8-K
GREENBRIER COMPANIES INC (GBX)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 27, 2022
THE GREENBRIER COMPANIES, INC.
(Exact name of registrant as specified in its charter)
| Oregon | 001-13146 | 93-0816972 |
|---|---|---|
| (State of<br> <br>Incorporation) | (Commission<br> <br>File Number) | (I.R.S. Employer<br> <br>Identification No.) |
One Centerpointe Drive, Suite 200, Lake Oswego, OR 97035
(Address of principal executive offices) (Zip Code)
(503) 684-7000
Registrant’s telephone number, including area code
Former name or former address, if changed since last report: N/A
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br>Symbol(s) | Name of each exchange<br> <br>on which registered |
|---|---|---|
| Common Stock without par value | GBX | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition |
|---|
On October 27, 2022, The Greenbrier Companies, Inc. (“Greenbrier” or the “Company”) issued a press release reporting the Company’s financial results for the fourth fiscal quarter and year ended August 31, 2022. A copy of such release is furnished herewith as Exhibit 99.1 and is incorporated into this Item 2.02 by reference.
The information contained in this Item 2.02 of this Current Report on Form 8-K, including the exhibit, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be incorporated by reference into any filings made by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits |
|---|
(d) Exhibits
| Exhibit<br> <br>No. | Description |
|---|---|
| 99.1 | Press Release dated October 27, 2022 of The Greenbrier Companies, Inc. reporting the Company’s financial results for the fourth fiscal quarter and year ended August 31, 2022. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| THE GREENBRIER COMPANIES, INC. | ||
|---|---|---|
| Date: October 27, 2022 | By: | /s/ Adrian J. Downes |
| Adrian J. Downes | ||
| Senior Vice President, Chief Financial Officer and Chief Accounting Officer |
EX-99.1
Exhibit 99.1
| One Centerpointe Drive, Suite 200, Lake Oswego, Oregon 97035 503-684-7000 | www.gbrx.com | |
|---|---|---|
| For release: October 27, 2022 6:00 a.m. EDT | Contact: | Justin Roberts, Investor Relations |
| --- | --- | --- |
| Jack Isselmann, Media Relations | ||
| Ph: 503-684-7000 |
Greenbrier Reports Fourth Quarter and Fiscal Year 2022 Results
Fourth Quarter diluted EPS of $0.60
Generated nearly $180 million of operating cash flow in the quarter
Strong lease fleet utilization of 98%
Issues fiscal 2023 guidance
Lake Oswego, Oregon, October 27, 2022 – 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, 2022.
Fourth Quarter Highlights
| • | New railcar orders for 4,800 units valued at $620 million and deliveries of 5,800 units.<br> |
|---|---|
| • | Diversified new railcar backlog as of August 31, 2022 was 29,500 units with an estimated value of<br>$3.5 billion. |
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| • | Railcar refurbishment backlog of 2,300 units valued at $170 million. |
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| • | Ended the quarter with liquidity of $690 million, including $543 million in cash and $147 million<br>of available borrowing capacity. |
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| • | Operating cash flow of nearly $180 million. |
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| • | Net earnings attributable to Greenbrier for the quarter were $20 million, or $0.60 per diluted share, on<br>revenue of $950 million. |
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| • | EBITDA for the quarter was $89 million, or 9.3% of revenue. |
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| • | Finalized $150 million non-recourse term loan at Greenbrier leasing<br>subsidiary with $75 million drawn immediately and $75 million expected to be drawn in fiscal 2023. Terms are similar to the leasing term loan refinanced in August 2021. |
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| • | Board declared a quarterly dividend of $0.27 per share, payable on November 29, 2022 to shareholders of<br>record as of November 8, 2022 representing Greenbrier’s 34th consecutive quarterly dividend. |
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Fiscal Year 2022Highlights
| • | Diversified new railcar orders of 24,600 units valued at $2.9 billion and deliveries of nearly 20,000 units.<br> |
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| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 2 |
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| • | Regular lease fleet optimization and monetization generated $155 million of proceeds and $35 million of<br>gains. |
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| • | Net earnings attributable to Greenbrier were $47 million, or $1.40 per diluted share, on revenue of nearly<br>$3.0 billion. |
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| • | In February, GBX Leasing completed issuance of $323 million of asset-backed notes with a blended interest<br>rate of 2.9% and a weighted average life of six years. |
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| • | Fixed the interest rate on most long-term floating rate debt to mitigate risk in current rising rate environment.<br>No significant debt maturities until 2026. |
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| • | EBITDA was $231 million, or 7.8% of revenue. |
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“Greenbrier’s fourth quarter performance marked a strong end to our fiscal year and demonstrates the value of our diverse business activities. Despite challenges throughout the year, including ongoing supply chain disruptions, increasing input costs and the war in Ukraine, our operations are building momentum. Greenbrier achieved a book-to-bill rate of 1.2x for fiscal 2022 on orders for 24,600 units during the fiscal year. Greenbrier also continued to execute our leasing strategy, increasing the number of railcars in the lease fleet in 2022 by nearly 40% to 12,200 units. Importantly, our expanded leasing platform is protected from interest rate risk since our leasing debt is non-recourse and at fixed interest rates. Our lease platform offers a strong source of liquidity, as demonstrated by robust syndication activity in 2022.” said Lorie Tekorius, Chief Executive Officer & President.
