GATX Corporation Reports First Quarter Results

Apr 24, 2001, 01:00 ET from GATX Corporation

    CHICAGO, April 24 /PRNewswire Interactive News Release/ --
 GATX Corporation (NYSE:   GMT) today announced its 2001 first quarter results.
 For the quarter, GATX reported consolidated net income of $170.7 million, or
 $3.45 per fully diluted share.  The results include $159.3 million of
 after-tax gains recognized to date on the sale of GATX Terminals Corporation's
 domestic and European operations, net of certain charges due to the closing of
 other business development activities previously incorporated within the
 Integrated Solutions Group, and $20.2 million of after-tax charges due to the
 closing of GATX Rail's East Chicago repair facility and other non-recurring
 items.
     Excluding the net gain from the sale of GATX Terminals and the
 nonrecurring charges, first quarter consolidated income totaled $31.6 million
 or $.63 per fully diluted share compared to net income of $40.6 million or
 $.82 per fully diluted share in the prior year period.  Income per share is
 summarized in the attached appendix.  All comments from here forward in this
 press release regarding first quarter results and the 2001 outlook pertain to
 normalized operations excluding the Terminals-related gain and non-recurring
 charges.
     Ronald H. Zech, chairman of GATX Corporation, stated, "The first quarter
 was one of both substantial progress on our strategic initiatives and
 challenges in certain markets.  On the strategic front, we completed the sale
 of GATX Terminals' domestic and European operations as planned.  The proceeds
 from the sale greatly enhance our capital structure and set the stage for
 redeployment of this capital into our higher-return finance and leasing
 businesses.  We also closed three other significant transactions during the
 quarter:  the purchase of a 50% interest in Pembroke Group, a large aircraft
 leasing entity with over $850 million in assets; the purchase of a rail
 operation in Poland incorporating nearly 12,000 railcars; and the acquisition
 of a $370 million technology equipment portfolio from El Camino Resources.
 These transactions highlight our strategy of leveraging our partnering skills,
 asset knowledge and structuring expertise.  Lastly, during the first quarter
 we signed a new labor agreement with our U.S. rail maintenance center
 employees, ending a lengthy labor dispute and positioning the company for more
 efficient performance in the years ahead.
     "While the strategic steps point to positive long-term success for GATX,
 increasing economic weakness and issues within certain markets present
 significant near-term challenges.  In particular, the North American rail
 market continued to weaken in the first quarter.  Major customers,
 particularly in the chemical industry, are experiencing difficult conditions
 in their respective markets.  Higher natural gas prices, which dramatically
 increase raw material costs and decrease production expectations for chemical
 companies, are ultimately resulting in tempered demand for railcars.  Each of
 these factors had a negative impact on GATX Rail's first quarter results as
 comparable income of $12.1 million was down from $13.4 million in the prior
 quarter and $18.5 million in the year ago period.  Notwithstanding the fact
 that due to the labor dispute we incurred approximately $2.0 million of
 incremental after-tax maintenance expense in each of the past two quarters,
 the financial results reflect difficult market conditions that are expected to
 have a negative impact on GATX Rail's financial results versus 2000.
     "GATX Capital's first quarter pre-tax spread, remarketing income, and
 warrant income each increased over the prior year period.  However, these
 increases were more than offset by our decision to increase the loss allowance
 primarily to reflect exposure to the telecommunications and steel markets.  As
 a result, Financial Services' net income totaled $11.5 million in the first
 quarter compared to $22.9 million in the prior year period.  While the telecom
 and steel portfolios represent a small portion of GATX Capital's net
 investments and only 2.5% and 1.0% of GATX's overall asset base, we believe it
 is prudent to allocate additional reserves to cover potential losses given the
 weakness in these industries.  As a result of the increased loss provision and
 general economic weakness, we currently estimate that GATX Capital's net
 income will not meet 2000 levels.
     "At the onset of this year, we indicated that 2001 would be a year of
 significant transition for GATX as we complete the sale of GATX Terminals and
 begin the process of redeploying the sale proceeds into our finance and
 leasing businesses.  In 2000, our consolidated income per share, excluding a
 litigation reserve, was $3.37 per share and our goal has been to grow earnings
 from this base in 2001.  We will clearly not meet this goal based on a number
 of factors including general economic weakness, a difficult rail market,
 increased year over year loss provisions, and expected near-term earnings
 dilution resulting from the sale of GATX Terminals.  In addition, the current
 economic environment is presenting increased opportunities for investments in
 traditional assets such as aircraft and international rail, and we may shift a
 greater percentage of our planned investment volume toward these types of
 assets.  These investments offer attractive long-term returns, but are not as
 accretive in the short-term as technology or venture investments."
     Mr. Zech concluded, "Although our preference is to provide our
 shareholders with a clear picture of our expected operating performance in
 2001, providing an accurate forecast in this environment is very difficult
 given the number and variety of factors that will likely impact our business.
 We will provide up-to-date guidance as certain markets issues and investment
 opportunities are clarified.  GATX has experienced every possible economic
 scenario in its 100+ years of operation -- and our long-term view and focus on
 returns have always served the company well.  With leading positions in
 attractive markets, a solid capital structure, enhanced liquidity, and a
 heightened focus on our core operations, GATX is well positioned for the
 future."
 
