Exhibit 99.1

 

News Release    LOGO
One Centerpointe Drive, Suite 200, Lake Oswego, Oregon 97035 503-684-7000    www.gbrx.com

 

 

For release: October 23, 2020 6:00 a.m. EDT      Contact:    Lorie Tekorius, Investor Relations
        Justin Roberts, Investor Relations
        Ph: 503-684-7000

Greenbrier Reports Fourth Quarter and 2020 Fiscal Year Results

~ Operating cash flow of $183 million in the quarter and $272 million in the full year ~

~ Orders for 2,800 railcars valued at approximately $250 million in the quarter ~

~ Backlog of ~$2.4 billion; resized production footprint aligns with market ~

Lake Oswego, Oregon, October

 23, 2020 – The Greenbrier Companies, Inc. (NYSE: GBX) (“Greenbrier”), a leading international supplier of equipment and services to global freight transportation markets, today reported financial results for its fourth fiscal quarter and year ended August 31, 2020.

Fourth Quarter Highlights

 

   

Liquidity of $919.6 million, including $833.7 million in cash and $85.9 million of available borrowing capacity. Combined with nearly $200 million of additional initiatives in progress, exceeded the $1 billion liquidity and cost savings target.

 

   

Generated operating cash flow of $183.2 million in the quarter primarily driven by decreases in working capital and from syndication activity.

 

   

Diversified new railcar backlog as of August 31, 2020 was 24,600 units with an estimated value of $2.4 billion, including orders for 2,800 railcars valued at approximately $250.0 million received during the quarter. Deliveries in the quarter were 5,100 units.

 

   

Net loss attributable to Greenbrier for the quarter was $0.1 million, or $0.00 per diluted share, on revenue of $636.4 million. Net loss includes $1.9 million, net of tax, ($0.06 per share) of integration related expenses from the American Railcar Industries (ARI) acquisition and $3.6 million, net of tax and noncontrolling interest, ($0.10 per share) of severance expenses.

 

   

Adjusted net earnings attributable to Greenbrier for the quarter were $5.5 million, or $0.16 per diluted share, excluding $5.5 million, net of tax, ($0.16 per share) of integration and severance expenses.

 

   

Adjusted EBITDA for the quarter was $55.7 million, or 8.7% of revenue.

 

   

Board declares a quarterly dividend of $0.27 per share, payable on December 2, 2020 to shareholders as of November 11, 2020 representing Greenbrier’s 26th consecutive dividend.

Fiscal Year 2020 Highlights

 

   

Net earnings attributable to Greenbrier for the year were $49.0 million, or $1.46 per diluted share, on revenue of $2.8 billion. Net earnings include $8.4 million, net of tax, ($0.26 per share) of integration related expenses from the ARI acquisition and $12.9 million, net of tax, ($0.38 per share) of severance expenses.

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 2

 

   

Adjusted net earnings attributable to Greenbrier were $70.2 million, or $2.10 per diluted share, excluding $21.3 million, net of tax and noncontrolling interest, ($0.64 per share) of integration and severance expenses.

 

   

Adjusted EBITDA for the year was $310.3 million, or 11.1% of revenue.

 

   

Strong cash flows from operations of $272.3 million includes $405.4 million in the second half of the fiscal year.

 

   

New railcar deliveries of 21,700 units for the year were the second highest in Greenbrier’s history.

 

   

Generated new railcar orders of 16,600 units, valued at $1.6 billion, with 40% originating internationally.

William A. Furman, Chairman & CEO commented, “Greenbrier continued to perform well during this period of weaker demand. Critically, our diverse $2.4 billion backlog remains supported by strong customer commitments and provides clear visibility for several years. Entering fiscal 2021, we remain focused on maintaining our strong liquidity position. Greenbrier ended the quarter with more than $830 million of cash, an increase of nearly $100 million from the end of the third quarter. Net debt decreased by nearly $360 million since Greenbrier’s fiscal second quarter. Our adjusted manufacturing footprint meets today’s demand levels without constraining our ability to increase capacity as markets improve, allowing Greenbrier to maintain our presence in every region we serve around the world. Looking forward, we see early signs that demand will improve later in calendar 2021. Greenbrier is well-positioned to benefit from improving conditions in our core markets.”