Tekorius concluded, “Our outlook for Greenbrier’s business is broadly optimistic for fiscal 2023 despite uncertain macroeconomic conditions. Our backlog of nearly 30,000 units, valued at $3.5 billion, coupled with our strong liquidity position, provides visibility and an opportunity to drive higher performance, building on the momentum in our business. We expect railcar utilization levels to remain high as scrapping continues to outpace new deliveries contributing to a strong North American leasing market for originations and lease renewals.”
Business Update & Outlook
Greenbrier’s strategy during the fourth fiscal quarter produced strong operating performance amid ongoing economic volatility. Based on current trends and production schedules, Greenbrier expects the following performance in fiscal 2023:
| • | Deliveries of 22,000 – 24,000 units including approximately 1,000 units in Greenbrier-Maxion (Brazil)<br> |
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| • | Revenue at $3.2 – $3.6 billion |
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| • | Capital expenditures at approximately $240 million in Leasing & Management Services,<br>$80 million in Manufacturing and $10 million in Maintenance Services |
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| • | Proceeds of equipment sales are expected to be approximately $100 million |
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| • | Build and capitalize into the lease fleet approximately 2,000 units. These units are not included in the delivery<br>guidance. |
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We will provide additional operating commentary during the earnings call.
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| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 3 |
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Financial Summary
| Q4 FY22 | Q3 FY22 | |
|---|---|---|
| Revenue | $950.7M | 793.5M |
| Gross margin | $127.3M | 76.3M |
| Gross margin % | 13.4% | 9.6% |
| Selling and administrative | $68.8M | 57.4M |
| Net gain on disposition of<br> <br>equipment | $2.9M | 0.7M |
| EBITDA | $88.8M | 48.6M |
| Net earnings attributable to noncontrolling interest | $9.2M | 4.5M |
| Net earnings attributable to Greenbrier | $20.2M | 3.1M |
| Diluted EPS | $0.60 | 0.09 |
All values are in US Dollars.
Segment Summary
| Q4 FY22 | Sequential Comparison – Main Drivers | |||
|---|---|---|---|---|
| Manufacturing | ||||
| Revenue | $ | 817.5M | 650.9M | Increased deliveries reflecting progress of production ramp in North America |
| Gross margin | 84.5M | $39.6M | Improved operating efficiencies | |
| Gross margin % | 10.3% | 6.1% | ||
| Operating margin % ^(1)^ | 7.6% | 3.1% | ||
| Deliveries ^(2)^ | 5,700 | 4,900 | Higher production rates and timing of syndication activity | |
| Maintenance Services | ||||
| Revenue | 87.2M | $101.5M | Lower Repair and Wheel volumes sequentially after seasonally strong Q3 | |
| Gross margin % | 10.6% | 10.2% | Improved operating efficiencies | |
| Operating margin %^(1)(3)^ | 13.0% | 8.5% | Reflects gain on dissolution of axle joint venture | |
| Leasing & Management Services (including GBX Leasing) | ||||
| Revenue | 46.0M | $41.1M | Increased syndication activity and lease fleet income | |
| Gross margin % | 73.0% | 64.0% | ||
| Operating margin %^(1) (3)^ | 53.0% | 46.7% | ||
| Fleet utilization | 98.4% | 97.5% |
All values are in US Dollars.
| ^(1)^ | See supplemental segment information on page 9 for additional information. |
|---|---|
| ^(2)^ | Excludes Brazil deliveries which are not consolidated into Manufacturing revenue and margins.<br> |
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| ^(3)^ | Includes Net gain on disposition of equipment, which is excluded from gross margin.^^ |
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| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 4 |
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Conference Call
Greenbrier will host a teleconference to discuss its fourth quarter and fiscal year results. In conjunction with this news release, Greenbrier has posted a supplemental earnings presentation to our website.