     FINANCIAL SERVICES
     Financial Services, comprised principally of GATX Capital, posted net
 income in the first quarter of $11.5 million compared to $22.9 million in the
 prior year period.  Increases in pre-tax spread, remarketing gains, and
 warrant income were offset by an increased loss provision.  Investment volume
 for the quarter totaled $755 million compared to $326 million in the prior
 year period.  The two main drivers behind the volume increase include
 approximately $370 million attributable to the acquisition of a portfolio of
 technology equipment, and continued new investment in the aircraft portfolio.
     Pre-tax spread totaled $46.9 million in the first quarter compared to
 $36.6 million in the prior year period.  Annualized pre-tax spread in the
 quarter was 5.0% of average net investments compared to 5.1% in the year ago
 period and 3.9% in the fourth quarter of 2000.  The increase in pre-tax spread
 was driven by continued growth in GATX Capital's total net investment balance.
     Remarketing gains, including gains from the sale of owned assets and
 residual sharing fees, totaled $14.4 million in the quarter compared to
 $9.5 million in the prior year period.  Remarketing gains in the quarter
 reflect secondary market activity primarily in the owned and managed aircraft
 portfolio.
     Although equity markets remained volatile throughout the first quarter,
 warrant income for the quarter totaled $15.3 million compared to $14.0 million
 in the prior year period.  Unrealized gains totaled $23 million at the close
 of the quarter compared to $46 million at year end.  The change in the
 unrealized value reflects both the income realized during the first quarter
 and market-driven fluctuations in the remaining public warrant and stock
 positions.
     In the first quarter, GATX Capital's loss provision totaled $21.3 million
 and the quarter-end allowance for losses totaled 5.8% of reservable assets,
 compared to 5.3% in the prior year period and 5.9% at the end of the fourth
 quarter of 2000.  Net charge-offs during the quarter totaled $12.2 million, or
 .31% of average net investment compared to .19% in the prior year period and
 .70% in the fourth quarter of 2000.
 
     GATX RAIL
     GATX Rail reported a net loss of $4.1 million in the first quarter,
 including a $16.2 million after-tax charge related to the closing of GATX
 Rail's East Chicago repair facility and other non-recurring items.  Excluding
 these non-recurring items, GATX Rail's income was $12.1 million compared to
 $18.5 million in the prior year period and $13.4 million in the fourth quarter
 of 2000.  In both the first quarter of 2001 and the fourth quarter of 2000,
 GATX Rail incurred approximately $2.0 million of incremental after-tax
 maintenance expense as a result of the labor dispute.
     Railcar utilization was 92% at the end of the first quarter, down slightly
 from 93% at year end and 94% in the prior year period.  The utilization in the
 first quarter reflects the fact that overall railcar demand, both for new and
 used cars, remains soft.
     In early 2000, GATX Rail began reducing new car orders, a process that
 continued through the balance of the year and into the first quarter of 2001.
 GATX Rail's North American fleet totaled 91,500 cars at the end of the first
 quarter, up from 90,400 in the prior year period but virtually unchanged from
 year end.  GATX Rail's new car order activity is currently limited to specific
 customer orders or select car types.
 
     DISCONTINUED OPERATIONS
     Discontinued Operations incorporates the company's supply-chain services
 operations that were either sold during the first quarter or targeted for sale
 in 2001.  Substantially all of GATX Terminals' domestic and European terminal
 and pipeline operations were sold during the quarter, generating a substantial
 after-tax gain of approximately $159.3 million, net of certain charges related
 to the closing of other business development activities previously
 incorporated within the Integrated Solutions Group.  GATX also realized
 $4.6 million of income related to the sale of its remaining equity interest in
 GATX Logistics.  GATX had retained an equity interest in GATX Logistics in
 order to capitalize on the potential upside from a subsequent sale of the
 company to another entity.  For the quarter, GATX Terminals generated
 $2.4 million of income reflecting operations in which GATX continued to hold
 an ownership interest.
 
     COMPANY DESCRIPTION
     GATX Corporation (NYSE:   GMT) is a unique finance and leasing company
 combining asset knowledge and services, structuring expertise, creative
 partnering and risk capital to serve customers and partners worldwide.  GATX
 Corporation provides leasing and financial services responsive to the
 specialized needs of a range of businesses.  GATX Corporation specializes in
 railcar and locomotive operating leasing, aircraft operating leasing,
 information technology leasing, venture finance, and financing solutions for
 customers in diverse industrial sectors worldwide.
 
     TELECONFERENCE INFORMATION
     GATX Corporation will host a teleconference to discuss first quarter
 results.  Teleconference details are as follows:
 
     Tuesday, April 24th
     3:00 PM Eastern Time
     Domestic Dial-In:  1-888-428-4478
     International Dial-In:  1-612-332-0819
 
     Call in details and real-time audio access are available at:
 www.gatx.com .  Please access the call 15 minutes prior to the start time.
 Following the call, a replay will be available on the same site.
 
     FORWARD-LOOKING STATEMENTS
     This press release includes statements that may constitute forward-looking
 statements made pursuant to the safe harbor provision of the Private
 Securities Litigation Reform Act of 1995.  This information may involve risks
 and uncertainties that could cause actual results to differ materially from
 the forward-looking statements.  Although the company believes that the
 expectations reflected in such forward-looking statements are based on
 reasonable assumptions, such statements are subject to risks and uncertainties
 that could cause actual results to differ materially from those projected.
 With respect to outlook comments within this release relating to the 2001
 performance of GATX Rail Corporation, GATX Capital Corporation, and GATX
 Corporation, risks and uncertainties include, but are not limited to, general
 economic conditions, railcar lease rate and utilization levels, dynamics
 affecting customers within the chemical, petroleum and food industries, and
 general market conditions in the air, telecommunications, venture, and other
 large-ticket leasing industries.
 