Business Update & Outlook

As we enter fiscal 2021, Greenbrier continues to execute on its COVID-19 response plan, and protecting our employees within the work environment remains our top priority. The strict protocols enacted and rapid response to clusters has allowed us to operate safely and efficiently throughout the world. Continued vigilance is required as community spread of COVID-19 is increasing in many areas where we operate. We are continuously working to maintain a low incident rate of COVID-19 among our employees by focusing on their health and enhancing the preventative and remedial actions of our rapid response teams across the company.

We also remain focused on preserving the near-term and longer-term financial health of Greenbrier in light of the economic consequences of the pandemic and an industry downturn. Maintaining cash flow and liquidity are essential components of Greenbrier’s current operating strategy, and we have been very successful in this regard. We addressed our cost structure by reducing operating expenses and capital expenditures and are appropriately positioned for today’s market environment. We closed 13 rail production lines in fiscal 2020 and are continuously adjusting capacity to align with an evolving demand outlook. We also reduced our global workforce by over 6,500 employees, or by about 40%, including both staff and production employees. Looking forward, while we remain focused on managing our cost base, we will be nimble and adjust capacity to ensure Greenbrier’s ability to fully participate in an economic recovery. Coupled with a new railcar backlog valued at approximately $2.4 billion, we have preserved Greenbrier’s ability to operate in a very challenging market environment.

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 3

 

Financial Summary

 

     Q4 FY20    Q3 FY20   

Sequential Comparison – Main Drivers

Revenue    $636.4M    $762.6M    Fewer deliveries and lower activity levels in Wheels, Repair & Parts
Gross margin    10.5%    14.1%    Less syndication activity and operating inefficiencies in Manufacturing and Wheels, Repair & Parts
Selling and administrative    $46.3M    $49.5M    Continuing cost reduction initiatives result in reduced employee-related and travel & entertainment expenses; each quarter includes $1.8 million of severance expense
Net gain on disposition of equipment    $0.6M    $8.8M    Minimal fleet disposition activity
Adjusted EBITDA    $55.7M    $99.9M    Lower operating earnings
Effective tax rate    21.3%    41.2%    Continued volatility from geographic mix of earnings and discrete items related to foreign currency fluctuations
Adjusted net earnings attributable to Greenbrier    $5.5M(1)    $35.1M(2)    Lower operating earnings reflecting fewer deliveries, operating inefficiencies and lower net gains on equipment sales partially offset by lower selling & administrative expense
Adjusted diluted EPS    $0.16(1)    $1.05(2)   

 

(1) 

Excludes expense of $5.6 million ($0.16 per share), net of tax and noncontrolling interest, associated with ARI integration related expenses and severance expenses.

(2) 

Excludes expense of $7.3 million ($0.22 per share), net of tax, associated with ARI integration related expenses and severance expenses.

Segment Summary

 

     Q4 FY20    Q3 FY20   

Sequential Comparison – Main Drivers

Manufacturing

Revenue

   $549.7M    $653.0M    Lower production rates and less syndication activity results in fewer deliveries

Gross margin

   9.4%    13.8%    Operating inefficiencies from rationalizing capacity and less syndication activity

Operating margin (1)

   5.4%    10.5%   

Deliveries (2)

   4,900    5,400   

Wheels, Repair & Parts

Revenue

   $64.8M    $82.0M    Reduced wheel volumes and repair activity

Gross margin

   6.0%    8.6%    Operating inefficiencies due to lower business activity levels

Operating margin (1)

   1.3%    4.6%   

Leasing & Services

Revenue

   $22.0M    $27.5M    Less interim rent on leased railcars for syndication and no externally sourced syndication sales activity

Gross margin

   53.2%    37.4%    No externally sourced syndication sales activity

Operating margin (1) (3)

   29.7%    43.0%   

Fleet utilization

   90.4%    92.1%   

 

(1) 

See supplemental segment information on page 11 for additional information.

(2) 

Excludes Brazil deliveries which are not consolidated into manufacturing revenue and margins.

(3) 

Includes Net gain on disposition of equipment, which is excluded from gross margin.