Teleconference details are as follows:
| • | October 27, 2022 |
|---|---|
| • | 8:00 a.m. Pacific Daylight Time |
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| • | Phone:<br>1-888-317-6003 (Toll Free),<br>1-412-317-6061 (International), Entry Number “0909841” |
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| • | Real-time Audio Access: (“Newsroom” at http://www.gbrx.com) |
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Please access the site 10-15 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. Through its wholly-owned subsidiaries and joint ventures, Greenbrier designs, builds and markets freight railcars and marine barges in North America, Europe and Brazil. We are a leading provider of freight railcar wheel services, parts, maintenance and retrofitting services in North America through our maintenance services business unit. Greenbrier manages 408,000 railcars and offers railcar management, regulatory compliance services and leasing services to railroads and other railcars owners in North America. GBX Leasing (GBXL) is a special purpose subsidiary that owns and manages a portfolio of leased railcars that originate primarily from Greenbrier’s manufacturing operations. GBXL and Greenbrier own a lease fleet of approximately 12,200 railcars. Learn more about Greenbrier at www.gbrx.com.
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| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 5 | |
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| THE GREENBRIER COMPANIES, INC. |
CONSOLIDATED BALANCE SHEETS
(In millions, unaudited)
| August 31,<br>2022 | May 31,<br>2022 | February 28,<br>2022 | November 30,<br>2021 | August 31,<br>2021 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Assets | ||||||||||
| Cash and cash equivalents | $ | 543.0 | $ | 449.7 | $ | 586.8 | $ | 410.8 | $ | 646.8 |
| Restricted cash | 16.1 | 16.1 | 15.7 | 27.1 | 24.6 | |||||
| Accounts receivable, net | 501.2 | 464.8 | 399.0 | 393.3 | 306.4 | |||||
| Income tax receivable | 39.8 | 129.4 | 106.0 | 106.2 | 112.1 | |||||
| Inventories | 815.3 | 781.7 | 728.5 | 631.4 | 573.6 | |||||
| Leased railcars for syndication | 111.1 | 142.9 | 80.0 | 99.1 | 51.6 | |||||
| Equipment on operating leases, net | 770.9 | 676.1 | 650.4 | 751.3 | 609.8 | |||||
| Property, plant and equipment, net | 645.2 | 642.7 | 646.5 | 654.4 | 670.2 | |||||
| Investment in unconsolidated affiliates | 92.5 | 96.2 | 90.2 | 83.1 | 79.9 | |||||
| Intangibles and other assets, net | 189.1 | 177.8 | 179.6 | 183.0 | 183.6 | |||||
| Goodwill | 127.3 | 128.7 | 130.0 | 130.3 | 132.1 | |||||
| $ | 3,851.5 | $ | 3,706.1 | $ | 3,612.7 | $ | 3,470.0 | $ | 3,390.7 | |
| Liabilities and Equity | ||||||||||
| Revolving notes | $ | 296.6 | $ | 303.3 | $ | 292.2 | $ | 516.3 | $ | 372.2 |
| Accounts payable and accrued liabilities | 725.1 | 639.0 | 581.2 | 540.4 | 569.8 | |||||
| Deferred income taxes | 68.6 | 72.9 | 51.9 | 51.3 | 73.3 | |||||
| Deferred revenue | 35.3 | 33.3 | 43.0 | 36.6 | 42.8 | |||||
| Notes payable, net | 1,269.1 | 1,202.6 | 1,209.2 | 895.7 | 826.5 | |||||
| Contingently redeemable noncontrolling interest | 27.7 | 27.8 | 28.5 | 29.7 | 29.7 | |||||
| Total equity – Greenbrier | 1,276.9 | 1,270.4 | 1,252.6 | 1,237.3 | 1,307.7 | |||||
| Noncontrolling interest | 152.2 | 156.8 | 154.1 | 162.7 | 168.7 | |||||
| Total equity | 1,429.1 | 1,427.2 | 1,406.7 | 1,400.0 | 1,476.4 | |||||
| $ | 3,851.5 | $ | 3,706.1 | $ | 3,612.7 | $ | 3,470.0 | $ | 3,390.7 | |
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 6 | |||||||||
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| THE GREENBRIER COMPANIES, INC. |
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except number of shares which are reflected in thousands and per share amounts, unaudited)
| Years Ended<br>August 31, | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2020 | |||||||
| Revenue | |||||||||
| Manufacturing | $ | 2,476.6 | $ | 1,311.1 | $ | 2,309.5 | |||