     FOR FURTHER INFORMATION CONTACT:
     Analysts and Investors
     Robert C. Lyons
     GATX Corporation
     312-621-6633
 
     Investor, corporate information and press releases may be found at
 http://www.gatx.com .  A variety of current financial information, historical
 financial information, press releases and photographs are available at this
 site.  GATX press releases may be obtained by accessing PR Newswire's Company
 News On-Call's automated fax service at 800-758-5804.  The company
 identification number for GATX is 105121.
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF INCOME
                    (In Millions, Except Per Share Amounts)
 
                                                            (unaudited)
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
 
     Gross Income
      Lease, interest and financing services           $356.3         $290.2
      Other expense                                       (.3)          (1.2)
      Revenues                                          356.0          289.0
      Share of affiliates' earnings                      14.9           20.0
     Total Gross Income                                 370.9          309.0
 
     Ownership Costs
      Depreciation and amortization                     103.1           79.4
      Interest, net                                      61.0           54.0
      Operating lease expense                            48.3           40.2
     Total Ownership Costs                              212.4          173.6
 
     Other Costs and Expenses
      Operating expenses                                 63.1           30.8
      Selling, general and administrative                57.3           41.1
      Provision for possible losses                      21.3            2.0
      Fair value adjustments for derivatives              1.1             --
 
     Income from Continuing Operations before
      Income Taxes                                       15.7           61.5
 
     Income Taxes                                        11.3           23.9
 
     Income from Continuing Operations                    4.4           37.6
 
     Discontinued Operations
      Operating results, net of income taxes              2.4            3.0
      Gain on sale of portion of segment,
       net of income taxes                              163.9             --
 
     Total Discontinued Operations                      166.3            3.0
 
     Net Income                                        $170.7          $40.6
 
     Per Share Data
      Basic:
       Income from continuing operations                 $.09           $.78
       Income from discontinued operations               3.44            .06
       Total                                            $3.53           $.84
       Average number of common shares (in thousands)  48,278         48,394
      Diluted:
       Income from continuing operations                 $.09           $.76
       Income from discontinued operations               3.36            .06
       Total                                            $3.45           $.82
       Average number of common shares and common
        share equivalents (in thousands)               49,417         49,210
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                 (In Millions)
 
                                                    (unaudited)
                                                     March 31      December 31
                                                        2001           2000
     Assets
 
     Cash and Cash Equivalents                         $627.2         $173.6
     Receivables
      Trade accounts                                     50.6           93.7
      Finance leases                                  1,009.0          878.3
      Secured loans                                     666.7          634.1
      Less - allowance for possible losses             (108.7)         (95.2)
                                                      1,617.6        1,510.9
     Operating Lease Assets and Facilities, net       2,840.1        2,654.1
 
     Investments in Affiliated Companies              1,040.8          951.2
 
     Other Assets                                       416.7          343.0
 
     Net Assets of Discontinued Operations              163.5          630.9
 
                                                     $6,705.9       $6,263.7
 
     Liabilities, Deferred Items and Shareholders' Equity
 
     Accounts Payable                                  $300.6         $317.3
     Accrued Expenses                                   324.1          141.7
     Debt
      Short-term                                        601.7          557.2
      Long-term:
       Recourse                                       2,907.2        3,093.9
       Nonrecourse                                      689.9          494.2
      Capital lease obligations                         156.0          164.2
                                                      4,354.8        4,309.5
 
     Deferred Items, including Income Taxes             789.1          705.7
 
       Total Shareholders' Equity                       937.3          789.5
 
                                                     $6,705.9       $6,263.7
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In Millions)
 
                                                            (unaudited)
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
     Operating Activities
     Income from continuing operations                   $4.4          $37.6
     Adjustments to reconcile income from
      continuing operations to net cash
       provided by continuing operations:
        Realized gains on remarketing of
         leased equipment                                (8.5)          (9.7)
        Provision for depreciation and amortization     103.1           79.4
        Provision for possible losses                    21.3            2.0
        Deferred income taxes                           (29.3)          29.0
     Other, including working capital and
      advances to discontinued operations               (69.9)        (112.3)
      Net cash provided by continuing operations and
       advances to discontinued operations               21.1           26.0
 
     Investing Activities
     Additions to equipment on lease, net of
      nonrecourse financing for leveraged leases       (266.0)        (155.9)
     Additions to operating lease assets
      and facilities                                    (39.0)        (131.2)
     Secured loans extended                             (80.5)        (113.9)
     Investments in affiliated companies               (141.1)         (49.5)
     Other investments and progress payments           (113.7)          (7.8)
     Portfolio investments and capital additions       (640.3)        (458.3)
     Portfolio proceeds                                 248.4           99.2
     Proceeds from sale of portion of segment         1,028.4             --
     Proceeds from other asset sales                      5.0            4.4
     Net cash provided by (used in) investing
      activities of continuing operations               641.5         (354.7)
 