 

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Exhibit 99.1

 

Greenbrier Reports Fourth Quarter Results (Cont.)    Page 4

 

Conference Call

Greenbrier will host a teleconference to discuss its fourth quarter 2020 results. In conjunction with this news release, Greenbrier has posted a supplemental earnings presentation to our website. Teleconference details are as follows:

 

   

October 23, 2020

 

   

8:00 a.m. Pacific Daylight Time

 

   

Phone: 1-630-395-0143, Password: “Greenbrier”

 

   

Real-time Audio Access: (“Newsroom” at http://www.gbrx.com)

Please access the site 10 minutes prior to the start time.

About Greenbrier

Greenbrier, headquartered in Lake Oswego, Oregon, is a leading international supplier of equipment and services to global freight transportation markets. Greenbrier designs, builds and markets freight railcars and marine barges in North America. Greenbrier Europe is an end-to-end freight railcar manufacturing, engineering and repair business with operations in Poland, Romania and Turkey that serves customers across Europe and in other geographies as opportunities arise. Greenbrier builds freight railcars and rail castings in Brazil through two separate strategic partnerships. We are a leading provider of freight railcar wheel services, parts, repair, refurbishment and retrofitting services in North America through our wheels, repair & parts business unit. Greenbrier offers railcar management, regulatory compliance services and leasing services to railroads and related transportation industries in North America. Through unconsolidated joint ventures, we produce industrial and rail castings, and other components. Greenbrier owns a lease fleet of 8,300 railcars and performs management services for 393,000 railcars. Learn more about Greenbrier at www.gbrx.com.

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 5

 

THE GREENBRIER COMPANIES, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, unaudited)

 

     August 31,
2020
     May 31,
2020
     February 29,
2020
     November 30,
2019
     August 31,
2019
 

Assets

              

Cash and cash equivalents

   $ 833,745      $ 735,258      $ 169,899      $ 253,602      $ 329,684  

Restricted cash

     8,342        8,704        8,569        8,648        8,803  

Accounts receivable, net

     239,597        261,629        326,229        313,786        373,383  

Inventories

     529,529        675,442        709,115        733,806        664,693  

Leased railcars for syndication

     107,671        136,144        255,073        135,319        182,269  

Equipment on operating leases, net

     350,442        355,841        385,974        396,187        366,688  

Property, plant and equipment, net

     711,524        719,155        723,326        730,730        717,973  

Investment in unconsolidated affiliates

     72,354        75,508        79,082        85,141        91,818  

Intangibles and other assets, net

     190,322        181,315        160,709        162,089        125,379  

Goodwill

     130,308        130,035        129,684        129,468        129,947  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
   $ 3,173,834      $ 3,279,031      $ 2,974,660      $ 2,948,776      $ 2,990,637  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Liabilities and Equity

              

Revolving notes

   $ 351,526      $ 416,535      $ 37,196      $ 29,502      $ 27,115  

Accounts payable and accrued liabilities

     463,880        488,969        499,898        527,789        568,360  

Deferred income taxes

     7,701        4,354        9,173        9,417        13,946  

Deferred revenue

     42,467        63,536        70,869        59,657        85,070  

Notes payable, net

     804,088        806,919        811,860        817,830        822,885  

Contingently redeemable noncontrolling

interest

     31,117        30,611        30,782        31,723        31,564  

Total equity - Greenbrier

     1,293,043        1,291,221        1,286,472        1,281,808        1,276,730  

Noncontrolling interest

     180,012        176,886        201,410        191,050        164,967  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total equity

     1,473,055        1,468,107        1,487,882        1,472,858        1,441,697  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
   $ 3,173,834      $ 3,279,031      $ 2,947,660      $ 2,948,776      $ 2,990,637  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 6

 

THE GREENBRIER COMPANIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts, unaudited)

 

     Years Ended August 31,  
     2020     2019     2018  

Revenue

      

Manufacturing

   $ 2,349,971     $ 2,431,499     $ 2,044,586  

Wheels, Repair & Parts

     324,670       444,502       347,023  

Leasing & Services

     117,548       157,590       127,855  
  

 

 

   

 

 

   

 

 

