EX-99.1

EX-99.1 2 d821484dex991.htm EX-99.1 EX-99.1

Exhibit 99.1


News Release

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

For release: October 25, 2019, 6:00 a.m. EDT

Contact:

Lorie Tekorius, Investor Relations

Justin Roberts, Investor Relations

503-684-7000

Greenbrier Reports Fourth Quarter and Fiscal Year Results

~ Record revenue of $3.0 billion and deliveries of 23,400 units ~

~ American Railcar Industries (ARI) manufacturing integration underway; Synergies of $15 million expected in fiscal 2020 ~

~ Provides guidance for 2020 ~

Lake Oswego, Oregon, October 25, 2019 – The Greenbrier Companies, Inc. (NYSE: GBX) today reported financial results for its fourth fiscal quarter and year ended August 31, 2019.

Fourth Quarter Highlights

•

Net earnings attributable to Greenbrier for the quarter were $35.1 million, or $1.06 per diluted share, on record revenue of $914.2 million. Quarterly results include $8.2 million, net of tax, ($0.25 per share) in costs related to the ARI acquisition.

•

Adjusted net earnings attributable to Greenbrier were $43.3 million ($1.31 per diluted share) excluding the ARI acquisition costs.

•

Adjusted EBITDA for the quarter was $109.4 million, or 12.0% of revenue.

•

Record new railcar deliveries totaled 7,300 units for the quarter.

•

Diversified orders of 4,900 railcars were received during the quarter, valued at over $500.0 million.

•

New railcar backlog was 30,300 units with an estimated value of $3.3 billion. Backlog reflects the transfer of 10,600 units from ARI and the removal of 3,500 small cube covered hoppers for sand service for which the company realized negotiated economic benefits. Remaining backlog does not include any other orders for the sand market.

•

Marine backlog exceeds $100 million and extends through calendar 2020.

•

Board declares a quarterly dividend of $0.25 per share, payable on December 4, 2019 to shareholders of record as of November 13, 2019.

•

Dividend yield approximately 3.1% as of October 24, 2019.

Fiscal Year 2019 Highlights

•

Net earnings attributable to Greenbrier for the year were $71.1 million, or $2.14 per diluted share, on record revenue of $3.0 billion. Adjusted net earnings attributable to Greenbrier for the year were $95.2 million, or $2.87 per diluted share, excluding the non-cash goodwill impairment charge and ARI acquisition costs.

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 2

Fiscal Year 2019 Highlights (Cont.)

•

Adjusted EBITDA for the year was $290.9 million, or 9.6% of revenue.

•

Record new railcar deliveries totaled 23,400 units for the year.

•

Orders of 20,600 units valued at approximately $2.2 billion across a broad range of railcar types with over 20% originating internationally.

•

Cash provided by operating activities exceeded $125 million for the second half of the year.

William A. Furman, Chairman & CEO said, “Greenbrier ended its fiscal 2019 with positive momentum. We enter fiscal 2020 supported by solid railcar order activity and improvements in operational areas that caused headwinds in 2019. We are pleased that in the fourth quarter, both deliveries and earnings met expectations. A robust backlog exceeding 30,000 units, valued at over $3 billion, combined with a healthy balance sheet provides optionality for the future. Greenbrier’s strategy remains focused on four elements: 1) reinforcing core North American markets, 2) executing on our international strategy while improving profitability, 3) robust development of the talent pipeline and 4) continuing to grow the business at scale.”

Furman concluded, “Recent progress and opportunities in Europe and other international markets are positive. We are optimistic about long term success in these markets. In North America, we completed the largest acquisition in Greenbrier’s history in late July. We have been actively welcoming new colleagues and integrating the new manufacturing operations. We expect to generate approximately $15 million in synergies in fiscal 2020, consistent with our initial expectations. The ARI acquisition adds talent in manufacturing, engineering and other fields. With this long-contemplated transaction now complete, Greenbrier is one of the largest freight railcar builders and railcar service providers in the world.”

