Media & Resources Press Releases Greenbrier Reports Strong Fiscal Third Quarter Financial Results

Greenbrier Reports Strong Fiscal Third Quarter Financial Results

LAKE OSWEGO, Ore., June 28, 2012 /PRNewswire/ -- The Greenbrier Companies (NYSE: GBX) today reported results for its fiscal third quarter ended May 31, 2012.

Third Quarter Highlights                                                                                                       

  • Revenue for the third quarter of 2012 was a record $507.8 million, up 11% from $458.2 million in the second quarter of this year, and up 60% from $317.3 million in the prior year's third quarter.
  • Net earnings attributable to Greenbrier ("net earnings") for the quarter were $19.1 million, or $0.61 per diluted share, compared to $17.7 million, or $0.57 per diluted share, in the second quarter of this year, and a net loss of $3.3 million, or a loss of $0.14 per diluted share, in the same period last year.
  • Adjusted EBITDA for the quarter was $44.6 million, or 8.8% of revenue, compared to $40.1 million, or 8.7% of revenue in the second quarter of 2012, and $25.7 million, or 8.1% of revenue in the third quarter of 2011.
  • New railcar deliveries in the third quarter of 2012 were 4,500 units, compared to 3,700 units in the second quarter of 2012, and 2,200 units in the third quarter of 2011.  Current quarter deliveries include approximately 800 units under lease which were sold to third parties as part of the Company's enhanced lease syndication activities.
  • During the third quarter, the Company received orders for 3,100 new railcars.  Greenbrier's new railcar manufacturing backlog as of May 31, 2012 was 11,500 units with an estimated value of $1.14 billion, compared to 12,500 units with a value of $1.10 billion as of February 29, 2012.

Discussion of Quarterly Results and Outlook
William A. Furman, president and chief executive officer, said, "I am pleased with our strong quarterly results.  Revenue and gross margin grew in each of our business segments as compared to the second quarter of this year.  We continue to benefit from efficiencies of operating at higher volumes, particularly in our manufacturing segment where we delivered a record 4,500 railcars this quarter.  Approximately 800 of these deliveries were new leased railcars that were sold to third parties as part of our enhanced lease syndication activities.  As compared to the second quarter of this year, manufacturing gross margin grew by over $10 million, and gross margin as a percentage of revenue grew to 10.8%, as compared to 9.2%.  Our managed fleet also grew by 2,000 units." 

Furman added, "The value of our backlog increased for the third consecutive quarter.  We continue to see demand across multiple railcar types, and continue to diversify the product mix in our backlog, which now includes seven different railcar types in North America.  Small-cubed covered hopper cars used to carry sand for shale drilling activity comprised 18% of our backlog value as of May 31, 2012.  As a result of increased demand for tank cars, we are increasing tank car production rates, and plan to open a second tank car line in fiscal 2013.  We also received two barge orders valued at $25 million during the quarter, and believe that marine orders for delivery in 2013 will continue to grow."

Furman concluded, "We continue to focus on working capital management and free cashflow.  During the quarter, we generated cash provided by operating activities of over $61 million, and reduced net debt by $35 million."

Segment Details
The Manufacturing segment consists of new railcar production in Europe and North America and marine production in North America.  Manufacturing segment revenue for the third quarter was $364.9 million, compared to $173.5 million in the third fiscal quarter of 2011.  The revenue increase was primarily due to higher railcar deliveries and higher per unit average sales prices.  Deliveries during the quarter totaled 4,500 units, compared to 2,200 units in the same period last year.  Manufacturing gross margin for the third quarter was 10.8% of revenue, compared to 9.2% of revenue in the second quarter of this year, and 8.5% in the third quarter of 2011.  The increase in gross margin from the third quarter of 2011 is primarily attributable to efficiencies gained by operating at higher production rates, more favorable pricing and change in sales mix.