 
     2,792,189       3,033,591       2,519,464  

Cost of revenue

      

Manufacturing

     2,065,169       2,137,625       1,727,407  

Wheels, Repair & Parts

     302,189       420,890       318,330  

Leasing & Services

     71,700       108,590       64,672  
  

 

 

   

 

 

   

 

 

 
     2,439,058       2,667,105       2,110,409  

Margin

     353,131       366,486       409,055  

Selling and administrative

     204,706       213,308       200,439  

Net gain on disposition of equipment

     (20,004     (40,963     (44,369

Goodwill impairment

     —         10,025       —    
  

 

 

   

 

 

   

 

 

 

Earnings from operations

     168,429       184,116       252,985  

Other costs

      

Interest and foreign exchange

     43,619       30,912       29,368  
  

 

 

   

 

 

   

 

 

 

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

     124,810       153,204       223,617  

Income tax expense

     (40,184     (41,588     (32,893
  

 

 

   

 

 

   

 

 

 

Earnings before earnings (loss) from unconsolidated affiliates

     84,626       111,616       190,724  

Earnings (loss) from unconsolidated affiliates

     2,960       (5,805     (18,661
  

 

 

   

 

 

   

 

 

 

Net earnings

     87,586       105,811       172,063  

Net earnings attributable to noncontrolling interest

     (38,619     (34,735     (20,282
  

 

 

   

 

 

   

 

 

 

Net earnings attributable to Greenbrier

   $ 48,967     $ 71,076     $ 151,781  
  

 

 

   

 

 

   

 

 

 

Basic earnings per common share

   $ 1.50     $ 2.18     $ 4.92  

Diluted earnings per common share

   $ 1.46     $ 2.14     $ 4.68  

Weighted average common shares

      

Basic

     32,670       32,615       30,857  

Diluted

     33,441       33,165       32,835  

Dividends declared per common share

   $ 1.06     $ 1.00     $ 0.96  

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 7

 

THE GREENBRIER COMPANIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)

 

     Years Ended August 31,  
     2020     2019     2018  

Cash flows from operating activities:

      

Net earnings

   $ 87,586     $ 105,811     $ 172,063  

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

      

Deferred income taxes

     (9,489     (20,225     (40,496

Depreciation and amortization

     109,850       83,731       74,356  

Net gain on disposition of equipment

     (20,004     (40,963     (44,369

Stock based compensation expense

     8,997       11,153       29,314  

Accretion of debt discount

     5,504       4,458       4,171  

Noncontrolling interest adjustments

     1,436       7,402       2,864  

Goodwill Impairment

     —         10,025       —    

Other

     1,142       145       1,688  

Decrease (increase) in assets:

      

Accounts receivable, net

     135,326       13,022       (83,551

Inventories

     166,607       (143,168     (26,592

Leased railcars for syndication

     (12,942     (96,110     (54,023

Other assets

     (64,995     6,843       34,115  

Increase (decrease) in liabilities:

      

Accounts payable and accrued liabilities

     (108,837     55,910       54,032  

Deferred revenue

     (27,920     (19,275     (20,231
  

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     272,261       (21,241     103,341  
  

 

 

   

 

 

   

 

 

 

Cash flows from investing activities:

      

Acquisitions, net of cash acquired

     —         (361,878     (34,874

Proceeds from sales of assets

     83,484       125,427       153,224  

Capital expenditures

     (66,879     (198,233     (176,848

Investment in and advances to unconsolidated affiliates

     (1,815     (11,393     (26,455

Cash distribution from unconsolidated affiliates and other

     12,693       2,096       4,661  
  

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) investing activities

     27,483       (443,981     (80,292
  

 

 

   

 

 

   

 

 

 

Cash flows from financing activities:

      

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

     146,542       (105     23,401  

Proceeds from revolving notes with maturities longer than 90 days

     176,500       —         —    

Proceeds from issuance of notes payable

     —         525,000       13,771  

Repayments of notes payable

     (30,179     (182,971     (22,269

Debt issuance costs

     —         (8,630     —    

Dividends

     (35,173     (33,193     (29,914

Cash distribution to joint venture partner

     (38,969     (16,879     (73,033

Investment by joint venture partner

     —         —         6,500  

Tax payments for net share settlement of restricted stock

     (2,266     (6,321     (7,723
  

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) financing activities

     216,455       276,901       (89,267
  

 