Business Outlook

Based on current business trends and production schedules for fiscal 2020, Greenbrier believes:

•

Deliveries will be 26,000 – 28,000 units including Greenbrier-Maxion (Brazil) which will account for approximately 2,000 units

•

Revenue will be approximately $3.5 billion

•

Diluted EPS of $2.60 – $3.00 excluding approximately $20 – $25 million of pre-tax integration and acquisition-related expenses from the ARI acquisition

As noted in the “Safe Harbor” statement, there are risks to achieving this guidance. Certain orders and backlog in this release are subject to customary documentation and completion of terms.

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 3

Financial Summary


	Q4 FY19			Q3 FY19			Sequential Comparison – Main Drivers
Revenue	$	914.2M		$	856.2M		Record quarterly revenue driven by higher deliveries
Gross margin		14.6	%		12.4	%	Primarily higher deliveries and strong syndication activity
Selling and administrative expense	$	60.6M		$	54.4M		Q4 includes $11.0 million and Q3 includes $5.8 million of ARI acquisition expense
Net gain on disposition of equipment	$	3.5M		$	11.0M		Lower lease fleet portfolio sales
Adjusted EBITDA	$	109.4		$	84.4M		Increased operating earnings; see reconciliation on page 12
Effective tax rate		25.0	%		30.0	%	Q4 tax rate in line with annual expectations
Loss from unconsolidated affiliates	$	0.9M		$	4.6M		Improvement in Brazil operations
Net earnings attributable to noncontrolling interest	$	15.7M		$	10.6M		Higher GIMSA JV deliveries
Adjusted net earnings attributable to Greenbrier	$	43.3M	⁽¹⁾	$	29.6M	⁽²⁾	Increased operating earnings driven by higher deliveries and improved gross margin
Adjusted diluted EPS	$	1.31	⁽¹⁾	$	0.89	⁽²⁾

⁽¹⁾	Excludes expense of $8.2 million ($0.25 per share), net of tax, associated with ARI acquisition costs

⁽²⁾	Excludes $10.0 million ($0.30 per share) non-cash impact associated with a goodwill impairment charge and expense of $4.3 million ($0.13 per share), net of tax, associated with ARI acquisition costs

Segment Summary


	Q4 FY19			Q3 FY19			Sequential Comparison – Main Drivers
Manufacturing
Revenue	$	802.1M		$	681.6M		Increase driven by higher deliveries
Gross margin		14.5	%		13.3	%	Higher deliveries and increased syndication activity
Operating margin ⁽¹⁾		11.8	%		10.6	%
Deliveries ⁽²⁾		7,300			6,500		Record quarterly deliveries
Wheels, Repair & Parts
Revenue	$	85.7M		$	125.0M		Lower volumes driven by decreased rail traffic
Gross margin		4.7	%		4.1	%	Improved Wheels and Parts profitability partially offset by Repair operations
Operating margin⁽¹⁾		(0.2	%)		(7.1	%)
Leasing & Services
Revenue	$	26.4M		$	49.6M		Less secondary market syndication activity
Gross margin		50.7	%		21.4	%	More normalized margin levels reflecting less secondary market syndication activity
Operating margin^{(1) (3)}		41.2	%		30.9	%

⁽¹⁾	See supplemental segment information on page 11 for additional information.

⁽²⁾	Excludes Brazil deliveries which are not consolidated into manufacturing revenue and margin.

⁽³⁾	Includes Net gain on disposition of equipment, which is not included in gross margin.

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 4

Conference Call

Greenbrier will host a teleconference to discuss its fourth quarter 2019 results. In conjunction with this news release, Greenbrier has posted a supplemental earnings presentation to our website. Teleconference details are as follows:

•

October 25, 2019

•

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 the nations of the Gulf Cooperation Council. 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, tank heads and other components. Greenbrier owns a lease fleet of 9,400 railcars and performs management services for 380,000 railcars. Learn more about Greenbrier at www.gbrx.com.

