THE GREENBRIER COMPANIES, INC. 
By LAKE OSWEGO, Ore., Jan. 8, 2014 /PRNewswire/ -- The Greenbrier Companies, Inc. (NYSE: GBX) today reported financial results for its first fiscal quarter ended November 30, 2013.
First Quarter Highlights
-- Net earnings for the quarter were $16.0 million, or $0.51 per diluted
share, excluding restructuring charges (net of tax) of $0.6 million, on
revenue of $490.4 million. "Economic" EPS was $0.56, which excludes
restructuring charges and the impact of out-of-the-money shares
underlying our 3.5% convertible bonds.
-- Net earnings attributable to Greenbrier for the quarter, which includes
restructuring charges, were $15.4 million, or $0.49 per diluted share.
-- Adjusted EBITDA for the quarter was $50.0 million, or 10.2% of revenue.
-- New railcar backlog as of November 30, 2013 was 13,500 units with an
estimated value of $1.43 billion (average unit sale price of $106,000)
compared to 14,400 units with an estimated value of $1.52 billion
(average unit sale price of $106,000) on August 31, 2013.
-- New railcar deliveries totaled 3,700 units for the quarter, compared to
3,500 units for the quarter ended August 31, 2013.
-- Received orders for 2,500 new railcars valued at $230 million during the
quarter. Subsequent to quarter end, Greenbrier received orders for
another 1,100 units valued at approximately $130 million.
-- To date, repurchased 110,400 shares of common stock at a cost of $3.4
million, under a $50 million share repurchase program.
Progress on Strategic Initiatives
-- To date, closed or sold six underperforming or non-core facilities in
the Wheels, Repair & Parts segment; one additional shop to be closed by
the end of January 2014. Restructuring and realignment continues in this
business segment.
-- Improved gross margin for the quarter to 12.6%, more than halfway to
fourth quarter 2014 minimum goal of a 200 basis point improvement to at
least 13.5% gross margin.
-- Substantially met $100 million minimum capital efficiency goal
originally scheduled to be met by February 2014. Net debt reduced by
$90 million since February 28, 2013; management continues to focus on
capital liberation.
William A. Furman, president and chief executive officer, said, "We continue to gain momentum from our strong finish to fiscal 2013, with sustained performance by Manufacturing, our largest segment, leading the way. With gross margin of 13.4%, an expansion of 110 basis points over the previous quarter, Manufacturing is meeting higher expectations set for fiscal 2014. Leasing & Services is also meeting expectations. We continue to refine our leasing model, including a reduction in the permanent capital invested in this business. Wheels, Repair & Parts produced disappointing financial results, but within the results are solid improvements at a number of locations, and about $2 million of costs that adversely affected margin, which we do not expect to recur in the future."
"Our diversified product offerings create superior value. Currently, less than 50% of our backlog is in tank cars, with the balance in a variety of railcar types. Demand for our comprehensive line of automotive carrying railcars remains robust. In the energy markets, increasing demand for sand used in fracking techniques to extract difficult-to-access oil and gas is leading to growing sales of our small cube covered hopper cars. We still see strong demand for tank cars. Market conditions in Europe are improving, and order activity for our European operations has picked up after a long period of softer demand in the region."
"We anticipate that new repair work, particularly in tank cars, will have a positive impact on our Wheels, Repair & Parts segment. We are progressing on necessary changes in our shop network and operations to improve performance, and expect to have better financial results in the quarters ahead."
"Consistent with our strategy to reduce permanent capital invested in Leasing & Services, we continue to sell lease fleet assets for positive returns, while maintaining syndication and asset management revenues. Our managed fleet grew by 7,000 units during the quarter. We continue to enter into comprehensive management and maintenance solutions with our customers, an area of increasing opportunity for the Company."
"Overall, rail fundamentals are solid. We are confident that Greenbrier is well-positioned to take advantage of a number of established and emerging opportunities, as well as to achieve our margin enhancement and capital liberation goals. We expect our business will expand across all segments, and to realize operating leverage and growth in ROIC. The $50 million stock repurchase program initiated during the first quarter is another significant step to enhance shareholder value," concluded Furman.