 

   

 

 

   

 

 

 

Effect of exchange rate changes

     (12,599     (12,666     (14,666

Increase (decrease) in cash and cash equivalents and restricted cash

     503,600       (200,987     (80,884

Cash and cash equivalents and restricted cash

      

Beginning of period

     338,487       539,474       620,358  
  

 

 

   

 

 

   

 

 

 

End of period

   $ 842,087     $ 338,487     $ 539,474  
  

 

 

   

 

 

   

 

 

 

Balance Sheet Reconciliation:

      

Cash and cash equivalents

   $ 833,745     $ 329,684     $ 530,655  

Restricted cash

     8,342       8,803       8,819  
  

 

 

   

 

 

   

 

 

 

Total cash and cash equivalents and restricted cash as presented above

   $ 842,087     $ 338,487     $ 539,474  
  

 

 

   

 

 

   

 

 

 

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 8

 

THE GREENBRIER COMPANIES, INC.

SUPPLEMENTAL INFORMATION

(In thousands, excluding backlog and delivery units, unaudited)

Reconciliation of Net earnings to Adjusted EBITDA

 

     Three Months Ended      Year Ended  
     August 31,
2020
     May 31,
2020
     August 31,
2020
 

Net earnings

   $ 7,691      $ 35,869      $ 87,586  

Interest and foreign exchange

     10,596        7,562        43,619  

Income tax expense

     2,306        24,421        40,184  

Depreciation and amortization

     27,398        23,114        109,850  

Severance expense

     5,919        6,341        21,201  

ARI integration related costs

     1,750        2,545        7,821  
  

 

 

    

 

 

    

 

 

 

Adjusted EBITDA

   $ 55,660      $ 99,852      $ 310,261  
  

 

 

    

 

 

    

 

 

 

 

     Three Months
Ended
     Year Ended  
     August 31,
2020
     August 31,
2020
 

Backlog Activity (units) (1)

     

Beginning backlog

     26,700        30,300  

Orders received

     2,800        16,600  

Contract modification

     —          (575

Production held as Leased railcars for syndication

     (700      (3,200

Production sold directly to third parties

     (4,200      (18,525
  

 

 

    

 

 

 

Ending backlog

     24,600        24,600  
  

 

 

    

 

 

 

Delivery Information (units) (1)

     

Production sold directly to third parties

     4,200        18,525  

Sales of Leased railcars for syndication

     900        3,175  
  

 

 

    

 

 

 

Total deliveries

     5,100        21,700  
  

 

 

    

 

 

 

 

(1) 

Includes Greenbrier-Maxion, our Brazilian railcar manufacturer, which is accounted for under the equity method

 

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Greenbrier Reports Fourth Quarter Results (Cont.)    Page 9

 

THE GREENBRIER COMPANIES, INC.

SUPPLEMENTAL INFORMATION

(In thousands, except per share amounts, unaudited)

Operating Results by Quarter for 2020 are as follows:

 

     First     Second     Third     Fourth     Total  

Revenue

          

Manufacturing

   $ 657,367     $ 489,943     $ 653,007     $ 549,654     $ 2,349,971  

Wheels, Repair & Parts

     86,608       91,225       82,024       64,813       324,670  

Leasing & Services

     25,384       42,680       27,526       21,958       117,548  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     769,359       623,848       762,557       636,425       2,792,189  

Cost of revenue

          

Manufacturing

     581,912       422,309       562,793       498,155       2,065,169  

Wheels, Repair & Parts

     81,892       84,373       75,001       60,923       302,189  

Leasing & Services

     13,366       30,830       17,232       10,272       71,700  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     677,170       537,512       655,026       569,350       2,439,058  

Margin

     92,189       86,336       107,531       67,075       353,131  

Selling and administrative expense

     54,364       54,597       49,494       46,251       204,706  

Net gain on disposition of equipment

     (3,959     (6,697     (8,775     (573     (20,004
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings from operations