“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 “affirms,” “anticipates,” “believes,” “forecast,” “potential,” “goal,” “contemplates,” “expects,” “intends,” “plans,” “projects,” “hopes,” “seeks,” “estimates,” “strategy,” “could,” “would,” “should,” “likely,” “will,” “may,” “can,” “designed to,” “future,” “foreseeable future” and similar expressions to identify forward-looking statements. These forward-looking statements include, without limitation, the information under the heading “Business Outlook” and any other information regarding future performance and strategies. 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, economic downturns (global or national); reported backlog and awards that are not indicative of Greenbrier’s financial results; uncertainty or changes in the credit markets and financial services industry; high levels of indebtedness and compliance with the terms of Greenbrier’s indebtedness; write-downs of goodwill, intangibles and other assets in future periods; sufficient availability of borrowing capacity; integration of past or future acquisitions, including the integration of the manufacturing business of American Railcar Industries, and establishment of joint ventures; fluctuations in demand for newly manufactured railcars or failure to obtain orders as anticipated in developing forecasts; interest rate fluctuations and volatility in global or national financial markets; loss of one or more significant customers; customer order or payment defaults or related issues; policies and priorities of the federal government regarding international trade, taxation and infrastructure; risks related to operations outside of the U.S. including economic or political instability, dishonoring of contracts, exchange rates, diminishment of property rights; violations of anti-corruption laws; 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, energy, 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

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 5

delays as a result of, among other matters, costs or inefficiencies associated with expansion, start-up, or changing of production lines or changes in production rates, changing technologies, transfer of production between facilities or non-performance of alliance partners, subcontractors or suppliers; inability to compete successfully; ability to obtain suitable contracts for the sale of leased equipment and risks related to car hire and residual values; succession planning; discovery of defects in railcars or services resulting in increased warranty costs or litigation; inability to lease railcars at favorable rates and on favorable terms; physical damage or product or service liability claims that exceed Greenbrier’s insurance coverage; train derailments or other accidents or claims that could subject Greenbrier to legal claims; actions or inactions by various regulatory agencies including potential environmental remediation obligations or changing tank car or other railcar or railroad regulation; a decline in performance or demand, oversupply, or increase in efficiency, of the rail freight industry; and issues arising from investigations of whistleblower complaints. More information on these risks and other 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 reports on Form 10-K and subsequent Form 10-Q filings. 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 EBITDA, Adjusted net earnings attributable to Greenbrier, Adjusted diluted EPS and Diluted EPS range excluding integration and acquisition-related expenses from the ARI acquisition 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 (benefit), 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. Diluted EPS range excluding integration and acquisition-related expenses from the ARI acquisition exclude integration and acquisition-related expenses from the ARI acquisition. We believe this assists in comparing our performance across reporting periods.

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 6

THE GREENBRIER COMPANIES, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, unaudited)


	August 31, 2019		May 31, 2019		February 28, 2019		November 30, 2018		August 31, 2018
Assets
Cash and cash equivalents	$	329,684	$	359,625	$	341,500	$	462,797	$	530,655
Restricted cash		8,803		21,471		21,584		8,872		8,819
Accounts receivable, net		373,383		330,385		335,732		306,917		348,406
Inventories		664,693		592,099		574,146		492,573		432,314
Leased railcars for syndication		182,269		130,489		163,472		233,415		130,926
Equipment on operating leases, net		366,688		376,241		381,336		317,282		322,855
Property, plant and equipment, net		717,973		478,502		472,739		461,120		457,196
Investment in unconsolidated affiliates		91,818		53,036		58,685		58,682		61,414
Intangibles and other assets, net		125,379		97,022		101,284		95,958		94,668
Goodwill		129,947		74,318		82,743		77,508		78,211

	$	2,990,637	$	2,513,188	$	2,533,221	$	2,515,124	$	2,465,464

Liabilities and Equity
Revolving notes	$	27,115	$	25,952	$	22,323	$	22,189	$	27,725
Accounts payable and accrued liabilities		568,360		473,106		474,863		438,304		449,857
Deferred income taxes		13,946		12,089		29,481		30,631		31,740
Deferred revenue		85,070		76,170		91,533		108,566		105,954
Notes payable, net		822,885		483,918		486,107		487,764		436,205
Contingently redeemable noncontrolling interest		31,564		24,722		25,637		28,449		29,768
Total equity - Greenbrier		1,276,730		1,262,315		1,257,818		1,257,631		1,250,101
Noncontrolling interest		164,967		154,916		145,459		141,590		134,114