| Maintenance Services | 347.7 | 298.3 | 324.7 | ||||||
| Leasing & Management Services | 153.4 | 138.5 | 158.0 | ||||||
| 2,977.7 | 1,747.9 | 2,792.2 | |||||||
| Cost of revenue | |||||||||
| Manufacturing | 2,300.9 | 1,189.2 | 2,065.2 | ||||||
| Maintenance Services | 322.0 | 280.4 | 302.2 | ||||||
| Leasing & Management Services | 48.8 | 46.7 | 71.7 | ||||||
| 2,671.7 | 1,516.3 | 2,439.1 | |||||||
| Margin | 306.0 | 231.6 | 353.1 | ||||||
| Selling and administrative expense | 225.2 | 191.8 | 204.7 | ||||||
| Net gain on disposition of equipment | (37.2 | ) | (1.2 | ) | (20.0 | ) | |||
| Earnings from operations | 118.0 | 41.0 | 168.4 | ||||||
| Other costs | |||||||||
| Interest and foreign exchange | 57.4 | 43.3 | 43.6 | ||||||
| Net loss on extinguishment of debt | — | 6.3 | — | ||||||
| Earnings (loss) before income tax and earnings from unconsolidated affiliates | 60.6 | (8.6 | ) | 124.8 | |||||
| Income tax (expense) benefit | (18.1 | ) | 40.2 | (40.2 | ) | ||||
| Earnings before earnings from unconsolidated affiliates | 42.5 | 31.6 | 84.6 | ||||||
| Earnings from unconsolidated affiliates | 11.3 | 3.5 | 3.0 | ||||||
| Net earnings | 53.8 | 35.1 | 87.6 | ||||||
| Net earnings attributable to noncontrolling interest | (6.9 | ) | (2.7 | ) | (38.6 | ) | |||
| Net earnings attributable to Greenbrier | $ | 46.9 | $ | 32.4 | $ | 49.0 | |||
| Basic earnings per common share: | $ | 1.44 | $ | 0.99 | $ | 1.50 | |||
| Diluted earnings per common share: | $ | 1.40 | $ | 0.96 | $ | 1.46 | |||
| Weighted average common shares: | |||||||||
| Basic | 32,569 | 32,648 | 32,670 | ||||||
| Diluted | 33,631 | 33,665 | 33,441 | ||||||
| Dividends per common share | $ | 1.08 | $ | 1.08 | $ | 1.06 | |||
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 7 | ||||||||
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| THE GREENBRIER COMPANIES, INC. |
CONSOLIDATED STATEMENTS OF CASHFLOWS
(In millions, unaudited)
| Years EndedAugust 31, | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2020 | |||||||
| Cash flows from operating activities | |||||||||
| Net earnings | $ | 53.8 | $ | 35.1 | $ | 87.6 | |||
| Adjustments to reconcile net earnings to net cash provided by (used in) operating<br>activities: | |||||||||
| Deferred income taxes | 12.9 | 51.1 | (9.5 | ) | |||||
| Depreciation and amortization | 102.0 | 100.7 | 109.9 | ||||||
| Net gain on disposition of equipment | (37.2 | ) | (1.2 | ) | (20.0 | ) | |||
| Stock based compensation expense | 15.5 | 14.7 | 9.0 | ||||||
| Net loss on extinguishment of debt | — | 6.3 | — | ||||||
| Accretion of debt discount | — | 7.1 | 5.5 | ||||||
| Noncontrolling interest adjustments | 1.6 | 2.3 | 1.4 | ||||||
| Other | 3.8 | 2.4 | 1.0 | ||||||
| Decrease (increase) in assets: | |||||||||
| Accounts receivable, net | (198.2 | ) | (82.1 | ) | 144.4 | ||||
| Income tax receivable | 72.3 | (103.0 | ) | (9.1 | ) | ||||
| Inventories | (267.9 | ) | (166.5 | ) | 166.6 | ||||
| Leased railcars for syndication | (40.6 | ) | (11.9 | ) | (12.9 | ) | |||
| Other assets | (28.1 | ) | (5.8 | ) | (65.0 | ) | |||
| Increase (decrease) in liabilities: | |||||||||
| Accounts payable and accrued liabilities | 165.3 | 109.9 | (108.8 | ) | |||||
| Deferred revenue | (5.6 | ) | 0.4 | (27.9 | ) | ||||
| Net cash provided by (used in) operating activities | (150.4 | ) | (40.5 | ) | 272.2 | ||||
| Cash flows from investing activities | |||||||||
| Proceeds from sales of assets | 155.5 | 15.9 | 83.5 | ||||||
| Capital expenditures | (380.7 | ) | (139.0 | ) | (66.9 | ) | |||
| Investments in and advances to unconsolidated affiliates | (2.3 | ) | — | (1.8 | ) | ||||
| Cash distribution from unconsolidated affiliates and other | 3.5 | 5.3 | 12.7 | ||||||
| Net cash provided by (used in) investing activities | (224.0 | ) | (117.8 | ) | 27.5 | ||||
| Cash flows from financing activities | |||||||||
| Net change in revolving notes with maturities of 90 days or less | (101.3 | ) | 197.4 | 146.5 | |||||