The Wheel Services, Refurbishment & Parts segment, which consists of a network of 40 locations, provides wheel services, repairs and refurbishes railcars, and provides railcar parts across North America.  Revenue for this segment in the third quarter was $125.1 million, compared to $126.3 million in the same period last year.  The slight decline is primarily the result of lower demand for wheel set replacements offset by higher refurbishment and parts demand.  Wheel volumes were down due to the unseasonably warm winter in the current year; cold weather typically causes wheel sets to wear at a faster rate.  In addition, an industry-wide decline in coal car loadings contributed to decreased wheel demand, as coal cars are higher mileage railcars.  Gross margin for the Wheel Services, Refurbishment & Parts segment was 10.8% of revenue, compared to 12.0% of revenue in the third quarter of 2011, and 11.1% of revenue in the second quarter of this year.  The decrease in gross margin from the third quarter of 2011 was primarily a result of a change in sales mix, a decrease in scrap metal pricing, and costs and inefficiencies associated with replacing certain wheel sets produced at our Mexico City wheel shop which do not conform to America Association of Railroads mounting standards.

The Leasing & Services segment includes results from both Greenbrier's own lease fleet of approximately 9,000 railcars, as well as from fleet management services the Company provides for approximately 218,000 railcars owned by third parties.  Revenue for this segment was $17.7 million for the quarter, compared to $17.5 million in the same quarter last year.  Leasing & Services gross margin for the quarter was 50.2% of revenue, compared to 48.6% of revenue for the second quarter of this year, and 47.0% of revenue in the third quarter of 2011.  The increase in both revenue and gross margin, compared to the third quarter of 2011, were primarily a result of higher rents earned on a greater number of leased railcars for syndication.  Lease fleet utilization as of the end of the quarter was 95.5%, compared to 97.3% as of February 29, 2012, and 96.8% as of May 31, 2011,.  

Gains on disposition of equipment in the current quarter were $2.6 million, compared to $1.7 million in the third quarter of 2011. 

Selling and administrative costs were $28.8 million or 5.7% of revenue for the quarter, versus $22.6 million or 7.1% of revenue for the same quarter last year.  The increase is primarily due to an increase in employee related costs, including incentive-based compensation.  In addition, revenue-based fees paid to our joint venture partner in Mexico increased due to higher activity levels. We also incurred nonrecurring legal and audit fees associated with the structuring of a leased railcar syndication transaction.

Interest and foreign exchange expense was $6.6 million in the third quarter, compared to $9.8 million for the same period in 2011.  The third quarter benefited from lower interest rates due to refinancing activities completed in the prior comparable period.

The tax rate for the quarter was 29.7%; the estimated tax rate for the balance of the year is about 33%.  The lower tax rate for the quarter was due to discrete tax items.

Business Outlook
Based on current business trends, management anticipates that revenue, adjusted EBITDA and earnings per share will be higher in the fourth quarter of 2012, compared to the fourth quarter of 2011.  The company expects to deliver approximately 4,000 new railcars in the fourth quarter.  The lower anticipated deliveries in the fourth quarter, as compared to the third quarter, are due to line changeovers, changes in product mix, and lower syndications of leased railcars.

Conference Call
Greenbrier will host a teleconference to discuss third quarter results.  In conjunction with this news release, Greenbrier has posted a supplemental earnings presentation to our website.  Teleconference details are as follows:

  • June 28, 2012
  • 8:00 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 July 14, 2012 at 1-402-998-0083.

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 three 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 40 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 9,000 railcars, and performs management services for approximately 218,000 railcars.

"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:  This 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, 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," "contemplates," "expects," "intends," "plans," "seeks," "estimates," "could," "would," "will," "may," "can," 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, 2011, 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.

Adjusted EBITDA is not a financial measure under generally accepted accounting principles (GAAP). We define Adjusted EBITDA as earnings (loss) attributable to Greenbrier before loss on extinguishment of debt, interest and foreign exchange, income tax expense (benefit), 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.

 

THE GREENBRIER COMPANIES, INC.