Business Outlook
Based on current business trends and industry forecasts, in fiscal 2014 Greenbrier continues to believe its:
-- Deliveries will exceed 15,000 units
-- Revenue will exceed $2 billion
-- EPS, excluding restructuring charges, will be in the range of $2.45 to
$2.70
As disclosed previously, financial results in the second half of the year are expected to be stronger than the first half. Also, while gross margin is expected to increase overall, management does not believe its track will be linear.
Financial Summary
-----------------
Q1 FY14 Q4 FY13 Sequential Comparison - Main
Drivers
------- ------- -----------------------------
Up 1.3% due to increased
deliveries and Manufacturing
revenue, partially offset by
lower revenues in Wheels,
Revenue $490.4M $484.2M Repair & Parts
------- ------- ------- -----------------------------
Up 10 bps attributable to
Manufacturing operating
efficiencies, favorable
product mix, and lease
syndications, partially
offset by lower margins in
Gross margin 12.6% 12.5% Wheels, Repair & Parts
------------ ---- ---- --------------------------
SG&A $26.1M $26.8M
---- ------ ------
Gain on $3.7M $8.5M Timing of sales fluctuates
disposition and is opportunistic;
typically ranges from $1.0M
-$5.0M per quarter
of equipment
------------
Restructuring $0.9M $2.7M Related to the Wheels, Repair
charges & Parts segment
-------------- ----- ----- -----------------------------
Adjusted $50.0M $52.1M Down due to timing of
EBITDA (1) disposition of leased
equipment
----------- ------ ------ ----------------------
Effective 31.4% 34.5% Reflects geographic mix of
tax rate earnings
--------- ---- ---- ---------------------------
Net earnings $16.0M $22.5M Down due to lower gains on
(1) sale and higher earnings
attributable to
noncontrolling interest
------------ ------ ------ ---------------------------
Diluted EPS
(1) $0.51 $0.6 Lower net earnings
----------- ----- ---- ------------------
Economic EPS $0.56 $0.79 Excludes "if converted"
(1) impact of out-of-the-
money bonds due 2018
------------ ----- ----- ------------------------
(1) Excluding restructuring
charges.
Segment Summary
---------------
Q1 FY14 Q4 FY13 Sequential Comparison - Main
Drivers
------- ------- ----------------------------
Manufacturing
-------------
Revenue $359.5M $351.7M Up 2.2% due to increased
deliveries
------- ------- ------- -------------------------
Gross margin 13.4% 12.3% Up 110 bps due to improved
operating efficiencies,
favorable product mix, and
strong syndication activity
------------ ---- ---- ---------------------------
Operating margin (2) 10.7% 8.6%
-------------------- ---- ---
Deliveries 3,700 3,500 Strong demand across
multiple car types
---------- ----- ----- ---------------------
Wheels, Repair & Parts
----------------------
Revenue $113.4M $114.0M Down 0.5% due to mix of work
and lower Repair revenue
------- ------- ------- ----------------------------
Down 190 bps due to
operational inefficiencies
in Repair and $2 million in
various costs not expected
Gross margin 4.8% 6.7% to recur
------------ --- --- ---------------------------
Operating margin (2) (3) (0.3)% (0.1)%
-------------------- ----- -----
Leasing & Services
------------------
Revenue $17.5M $18.5M Down 5.4% due to lower
interim rents
------- ------ ------ -----------------------
Gross margin 46.3% 50.7% Down 440 bps due primarily
to lower interim rents
------------ ---- ---- ---------------------------
Operating margin (2) (4) 49.6% 82.5%
-------------------- ---- ----
Lease fleet utilization 97.0% 97.4%
-------------------- ---- ----
(2) See supplemental segment
information on page 11 for
additional information.
(3) Includes restructuring
charges of $0.9 million in
Q1 2014 and $2.7 million
in Q4 2013.
Operating margin includes
Gains on disposition of
equipment, which is
excluded from gross
(4) margin.
Conference Call
Greenbrier will host a teleconference to discuss its first quarter 2014 results. In conjunction with this news release, Greenbrier has posted a supplemental earnings presentation to our website. Teleconference details are as follows:
-- January 8, 2014
-- 8:00 a.m. Pacific Standard Time
-- Phone: 1-630-395-0143, Password: "Greenbrier"
-- Real-time Audio Access: ("Newsroom" at http://www.gbrx.com)Please access the site 10 minutes prior to the start time. Following the call, a webcast replay will be available for 30 days. Telephone replay will be available through January 26, 2014, at 203-369-3048.