Total equity		1,441,697		1,417,231		1,403,277		1,399,221		1,384,215

	$	2,990,637	$	2,513,188	$	2,533,221	$	2,515,124	$	2,465,464

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 7

THE GREENBRIER COMPANIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts, unaudited)


	Years Ended August 31,
	2019			2018			2017
Revenue
Manufacturing	$	2,431,499		$	2,044,586		$	1,725,188
Wheels, Repair & Parts		444,502			347,023			312,679
Leasing & Services		157,590			127,855			131,297

		3,033,591			2,519,464			2,169,164
Cost of revenue
Manufacturing		2,137,625			1,727,407			1,373,967
Wheels, Repair & Parts		420,890			318,330			288,336
Leasing & Services		108,590			64,672			85,562

		2,667,105			2,110,409			1,747,865
Margin		366,486			409,055			421,299
Selling and administrative		213,308			200,439			170,607
Net gain on disposition of equipment		(40,963	)		(44,369	)		(9,740	)
Goodwill impairment		10,025			—			—

Earnings from operations		184,116			252,985			260,432
Other costs
Interest and foreign exchange		30,912			29,368			24,192

Earnings before income tax and loss from unconsolidated affiliates		153,204			223,617			236,240
Income tax expense		(41,588	)		(32,893	)		(64,014	)

Earnings before loss from unconsolidated affiliates		111,616			190,724			172,226
Loss from unconsolidated affiliates		(5,805	)		(18,661	)		(11,764	)

Net earnings		105,811			172,063			160,462
Net earnings attributable to noncontrolling interest		(34,735	)		(20,282	)		(44,395	)

Net earnings attributable to Greenbrier	$	71,076		$	151,781		$	116,067

Basic earnings per common share	$	2.18		$	4.92		$	3.97
Diluted earnings per common share	$	2.14		$	4.68		$	3.65
Weighted average common shares
Basic		32,615			30,857			29,225
Diluted		33,165			32,835			32,562
Dividends declared per common share	$	1.00		$	0.96		$	0.86

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 8

THE GREENBRIER COMPANIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)


	Years Ended August 31,
	2019			2018			2017
Cash flows from operating activities:
Net earnings	$	105,811		$	172,063		$	160,462
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Deferred income taxes		(20,225	)		(40,496	)		4,377
Depreciation and amortization		83,731			74,356			65,129
Net gain on disposition of equipment		(40,963	)		(44,369	)		(9,740	)
Stock based compensation expense		11,153			29,314			26,427
Accretion of debt discount		4,458			4,171			2,340
Noncontrolling interest adjustments		7,402			2,864			(677	)
Goodwill Impairment		10,025			—			—
Other		145			1,688			(845	)
Decrease (increase) in assets:
Accounts receivable, net		13,022			(83,551	)		(25,272	)
Inventories		(143,168	)		(26,592	)		(2,787	)
Leased railcars for syndication		(96,110	)		(54,023	)		41,015
Other		6,843			34,115			17,558
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		55,910			54,032			(25,422	)
Deferred revenue		(19,275	)		(20,231	)		33,039

Net cash provided by (used in) operating activities		(21,241	)		103,341			285,604

Cash flows from investing activities:
Acquisitions, net of cash acquired		(361,878	)		(34,874	)		(27,127	)
Proceeds from sales of assets		125,427			153,224			24,149
Capital expenditures		(198,233	)		(176,848	)		(86,065	)
Investment in and advances to unconsolidated affiliates		(11,393	)		(26,455	)		(40,632	)
Cash distribution from joint ventures		2,096			4,661			550

Net cash used in investing activities		(443,981	)		(80,292	)		(129,125	)

Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		(105	)		23,401			4,324
Proceeds from issuance of notes payable		525,000			13,771			276,093
Repayments of notes payable		(182,971	)		(22,269	)		(8,297	)
Debt issuance costs		(8,630	)		—			(9,082	)
Dividends		(33,193	)		(29,914	)		(24,890	)
Cash distribution to joint venture partner		(16,879	)		(73,033	)		(28,511	)
Investment by joint venture partner		—			6,500			—
Tax payments for net share settlement of restricted stock		(6,321	)		(7,723	)		(5,215	)