     41,784       38,436       66,812       21,397       168,429  

Other costs

          

Interest and foreign exchange

     12,852       12,609       7,562       10,596       43,619  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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

     28,932       25,827       59,250       10,801       124,810  

Income tax expense

     (5,994     (7,463     (24,421     (2,306     (40,184
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings before earnings (loss) from unconsolidated affiliates

     22,938       18,364       34,829       8,495       84,626  

Earnings (loss) from unconsolidated affiliates

     1,073       1,651       1,040       (804     2,960  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings

     24,011       20,015       35,869       7,691       87,586  

Net earnings attributable to noncontrolling interest

     (16,342     (6,386     (8,097     (7,794     (38,619
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings (loss) attributable to Greenbrier

   $ 7,669     $ 13,629     $ 27,772     $ (103   $ 48,967  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings per common share (1)

   $ 0.24     $ 0.42     $ 0.85     $ (0.00   $ 1.50  

Diluted earnings per common share (1)

   $ 0.23     $ 0.41     $ 0.83     $ (0.00   $ 1.46  

Dividends declared per common share

   $ 0.25     $ 0.27     $ 0.27     $ 0.27     $ 1.06  

 

(1) 

Quarterly amounts may not total to the year to date amount as each period is calculated discretely. Diluted EPS is calculated by including the dilutive effect, using the treasury stock method, associated with shares underlying the 2.875% Convertible notes, 2.25% Convertible notes, restricted stock units that are not considered participating securities and performance based restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved.

 

- More -


Greenbrier Reports Fourth Quarter Results (Cont.)    Page 10

 

THE GREENBRIER COMPANIES, INC.

SUPPLEMENTAL INFORMATION

(In thousands, except per share amounts, unaudited)

Operating Results by Quarter for 2019 are as follows:

 

     First     Second     Third     Fourth     Total  

Revenue

          

Manufacturing

   $ 471,789     $ 476,019     $ 681,588     $ 802,103     $ 2,431,499  

Wheels, Repair & Parts

     108,543       125,278       124,980       85,701       444,502  

Leasing & Services

     24,191       57,374       49,584       26,441       157,590  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     604,523       658,671       856,152       914,245       3,033,591  

Cost of revenue

          

Manufacturing

     417,805       442,996       590,788       686,036       2,137,625  

Wheels, Repair & Parts

     100,978       118,455       119,821       81,636       420,890  

Leasing & Services

     13,207       43,376       38,971       13,036       108,590  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     531,990       604,827       749,580       780,708       2,667,105  

Margin

     72,533       53,844       106,572       133,537       366,486  

Selling and administrative expense

     50,432       47,892       54,377       60,607       213,308  

Net gain on disposition of equipment

     (14,353     (12,102     (11,019     (3,489     (40,963

Goodwill impairment

     —         —         10,025       —         10,025  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings from operations

     36,454       18,054       53,189       76,419       184,116  

Other costs

          

Interest and foreign exchange

     4,404       9,237       9,770       7,501       30,912  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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

     32,050       8,817       43,419       68,918       153,204  

Income tax expense

     (9,135     (2,248     (13,008     (17,197     (41,588
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings before earnings (loss) from unconsolidated affiliates

     22,915       6,569       30,411       51,721       111,616  

Earnings (loss) from unconsolidated affiliates

     467       (786     (4,564     (922     (5,805
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings

     23,382       5,783       25,847       50,799       105,811  

Net earnings attributable to noncontrolling interest

     (5,426     (3,018     (10,599     (15,692     (34,735
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings attributable to Greenbrier

   $ 17,956     $ 2,765     $ 15,248     $ 35,107     $ 71,076  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings per common share (1)

   $ 0.55     $ 0.08     $ 0.47     $ 1.08     $ 2.18  

Diluted earnings per common share (1)

   $ 0.54     $ 0.08     $ 0.46     $ 1.06     $ 2.14  

Dividends declared per common share

   $ 0.25     $ 0.25     $ 0.25     $ 0.25     $ 1.00  

 

(1) 

Quarterly amounts may not total to the year to date amount as each period is calculated discretely. Diluted EPS is calculated by including the dilutive effect, using the treasury stock method, associated with shares underlying the 2.875% Convertible notes, 2.25% Convertible notes, restricted stock units that are not considered participating securities and performance based restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved.