     Financing Activities
     Net (decrease) increase in long-term debt         (242.0)          64.8
     Net increase in short-term debt                     44.5          330.4
     Repayment of capital lease obligations              (8.2)          (6.1)
     Issuance (repurchase) of common stock and other     11.7          (26.5)
     Cash dividends                                     (15.0)         (14.5)
     Net cash (used in) provided by financing
      activities of continuing operations              (209.0)         348.1
     Net increase in cash and cash equivalents from
      continuing operations                             453.6           19.4
     Net (decrease) increase in cash and cash
      equivalents from discontinued operations          (12.6)           1.8
     Net increase in cash and cash equivalents         $441.0          $21.2
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                         SUPPLEMENTARY DATA (UNAUDITED)
                (In Millions, Except Earnings Per Share Amounts)
 
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
     GATX Corporation
     Basic Net Income per Share
      Income from Continuing operations                  $.09           $.78
      Income from Discontinued operations                3.44            .06
      Total                                             $3.53           $.84
     Diluted Net Income per Share
      Income from continuing operations                  $.09           $.76
      Income from discontinued operations                3.36            .06
      Total                                             $3.45           $.82
 
     Revenues                                          $356.0         $289.0
     Share of affiliates' earnings                       14.9           20.0
     Gross Income                                      $370.9         $309.0
     Income from Continuing Operations before
      Income Taxes                                       15.7           61.5
     Income from Continuing Operations                    4.4           37.6
     Income from Discontinued Operations                166.3            3.0
     Net Income                                        $170.7          $40.6
 
     Equity                                             937.3          838.3
     Return on Average Equity (a)                        17.5%          19.1%
 
     Net Assets of Continuing Operations              6,054.5        5,122.5
     Net Assets of Discontinued Operations              163.5          761.5
     Intersegment and Other Assets                      487.9          (59.2)
       Total Assets                                   6,705.9        5,824.8
 
     GATX Rail
     Revenues                                          $142.4         $140.2
     Share of affiliates' earnings                         .9            1.1
     Gross Income                                      $143.3          141.3
     Depreciation and amortization                       24.4           25.8
     Interest                                            12.9           14.7
     Operating lease expense                             35.3           29.3
     Income before Income Taxes                          (5.0)          29.3
     Net Income                                         $(4.1)         $18.5
 
     Assets                                           1,758.8        1,788.8
     Equity                                             351.2          336.8
 
     North American Fleet
     Fleet Additions                                      360          2,100
     Total Fleet                                       91,500         90,400
     Utilization                                           92%            94%
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                         SUPPLEMENTARY DATA (UNAUDITED)
                (In Millions, Except Earnings Per Share Amounts)
 
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
     Financial Services
     Revenues                                          $212.9         $150.0
     Share of affiliates' earnings                       14.0           18.9
     Gross Income                                       226.9          168.9
     Depreciation and amortization                       77.9           52.5
     Interest                                            55.7           38.2
     Operating lease expense                             12.7           11.3
     Income before Income Taxes                          19.1           37.4
     Net Income                                         $11.5          $22.9
 
     Net Investments                                  3,914.6        2,996.1
     Other Assets (b)                                   381.1          337.6
       Total Assets                                   4,295.7        3,333.7
 
     Common Equity                                      412.1          390.1
 
     GATX Capital only
     New Investment Volume                              754.6          325.7
     Portfolio Pre-Tax Spread (c)                        46.9           36.6
     Annualized Pre-Tax Spread as % of Average Net
      Investments                                         5.0%           5.1%
     Asset remarketing:
      Disposition Gains on Owned Assets                   8.5            9.3
      Residual Sharing Fees                               5.9             .2
     Warrant Income                                      15.3           14.0
 
     (a) Based on $31.6 million 1Q01 income; excludes 4Q00 litigation reserve.
     (b) Includes marine operating assets
     (c) Lease, interest and affiliate income less ownership costs
 
 
            GATX CORPORATION CONSOLIDATED INCOME SUMMARY (unaudited)
 
     APPENDIX A
                                                   Elimination
                                  Other   COLI     of Net Gain
                 First   East     Rail    Tax      excluding    Adjusted First
                Quarter Chicago   Non-  Adjustment the Sale of   First  Quarter
                 2001   Closing recurring  (a)     Logistics    Quarter  2000
 
     GATX Rail   $(4.1) $12.4   $3.8                   $--       $12.1   $18.5
     Financial
      Services    11.5                                            11.5    22.9
     Corporate &
      Other       (3.0)                     4.0                    1.0    (3.8)
     Continuing
      Operations   4.4                                            24.6    37.6
 
     ISG - Discontinued Operations
 
      Operations   2.4                                             2.4     3.0
     Gain on
      sale of
      portion of
      segment    163.9                              (159.3)        4.6      --
     Discontinued
      Operations 166.3                                             7.0     3.0
 
     Total      $170.7  $12.4   $3.8       $4.0    $(159.3)      $31.6   $40.6
 
     Diluted EPS:
     Continuing   0.09                                            0.49    0.76
     Discontinued-
      operations  0.05                                            0.05    0.06
     Discontinued-
      gain on
      sale of
      portion of
      segment     3.31                                            0.09      --
 
     Total       $3.45                                           $0.63   $0.82
 
 
     (a) charge to reflect potential disallowance of tax benefits associated
         with the company's corporate owned life insurance (COLI) program
 