 

CONSOLIDATED BALANCE SHEETS

(In thousands, unaudited)

 
 

May 31,
2012

 

February 29,
2012

 

August 31,
2011

Assets

           

Cash and cash equivalents

 

$             44,915

 

$            40,666

 

$           50,222

Restricted cash

 

6,089

 

2,249

 

2,113

Accounts receivable, net 

 

172,086

 

177,544

 

188,443

Inventories

 

346,122

 

365,811

 

323,512

Leased railcars for syndication

 

66,776

 

79,681

 

30,690

Equipment on operating leases, net

 

334,872

 

322,811

 

321,141

Property, plant and equipment, net

 

172,729

 

165,700

 

161,200

Goodwill

 

137,066

 

137,066

 

137,066

Intangibles and other assets, net

 

84,693

 

85,155

 

87,268

   

$        1,365,348

 

$        1,376,683

 

$      1,301,655

             

Liabilities and Equity

           

Revolving notes

 

$             71,430

 

$           101,446

 

$           90,339

Accounts payable and accrued liabilities

 

323,977

 

340,328

 

316,536

Deferred income taxes

 

88,514

 

89,623

 

83,839

Deferred revenue

 

17,872

 

1,230

 

5,900

Notes payable

 

428,028

 

428,454

 

429,140

             

       Total equity Greenbrier

 

418,161

 

399,788

 

361,573

Noncontrolling interest

 

17,366

 

15,814

 

14,328

Total equity

 

435,527

 

415,602

 

375,901

   

$        1,365,348

 

$        1,376,683

 

$      1,301,655

 

 

 

THE GREENBRIER COMPANIES, INC.

 

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts, unaudited)

 
   

Three Months Ended

May 31,

 

Nine Months Ended

May 31,

   

2012

 

2011

 

2012

 

2011

Revenue

               

Manufacturing

 

$     364,930

 

$      173,487

 

$      947,792

 

$      415,548

Wheel Services, Refurbishment & Parts

 

125,145

 

126,317

 

362,788

 

333,600

Leasing & Services

 

17,722

 

17,476

 

53,601

 

51,406

   

507,797

 

317,280

 

1,364,181

 

800,554

                 

Cost of revenue

               

Manufacturing

 

325,424

 

158,674

 

852,464

 

385,974

Wheel Services, Refurbishment & Parts

 

111,610

 

111,202

 

324,055

 

299,026

Leasing & Services

 

8,825

 

9,254

 

27,783

 

27,099

   

445,859

 

279,130

 

1,204,302

 

712,099

                 

Margin

 

61,938

 

38,150

 

159,879

 

88,455

                 

Selling and administrative

 

28,784

 

22,580

 

76,998

 

58,212

Gain on disposition of equipment

 

(2,585)

 

(1,678)

 

(8,897)

 

(6,148)

Earnings from operations

 

35,739

 

17,248

 

91,778

 

36,391

                 

Other costs

               

Interest and foreign exchange

 

6,560

 

9,807

 

18,574

 

30,646

Loss on extinguishment of debt

 

-

 

10,007

 

-

 

10,007

Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates

 

 

29,179

 

 

(2,566)

 

 

73,204

 

 

(4,262)

                 

Income tax benefit (expense)

 

(8,655)

 

301

 

(21,798)

 

812

Earnings (loss) before earnings (loss) from unconsolidated affiliates

 

 

20,524

 

 

(2,265)

 

 

51,406

 

 

(3,450)

                 

Earnings (loss) from unconsolidated affiliates

 

201

 

(539)

 

(99)

 

(1,700)

                 

Net earnings (loss)

 

20,725

 

(2,804)

 

51,307

 

(5,150)

Net earnings attributable to

    noncontrolling interest

 

 

(1,608)

 

 

(510)

 

 

(4)

 

 

(1,019)

 

Net earnings (loss) attributable to Greenbrier

 

 

 

$        19,117

 

 

 

$        (3,314)

 

 

 

$        51,303

 

 

 

$        (6,169)

                 

Basic earnings (loss) per common share

 

$            0.71

 

$          (0.14)

 

$            1.94

 

$          (0.27)

                 

Diluted earnings (loss) per common share

 

$            0.61

 

$          (0.14)

 

$            1.65

 

$          (0.27)

                 

Weighted average common shares:

               

Basic

 

26,981

 

24,127

 

26,378

 

22,893

Diluted

 

33,862

 

24,127

 

33,640

 

22,893

 

 

THE GREENBRIER COMPANIES, INC.