About Greenbrier Companies
Greenbrier (www.gbrx.com), headquartered in Lake Oswego, Oregon, is a leading supplier of transportation equipment and services to the railroad industry. Greenbrier builds new railroad freight cars in its four manufacturing facilities in the U.S. and Mexico and marine barges at its U.S. facility. It also repairs and refurbishes freight cars and provides wheels and railcar parts at 35 locations across North America. Greenbrier builds new railroad freight cars and refurbishes freight cars for the European market through both its operations in Poland and various subcontractor facilities throughout Europe. Greenbrier owns approximately 8,300 railcars, and performs management services for approximately 231,000 railcars.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This press release may contain forward-looking statements, including statements regarding expected new railcar production volumes and schedules, expected customer demand for the Company's products and services, plans to increase manufacturing capacity, restructuring plans, new railcar delivery volumes and schedules, growth in demand for the Company's railcar services and parts business, and the Company's future financial performance. Greenbrier uses words such as "anticipates," "believes," "forecast," "potential," "goal," "contemplates," "expects," "intends," "plans," "projects," "hopes," "seeks," "estimates," "could," "would," "will," "may," "can," "designed to," "foreseeable future" and similar expressions to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to certain risks and uncertainties that could cause actual results to differ materially from in the results contemplated by the forward-looking statements. Factors that might cause such a difference include, but are not limited to, reported backlog is not indicative of our financial results; turmoil in the credit markets and financial services industry; high levels of indebtedness and compliance with the terms of our indebtedness; write-downs of goodwill, intangibles and other assets in future periods; sufficient availability of borrowing capacity; fluctuations in demand for newly manufactured railcars or failure to obtain orders as anticipated in developing forecasts; loss of one or more significant customers; customer payment defaults or related issues; actual future costs and the availability of materials and a trained workforce; failure to design or manufacture new products or technologies or to achieve certification or market acceptance of new products or technologies; steel or specialty component price fluctuations and availability and scrap surcharges; changes in product mix and the mix between segments; labor disputes, energy shortages or operating difficulties that might disrupt manufacturing operations or the flow of cargo; production difficulties and product delivery delays as a result of, among other matters, changing technologies, production of new railcar types, or non-performance of subcontractors or suppliers; ability to obtain suitable contracts for the sale of leased equipment and risks related to car hire and residual values; difficulties associated with governmental regulation, including environmental liabilities; integration of current or future acquisitions; succession planning; all as may be discussed in more detail under the headings "Risk Factors" and "Forward Looking Statements" in our Annual Report on Form 10-K for the fiscal year ended August 31, 2013, and our other reports on file with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date hereof. Except as otherwise required by law, we do not assume any obligation to update any forward-looking statements.
Net earnings excluding restructuring charges, Adjusted EBITDA, and Diluted earnings per share excluding restructuring charges are not financial measures under generally accepted accounting principles (GAAP). We define Net earnings excluding restructuring charges as Net earnings before restructuring charges (after-tax). We define Adjusted EBITDA as Net earnings attributable to Greenbrier before interest and foreign exchange, income tax expense, restructuring charges and depreciation and amortization. We define Diluted earnings per share excluding restructuring charges as Net earnings excluding restructuring charges before interest and debt issuance costs (net of tax) on convertible notes divided by Weighted average diluted common shares outstanding. Net earnings excluding restructuring charges, Adjusted EBITDA, and Diluted earnings per share excluding restructuring charges are performance measurement tools used by Greenbrier. You should not consider Net earnings excluding restructuring charges, Adjusted EBITDA, and Diluted earnings per share excluding restructuring charges in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because Adjusted EBITDA and Diluted earnings per share excluding restructuring charges are not measures of financial performance under GAAP and are susceptible to varying calculations, the Adjusted EBITDA and Diluted earnings per share excluding restructuring charges measures presented may differ from and may not be comparable to similarly titled measures used by other companies.
THE GREENBRIER COMPANIES, INC.
