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)



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