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)

 
   

Nine Months Ended

May 31,

   

2012

 

2011

Cash flows from operating activities

       

Net income (loss)

 

$              51,307

 

$               (5,150)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

       

Deferred income taxes

 

4,801

 

(5,276)

Depreciation and amortization

 

30,603

 

28,174

Gain on sales of leased equipment

 

(8,897)

 

(2,901)

Accretion of debt discount

 

2,416

 

5,446

Stock based compensation expense

 

6,724

 

4,961

Loss on extinguishment of debt (non-cash portion)

 

-

 

2,868

Other

 

3,586

 

91

Decrease (increase) in assets:

       

Accounts receivable

 

10,429

 

(51,427)

Inventories

 

(26,748)

 

(83,293)

Leased railcars for syndication

 

(43,561)

 

(48,465)

Other

 

(1,419)

 

5,834

Increase (decrease) in liabilities:

       

Accounts payable and accrued liabilities

 

12,401

 

77,273

            Deferred revenue

 

11,991

 

(5,442)

Net cash provided by (used in) operating activities

 

53,633

 

(77,307)

Cash flows from investing activities

       

Proceeds from sales of equipment

 

33,253

 

14,179

Investment in and advances to unconsolidated affiliates

 

(544)

 

(979)

Decrease (increase) in restricted cash

 

(3,976)

 

308

Capital expenditures

 

(72,117)

 

(59,689)

Other

 

35

 

52

Net cash used in investing activities

 

(43,349)

 

(46,129)

Cash flows from financing activities

       

Net change in revolving notes with maturities of 90 days or less

 

(49,114)

 

3,694

Proceeds from revolving notes with maturities longer than 90 days

 

56,644

 

13,373

Repayments of revolving notes with maturities longer than 90 days

 

(23,573)

 

(6,194)

Proceeds from issuance of notes payable

 

2,500

 

231,250

Debt issuance costs

 

-

 

(7,857)

Repayments of notes payable

 

(6,028)

 

(238,569)

Gross proceeds from equity offering

 

-

 

63,180

Excess tax benefit from restricted stock awards

 

2,670

 

-

Investment by joint venture partner

 

410

 

-

Expenses from equity offering

 

-

 

(420)

Other

 

-

 

26

Net cash provided by (used in) financing activities

 

(16,491)

 

58,483

Effect of exchange rate changes

 

900

 

391

Decrease in cash and cash equivalents

 

(5,307)

 

(64,562)

Cash and cash equivalents

       

Beginning of period

 

50,222

 

98,864

End of period

 

$              44,915

 

$              34,302

         
         
         
 

 

 

THE GREENBRIER COMPANIES, INC.

 

SUPPLEMENTAL INFORMATION

Quarterly Results of Operations (Unaudited)

 

Operating results by quarter for 2012 and 2011 are as follows:

 

 

(In thousands, except per share amount)

 

First

 

 

Second

 

 

Third

 

Nine Month

Total

2012

             

Revenue

             

   Manufacturing

$   262,656

 

$   320,206

 

$   364,930

 

$       947,792

   Wheel Services, Refurbishment & Parts

117,749

 

119,894

 

125,145

 

362,788

   Leasing & Services

17,794

 

18,086

 

17,722

 

53,601

 

398,199

 

458,186

 

507,797

 

1,364,181

Cost of revenue

             

   Manufacturing

236,188

 

290,851

 

325,424

 

852,464

   Wheel Services, Refurbishment & Parts

105,891

 

106,554

 

111,610

 

324,055

   Leasing & Services

9,663

 

9,295

 

8,825

 

27,783

 

351,742

 

406,700

 

445,859

 

1,204,302

               

Margin

46,457

 

51,486

 

61,938

 

159,879

               

Selling and administrative

23,235

 

24,979

 

28,784

 

76,998

Gain on disposition of equipment

(3,658)

 

(2,654)

 

(2,585)

 

(8,897)

Earnings from operations

26,880

 

29,161

 

35,739

 

91,778

               

Other costs

             

   Interest and foreign exchange

5,383

 

6,630

 

6,560

 

18,574

Earnings before income tax and earnings 

   (loss) from unconsolidated affiliates

 