| Proceeds from revolving notes with maturities longer than 90 days | 35.0 | 112.0 | 176.5 | ||||||
| Repayments of revolving notes with maturities longer than 90 days | — | (287.0 | ) | — | |||||
| Proceeds from issuance of notes payable | 398.3 | 391.9 | — | ||||||
| Repayments of notes payable | (23.4 | ) | (337.8 | ) | (30.2 | ) | |||
| Debt issuance costs | (7.3 | ) | (22.0 | ) | — | ||||
| Repurchase of stock | — | (20.0 | ) | — | |||||
| Dividends | (35.8 | ) | (35.6 | ) | (35.2 | ) | |||
| Cash distribution to joint venture partner | (16.9 | ) | (25.3 | ) | (38.9 | ) | |||
| Investment by joint venture partner | — | 7.0 | — | ||||||
| Tax payments for net share settlement of restricted stock | (3.7 | ) | (3.3 | ) | (2.2 | ) | |||
| Net cash provided by (used in) financing activities | 244.9 | (22.7 | ) | 216.5 | |||||
| Effect of exchange rate changes | 17.2 | 10.3 | (12.6 | ) | |||||
| Increase (decrease) in cash, cash equivalents and restricted cash | (112.3 | ) | (170.7 | ) | 503.6 | ||||
| Cash and cash equivalents and restricted cash | |||||||||
| Beginning of period | 671.4 | 842.1 | 338.5 | ||||||
| End of period | $ | 559.1 | $ | 671.4 | $ | 842.1 | |||
| Balance Sheet Reconciliation: | |||||||||
| Cash and cash equivalents | $ | 543.0 | $ | 646.8 | $ | 833.8 | |||
| Restricted cash | 16.1 | 24.6 | 8.3 | ||||||
| Total cash and cash equivalents and restricted cash | $ | 559.1 | $ | 671.4 | $ | 842.1 | |||
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 8 | ||||||||
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| THE GREENBRIER COMPANIES, INC. |
SUPPLEMENTAL LEASING INFORMATION
(In millions, except owned and managed fleet, unaudited)
In April 2021, Greenbrier announced an enhanced leasing strategy that included the formation of GBX Leasing (GBXL), a joint venture with The Longwood Group and Greenbrier. Greenbrier owns approximately 95% of GBXL and consolidates it in Greenbrier’s financial statements in the Leasing & Management Services segment. GBXL provides an additional “go to market” element to Greenbrier’s Commercial strategy of direct sales, partnerships with operating leasing companies, and origination of leases for syndication partners as well as providing a platform for further growth at scale. Investing in leasing assets delivers predictable, tax-advantaged cash flows. Together, Greenbrier and GBX Leasing have nearly $900 million of railcar assets and expect to continue investing to grow over the next several years.
Our leasing operations observe Greenbrier’s established portfolio standards including working with customers with strong credit profiles, a diverse equipment mix and staggered maturity ladders. To mitigate the volatile interest rate environment, Greenbrier Leasing and GBX Leasing have fixed all floating rate debt. Investing in leasing assets reduces Greenbrier’s Manufacturing revenue and margin in the short-term but provides meaningful tax benefits, longer-term earnings and cash flow stability.
Key information for the consolidated Leasing & Management Services segment:
| (In Units) | August 31,<br>2022 | May 31,<br>2022 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Owned fleet^(1)^ | 12,200 | 11,800 | |||||||
| Managed fleet | 408,000 | 421,000 | |||||||
| Owned fleet utilization^(1)^ | 98 | % | 98 | % | |||||
| Three Months Ended | Year Ended | ||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| August 31,<br>2022 | May 31,<br>2022 | August 31,<br>2022 | |||||||
| Beginning balance | 11,800 | 11,000 | 8,800 | ||||||
| Cars added | 1,700 | 1,700 | 9,500 | ||||||
| Cars sold / scrapped | (1,300 | ) | (900 | ) | (6,100 | ) | |||
| Ending balance | 12,200 | 11,800 | 12,200 | ||||||
| August 31,<br>2022 | May 31,<br>2022 | ||||||||
| --- | --- | --- | --- | --- | --- | --- | |||
| Equipment on operating lease^(2)^ | $ | 770.9 | $ | 676.1 | |||||
| GBX Leasing non-recourse warehouse | $ | — | $ | — | |||||
| GBX Leasing ABS non-recourse notes | 318.6 | 321.5 | |||||||
| Leasing non-recourse term loan | 268.0 | 194.8 | |||||||