Net cash provided by (used in) financing activities		276,901			(89,267	)		204,422

Effect of exchange rate changes		(12,666	)		(14,666	)		12,499
Increase (decrease) in cash and cash equivalents and restricted cash		(200,987	)		(80,884	)		373,400
Cash and cash equivalents and restricted cash
Beginning of period		539,474			620,358			246,958

End of period	$	338,487		$	539,474		$	620,358

Balance Sheet Reconciliation:
Cash and cash equivalents	$	329,684		$	530,655		$	611,466
Restricted cash		8,803			8,819			8,892

Total cash and cash equivalents and restricted cash as presented above	$	338,487		$	539,474		$	620,358

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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 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

⁽¹⁾

Quarterly amounts do 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.

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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 2018 are as follows:


	First			Second			Third			Fourth			Total
Revenue
Manufacturing	$	451,485		$	511,827		$	510,099		$	571,175		$	2,044,586
Wheels, Repair & Parts		78,011			88,710			94,515			85,787			347,023
Leasing & Services		30,039			28,799			36,773			32,244			127,855

		559,535			629,336			641,387			689,206			2,519,464
Cost of revenue
Manufacturing		380,850			429,165			427,875			489,517			1,727,407
Wheels, Repair & Parts		72,506			80,708			85,850			79,266			318,330
Leasing & Services		16,865			14,116			19,155			14,536			64,672

		470,221			523,989			532,880			583,319			2,110,409
Margin		89,314			105,347			108,507			105,887			409,055
Selling and administrative expense		47,043			50,294			51,793			51,309			200,439
Net gain on disposition of equipment		(19,171	)		(5,817	)		(14,825	)		(4,556	)		(44,369	)

Earnings from operations		61,442			60,870			71,539			59,134			252,985
Other costs
Interest and foreign exchange		7,020			7,029			6,533			8,786			29,368

Earnings before income tax and earnings (loss) from unconsolidated affiliates		54,422			53,841			65,006			50,348			223,617
Income tax benefit (expense)		(18,135	)		11,301			(15,944	)		(10,115	)		(32,893	)

Earnings before earnings (loss) from unconsolidated affiliates		36,287			65,142			49,062			40,233			190,724
Earnings (loss) from unconsolidated affiliates		(2,910	)		147			(12,823	)		(3,075	)		(18,661	)

Net earnings		33,377			65,289			36,239			37,158			172,063
Net earnings attributable to noncontrolling interest		(7,124	)		(3,647	)		(3,288	)		(6,223	)		(20,282	)

Net earnings attributable to Greenbrier	$	26,253		$	61,642		$	32,951		$	30,935		$	151,781

Basic earnings per common share ⁽¹⁾	$	0.90		$	2.10		$	1.03		$	0.95		$	4.92
Diluted earnings per common share ⁽¹⁾	$	0.83		$	1.91		$	1.01		$	0.94		$	4.68

⁽¹⁾

Quarterly amounts do not total to the year to date amount as each period is calculated discretely. Diluted EPS is calculated using the more dilutive of two approaches. The first approach includes the dilutive effect, using the treasury stock method, associated with shares underlying the 2.875% 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. The second approach supplements the first by including the “if converted” effect of the 3.5% Convertible notes during the periods in which they were outstanding. 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 3.5% Convertible notes are included in the calculation of both approaches using the treasury stock method when the average stock price is greater than the applicable conversion price.

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 11

THE GREENBRIER COMPANIES, INC.