Consolidated Balance Sheets
(In thousands, unaudited)
November August 31, May 31, February November
30, 2013 2013 2013 28, 2013 30, 2012
-------- ---- ---- -------- --------
Assets
Cash and cash
equivalents $81,226 $97,435 $31,606 $55,637 $41,284
Restricted
cash 8,975 8,807 8,906 8,899 7,322
Accounts
receivable,
net 174,745 154,848 162,352 144,933 163,385
Inventories 328,235 316,783 344,168 359,281 363,642
Leased
railcars for
syndication 61,282 68,480 71,091 36,198 54,297
Equipment on
operating
leases, net 293,291 305,468 332,924 344,576 362,522
Property,
plant and
equipment,
net 201,353 201,533 197,779 194,887 186,715
Goodwill 57,416 57,416 57,416 134,316 137,066
Intangibles
and other
assets, net 76,055 78,971 79,364 86,194 79,500
------ ------ ------ ------ ------
$1,282,578 $1,289,741 $1,285,606 $1,364,921 $1,395,733
========== ========== ========== ========== ==========
Liabilities and Equity
Revolving
notes $38,805 $48,209 $92,968 $50,058 $89,826
Accounts
payable and
accrued
liabilities 293,041 315,938 286,964 278,221 282,925
Deferred
income taxes 86,501 86,040 86,229 99,965 96,498
Deferred
revenue 8,706 8,838 16,203 23,178 28,283
Notes payable 372,666 373,889 372,942 427,553 427,697
Total equity
-Greenbrier 447,599 428,202 404,707 461,136 447,080
Noncontrolling
interest 35,260 28,625 25,593 24,810 23,424
------ ------ ------ ------ ------
Total equity 482,859 456,827 430,300 485,946 470,504
------- ------- ------- ------- -------
$1,282,578 $1,289,741 $1,285,606 $1,364,921 $1,395,733
========== ========== ========== ========== ==========
THE GREENBRIER COMPANIES, INC.
Consolidated Statements of Operations
(In thousands, except per share amounts, unaudited)
Three Months
Ended
November 30,
------------
2013 2012
---- ----
Revenue
Manufacturing $359,473 $285,368
Wheels, Repair & Parts 113,401 112,100
Leasing & Services 17,481 17,906
------ ------
490,355 415,374
Cost of revenue
Manufacturing 311,440 258,492
Wheels, Repair & Parts 107,975 101,476
Leasing & Services 9,381 7,627
----- -----
428,796 367,595
Margin 61,559 47,779
Selling and administrative
expense 26,109 26,100
Net gain on disposition of
equipment (3,651) (1,408)
Restructuring charges 879 -
Earnings from operations 38,222 23,087
Other costs
Interest and foreign exchange 4,744 5,900
Earnings before income tax and
earnings (loss) from 33,478 17,187
unconsolidated affiliates
Income tax expense (10,522) (4,586)
------- ------
Earnings before earnings
(loss) from 22,956 12,601
unconsolidated affiliates
Earnings (loss) from
unconsolidated affiliates 41 (40)
--- ---
Net earnings 22,997 12,561
Net earnings attributable to
noncontrolling interest (7,609) (2,134)
------ ------
Net earnings attributable to
Greenbrier $15,388 $10,427
======= =======
Basic earnings per common
share: $0.54 $0.38
Diluted earnings per common
share: $0.49 $0.35
Weighted average common
shares:
Basic 28,417 27,144
Diluted 34,462 33,991
THE GREENBRIER COMPANIES, INC.
Consolidated Statements of Cash Flows
(In thousands, unaudited)
Three Months Ended
November 30,
------------
2013 2012
---- ----
Cash flows from operating
activities:
Net earnings $22,997 $12,561
Adjustments to reconcile net
earnings to net cash used in
operating activities:
Deferred income taxes 286 940
Depreciation and amortization 10,897 10,923
Net gain on disposition of
equipment (3,651) (1,408)
Accretion of debt discount - 849
Stock based compensation
expense 1,359 1,886
Other 527 (1,705)
Decrease (increase) in assets:
Accounts receivable (19,305) (15,515)
Inventories (13,178) (41,465)
Leased railcars for
syndication 9,853 43,501
Other 2,069 945
Increase (decrease) in
liabilities:
Accounts payable and accrued
liabilities (25,137) (48,036)
Deferred revenue (172) 11,039
---- ------
Net cash used in operating
activities (13,455) (25,485)
------- -------
Cash flows from investing
activities:
Proceeds from sales of assets 14,051 10,086
Capital expenditures (6,542) (25,141)
Increase in restricted cash (168) (1,045)
Investment in and net advances
to unconsolidated affiliates (1,253) (160)
Net cash provided by (used in)
investing activities 6,088 (16,260)
----- -------
Cash flows from financing
activities:
Net change in revolving notes
with maturities of 90 days or
less - 27,935
Proceeds from revolving notes
with maturities longer than
90 days 7,474 9,195
Repayments of revolving notes
with maturities longer than
90 days (16,878) (8,941)
Repayments of notes payable (1,223) (1,230)
Investment by joint venture
partner 419 1,182
Repurchase of stock (871) -
Excess tax benefit from
restricted stock awards 152 217
Net cash provided by (used in)
financing activities (10,927) 28,358
------- ------
Effect of exchange rate
changes 2,085 1,100
Decrease in cash and cash
equivalents (16,209) (12,287)
Cash and cash equivalents
Beginning of period 97,435 53,571
------ ------
End of period $81,226 $41,284
======= =======
THE GREENBRIER COMPANIES, INC.