| Total Leasing non-recourse debt | $ | 586.6 | $ | 516.3 | |||||
| Fleet leverage %^(3)^ | **** | 76 | % | **** | 76 | % | |||
| ^(1)^ | Owned fleet includes Leased railcars for syndication | ||||||||
| --- | --- | ||||||||
| ^(2)^ | Equipment on operating lease assets not securing Leasing non-recourse<br>term loan support the $600 million U.S. revolver | ||||||||
| --- | --- | ||||||||
| ^(3)^ | Total Leasing non-recourse debt / Equipment on operating lease<br> | ||||||||
| --- | --- | ||||||||
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 9 | ||||||||
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| THE GREENBRIER COMPANIES, INC. |
SUPPLEMENTAL INFORMATION
(In millions, unaudited)
Segment Information
| Three months ended August 31, 2022: | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | Earnings (loss) from operations | ||||||||||||||||
| External | Intersegment | Total | External | Intersegment | Total | ||||||||||||
| Manufacturing | $ | 817.5 | $ | 112.1 | $ | 929.6 | $ | 62.5 | $ | 9.8 | $ | 72.3 | |||||
| Maintenance Services | 87.2 | 9.0 | 96.2 | 11.3 | — | 11.3 | |||||||||||
| Leasing & Management Services | 46.0 | 0.6 | 46.6 | 24.4 | — | 24.4 | |||||||||||
| Eliminations | — | (121.7 | ) | (121.7 | ) | — | (9.8 | ) | (9.8 | ) | |||||||
| Corporate | — | — | — | (36.8 | ) | — | (36.8 | ) | |||||||||
| $ | 950.7 | $ | — | $ | 950.7 | $ | 61.4 | $ | — | $ | 61.4 | ||||||
| Three months ended May 31, 2022: | |||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Revenue | Earnings (loss) from operations | ||||||||||||||||
| External | Intersegment | Total | External | Intersegment | Total | ||||||||||||
| Manufacturing | $ | 650.9 | $ | 38.3 | $ | 689.2 | $ | 20.5 | $ | 1.8 | $ | 22.3 | |||||
| Maintenance Services | 101.5 | 8.6 | 110.1 | 8.6 | — | 8.6 | |||||||||||
| Leasing & Management Services | 41.1 | 0.6 | 41.7 | 19.2 | 0.1 | 19.3 | |||||||||||
| Eliminations | — | (47.5 | ) | (47.5 | ) | — | (1.9 | ) | (1.9 | ) | |||||||
| Corporate | — | — | — | (28.7 | ) | — | (28.7 | ) | |||||||||
| $ | 793.5 | $ | — | $ | 793.5 | $ | 19.6 | $ | — | $ | 19.6 | ||||||
| Total assets | |||||||||||||||||
| --- | --- | --- | --- | --- | |||||||||||||
| August 31,<br>2022 | May 31,<br>2022 | ||||||||||||||||
| Manufacturing | $ | 1,853.9 | $ | 1,814.1 | |||||||||||||
| Maintenance Services | 284.8 | 266.8 | |||||||||||||||
| Leasing & Management Services | 1,152.2 | 1,158.3 | |||||||||||||||
| Unallocated, including cash | 560.6 | 466.9 | |||||||||||||||
| $ | 3,851.5 | $ | 3,706.1 |
SUPPLEMENTAL BACKLOG AND DELIVERYINFORMATION
(Unaudited)
| Three Months<br>Ended | Year Ended | |||||
|---|---|---|---|---|---|---|
| August 31, 2022 | August 31, 2022 | |||||
| Backlog Activity (units) ^(1)^ | ||||||
| Beginning backlog | 30,900 | 26,600 | ||||
| Orders received | 4,800 | 24,600 | ||||
| Production held on the Balance Sheet | (1,700 | ) | (6,000 | ) | ||
| Production sold directly to third parties | (4,500 | ) | (15,700 | ) | ||
| Ending backlog | 29,500 | 29,500 | ||||
| Delivery Information (units) ^(1)^ | ||||||
| Produced & Delivered from Backlog | 4,500 | 15,700 | ||||
| Delivered from Balance Sheet | 1,300 | 4,200 | ||||
| Total deliveries | 5,800 | 19,900 | ||||
| ^(1)^ | Includes Greenbrier-Maxion, our Brazilian railcar manufacturer, which is accounted for under the equity method<br> | |||||
| --- | --- | |||||
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 10 | |||||
| --- | --- | --- | ||||
| THE GREENBRIER COMPANIES, INC. |
SUPPLEMENTAL INFORMATION
(In millions, unaudited)
Reconciliation of Netearnings to EBITDA
| Three Months Ended | Year Ended | |||||
|---|---|---|---|---|---|---|
| August 31,<br>2022 | May 31,<br>2022 | August 31,<br>2022 | ||||
| Net earnings | $ | 29.4 | $ | 7.6 | $ | 53.8 |
| Interest and foreign exchange | 18.1 | 14.9 | 57.4 | |||
| Income tax expense | 15.2 | 1.1 | 18.1 | |||
| Depreciation and amortization | 26.1 | 25.0 | 102.0 | |||
| EBITDA | $ | 88.8 | $ | 48.6 | $ | 231.3 |