 

- More -


Greenbrier Reports Fourth Quarter Results (Cont.)    Page 11

 

THE GREENBRIER COMPANIES, INC.

SUPPLEMENTAL INFORMATION

(In thousands, unaudited)

Segment Information

 

Three months ended August 31, 2020:

 

       
     Revenue     Earnings (loss) from operations  
     External      Intersegment     Total     External     Intersegment     Total  

Manufacturing

   $ 549,654      $ 1,683     $ 551,337     $ 29,695     $ (19   $ 29,676  

Wheels, Repair & Parts

     64,813        95       64,908       813       3       816  

Leasing & Services

     21,958        10,898       32,856       6,520       10,528       17,048  

Eliminations

     —          (12,676     (12,676     —         (10,512     (10,512

Corporate

     —          —         —         (15,631     —         (15,631
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 636,425      $ —       $ 636,425     $ 21,397     $ —       $ 21,397  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

Three months ended May 31, 2020:

 

       
     Revenue     Earnings (loss) from operations  
     External      Intersegment     Total     External     Intersegment     Total  

Manufacturing

   $ 653,007      $ 1,151     $ 654,158     $ 68,445     $ 95     $ 68,540  

Wheels, Repair & Parts

     82,024        1,527       83,551       3,785       (393     3,392  

Leasing & Services

     27,526        14,841       42,367       11,837       14,454       26,291  

Eliminations

     —          (17,519     (17,519     —         (14,156     (14,156

Corporate

     —          —         —         (17,255     —         (17,255
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 762,557      $ —       $ 762,557     $ 66,812     $ —       $ 66,812  
  

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

     Total assets  
     August 31,
2020
     May 31,
2020
 

Manufacturing

   $ 1,301,715      $ 1,441,052  

Wheels, Repair & Parts

     271,862        296,888  

Leasing & Services

     739,025        777,523  

Unallocated, including cash

     861,232        763,568  
  

 

 

    

 

 

 
   $ 3,173,834      $ 3,279,031  
  

 

 

    

 

 

 

 

- More -


Greenbrier Reports Fourth Quarter Results (Cont.)    Page 12

 

THE GREENBRIER COMPANIES, INC.

SUPPLEMENTAL INFORMATION

(In thousands, except per share amounts, unaudited)

Reconciliation of common shares outstanding

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

 

     Three Months Ended      Year Ended  
     August 31,
2020
     May 31,
2020
     August 31,
2020
 

Weighted average basic common shares outstanding (1)

     32,658        32,690        32,670  

Dilutive effect of convertible notes (2)

     —          —          —    

Dilutive effect of restricted stock units (3)

     —          788        771  
  

 

 

    

 

 

    

 

 

 

Weighted average diluted common shares outstanding

     32,658        33,478        33,441  
  

 

 

    

 

 

    

 

 

 

 

(1)

Restricted stock grants and restricted stock units that are considered participating securities, 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.

(2)

The dilutive effect of the 2.875% Convertible notes issued in February 2017 and the 2.25% Convertible notes issued in July 2019 were excluded for the periods in which they were outstanding as the average stock price was less than the applicable conversion price and therefore was anti-dilutive.

(3)

Restricted stock units that are not considered participating securities and restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position.

Reconciliation of Net earnings attributable to Greenbrier to Adjusted net earnings attributable to Greenbrier

 

     Three Months Ended      Year Ended  
     August 31,
2020
     May 31,
2020
     August 31,
2020
 

Net earnings (loss) attributable to Greenbrier

   $ (103    $ 27,772      $ 48,967  

ARI integration related costs, net of tax (1)

     1,936        2,539        8,358  

Severance expense, net of tax & noncontrolling interest (2)

     3,636        4,803        12,867  
  

 

 

    

 

 

    

 

 

 

Adjusted net earnings attributable to Greenbrier

   $ 5,469      $ 35,114      $ 70,192  
  

 

 

    

 

 

    

 

 

 

 

(1)

Net of tax of $620, $813, and $2,689, respectively.