Supplemental Information
(In thousands, except per share amounts, unaudited)
Operating Results by Quarter for 2013 are as follows:
First Second Third Fourth Total
----- ------ ----- ------ -----
Revenue
Manufacturing $285,368 $294,047 $284,591 $351,728 $1,215,734
Wheels, Repair
& Parts 112,100 111,952 131,167 114,003 469,222
Leasing &
Services 17,906 17,167 17,905 18,484 71,462
------ ------ ------ ------ ------
415,374 423,166 433,663 484,215 1,756,418
Cost of revenue
Manufacturing 258,492 262,650 253,360 308,387 1,082,889
Wheels, Repair
& Parts 101,476 103,134 120,476 106,415 431,501
Leasing &
Services 7,627 9,107 9,808 9,113 35,655
----- ----- ----- ----- ------
367,595 374,891 383,644 423,915 1,550,045
Margin 47,779 48,275 50,019 60,300 206,373
Selling and
administrative 26,100 24,942 25,322 26,811 103,175
Net gain on
disposition of
equipment (1,408) (3,076) (5,131) (8,457) (18,072)
Goodwill
impairment - - 76,900 - 76,900
Restructuring
charges - - - 2,719 2,719
Earnings (loss)
from
operations 23,087 26,409 (47,072) 39,227 41,651
Other costs
Interest and
foreign
exchange 5,900 6,322 5,905 4,031 22,158
----- ----- ----- ----- ------
Earnings (loss) before income tax and
earnings (loss) from unconsolidated
affiliates
17,187 20,087 (52,977) 35,196 19,493
Income tax
expense (4,586) (5,590) (2,729) (12,155) (25,060)
Earnings (loss)
from
unconsolidated
affiliates (40) (105) 82 249 186
--- ---- --- --- ---
Net earnings
(loss) 12,561 14,392 (55,624) 23,290 (5,381)
Net earnings attributable to
noncontrolling
interest (2,134) (553) (406) (2,574) (5,667)
------ ---- ---- ------ ------
Net earnings
(loss)
attributable
to Greenbrier $10,427 $13,839 $(56,030) $20,716 $(11,048)
======= ======= ======== ======= ========
Basic earnings
(loss) per
common share:
(1) $0.38 $0.51 $(2.10) $0.74 $(0.41)
Diluted
earnings
(loss) per
common share:
(2) $0.35 $0.45 $(2.10) $0.64 $(0.41)
Quarterly amounts do not
total to the year to
date amount as each
period is calculated
(1) discretely.
(2) Quarterly amounts do not
total to the year to
date amount as each
period is calculated
discretely. For the
first, second and
fourth quarters,
diluted earnings per
common share includes
the outstanding
warrants using the
treasury stock method
and the dilutive effect
of shares underlying
the 2018 Convertible
Notes using the "if
converted" method in
which debt issuance and
interest costs, net of
tax, were added back to
net earnings.
THE GREENBRIER COMPANIES, INC.
