 |
|||
Sales of Leased railcars for syndication |
700 |
2,100 |
|||
Total deliveries |
3,500 |
11,600 |
THE GREENBRIER COMPANIES, INC. |
|||||||
SUPPLEMENTAL INFORMATION |
|||||||
(In thousands, except per share amounts, unaudited) |
|||||||
Reconciliation of common shares outstanding and diluted earnings per share |
|||||||
The shares used in the computation of the Company's basic and diluted earnings per common share and Diluted earnings per share excluding goodwill impairment and restructuring charges are reconciled as follows: |
|||||||
Three Months Ended |
Year Ended |
||||||
August 31, 2013 |
May 31, 2013 |
August 31, 2013 |
|||||
Weighted average basic common shares outstanding (1) |
28,062 |
26,619 |
26,678 |
||||
Dilutive effect of warrants (2) |
366 |
- |
- |
||||
Dilutive effect of convertible notes (2)(3) |
6,045 |
- |
- |
||||
Weighted average diluted common shares outstanding |
34,473 |
26,619 |
26,678 |
||||
Dilutive effect of warrants |
847 |
700 |
|||||
Dilutive effect of restricted stock and restricted stock units |
627 |
737 |
|||||
Dilutive effect of convertible notes (3) |
6,045 |
6,045 |
|||||
Adjusted weighted average diluted common shares outstanding (4) |
34,138 |
34,160 |
|||||
(1) |
Restricted stock grants and restricted stock units, including some grants subject to certain performance criteria, are included in Weighted average basic common shares outstanding when the Company is in a net earnings position. Weighted average basic common shares outstanding exclude shares of unvested restricted stock and restricted stock units for the three months ended May 31, 2013 and the year ended August 31, 2013 due to a net loss. |
(2) |
The dilutive effect of common stock equivalents is excluded from the Weighted average diluted common shares outstanding for the three months ended May 31, 2013 and the year ended August 31, 2013 due to a net loss. |
(3) |
The dilutive effect of the 2018 Convertible notes are included in the Weighted average diluted common shares outstanding for the three months ended August 31, 2013 and Adjusted weighted average diluted common shares outstanding for the three months ended May 31, 2013 and the year ended August 31, 2013 as they were considered dilutive under the "if converted" method as further discussed below. The dilutive effect of the 2026 Convertible notes was excluded from the share calculations as the stock price for each period presented was less than the initial conversion price of $48.05 and therefore considered anti-dilutive. |
(4) |
Adjusted weighted average diluted common shares outstanding is not a financial measure under GAAP. We define Adjusted weighted average diluted common shares outstanding as Weighted average diluted common shares outstanding plus the dilutive effect of common stock equivalents related to warrants, restricted stock, restricted stock units and convertible notes to the extent that they are considered dilutive in the Diluted earnings per share excluding goodwill impairment and restructuring charges calculation. Adjusted weighted average diluted common shares outstanding is a performance measurement tool used by Greenbrier. You should not consider Adjusted weighted average diluted common shares outstanding in isolation or as a substitute for other financial statement data determined in accordance with GAAP. |
Diluted earnings per share excluding goodwill impairment and restructuring charges for the three months and year ended August 31, 2013 and the three months ended May 31, 2013 was calculated using the more dilutive of two approaches. The first approach includes the dilutive effect of outstanding warrants and shares underlying the 2026 Convertible notes in the share count using the treasury stock method. The second approach supplements the first by including the "if converted" effect of the 2018 Convertible notes issued in March 2011. Under the "if converted method" debt issuance and interest costs, both net of tax, associated with the convertible notes are added back to net earnings and the share count is increased by the shares underlying the convertible notes. The 2026 Convertible notes would only be included in the calculation of both approaches if the current stock price is greater than the initial conversion price of $48.05 using the treasury stock method.