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 11 | |||||
| --- | --- | --- | ||||
| THE GREENBRIER COMPANIES, INC. |
SUPPLEMENTAL INFORMATION
(In millions, except per share amounts, unaudited)
Operating Results by Quarter for 2022 are as follows:
| First | Second | Third | Fourth | Total | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | |||||||||||||||
| Manufacturing | $ | 452.5 | $ | 555.7 | $ | 650.9 | $ | 817.5 | $ | 2,476.6 | |||||
| Maintenance Services | 72.4 | 86.6 | 101.5 | 87.2 | 347.7 | ||||||||||
| Leasing & Management Services | 25.8 | 40.5 | 41.1 | 46.0 | 153.4 | ||||||||||
| 550.7 | 682.8 | 793.5 | 950.7 | 2,977.7 | |||||||||||
| Cost of revenue | |||||||||||||||
| Manufacturing | 421.6 | 535.0 | 611.3 | 733.0 | 2,300.9 | ||||||||||
| Maintenance Services | 71.2 | 81.7 | 91.1 | 78.0 | 322.0 | ||||||||||
| Leasing & Management Services | 10.3 | 11.3 | 14.8 | 12.4 | 48.8 | ||||||||||
| 503.1 | 628.0 | 717.2 | 823.4 | 2,671.7 | |||||||||||
| Margin | 47.6 | 54.8 | 76.3 | 127.3 | 306.0 | ||||||||||
| Selling and administrative expense | 44.3 | 54.7 | 57.4 | 68.8 | 225.2 | ||||||||||
| Net gain on disposition of equipment | (8.5 | ) | (25.1 | ) | (0.7 | ) | (2.9 | ) | (37.2 | ) | |||||
| Earnings from operations | 11.8 | 25.2 | 19.6 | 61.4 | 118.0 | ||||||||||
| Other costs | |||||||||||||||
| Interest and foreign exchange | 12.6 | 11.8 | 14.9 | 18.1 | 57.4 | ||||||||||
| Earnings (loss) before income tax and earnings from unconsolidated affiliates | (0.8 | ) | 13.4 | 4.7 | 43.3 | 60.6 | |||||||||
| Income tax (expense) benefit | 1.4 | (3.2 | ) | (1.1 | ) | (15.2 | ) | (18.1 | ) | ||||||
| Earnings before earnings from unconsolidated affiliates | 0.6 | 10.2 | 3.6 | 28.1 | 42.5 | ||||||||||
| Earnings from unconsolidated affiliates | 5.0 | 1.0 | 4.0 | 1.3 | 11.3 | ||||||||||
| Net earnings | 5.6 | 11.2 | 7.6 | 29.4 | 53.8 | ||||||||||
| Net (earnings) loss attributable to noncontrolling interest | 5.2 | 1.6 | (4.5 | ) | (9.2 | ) | (6.9 | ) | |||||||
| Net earnings attributable to Greenbrier | $ | 10.8 | $ | 12.8 | $ | 3.1 | $ | 20.2 | $ | 46.9 | |||||
| Basic earnings per common share^(1)^ | $ | 0.33 | $ | 0.39 | $ | 0.10 | $ | 0.62 | $ | 1.44 | |||||
| Diluted earnings per common share^(1)^ | $ | 0.32 | $ | 0.38 | $ | 0.09 | $ | 0.60 | $ | 1.40 | |||||
| Dividends per common share | $ | 0.27 | $ | 0.27 | $ | 0.27 | $ | 0.27 | $ | 1.08 | |||||
| ^(1)^ | Quarterly amounts may not total to the<br>year-to-date amount as each period is calculated discretely. | ||||||||||||||
| --- | --- | ||||||||||||||
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year Results (Cont.) | Page 12 | ||||||||||||||
| --- | --- | --- | |||||||||||||
| THE GREENBRIER COMPANIES, INC. |
SUPPLEMENTAL INFORMATION
(In millions, except per share amounts, unaudited)
Operating Results by Quarter for 2021 are as follows:
| First | Second | Third | Fourth | Total | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | |||||||||||||||
| Manufacturing | $ | 304.5 | $ | 201.5 | $ | 339.7 | $ | 465.4 | $ | 1,311.1 | |||||
| Maintenance Services | 65.6 | 71.6 | 80.9 | 80.2 | 298.3 | ||||||||||
| Leasing & Management Services | 32.9 | 22.5 | 29.6 | 53.5 | 138.5 | ||||||||||
| 403.0 | 295.6 | 450.2 | 599.1 | 1,747.9 | |||||||||||
| Cost of revenue | |||||||||||||||
| Manufacturing | 280.9 | 201.8 | 292.4 | 414.1 | 1,189.2 | ||||||||||
| Maintenance Services | 63.0 | 66.7 | 73.7 | 77.0 | 280.4 | ||||||||||
| Leasing & Management Services | 18.4 | 9.5 | 8.9 | 9.9 | 46.7 | ||||||||||
| 362.3 | 278.0 | 375.0 | 501.0 | 1,516.3 | |||||||||||
| Margin | 40.7 | 17.6 | 75.2 | 98.1 | 231.6 | ||||||||||
| Selling and administrative expense | 43.7 | 43.4 | 49.3 | 55.4 | 191.8 | ||||||||||
| Net (gain) loss on disposition of equipment | (0.9 | ) | (0.1 | ) | 0.2 | (0.4 | ) | (1.2 | ) | ||||||
| Earnings (loss) from operations | (2.1 | ) | (25.7 | ) | 25.7 | 43.1 | 41.0 | ||||||||
| Other costs | |||||||||||||||