SUPPLEMENTAL INFORMATION

(In thousands, unaudited)

Segment Information

Three months ended August 31, 2019:


	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	802,103	$	14,829		$	816,932		$	94,628		$	1,579		$	96,207
Wheels, Repair & Parts		85,701		11,826			97,527			(191	)		640			449
Leasing & Services		26,441		13,482			39,923			10,883			13,061			23,944
Eliminations		—		(40,137	)		(40,137	)		—			(15,280	)		(15,280	)
Corporate		—		—			—			(28,901	)		—			(28,901	)

	$	914,245	$	—		$	914,245		$	76,419		$	—		$	76,419

Three months ended May 31, 2019:


	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	681,588	$	29,201		$	710,789		$	72,110			2,000		$	74,110
Wheels, Repair & Parts		124,980		11,601			136,581			(8,820	)		808			(8,012	)
Leasing & Services		49,584		5,848			55,432			15,337			4,913			20,250
Eliminations		—		(46,650	)		(46,650	)		—			(7,721	)		(7,721	)
Corporate		—		—			—			(25,438	)		—			(25,438	)

	$	856,152	$	—		$	856,152		$	53,189		$	—		$	53,189


	Total assets
	August 31, 2019		May 31, 2019
Manufacturing	$	1,606,571	$	1,143,718
Wheels, Repair & Parts		306,725		307,630
Leasing & Services		708,799		650,483
Unallocated		368,542		411,357

	$	2,990,637	$	2,513,188

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Greenbrier Reports Fourth Quarter Results… *(Cont.)*		Page 12

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, 2019		May 31, 2019		August 31, 2019
Net earnings	$	50,799	$	25,847	$	105,811
Interest and foreign exchange		7,501		9,770		30,912
Income tax expense		17,197		13,008		41,588
Depreciation and amortization		22,898		20,018		83,731
Goodwill impairment		—		10,025		10,025
ARI acquisition costs		10,971		5,761		18,820

Adjusted EBITDA	$	109,366	$	84,429	$	290,887


	Three Months Ended August 31, 2019			Year Ended August 31, 2019
Backlog Activity (units) ⁽¹⁾
Beginning backlog		26,100			27,400
Orders received		4,900			20,600
Transfer of ARI backlog		10,600			10,600
Removal of small cube hoppers		(3,500	)		(3,500	)
Produced onto Balance Sheet		(2,300	)		(6,200	)
Produced & delivered from backlog		(5,500	)		(18,600	)

Ending backlog		30,300			30,300

Delivery Information (units) ⁽¹⁾
Production sold directly to third parties		5,500			18,600
Sales of Leased railcars for syndication		1,800			4,800

Total deliveries		7,300			23,400

⁽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 13

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, 2019		May 31, 2019		August 31, 2019
Weighted average basic common shares outstanding ⁽¹⁾		32,591		32,603		32,615
Dilutive effect of convertible notes ⁽²⁾		—		—		—
Dilutive effect of restricted stock units ⁽³⁾		585		580		550

Weighted average diluted common shares outstanding		33,176		33,183		33,165

⁽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, 2019		May 31, 2019		August 31, 2019
Net earnings attributable to Greenbrier	$	35,107	$	15,248	$	71,076
Goodwill impairment		—		10,025		10,025
ARI acquisition costs, net of tax		8,228		4,285		14,079

Adjusted net earnings attributable to Greenbrier	$	43,335	$	29,558	$	95,180

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


	Three Months Ended						Year Ended
	August 31, 2019			May 31, 2019			August 31, 2019
Diluted earnings per share	$	1.06		$	0.46		$	2.14
Goodwill impairment		—			0.30	⁽¹⁾		0.30	⁽¹⁾
ARI acquisition costs		0.25	⁽³⁾		0.13	⁽²⁾		0.43	⁽⁴⁾

Adjusted diluted earnings per share	$	1.31		$	0.89		$	2.87

⁽¹⁾	Goodwill impairment of $10.0 million divided by weighted average diluted common shares outstanding of 33,183 for the three months ended May 31, 2019 and divided by weighted average diluted common shares outstanding of 33,165 for the year ended August 31, 2019.

⁽²⁾	ARI acquisition costs of $4.3 million, net of tax, divided by weighted average diluted common shares outstanding of 33,183 for the three months ended May 31, 2019.

⁽³⁾	ARI integration costs of $8.2 million, net of tax, divided by weighted average diluted common shares outstanding of 33,176 for the three months ended August 31, 2019.

⁽⁴⁾	ARI integration costs of $14.1 million, net of tax, divided by weighted average diluted common shares outstanding of 33,165 for the year ended August 31, 2019.

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