(2)

Net of tax and noncontrolling interest of $2,283, $1,538 and $8,334, respectively.

Reconciliation of Diluted earnings per share to Adjusted diluted earnings per share

 

     Three Months Ended      Year Ended  
     August 31,
2020
     May 31,
2020
     August 31,
2020
 

Diluted earnings per share

   $ 0.00      $ 0.83      $ 1.46  

ARI integration related costs, net of tax

     0.06        0.08        0.26  

Severance expense, net of tax & noncontrolling interest

     0.10        0.14        0.38  
  

 

 

    

 

 

    

 

 

 

Adjusted diluted earnings per share

   $ 0.16      $ 1.05      $ 2.10  
  

 

 

    

 

 

    

 

 

 

Weighted average diluted shares used to calculate Adjusted diluted earnings per share

     33,519        33,478        33,441  

 

- More -


Greenbrier Reports Fourth Quarter Results (Cont.)    Page 13

 

“SAFE HARBOR” STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This press release may contain forward-looking statements, including any statements that are not purely statements of historical fact. Greenbrier uses words, and variations of words, such as “achieve,” “align,” “believe,” “continue,” “improve,” “maintain,” “target,” “will,” “working,” and similar expressions to identify forward-looking statements. These forward-looking statements include, without limitation, statements about backlog, future liquidity and cash flow, spending reductions, available borrowing capacity, lower capital expenditures, expected trends as well as other information regarding future performance and strategies and appear throughout this press release including in the headlines and the sections “Fourth Quarter Highlights” and “Business Update & Outlook.” 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 the results contemplated by the forward-looking statements. Factors that might cause such a difference include, but are not limited to, the following. (1) We are unable to predict when, how, or with what magnitude COVID-19 governmental reaction to the pandemic, and related economic disruptions will negatively impact our business: we may be prevented from operating our facilities; the operations of our customers may be disrupted increasing the likelihood that our customers may attempt to delay, defer or cancel orders, or cease to operate as going concerns; the operations of our suppliers may be disrupted; our indebtedness may increase; we may breach the covenants in our credit agreement; the market price of our common stock may drop or remain volatile; we may incur significant employee health care costs under our self-insurance programs. The longer the pandemic continues, the more likely that negative impacts on our business will occur, some of which we cannot now foresee. (2) Our backlog of railcar units and marine vessels is not necessarily indicative of future results of operations. Certain orders in backlog are subject to customary documentation which may not occur. Customers may attempt to cancel or modify orders or refuse to accept and pay for products. The likelihood of cancellations, modifications, rejection and non-payment for our products generally increases during periods of market weakness. The timing of converting backlog to revenue is also materially impacted by our decision whether to lease railcars, sell railcars, or syndicate railcars with a lease attached to an investor. More information on potential factors that could cause our results to differ from our forward-looking statements is included in the Company’s filings with the SEC, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recently filed periodic report on Form 10-K. Except as otherwise required by law, the Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s opinions only as of the date hereof.

Adjusted Financial Metric Definitions

Adjusted EBITDA, Adjusted net earnings attributable to Greenbrier and Adjusted diluted EPS are not financial measures under generally accepted accounting principles (GAAP). These metrics are performance measurement tools used by rail supply companies and Greenbrier. You should not consider these metrics in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because these metrics are not a measure of financial performance under GAAP and are susceptible to varying calculations, the measures presented may differ from and may not be comparable to similarly titled measures used by other companies.

We define Adjusted EBITDA as Net earnings before Interest and foreign exchange, Income tax expense, Depreciation and amortization and excluding the impact associated with items we do not believe are indicative of our core business or which affect comparability. We believe the presentation of Adjusted EBITDA provides useful information as it excludes the impact of financing, foreign exchange, income taxes and the accounting effects of capital spending. These items may vary for different companies for reasons unrelated to the overall operating performance of a company’s core business. We believe this assists in comparing our performance across reporting periods.

Adjusted net earnings attributable to Greenbrier and Adjusted diluted EPS excludes the impact associated with items we do not believe are indicative of our core business or which affect comparability. We believe this assists in comparing our performance across reporting periods.

 

# # #

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