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SOURCE GATX Corporation
    CHICAGO, April 24 /PRNewswire Interactive News Release/ --
 GATX Corporation (NYSE:   GMT) today announced its 2001 first quarter results.
 For the quarter, GATX reported consolidated net income of $170.7 million, or
 $3.45 per fully diluted share.  The results include $159.3 million of
 after-tax gains recognized to date on the sale of GATX Terminals Corporation's
 domestic and European operations, net of certain charges due to the closing of
 other business development activities previously incorporated within the
 Integrated Solutions Group, and $20.2 million of after-tax charges due to the
 closing of GATX Rail's East Chicago repair facility and other non-recurring
 items.
     Excluding the net gain from the sale of GATX Terminals and the
 nonrecurring charges, first quarter consolidated income totaled $31.6 million
 or $.63 per fully diluted share compared to net income of $40.6 million or
 $.82 per fully diluted share in the prior year period.  Income per share is
 summarized in the attached appendix.  All comments from here forward in this
 press release regarding first quarter results and the 2001 outlook pertain to
 normalized operations excluding the Terminals-related gain and non-recurring
 charges.
     Ronald H. Zech, chairman of GATX Corporation, stated, "The first quarter
 was one of both substantial progress on our strategic initiatives and
 challenges in certain markets.  On the strategic front, we completed the sale
 of GATX Terminals' domestic and European operations as planned.  The proceeds
 from the sale greatly enhance our capital structure and set the stage for
 redeployment of this capital into our higher-return finance and leasing
 businesses.  We also closed three other significant transactions during the
 quarter:  the purchase of a 50% interest in Pembroke Group, a large aircraft
 leasing entity with over $850 million in assets; the purchase of a rail
 operation in Poland incorporating nearly 12,000 railcars; and the acquisition
 of a $370 million technology equipment portfolio from El Camino Resources.
 These transactions highlight our strategy of leveraging our partnering skills,
 asset knowledge and structuring expertise.  Lastly, during the first quarter
 we signed a new labor agreement with our U.S. rail maintenance center
 employees, ending a lengthy labor dispute and positioning the company for more
 efficient performance in the years ahead.
     "While the strategic steps point to positive long-term success for GATX,
 increasing economic weakness and issues within certain markets present
 significant near-term challenges.  In particular, the North American rail
 market continued to weaken in the first quarter.  Major customers,
 particularly in the chemical industry, are experiencing difficult conditions
 in their respective markets.  Higher natural gas prices, which dramatically
 increase raw material costs and decrease production expectations for chemical
 companies, are ultimately resulting in tempered demand for railcars.  Each of
 these factors had a negative impact on GATX Rail's first quarter results as
 comparable income of $12.1 million was down from $13.4 million in the prior
 quarter and $18.5 million in the year ago period.  Notwithstanding the fact
 that due to the labor dispute we incurred approximately $2.0 million of
 incremental after-tax maintenance expense in each of the past two quarters,
 the financial results reflect difficult market conditions that are expected to
 have a negative impact on GATX Rail's financial results versus 2000.
     "GATX Capital's first quarter pre-tax spread, remarketing income, and
 warrant income each increased over the prior year period.  However, these
 increases were more than offset by our decision to increase the loss allowance
 primarily to reflect exposure to the telecommunications and steel markets.  As
 a result, Financial Services' net income totaled $11.5 million in the first
 quarter compared to $22.9 million in the prior year period.  While the telecom
 and steel portfolios represent a small portion of GATX Capital's net
 investments and only 2.5% and 1.0% of GATX's overall asset base, we believe it
 is prudent to allocate additional reserves to cover potential losses given the
 weakness in these industries.  As a result of the increased loss provision and
 general economic weakness, we currently estimate that GATX Capital's net
 income will not meet 2000 levels.
     "At the onset of this year, we indicated that 2001 would be a year of
 significant transition for GATX as we complete the sale of GATX Terminals and
 begin the process of redeploying the sale proceeds into our finance and
 leasing businesses.  In 2000, our consolidated income per share, excluding a
 litigation reserve, was $3.37 per share and our goal has been to grow earnings
 from this base in 2001.  We will clearly not meet this goal based on a number
 of factors including general economic weakness, a difficult rail market,
 increased year over year loss provisions, and expected near-term earnings
 dilution resulting from the sale of GATX Terminals.  In addition, the current
 economic environment is presenting increased opportunities for investments in
 traditional assets such as aircraft and international rail, and we may shift a
 greater percentage of our planned investment volume toward these types of
 assets.  These investments offer attractive long-term returns, but are not as
 accretive in the short-term as technology or venture investments."
     Mr. Zech concluded, "Although our preference is to provide our
 shareholders with a clear picture of our expected operating performance in
 2001, providing an accurate forecast in this environment is very difficult
 given the number and variety of factors that will likely impact our business.
 We will provide up-to-date guidance as certain markets issues and investment
 opportunities are clarified.  GATX has experienced every possible economic
 scenario in its 100+ years of operation -- and our long-term view and focus on
 returns have always served the company well.  With leading positions in
 attractive markets, a solid capital structure, enhanced liquidity, and a
 heightened focus on our core operations, GATX is well positioned for the
 future."
 