Supplemental Information
(In thousands, unaudited)
Segment Information
Three months ended November 30, 2013
Revenue Earnings (loss) from
operations
------- ---------------------
External Intersegment Total External Intersegment Total
-------- ------------ ----- -------- ------------ -----
Manufacturing $359,473 $ - $359,473 $38,314 $ - $38,314
Wheels,
Repair &
Parts 113,401 1,653 115,054 (374) 31 (343)
Leasing &
Services 17,481 2,869 20,350 8,670 2,869 11,539
Eliminations - (4,522) (4,522) - (2,900) (2,900)
Corporate - - - (8,388) - (8,388)
--- --- --- ------ --- ------
$490,355 $ - $490,355 $38,222 $ - $38,222
======== ===================== ======== ======= ================== =======
Three months ended November 30, 2012
Revenue Earnings (loss) from
operations
------- ---------------------
External Intersegment Total External Intersegment Total
-------- ------------ ----- -------- ------------ -----
Manufacturing $285,368 $6,949 $292,317 $15,502 $(45) $15,457
Wheels,
Repair &
Parts 112,100 5,386 117,486 6,137 (63) 6,074
Leasing &
Services 17,906 4,392 22,298 8,701 4,392 13,093
Eliminations - (16,727) (16,727) - (4,284) (4,284)
Corporate - - - (7,253) - (7,253)
--- --- --- ------ --- ------
$415,374 $ - $415,374 $23,087 $ - $23,087
======== ==================== ======== ======= =================== =======
Total assets
------------
November 30, August 31,
2013 2013
---- ----
Manufacturing $461,096 $401,630
Wheels, Repair & Parts 304,249 318,483
Leasing & Services 427,023 463,381
Unallocated 90,210 106,247
------ -------
$1,282,578 $1,289,741
========== ==========
THE GREENBRIER COMPANIES, INC.
Supplemental Information
(In thousands, excluding backlog and delivery units, unaudited)
Reconciliation of Net earnings to Adjusted EBITDA
Three Months
Ended
-------------
November 30, 2013 August 31, 2013
----------------- ---------------
Net earnings $22,997 $23,290
Interest and foreign
exchange 4,744 4,031
Income tax expense 10,522 12,155
Depreciation and
amortization 10,897 9,924
Restructuring charges 879 2,719
23,290
------
Adjusted EBITDA $50,039 $52,119
------- -------
(1) Adjusted EBITDA is not a
financial measure under
generally accepted
accounting principles
(GAAP). We define Adjusted
EBITDA as Net earnings
before interest and foreign
exchange, income tax
expense, restructuring
charges, depreciation and
amortization. Adjusted
EBITDA is a performance
measurement tool commonly
used by rail supply
companies and Greenbrier.
You should not consider
Adjusted EBITDA in
isolation or as a
substitute for other
financial statement data
determined in accordance
with GAAP. In addition,
because Adjusted EBITDA is
not a measure of financial
performance under GAAP and
is susceptible to varying
calculations, the Adjusted
EBITDA measure presented
may differ from and may not
be comparable to similarly
titled measures used by
other companies.
Three Months Ended
November 30, 2013
-----------------
Backlog Activity (units)
Beginning backlog 14,400
Orders received 2,500
Production held as Leased
railcars for syndication (100)
Production sold directly to
third parties (3,300)
------
Ending backlog 13,500
======
Delivery Information (units)
Production sold directly to
third parties 3,300
Sales of Leased railcars for
syndication 400
---
Total deliveries 3,700
=====
THE GREENBRIER COMPANIES, INC.
Supplemental Information
(In thousands, except per share amounts, unaudited)
Reconciliation of common shares outstanding and diluted
earnings per share
The shares used in the computation of the Company's basic and
diluted earnings per common share and Diluted earnings per
share excluding restructuring charges are reconciled as
follows:
Three Months
Ended
November 30, August 31,
2013 2013
---- ----
Weighted average basic
common shares outstanding
(1) 28,417 28,062
Dilutive effect of
warrants - 366
Dilutive effect of
convertible notes (2) 6,045 6,045
----- -----
Weighted average diluted
common shares outstanding 34,462 34,473
====== ======
(1) Restricted stock grants
and restricted stock
units, including some
grants subject to certain
performance criteria, are
included in Weighted
average basic common
shares outstanding when
the Company is in a net
earnings position.
(2) The dilutive effect of the
2018 Convertible notes
are included in the
Weighted average diluted
common shares outstanding
as they were considered
dilutive under the "if
converted" method as
further discussed below.
The dilutive effect of
the 2026 Convertible
notes was excluded from
the share calculations as
the stock price for each
period presented was less
than the initial
conversion price of
$48.05 and therefore
considered anti-
dilutive.