THE GREENBRIER COMPANIES, INC. |
|||||
SUPPLEMENTAL INFORMATION |
|||||
(In thousands, except per share amounts, unaudited) |
|||||
Reconciliation of Net earnings (loss) attributable to Greenbrier to Net earnings excluding goodwill impairment and restructuring charges |
|||||
Three Months Ended |
Year Ended |
||||
August 31, 2013 |
May 31, 2013 |
August 31, 2013 |
|||
Net earnings (loss) attributable to Greenbrier |
$ 20,716 |
$ (56,030) |
$ (11,048) |
||
Goodwill impairment (after-tax) |
- |
71,778 |
71,778 |
||
Restructuring charges (after-tax) |
1,781 |
- |
1,781 |
||
Net earnings excluding goodwill impairment and restructuring charges (1) |
$ 22,497 |
$ 15,748 |
$ 62,511 |
(1) |
Net earnings excluding goodwill impairment and restructuring charges is not a financial measure under GAAP. We define Net earnings excluding goodwill impairment and restructuring charges as Net earnings (loss) attributable to Greenbrier before goodwill impairment (after-tax) and restructuring charges (after-tax). Net earnings excluding goodwill impairment and restructuring charges is a performance measurement tool used by Greenbrier. You should not consider Net earnings excluding goodwill impairment and restructuring charges in isolation or as a substitute for other financial statement data determined in accordance with GAAP. |
Three Months Ended |
Year Ended |
||||
August 31, 2013 |
May 31, 2013 |
August 31, 2013 |
|||
Net earnings excluding goodwill impairment and restructuring charges |
$ 22,497 |
$ 15,748 |
$ 62,511 |
||
Add back: |
|||||
Interest and debt issuance costs on the 2018 Convertible notes, net of tax |
1,416 |
1,416 |
5,677 |
||
Earnings before interest and debt issuance costs on convertible notes |
$23,913 |
$ 17,164 |
$ 68,188 |
||
Adjusted weighted average diluted common shares outstanding |
34,473 |
34,138 |
34,160 |
||
Diluted earnings per share excluding goodwill impairment and restructuring charges (2) |
$ 0.69 (3) |
$ 0.50 (4) |
$ 2.00 (4) |
(2) |
Diluted earnings per share excluding goodwill impairment and restructuring charges is not a financial measure under GAAP. We define Diluted earnings per share excluding goodwill impairment and restructuring charges as Net earnings excluding goodwill impairment and restructuring charges before interest and debt issuance costs (net of tax) on convertible notes divided by Adjusted weighted average diluted common shares outstanding. Diluted earnings per share excluding goodwill impairment and restructuring charges is a performance measurement tool used by Greenbrier. You should not consider Diluted earnings per share excluding goodwill impairment and restructuring charges in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because Diluted earnings per share excluding goodwill impairment and restructuring charges is not a measure of financial performance under GAAP and is susceptible to varying calculations, the Diluted earnings per share excluding goodwill impairment and restructuring charges measure presented may differ from and may not be comparable to similarly titled measures used by other companies. |
(3) |
Net earnings excluding goodwill impairment and restructuring charges before interest and debt issuance costs (net of tax) on convertible notes |
Weighted average diluted common shares outstanding |
|
(4) |
Net earnings excluding goodwill impairment and restructuring charges before interest and debt issuance costs (net of tax) on convertible notes |
Adjusted weighted average diluted common shares outstanding |
THE GREENBRIER COMPANIES, INC. |
||||
SUPPLEMENTAL INFORMATION |
||||
(In thousands, except per share amounts, unaudited) |
||||
Reconciliation of basic earnings per share to economic earnings per share excluding goodwill impairment and restructuring charges |
||||
The shares used in the computation of the Company's basic and economic earnings per common share excluding goodwill impairment and restructuring charges are reconciled as follows: |
||||
Three Months Ended |
||||
August 31, 2013 |
May 31, 2013 |
|||
Weighted average basic common shares outstanding |
28,062 |
26,619 |
||
Dilutive effect of warrants |
366 |
847 |
||
Dilutive effect of restricted stock and restricted stock units |
- |
627 |
||
Weighted average economic diluted common shares outstanding |
28,428 |
28,093 |
||
Net earnings excluding goodwill impairment and restructuring charges |
$ 22,497 |
$ 15,748 |
||
Economic earnings per share excluding goodwill impairment and restructuring charges (1) |
$ 0.79 |
$ 0.56 |
||
(1) |
Economic earnings per share excluding goodwill impairment and restructuring charges is not a financial measure under GAAP. Economic earnings per share excluding goodwill impairment and restructuring charges is used to measure the current economic impact of our Convertible Bonds due in 2018 that have a conversion strike price of $38.05/share, which exceeds our current stock price. We define Economic earnings per share excluding goodwill impairment and restructuring charges as Net earnings excluding goodwill impairment and restructuring charges divided by the sum of Weighted average basic common shares outstanding, including the dilutive effect of restricted stock, restricted stock units and warrants. This calculation excludes the dilutive effect of the shares underlying the 2018 bonds under the "if converted" method, which is included in the calculation of Diluted earnings per share excluding goodwill impairment and restructuring charges. You should not consider Economic earnings per share excluding goodwill impairment and restructuring charges in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because Economic earnings per share excluding goodwill impairment and restructuring charges is not a measure of financial performance under GAAP and is susceptible to varying calculations, the Economic earnings per share excluding goodwill impairment and restructuring charges measure presented may differ from and may not be comparable to similarly titled measures used by other companies. |
SOURCE The Greenbrier Companies, Inc. (GBX)
Share this article