     FINANCIAL SERVICES
     Financial Services, comprised principally of GATX Capital, posted net
 income in the first quarter of $11.5 million compared to $22.9 million in the
 prior year period.  Increases in pre-tax spread, remarketing gains, and
 warrant income were offset by an increased loss provision.  Investment volume
 for the quarter totaled $755 million compared to $326 million in the prior
 year period.  The two main drivers behind the volume increase include
 approximately $370 million attributable to the acquisition of a portfolio of
 technology equipment, and continued new investment in the aircraft portfolio.
     Pre-tax spread totaled $46.9 million in the first quarter compared to
 $36.6 million in the prior year period.  Annualized pre-tax spread in the
 quarter was 5.0% of average net investments compared to 5.1% in the year ago
 period and 3.9% in the fourth quarter of 2000.  The increase in pre-tax spread
 was driven by continued growth in GATX Capital's total net investment balance.
     Remarketing gains, including gains from the sale of owned assets and
 residual sharing fees, totaled $14.4 million in the quarter compared to
 $9.5 million in the prior year period.  Remarketing gains in the quarter
 reflect secondary market activity primarily in the owned and managed aircraft
 portfolio.
     Although equity markets remained volatile throughout the first quarter,
 warrant income for the quarter totaled $15.3 million compared to $14.0 million
 in the prior year period.  Unrealized gains totaled $23 million at the close
 of the quarter compared to $46 million at year end.  The change in the
 unrealized value reflects both the income realized during the first quarter
 and market-driven fluctuations in the remaining public warrant and stock
 positions.
     In the first quarter, GATX Capital's loss provision totaled $21.3 million
 and the quarter-end allowance for losses totaled 5.8% of reservable assets,
 compared to 5.3% in the prior year period and 5.9% at the end of the fourth
 quarter of 2000.  Net charge-offs during the quarter totaled $12.2 million, or
 .31% of average net investment compared to .19% in the prior year period and
 .70% in the fourth quarter of 2000.
 
     GATX RAIL
     GATX Rail reported a net loss of $4.1 million in the first quarter,
 including a $16.2 million after-tax charge related to the closing of GATX
 Rail's East Chicago repair facility and other non-recurring items.  Excluding
 these non-recurring items, GATX Rail's income was $12.1 million compared to
 $18.5 million in the prior year period and $13.4 million in the fourth quarter
 of 2000.  In both the first quarter of 2001 and the fourth quarter of 2000,
 GATX Rail incurred approximately $2.0 million of incremental after-tax
 maintenance expense as a result of the labor dispute.
     Railcar utilization was 92% at the end of the first quarter, down slightly
 from 93% at year end and 94% in the prior year period.  The utilization in the
 first quarter reflects the fact that overall railcar demand, both for new and
 used cars, remains soft.
     In early 2000, GATX Rail began reducing new car orders, a process that
 continued through the balance of the year and into the first quarter of 2001.
 GATX Rail's North American fleet totaled 91,500 cars at the end of the first
 quarter, up from 90,400 in the prior year period but virtually unchanged from
 year end.  GATX Rail's new car order activity is currently limited to specific
 customer orders or select car types.
 
     DISCONTINUED OPERATIONS
     Discontinued Operations incorporates the company's supply-chain services
 operations that were either sold during the first quarter or targeted for sale
 in 2001.  Substantially all of GATX Terminals' domestic and European terminal
 and pipeline operations were sold during the quarter, generating a substantial
 after-tax gain of approximately $159.3 million, net of certain charges related
 to the closing of other business development activities previously
 incorporated within the Integrated Solutions Group.  GATX also realized
 $4.6 million of income related to the sale of its remaining equity interest in
 GATX Logistics.  GATX had retained an equity interest in GATX Logistics in
 order to capitalize on the potential upside from a subsequent sale of the
 company to another entity.  For the quarter, GATX Terminals generated
 $2.4 million of income reflecting operations in which GATX continued to hold
 an ownership interest.
 
     COMPANY DESCRIPTION
     GATX Corporation (NYSE:   GMT) is a unique finance and leasing company
 combining asset knowledge and services, structuring expertise, creative
 partnering and risk capital to serve customers and partners worldwide.  GATX
 Corporation provides leasing and financial services responsive to the
 specialized needs of a range of businesses.  GATX Corporation specializes in
 railcar and locomotive operating leasing, aircraft operating leasing,
 information technology leasing, venture finance, and financing solutions for
 customers in diverse industrial sectors worldwide.
 
     TELECONFERENCE INFORMATION
     GATX Corporation will host a teleconference to discuss first quarter
 results.  Teleconference details are as follows:
 
     Tuesday, April 24th
     3:00 PM Eastern Time
     Domestic Dial-In:  1-888-428-4478
     International Dial-In:  1-612-332-0819
 
     Call in details and real-time audio access are available at:
 www.gatx.com .  Please access the call 15 minutes prior to the start time.
 Following the call, a replay will be available on the same site.
 
     FORWARD-LOOKING STATEMENTS
     This press release includes statements that may constitute forward-looking
 statements made pursuant to the safe harbor provision of the Private
 Securities Litigation Reform Act of 1995.  This information may involve risks
 and uncertainties that could cause actual results to differ materially from
 the forward-looking statements.  Although the company believes that the
 expectations reflected in such forward-looking statements are based on
 reasonable assumptions, such statements are subject to risks and uncertainties
 that could cause actual results to differ materially from those projected.
 With respect to outlook comments within this release relating to the 2001
 performance of GATX Rail Corporation, GATX Capital Corporation, and GATX
 Corporation, risks and uncertainties include, but are not limited to, general
 economic conditions, railcar lease rate and utilization levels, dynamics
 affecting customers within the chemical, petroleum and food industries, and
 general market conditions in the air, telecommunications, venture, and other
 large-ticket leasing industries.
 