Diluted earnings per share was calculated using the more dilutive of two approaches. The first approach includes the dilutive effect of outstanding warrants and shares underlying the 2026 Convertible notes in the share count using the treasury stock method. The second approach supplements the first by including the "if converted" effect of the 2018 Convertible notes issued in March 2011. Under the "if converted method" debt issuance and interest costs, both net of tax, associated with the convertible notes are added back to net earnings and the share count is increased by the shares underlying the convertible notes. The 2026 Convertible notes would only be included in the calculation of both approaches if the current stock price is greater than the initial conversion price of $48.05 using the treasury stock method.
Reconciliation of Net earnings attributable to Greenbrier to
Net earnings excluding restructuring charges
Three Months
Ended
November 30, August 31,
2013 2013
---- ----
Net earnings attributable
to Greenbrier $15,388 $20,716
Restructuring charges
(after-tax) 603 1,781
--- -----
Net earnings excluding
restructuring charges (1) 15,991 22,497
Add back:
Interest and debt issuance
costs on the 2018
Convertible
notes, net of tax 1,416 1,416
----- -----
Earnings before interest
and debt issuance costs on
convertible notes $17,407 $23,913
======= =======
Weighted average diluted
common shares outstanding 34,462 34,473
Diluted earnings per share
excluding restructuring
charges (2) $0.51 $0.69
(1) Net earnings excluding
restructuring charges is
not a financial measure
under GAAP. We define Net
earnings excluding
restructuring charges as
Net earnings attributable
to Greenbrier before
restructuring charges
(after-tax). Net earnings
excluding restructuring
charges is a performance
measurement tool used by
Greenbrier. You should not
consider Net earnings
excluding restructuring
charges in isolation or as
a substitute for other
financial statement data
determined in accordance
with GAAP.
(2) Diluted earnings per share
excluding restructuring
charges is not a financial
measure under GAAP. We
define Diluted earnings
per share excluding
restructuring charges as
Net earnings excluding
restructuring charges
before interest and debt
issuance costs (net of
tax) on convertible notes
divided by Weighted
average diluted common
shares outstanding.
Diluted earnings per share
excluding restructuring
charges is a performance
measurement tool used by
Greenbrier. You should not
consider Diluted earnings
per share excluding
restructuring charges in
isolation or as a
substitute for other
financial statement data
determined in accordance
with GAAP. In addition,
because Diluted earnings
per share excluding
restructuring charges is
not a measure of financial
performance under GAAP and
is susceptible to varying
calculations, the Diluted
earnings per share
excluding restructuring
charges measure presented
may differ from and may
not be comparable to
similarly titled measures
used by other companies.
THE GREENBRIER COMPANIES, INC.
Supplemental Information
(In thousands, except per share amounts, unaudited)
Reconciliation of basic earnings per share to economic
earnings per share excluding restructuring charges
The shares used in the computation of the Company's basic
and economic earnings per common share excluding
restructuring charges are reconciled as follows:
Three Months
Ended
-------------
November 30, August 31,
2013 2013
---- ----
Weighted average basic
common shares
outstanding 28,417 28,062
Dilutive effect of
warrants - 366
Weighted average economic
diluted common shares
outstanding 28,417 28,428
====== ======
Net earnings excluding
restructuring charges $15,991 $22,497
Economic earnings per
share excluding
restructuring charges
(1) $0.56 $0.79
(1) Economic earnings per share
excluding restructuring
charges is not a financial
measure under GAAP. Economic
earnings per share excluding
restructuring charges is
used to measure the current
economic impact of our
Convertible Bonds due in
2018 that have a conversion
strike price of
$38.05/share, which exceeds
our current stock price. We
define Economic earnings per
share excluding
restructuring charges as Net
earnings excluding
restructuring charges
divided by Weighted average
basic common shares
outstanding, including the
dilutive effect of warrants.
This calculation excludes
the dilutive effect of the
shares underlying the 2018
bonds under the "if
converted" method, which is
included in the calculation
of Diluted earnings per
share excluding
restructuring charges. You
should not consider Economic
earnings per share excluding
restructuring charges in
isolation or as a substitute
for other financial
statement data determined in
accordance with GAAP. In
addition, because Economic
earnings per share excluding
restructuring charges is not
a measure of financial
performance under GAAP and
is susceptible to varying
calculations, the Economic
earnings per share excluding
restructuring charges
measure presented may differ
from and may not be
comparable to similarly
titled measures used by
other companies.
SOURCE The Greenbrier Companies, Inc. (GBX)