21,497

 

 

22,531

 

 

29,179

 

 

73,204

               

Income tax expense

(7,797)

 

(5,348)

 

(8,655)

 

(21,798)

               

Earnings (loss) from unconsolidated

  affiliates

 

(372)

 

 

72

 

 

201

 

 

(99)

Net earnings

13,328

 

17,255

 

20,725

 

51,307

Net (earnings) loss attributable to

   Noncontrolling interest

 

1,189

 

 

415

 

 

(1,608)

 

 

(4)

Net earnings attributable to Greenbrier

$     14,517

 

$     17,670

 

$     19,117

 

$         51,303

               

Basic earnings per common share: (1)

$         0.57

 

$         0.66

 

$         0.71

 

$             1.94

Diluted earnings per common share: (2)

$         0.48

 

$         0.57

 

$         0.61

 

$             1.65

 

(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. Dilutive 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 (Unaudited)

 

(In thousands, except per share amount)

First

 

Second

 

Third

 

Fourth

 

Total

2011

                 

Revenue

                 

   Manufacturing

$     85,440

 

$   156,621

 

$   173,487

 

$   305,554

 

$   721,102

   Wheel Services, Refurbishment & Parts

95,268

 

112,015

 

126,317

 

119,265

 

452,865

   Leasing & Services

18,226

 

15,704

 

17,476

 

17,917

 

69,323

 

198,934

 

284,340

 

317,280

 

442,736

 

1,243,290

Cost of revenue

                 

   Manufacturing

79,747

 

147,552

 

158,674

 

275,154

 

661,127

   Wheel Services, Refurbishment & Parts

86,411

 

101,413

 

111,202

 

106,423

 

405,449

   Leasing & Services

9,120

 

8,725

 

9,254

 

10,084

 

37,183

 

175,278

 

257,690

 

279,130

 

391,661

 

1,103,759

                   

Margin

23,656

 

26,650

 

38,150

 

51,075

 

139,531

                   

Selling and administrative

17,938

 

17,693

 

22,580

 

22,115

 

80,326

Gain on disposition of equipment

(2,510)

 

(1,961)

 

(1,678)

 

(2,220)

 

(8,369)

Earnings from operations

8,228

 

10,918

 

17,248

 

31,180

 

67,574

                   

Other costs

                 

   Interest and foreign exchange

10,304

 

10,536

 

9,807

 

6,345

 

36,992

   Loss on extinguishment of debt

-

 

-

 

10,007

 

5,650

 

15,657

Earnings (loss) before income tax and loss from unconsolidated affiliates

 

(2,076)

 

 

382

 

 

(2,566)

 

 

19,185

 

 

14,925

                   

Income tax benefit (expense)

611

 

(100)

 

301

 

(4,376)

 

(3,564)

                   

Loss from unconsolidated

  affiliates

 

(587)

 

 

(575)

 

 

(539)

 

 

(1,273)

 

 

(2,974)

Net earnings (loss)

(2,052)

 

(293)

 

(2,804)

 

13,536

 

8,387

Net earnings attributable to Noncontrolling

   interest

 

(252)

 

 

(257)

 

 

(510)

 

 

(902)

 

 

(1,921)

Net earnings (loss) attributable to Greenbrier

 

$      (2,304)

 

 

$         (550)

 

 

$      (3,314)

 

 

$     12,634

 

 

$       6,466

                   

Basic earnings (loss) per common 

    share: (1)

 

$        (0.11)

 

 

$        (0.02)

 

 

$        (0.14)

 

 

$         0.50

 

 

$         0.27

Diluted earnings (loss) per common share: (2)

 

$        (0.11)

 

 

$        (0.02)

 

 

$        (0.14)

 

 

$         0.42

 

 

$         0.24

 

(1)     Quarterly amounts do not total to the year to date amount as each period is calculated discretely. Unvested restricted stock awards are excluded from the per share calculation for the first, second and third quarters due to a net loss in each of those periods.2010 includes income of $11.