     FOR FURTHER INFORMATION CONTACT:
     Analysts and Investors
     Robert C. Lyons
     GATX Corporation
     312-621-6633
 
     Investor, corporate information and press releases may be found at
 http://www.gatx.com .  A variety of current financial information, historical
 financial information, press releases and photographs are available at this
 site.  GATX press releases may be obtained by accessing PR Newswire's Company
 News On-Call's automated fax service at 800-758-5804.  The company
 identification number for GATX is 105121.
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF INCOME
                    (In Millions, Except Per Share Amounts)
 
                                                            (unaudited)
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
 
     Gross Income
      Lease, interest and financing services           $356.3         $290.2
      Other expense                                       (.3)          (1.2)
      Revenues                                          356.0          289.0
      Share of affiliates' earnings                      14.9           20.0
     Total Gross Income                                 370.9          309.0
 
     Ownership Costs
      Depreciation and amortization                     103.1           79.4
      Interest, net                                      61.0           54.0
      Operating lease expense                            48.3           40.2
     Total Ownership Costs                              212.4          173.6
 
     Other Costs and Expenses
      Operating expenses                                 63.1           30.8
      Selling, general and administrative                57.3           41.1
      Provision for possible losses                      21.3            2.0
      Fair value adjustments for derivatives              1.1             --
 
     Income from Continuing Operations before
      Income Taxes                                       15.7           61.5
 
     Income Taxes                                        11.3           23.9
 
     Income from Continuing Operations                    4.4           37.6
 
     Discontinued Operations
      Operating results, net of income taxes              2.4            3.0
      Gain on sale of portion of segment,
       net of income taxes                              163.9             --
 
     Total Discontinued Operations                      166.3            3.0
 
     Net Income                                        $170.7          $40.6
 
     Per Share Data
      Basic:
       Income from continuing operations                 $.09           $.78
       Income from discontinued operations               3.44            .06
       Total                                            $3.53           $.84
       Average number of common shares (in thousands)  48,278         48,394
      Diluted:
       Income from continuing operations                 $.09           $.76
       Income from discontinued operations               3.36            .06
       Total                                            $3.45           $.82
       Average number of common shares and common
        share equivalents (in thousands)               49,417         49,210
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                 (In Millions)
 
                                                    (unaudited)
                                                     March 31      December 31
                                                        2001           2000
     Assets
 
     Cash and Cash Equivalents                         $627.2         $173.6
     Receivables
      Trade accounts                                     50.6           93.7
      Finance leases                                  1,009.0          878.3
      Secured loans                                     666.7          634.1
      Less - allowance for possible losses             (108.7)         (95.2)
                                                      1,617.6        1,510.9
     Operating Lease Assets and Facilities, net       2,840.1        2,654.1
 
     Investments in Affiliated Companies              1,040.8          951.2
 
     Other Assets                                       416.7          343.0
 
     Net Assets of Discontinued Operations              163.5          630.9
 
                                                     $6,705.9       $6,263.7
 
     Liabilities, Deferred Items and Shareholders' Equity
 
     Accounts Payable                                  $300.6         $317.3
     Accrued Expenses                                   324.1          141.7
     Debt
      Short-term                                        601.7          557.2
      Long-term:
       Recourse                                       2,907.2        3,093.9
       Nonrecourse                                      689.9          494.2
      Capital lease obligations                         156.0          164.2
                                                      4,354.8        4,309.5
 
     Deferred Items, including Income Taxes             789.1          705.7
 
       Total Shareholders' Equity                       937.3          789.5
 
                                                     $6,705.9       $6,263.7
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In Millions)
 
                                                            (unaudited)
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
     Operating Activities
     Income from continuing operations                   $4.4          $37.6
     Adjustments to reconcile income from
      continuing operations to net cash
       provided by continuing operations:
        Realized gains on remarketing of
         leased equipment                                (8.5)          (9.7)
        Provision for depreciation and amortization     103.1           79.4
        Provision for possible losses                    21.3            2.0
        Deferred income taxes                           (29.3)          29.0
     Other, including working capital and
      advances to discontinued operations               (69.9)        (112.3)
      Net cash provided by continuing operations and
       advances to discontinued operations               21.1           26.0
 
     Investing Activities
     Additions to equipment on lease, net of
      nonrecourse financing for leveraged leases       (266.0)        (155.9)
     Additions to operating lease assets
      and facilities                                    (39.0)        (131.2)
     Secured loans extended                             (80.5)        (113.9)
     Investments in affiliated companies               (141.1)         (49.5)
     Other investments and progress payments           (113.7)          (7.8)
     Portfolio investments and capital additions       (640.3)        (458.3)
     Portfolio proceeds                                 248.4           99.2
     Proceeds from sale of portion of segment         1,028.4             --
     Proceeds from other asset sales                      5.0            4.4
     Net cash provided by (used in) investing
      activities of continuing operations               641.5         (354.7)
 