| Interest and foreign exchange | 11.1 | 9.6 | 10.2 | 12.4 | 43.3 | ||||||||||
| Net loss on extinguishment of debt | — | — | 4.8 | 1.5 | 6.3 | ||||||||||
| Earnings (loss) before income tax and earnings (loss) from unconsolidated affiliates | (13.2 | ) | (35.3 | ) | 10.7 | 29.2 | (8.6 | ) | |||||||
| Income tax benefit | 7.3 | 21.8 | 6.9 | 4.2 | 40.2 | ||||||||||
| Earnings (loss) before earnings (loss) from unconsolidated affiliates | (5.9 | ) | (13.5 | ) | 17.6 | 33.4 | 31.6 | ||||||||
| Earnings (loss) from unconsolidated affiliates | (0.8 | ) | (0.4 | ) | 2.4 | 2.3 | 3.5 | ||||||||
| Net earnings (loss) | (6.7 | ) | (13.9 | ) | 20.0 | 35.7 | 35.1 | ||||||||
| Net (earnings) loss attributable to noncontrolling interest | (3.3 | ) | 4.8 | (0.3 | ) | (3.9 | ) | (2.7 | ) | ||||||
| Net earnings (loss) attributable to Greenbrier | $ | (10.0) | $ | (9.1) | $ | 19.7 | $ | 31.8 | $ | 32.4 | |||||
| Basic earnings (loss) per common share^(1)^ | $ | (0.30) | $ | (0.28) | $ | 0.61 | $ | 0.98 | $ | 0.99 | |||||
| Diluted earnings (loss) per common share^(1)^ | $ | (0.30) | $ | (0.28) | $ | 0.59 | $ | 0.95 | $ | 0.96 | |||||
| Dividends declared per common share | $ | 0.27 | $ | 0.27 | $ | 0.27 | $ | 0.27 | $ | 1.08 | |||||
| ^(1)^ | Quarterly amounts may not total to the<br>year-to-date amount as each period is calculated discretely. | ||||||||||||||
| --- | --- | ||||||||||||||
| Greenbrier Reports Fourth Quarter and 2022 Fiscal Year 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 statements that are not purely statements of historical fact. Greenbrier uses words, and variations of words, such as “believe,” “continue,” “enhance,” “estimate,” “expect,” “mitigate,” “momentum,” “opportunities,” “outlook,” “protected,” “provides,” “position,” “will,” and similar expressions to identify forward-looking statements. These forward-looking statements include, without limitation, statements about backlog and other orders, leasing performance, financing, future liquidity, cash flow, tax treatment, and other information regarding future performance and strategies and appear throughout this press release including in the headlines and the sections titled “Fourth Quarter Highlights,” “Fiscal Year 2022 Highlights,” “Business Update & Outlook,” and “Supplemental Leasing Information.” 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: an economic downturn and economic uncertainty; inflation (including rising energy prices, interest rates, wages and other escalators) and policy reactions thereto (including actions by central banks); disruptions in the supply of materials and components used in the production of our products; the war in Ukraine and related events; and the COVID-19 pandemic, variants thereof, governmental reaction thereto, and related economic disruptions (including, among other factors, operations and supply disruptions and labor shortages). Our backlog of railcar units and marine vessels and other orders not included in backlog are not necessarily indicative of future results of operations. Certain orders in backlog are subject to customary documentation which may not occur. 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 and subsequent reports on 10-Q. 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 FinancialMetric Definitions
EBITDA is not a financial measure under generally accepted accounting principles (GAAP). This metric is a performance measurement tool used by rail supply companies and Greenbrier. You should not consider this metric in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because this metric is not a measure of financial performance under GAAP and is susceptible to varying calculations, the measure presented may differ from and may not be comparable to similarly titled measures used by other companies.
We define EBITDA as Net earnings before Interest and foreign exchange, Income tax expense, Depreciation and amortization. We believe the presentation of 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.