(2)     Quarterly amounts do not total to the year to date amount as each period is calculated discretely. The dilutive effect of warrants is excluded from per share calculations for the first, second and third quarters due to net losses for those periods. The fourth quarter dilutive 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

Reconciliation of Net Earnings (loss) attributable to Greenbrier to Adjusted EBITDA (1)

(In thousands, unaudited)

 
     

Three Months Ended

May 31,

 

Nine Months Ended

May 31,

     

2012

 

2011

 

2012

 

2011

Net earnings (loss) attributable to Greenbrier

 

$    19,117

 

 

$    (3,314)

 

 

$         51,303

 

 

$       (6,169)

Loss on extinguishment of debt

-

 

10,007

 

-

 

10,007

Interest and foreign exchange

6,560

 

9,807

 

18,574

 

30,646

Income tax expense (benefit)

8,655

 

(301)

 

21,798

 

(812)

Depreciation and amortization

10,281

 

9,548

 

30,603

 

28,174

                   

Adjusted EBITDA

$    44,613

 

$    25,747

 

$       122,278

 

$       61,846

                 
                       

(1) Adjusted EBITDA is not a financial measure under generally accepted accounting principles (GAAP). We define Adjusted EBITDA as earnings (loss) attributable to Greenbrier before loss on extinguishment of debt, interest and foreign exchange, income tax expense (benefit), 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 May 31,

     

2012

Backlog Activity (units)

     

February 29, 2012 backlog

12,500

Orders received

3,100

Production held as Leased railcars for syndication

(400)

Production sold directly to third parties

(3,700)

May 31, 2012 backlog

11,500

   

Delivery Information (units)

 

Production sold directly to third parties

3,700

Sales of Leased railcars for syndication

800

Third quarter ended May 31, 2012 deliveries

4,500

   

 

THE GREENBRIER COMPANIES, INC.

 

SUPPLEMENTAL INFORMATION

Calculation of Earnings (Loss) Per Share

 

The shares used in the computation of the Company's basic and diluted earnings (loss) per common share are reconciled as follows:

(In thousands)

Three Months Ended
May 31,

 

Nine Months Ended
May 31,

   

2012

 

2011

 

2012

 

2011

 

Weighted average basic common shares outstanding (1)

26,981

 

24,127

 

26,378

 

22,893

 

Dilutive effect of employee stock options (2)

-

 

-

 

-

 

-

 

Dilutive effect of warrants (3)

836

 

-

 

1,217

 

-

 

Dilutive effect of convertible notes (4)

6,045

 

-

 

6,045

 

-

 

Weighted average diluted common shares outstanding

33,862

 

24,127

 

33,640

 

22,893

                   

 

(1)     Restricted stock grants are treated as outstanding when issued and are included in weighted average basic common shares outstanding when the Company is in a net earnings position. Shares outstanding exclude 0.8 million shares of unvested restricted stock for the three and nine months ended May 31, 2011 due to a net loss.

(2)     There were no options outstanding for the three and nine months ended May 31, 2012. The dilutive effect of options was excluded from the share calculation for the three and nine months ended May 31, 2011 due to a net loss.

(3)     The dilutive effect of warrants to purchase 3.4 million shares was excluded from the share calculation for the three and nine months ended May 31, 2011 due to a net loss.

(4)     The dilutive effect of the 2018 Convertible notes are included 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.

 

Dilutive EPS for the three and nine months ended May 31, 2012 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 (see footnote 2 above). 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 6,045 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.

 

 

Three Months Ended
May 31, 2012

 

Nine Months Ended
May 31, 2012

Net earnings attributable to Greenbrier

$         19,117

 

$         51,303

Add back:

     

Interest and debt issuance costs on 2018 Convertible notes, net of tax

 

1,416

 

 

4,262

Earnings before interest and debt issuance costs on 2018 convertible notes

 

$         20,533

 

 

$         55,565

       

Weighted average diluted common shares outstanding

33,862

 

33,640

       

Diluted earnings per share

$       0.61 (1)

 

      $       1.65 (1)

 

(1)  Diluted earnings per share was calculated as follows:

Earnings before interest and debt issuance costs on 2018 convertible notes
           Weighted average diluted common shares outstanding

 

SOURCE The Greenbrier Companies, Inc. (GBX)