     Financing Activities
     Net (decrease) increase in long-term debt         (242.0)          64.8
     Net increase in short-term debt                     44.5          330.4
     Repayment of capital lease obligations              (8.2)          (6.1)
     Issuance (repurchase) of common stock and other     11.7          (26.5)
     Cash dividends                                     (15.0)         (14.5)
     Net cash (used in) provided by financing
      activities of continuing operations              (209.0)         348.1
     Net increase in cash and cash equivalents from
      continuing operations                             453.6           19.4
     Net (decrease) increase in cash and cash
      equivalents from discontinued operations          (12.6)           1.8
     Net increase in cash and cash equivalents         $441.0          $21.2
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                         SUPPLEMENTARY DATA (UNAUDITED)
                (In Millions, Except Earnings Per Share Amounts)
 
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
     GATX Corporation
     Basic Net Income per Share
      Income from Continuing operations                  $.09           $.78
      Income from Discontinued operations                3.44            .06
      Total                                             $3.53           $.84
     Diluted Net Income per Share
      Income from continuing operations                  $.09           $.76
      Income from discontinued operations                3.36            .06
      Total                                             $3.45           $.82
 
     Revenues                                          $356.0         $289.0
     Share of affiliates' earnings                       14.9           20.0
     Gross Income                                      $370.9         $309.0
     Income from Continuing Operations before
      Income Taxes                                       15.7           61.5
     Income from Continuing Operations                    4.4           37.6
     Income from Discontinued Operations                166.3            3.0
     Net Income                                        $170.7          $40.6
 
     Equity                                             937.3          838.3
     Return on Average Equity (a)                        17.5%          19.1%
 
     Net Assets of Continuing Operations              6,054.5        5,122.5
     Net Assets of Discontinued Operations              163.5          761.5
     Intersegment and Other Assets                      487.9          (59.2)
       Total Assets                                   6,705.9        5,824.8
 
     GATX Rail
     Revenues                                          $142.4         $140.2
     Share of affiliates' earnings                         .9            1.1
     Gross Income                                      $143.3          141.3
     Depreciation and amortization                       24.4           25.8
     Interest                                            12.9           14.7
     Operating lease expense                             35.3           29.3
     Income before Income Taxes                          (5.0)          29.3
     Net Income                                         $(4.1)         $18.5
 
     Assets                                           1,758.8        1,788.8
     Equity                                             351.2          336.8
 
     North American Fleet
     Fleet Additions                                      360          2,100
     Total Fleet                                       91,500         90,400
     Utilization                                           92%            94%
 
 
                       GATX CORPORATION AND SUBSIDIARIES
                         SUPPLEMENTARY DATA (UNAUDITED)
                (In Millions, Except Earnings Per Share Amounts)
 
                                                         Three Months Ended
                                                              March 31
                                                        2001           2000
     Financial Services
     Revenues                                          $212.9         $150.0
     Share of affiliates' earnings                       14.0           18.9
     Gross Income                                       226.9          168.9
     Depreciation and amortization                       77.9           52.5
     Interest                                            55.7           38.2
     Operating lease expense                             12.7           11.3
     Income before Income Taxes                          19.1           37.4
     Net Income                                         $11.5          $22.9
 
     Net Investments                                  3,914.6        2,996.1
     Other Assets (b)                                   381.1          337.6
       Total Assets                                   4,295.7        3,333.7
 
     Common Equity                                      412.1          390.1
 
     GATX Capital only
     New Investment Volume                              754.6          325.7
     Portfolio Pre-Tax Spread (c)                        46.9           36.6
     Annualized Pre-Tax Spread as % of Average Net
      Investments                                         5.0%           5.1%
     Asset remarketing:
      Disposition Gains on Owned Assets                   8.5            9.3
      Residual Sharing Fees                               5.9             .2
     Warrant Income                                      15.3           14.0
 
     (a) Based on $31.6 million 1Q01 income; excludes 4Q00 litigation reserve.
     (b) Includes marine operating assets
     (c) Lease, interest and affiliate income less ownership costs
 
 
            GATX CORPORATION CONSOLIDATED INCOME SUMMARY (unaudited)
 
     APPENDIX A
                                                   Elimination
                                  Other   COLI     of Net Gain
                 First   East     Rail    Tax      excluding    Adjusted First
                Quarter Chicago   Non-  Adjustment the Sale of   First  Quarter
                 2001   Closing recurring  (a)     Logistics    Quarter  2000
 
     GATX Rail   $(4.1) $12.4   $3.8                   $--       $12.1   $18.5
     Financial
      Services    11.5                                            11.5    22.9
     Corporate &
      Other       (3.0)                     4.0                    1.0    (3.8)
     Continuing
      Operations   4.4                                            24.6    37.6
 
     ISG - Discontinued Operations
 
      Operations   2.4                                             2.4     3.0
     Gain on
      sale of
      portion of
      segment    163.9                              (159.3)        4.6      --
     Discontinued
      Operations 166.3                                             7.0     3.0
 
     Total      $170.7  $12.4   $3.8       $4.0    $(159.3)      $31.6   $40.6
 
     Diluted EPS:
     Continuing   0.09                                            0.49    0.76
     Discontinued-
      operations  0.05                                            0.05    0.06
     Discontinued-
      gain on
      sale of
      portion of
      segment     3.31                                            0.09      --
 
     Total       $3.45                                           $0.63   $0.82
 
 
     (a) charge to reflect potential disallowance of tax benefits associated
         with the company's corporate owned life insurance (COLI) program
 
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 SOURCE  GATX Corporation

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